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Partners at the world’s largest consulting firm, McKinsey, have reportedly ousted their boss, Kevin Sneader, for handling a series of controversies during his attempt.
According to the Financial Times, the company’s 650 senior associates voted for Sneader ahead of the final round of a leadership election that was seen as a referendum on his three years in the office.
The 54-year-old Scotsman is said to be one of the first McKinsey executives in recent memory to serve just one term – Sneader’s five predecessors as global chief executive served two or more terms.
The influential firm is known for its costly advice to governments and multinational companies around the world. Known as the “CEO Factory,” McKinsey’s network for former employees includes some of the biggest names in business and politics.
Notable alumni include Chelsea Clinton, former Facebook CEO Sheryl Sandberg and former Credit Suisse CEO Tidjane Thiam. In Britain, those who worked or the company including politician William Hague, former HSBC chairman Lord Green, former municipal regulator Lord Turner.
With 30,000 employees in 65 countries, McKinsey is a key consultant to the UK government and has signed lucrative contracts during the Covid crisis. Last year McKinsey consultants were awarded £ 563,000 for six weeks of work – £ 14,000 a day – to create a permanent replacement for Public Health England, defining its ‘vision, purpose and story’.
But the company, which has a penchant for such mottos as “Leadership Through Integrity,” has been plagued by a series of crises under Sneader’s leadership.
Earlier this month, McKinsey agreed to pay nearly $ 600million (£ 426million) to settle a lawsuit brought by 49 U.S. states over its role in helping drugmakers sell more prescription pain relievers – even as the country faced a nationwide opioid overdose epidemic.
The consultancy came under pressure after legal documents revealed that it advised OxyContin maker Purdue Pharma on how to ‘boost’ sales of the drug in 2013. It was found that the company had encouraged sales reps to focus on doctors who were already prescribing high volumes of OxyContin and try to switch patients to more potent versions of the drug.
Sneader expressed regret after the settlement but stopped before admitting his guilt on McKinsey’s behalf. The company announced two years ago that it would not advise its clients on matters related to opioids.
The top-notch consultancy has also come under fire for working with authoritarian regimes. In 2018, the firm said it was “horrified” to learn that a document it produced could have been used to target critics of the Saudi government. McKinsey said he had no evidence that the document, created for internal purposes, was misused.
Earlier this month, it was one of several consulting firms cited as having received millions from a company implicated in a corruption scandal in Angola. McKinsey said at the time that an internal investigation did not reveal any irregularities.
With Sneader out of the race, McKinsey will likely be led by one of two main partners, Bob Sternfels, or Sven Smit, w. Both would have reached the final round of the election, which takes place every three years.
A McKinsey spokesperson did not confirm Sneader’s ouster, but said: “The election, which is being conducted by an independent third-party company, is now underway and we will announce the result after the election ends. “
Sneader’s downfall comes just weeks after KPMG UK chairman Bill Michael resigned after telling staff to ‘stop moaning’ during a virtual meeting on the impact of the coronavirus pandemic.
The 52-year-old Australian, who has been running the company since 2017, made the comments in a virtual town hall this month in which around a third of the 1,500 employees on the financial services advisory team attended.
Michael told staff to stop “playing the victim card” and described the concept of unconscious bias as “utter and utter crap for years.”
Michael, who received £ 1.7million last year, withdrew after the accounting firm asked law firm Linklaters to conduct an independent investigation. He later apologized and said the controversy had made his position with the accounting giant “untenable”.
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