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Johannesburg - Civil society groups have called for a proper investigation into international consultancy McKinsey, as a group of protesters braved Johannesburg's inclement weather on Thursday to pressure the company to account for its actions.
Cries of “McKinsey must fall” echoed over the Sandton traffic as Future South Africa, Corruption Watch and the Federation Unions of South Africa (Fedusa) staged the protest in front of McKinsey’s offices in Stella Street.
The consultancy stands accused of having subcontracted 30% of its business with Eskom to the Gupta-linked Trillian firm, in what critics say essentially amounted to a bribe to secure the contract for McKinsey.
Reports suggest the contract was lucrative for McKinsey, making up more than half of its African revenue.
The consultancy earlier indicated that law firm Norton Rose Fulbright is helping it with an internal probe into its actions in South Africa, but the outcome is yet to be released.
The group of protesters wanted to hand over a memorandum to McKinsey, but the consultant’s representatives left abruptly without allowing them to read it.
Mandla Nkomfe, FutureSA Convenor, then read the memorandum to the group of protesters, journalists and security guards at the boom gates that lead to McKinsey’s offices.
Protesters gathered in front of McKinsey's Sandton office on Thursday to demand a proper investigation into the company's actions in South Africa.
Executive director David Lewis said Corruption Watch is finalising its submission for the US justice system to investigate the firm’s conduct in South Africa. He believes there is enough evidence to suggest wrongdoing.
“An investigation into McKinsey’s conduct is desperately needed,” he said. “They have to account.”
He said McKinsey paid Trillian a large amount of money for doing absolutely nothing, other than getting the company a lucrative contract.
McKinsey’s links to Trillian emerged when Advocate Geoff Budlender released a report in June, which implicated the consultancy in corruption at Eskom. His scathing report stated that the power utility acquired the advisory services of McKinsey in September 2015 to the value of R1bn per year, and McKinsey subsequently subcontracted 30% of the services to Trillian, under the guise of "supplier development".
Future SA said in its memorandum that corruption is robbing South Africa of its potential to combat poverty and encourage economic development.
Eskom is central to South Africans’ lives and has great potential to contribute more to the economy, the memorandum stated.
“But because of McKinsey’s actions among others, this potential has been blunted and this will result in it wanting to increase its tariffs and this making electricity even more unaffordable for the poor.
The memorandum also questioned whether McKinsey’s global leaders had been aware of the relationship between the consultant and Eskom, and whether they had a view on this particular relationship.
“What are your leaders' views, apart from the apparent corrupt nature of the relationship between Eskom and Trillian, of the unconscionable fee of R1.6bn levied for a six-month advisory contract?”
It called on McKinsey to come clean, “as their silence up to this point has been deafening” and to cooperate with the parliamentary enquiry.
McKinsey itself also has to report unlawful actions of its employees to the relevant authorities, and assist investigations.
Fedusa’s Dennis George said companies have to account for the way they handle issues critical to South Africa's future.
Former Greenpeace chief and civil society protest stalwart Kumi Naidoo urged McKinsey not to be arrogant, adding that big companies such KPMG and Bell Pottinger have fallen due to their arrogance.
He said the protests would not stop. “We delivered a peaceful protest and McKinsey cowered inside their offices and did not want to meet us.”
Naidoo said capture state institutions in South Africa might not want to investigate McKinsey, but that authorities such as those in the US are quite zealous and would have an appetite to probe the consultant to see if there has been any wrongdoing.
“We are going nowhere.”
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