EDINBURGH — McKinsey is a big global consultancy that plies its services to global corporates. But, it also has a deeply sinister side to its operations. As an investigation by The New York Times reveals: McKinsey has actively nurtured the world’s nastiest political leaders and helped entrench systems that suppress democracy and human rights. The publication interviewed 40 current and former McKinsey employees, as well as dozens of their clients to put together a feature on the McKinsey organisation. From South Africa to Russia, McKinsey has been raking in lucrative fees while sucking up to political leaders and ignoring the big humanitarian issues. BizNews summarises the key findings in a series on McKinsey. – Jackie Cameron
By Thulasizwe Sithole
This year’s McKinsey & Company retreat in China was one to remember, opines The New York Times.
It describes how hundreds of the company’s consultants frolicked in the desert, riding camels over sand dunes and mingling in tents linked by red carpets. Meetings took place in a cavernous banquet hall that resembled a sultan’s ornate court, with a sign overhead to capture the mood.
___STEADY_PAYWALL___
“I can’t keep calm, I work at McKinsey & Company,” it said.
“Especially remarkable was the location: Kashgar, the ancient Silk Road city in China’s far west that is experiencing a major humanitarian crisis.
“About four miles from where the McKinsey consultants discussed their work, which includes advising some of China’s most important state-owned companies, a sprawling internment camp had sprung up to hold thousands of ethnic Uighurs — part of a vast archipelago of indoctrination camps where the Chinese government has locked up as many as one million people.
“One week before the McKinsey event, a United Nations committee had denounced the mass detentions and urged China to stop. But the political backdrop did not appear to bother the McKinsey consultants, who posted pictures on Instagram chronicling their Disney-like adventures.”
In fact, notes The New York Times, McKinsey’s involvement with the Chinese government goes much deeper than its odd choice to showcase its presence in the country.
“One of McKinsey’s state-owned clients has even helped build China’s artificial islands in the South China Sea, a major point of military tension with the United States.
“It turns out that McKinsey’s role in China is just one example of its extensive — and sometimes contentious — work around the world… At a time when democracies and their basic values are increasingly under attack, the iconic American company has helped raise the stature of authoritarian and corrupt governments across the globe, sometimes in ways that counter American interests,” notes The New York Times.
The US-based publication points out that McKinsey clients have included Saudi Arabia’s absolute monarchy, Turkey under the autocratic leadership of President Recep Tayyip Erdogan, and corruption-plagued governments in countries like South Africa.
In Ukraine, The New York Times continues, McKinsey and Paul Manafort — President Trump’s campaign chairman, later convicted of financial fraud — were paid by the same oligarch to help burnish the image of a disgraced presidential candidate, Viktor F. Yanukovych, recasting him as a reformer.
“Once in office, Mr. Yanukovych rebuffed the West, sided with Russia and fled the country, accused of stealing hundreds of millions of dollars. The events set off years of chaos in Ukraine and an international standoff with the Kremlin.
“Inside Russia itself, McKinsey has worked with Kremlin-linked companies that have been placed under sanctions by Western governments — companies that the firm helped build up over the years and, in some cases, continues to advise.”
McKinsey has consulted in many sectors of the Russian economy, including mining, manufacturing, oil and gas, banking, transportation and agriculture, the US media outlet reports.
“A McKinsey official sat on the Russian government’s energy board. Former McKinsey consultants have gone to work in the Russian companies they once advised.
“In August, VEB Bank — which is wholly owned by the Russian state, intertwined with Russian intelligence and under United States sanctions — hired McKinsey to develop its business strategy.
“There is no indication that McKinsey has violated American sanctions, which prohibit only certain transactions with targeted companies and individuals. But the larger question is whether the company, in pursuing legitimate business opportunities abroad, is helping to shore up President Vladimir V. Putin’s autocratic leadership,” it notes.
Other consulting companies serve similar clients, but none – according to The New York Times – have “the stature to confer credibility quite like McKinsey, a confidant for 92 years to many of the world’s most admired companies”.
In China, McKinsey has advised at least 22 of the 100 biggest state-owned companies — “the ones carrying out some of the government’s most strategic and divisive initiatives”, according to a review of Chinese-language material by The Times.
“While it is not unusual for American corporations to work with China’s state-owned companies, McKinsey’s role has sometimes put it in the middle of deeply troubled deals. In Malaysia, the company laid out the case for one of Asia’s most corrupt leaders to pursue billions of dollars from China at a time when he was suspected of funnelling vast sums of public money into his own pocket, drawing tens of thousands into the streets to protest against him,” adds The New York Times.
