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July 2018

News24: McKinsey apologises for overcharging Eskom

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McKinsey & Company has apologised to South Africa again over how business was handled with state-owned enterprise Eskom, saying it overcharged the utility and was slow to admit wrongdoing.

The consulting firm admitted in October to failing to follow its own procedures while doing business with the power company when it worked alongside Trillian Capital Partners, a business linked to the Gupta family. McKinsey reached a settlement last week to repay almost R1bn in fees to Eskom.

“The trust of our clients and the public in South Africa is now, understandably, very low,” Kevin Sneader, global managing partner of McKinsey, said Monday at a business school in Johannesburg.

“We did not communicate well enough how seriously we were taking this, or how sorry we were for our involvement.”

McKinsey became embroiled in claims that the Gupta family used their friendship with former President Jacob Zuma to win lucrative contracts from state companies, particularly through Eskom, which provides more than 90% of the nation’s electricity.

The Guptas and Zuma deny any wrongdoing. Financial-services firm Trillian is linked to the Gupta family through business associate Salim Essa, who was its principal shareholder until he sold out.

 

Click HERE to read the full article on News24.