DailyPost 2897
BCG’s ANGOLA BRIBE SCANDAL
Boston Consulting Group, BCG, is one of the famous ‘Big Three’ which are considered to be the most prestigious management consulting firms in the world. They work closely with clients facilitating transformational approaches for organizations to grow, build sustainable competitive advantage and drive positive societal impact. Presumably, they would be sticking to their mission while they work for clients across the globe, businesses, governments and various other types of organizations alike. What has come under the scanner now is BCG’s business dealings with the Angolan government.
It raises a variety of questions on the consulting methodologies, adopted by the big daddies of the consulting world. Treating this as one rarest of rare cases and that everything has been cleansed for good, does not serve anyone’s purpose. The approach might be a risky proposition. Consulting firms getting blacklisted and enquiries being conducted on them in different geographies, is nothing new. Treating correctional action sufficient enough to set right the wrongdoings and it being treated as an award of punishment as well, can just be one of approaches to handle it. Whether that would have a far reaching impact is a different question altogether.
Government’s investigation has found out that between 2011 and 2017, BCG through its Lisbon office paid its agent in Angola approximately $4.3 million dollars to help get governmental business pertaining to the Ministry of Economy and National Bank of Angola. Agent was paid 20 to 35% of the contract value and funds were sent to the agent’s offshore entities. Certain Portugal BCG employees acted to conceal the nature of the agent’s work when internal questions arose. This went to the extent of backdating contracts and falsifying the agent’s purported work product. These contracts resulted in revenues of $22.5 million and profits of around $14.4 million.
It has been absolved by the Dept of Justice by deciding to decline prosecution because of BCG’s timely and voluntary self-disclosure, full and proactive cooperation, timely and appropriate remediation, significant improvements to its compliance program, the absence of aggravating circumstances, such as involvement of the executive management and finally BCG willing to disgorge the amount of its ill-gotten wealth. How do we treat lack of active supervision leading to grave corrupt practices in the most blatant manner, if it were to be so, is a billion dollar question. The behavior and documentation of the main players of /at different levels, pre and post these deals and also during that long period of operation, might raise fingers. What is their criminal liability in the country in question? The closure raises more questions than it resolves.
THE WORLD IS IN SEARCH OF A BROADLY SANITISED BUSINESS CONSULTING ENVIRONMENT.
Sanjay Sahay
Have a nice evening.