December 5, 2019; New York Times
As presidential candidate Pete Buttigieg is learning, it is often more important than you might imagine to be careful about who you align yourself with. It might be your donors, your board directors, or even where you work. A recent editorial in the New York Times has called on Buttigieg to disclose what he worked on when he was employed at the mega-consulting firm McKinsey & Company.
McKinsey can be a very attractive option for newly minted MBAs who want to make their way in the business world. The company says it helps people and organizations across all sectors design and implement strategies to achieve change in their community and elsewhere. According to one report, new MBAs can expect to make a base salary of $83,000. Bonuses and other benefits can raise that amount to over $100,000—in the first year! It is completely understandable why a young graduate would be attracted to that. There is much to be earned and much to be learned.
Even better, when you travel to their website, McKinsey sounds like a place that is doing amazing research, promoting the well-being of people around the world. For example, they describe an “Insight” that $12 billion could be added to the world economy if we close the gender gap. The “Action” is that they have developed strategies in their “Power of Parity” that have informed companies and countries how to close the gender gap. A “Partnership” they highlight is McKinsey’s work with the Malala Fund, helping craft a strategy and operation plan to fulfill the goal of ensuring that girls have access to 12 years of education in a safe environment.
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But McKinsey is like the two-faced god Janus. One face is positive: in September 2018, they published an article about how we must do more to stem the tide of the opioid crisis. The report cites its impact on those who have sickened or died from overdose and their friends and families. However, five months later, the other face was revealed: the Massachusetts attorney general released unredacted legal papers accusing the company of working with Purdue Pharma on how to “turbo-charge” sales of their product OxyContin. According to the report, this advice included how to counter emotional messages delivered by grieving mothers whose teenagers had overdosed.
The rabbit hole gets deeper and deeper. The New York Times has written about McKinsey’s involvement in what turned out to be an illegal contract in South Africa that could have been worth as much as $700 million, involving a shady family at the center of a corruption scandal. McKinsey was also the consultant firm that advocated for the closure of public schools in Puerto Rico in the wake of Hurricane Maria. Even more recently, the Times wrote about McKinsey advising the US Immigration and Customs Enforcement (ICE) agency on how to implement President Trump’s crackdown on immigrants. Suggestions included cuts in food and medical attention. One recommendation was to place long-term detainees in the lowest-cost facilities, where the conditions were miserable.
With that background, Buttigieg has been called to reveal the names of his clients when he was at McKinsey and what exactly he did for them. He has said that he is under a nondisclosure agreement and so cannot speak without McKinsey’s approval. Recently, he shared a little about the work he did although he was not specific about the clients themselves. Is this the equivalent of Trump not revealing his tax filings? The Times seems to think so.
McKinsey has a number of services they provide to organizations in the social sector, including a free organizational capacity tool (although despite links from other organizations, this tool may have been taken down). But social sector organizations must ask: is it a good idea to align with a firm that encouraged ICE to treat immigrants inhumanely, or promoted austerity in Puerto Rico, or devised strategies to push opioids? Clearly, the decision is not without risk to one’s reputation.—Rob Meiksins