Management consulting firm McKinsey & Company on Friday said it would return the fee of approximately R1 billion to Eskom it earned on the 2016 turnaround programme for the power utility.
Eskom announced last year that it would recover R1.6bn paid to McKinsey and the Gupta-family associated Trillian Capital.
It said the money had been paid to the two companies illegally. McKinsey’s decision to repay the money followed a settlement agreement on Friday between the company, Eskom and the Asset Forfeiture Unit (AFU), McKinsey said.
The firm said that it had been in discussions with Eskom and AFU since the beginning of the year “to ensure the fee would be repaid through an appropriate and transparent legal process”.
It said the fee repayment was a consequence of Eskom’s non-compliance with the relevant procurement laws and was not an admission of liability by McKinsey. “McKinsey is thankful to have reached this milestone, which fulfils the commitment made last year to voluntarily return its full fee to Eskom.
We appreciate the support of Eskom and the AFU in resolving this matter,” said Saf Yeboah-Amankwah, a senior partner at McKinsey. Eskom chairperson Jabu Mabuza said on Friday: “This is a significant milestone for the board as we seek to fulfil what we see as our non-negotiable mandate to root out financial mismanagement and malfeasance as a critical foundation to restoring transparent and effective governance."
Sourced from Business Report - written by Siseko Njobeni