McKinsey & Company statement

18.00 SAST, 17 January 2018

McKinsey received notification of a Preservation Order from the National Prosecuting Authority on 17 January 2018 at 2.20pm SAST. We are currently reviewing the documentation.

We welcome all actions to resolve this issue and will continue to cooperate with the South African authorities and official investigations into these matters.

Eskom's counsel informed us in October 2017 that Eskom executives had acted unlawfully by failing to secure the appropriate approvals for the Turnaround Programme contract. We have no interest in being party to a contract entered into unlawfully by Eskom, and have written to them five times asking them to initiate the necessary proceedings before the Court. Even if Eskom chooses not to act to set aside the contract, we remain committed to returning the fees McKinsey earned in connection with the Turnaround Programme to South Africa.

No new information has emerged from the public reports that changes our understanding of the facts. When this issue first arose, we launched a comprehensive investigation. We stand by our statement of 17 October 2017, in which we categorically rejected the notion that our firm was involved in any acts of bribery or corruption related to our work at Eskom and our interaction with Regiments or Trillian. Our investigation concluded the following facts:

  • McKinsey has never served the Gupta family nor any companies publicly linked to the Gupta family.
  • McKinsey has never made payments directly or indirectly to secure contracts, nor have we aided others in doing so.
  • McKinsey did not introduce Trillian to Eskom nor vice versa.
  • McKinsey has not made payments to Trillian.
  • McKinsey never had a contract with Trillian, although we worked alongside them for a few months at Eskom.
  • McKinsey’s 9 February 2016 letter did not provide authorisation for Eskom to pay Trillian as the conditions set out in the letter had not been met.
  • Trillian failed our due diligence and we terminated discussions with them about a supplier development partnership in March 2016. We believe that Trillian withheld information from us about its connections to a Gupta family associate. We informed Eskom of this decision by letter on 30 March, having previously flagged our concerns to Eskom about Trillian’s continued failure to disclose its beneficial ownership.
  • McKinsey did not authorise any payments made by Eskom to Trillian, and any payments by Eskom to Trillian were made by Eskom after McKinsey informed Eskom that Trillian failed our due diligence.
  • Eskom’s internal investigation confirmed that we did not authorize any payments by Eskom to Trillian.