Why fury has met McKinsey’s return in Nairobi summit
Workers clean the Jomo Kenyatta statue at KICC during a tour of the ongoing refurbishment on August 10, 2023, ahead of the Africa Climate Summit to be held at the facility.
What you need to know:
- Civil society organisations reckon that the agenda of the summit has been influenced by McKinsey and company, even as the lead of African officials has been pushed on the back burner.
President William Ruto has come under pressure to drop US-based management consultancy as the leading technical advisor in the upcoming Heads of State Africa Climate Summit to be held in Nairobi next month.
Civil Society Organisations (CSO) claim McKinsey has hijacked the summit, giving prominence to issues such as the Carbon Credit Market, which they argue will largely benefit Western countries and the global consultancy’s clients.
“Rather than advancing Africa’s interests and position on critical climate issues, the summit has been seized by Western governments, consultancy companies and philanthropic organisations hell-bent on pushing pro-West agenda and interests at the expense of Africa,” reads a letter that the CSOs wrote President Ruto.
Kenya is co-hosting the summit with the Africa Union. It will be held between September 4 and 8. Kenya was selected to be the first host of this summit because President Ruto is the chairperson of the Committee of African Heads of State and Government on Climate Change (CAHOSCC).
Civil society organisations reckon that the agenda of the summit has been influenced by McKinsey and company, even as the lead of African officials has been pushed on the back burner.
Critics of the summit, as it is currently designed, argue that the event has been hijacked by big business through a series of ‘interventions’ within African governments to create a less policed climate space that will ultimately benefit big corporations with little value passed on to citizens.
“The result is a Summit agenda that foregrounds the position and interests of the West, namely, carbon markets, carbon sequestration and ‘climate positive’ approaches,” said the CSOs.
“These concepts and false solutions are led by Western interests while being marketed as African priorities,” read the statement.
Smart Business has seen communications by the senior managers of McKinsey allegedly tweaking and changing the concept note of the Africa Climate Summit. However, we could not confirm its authenticity.
An individual who is involved in the summit and was in the room when Ruto was chairing the meeting, insists that the concept note has been changed by McKinsey.
He says that CSOs are taking exceptions with the manner in which the concept note has been framed.
“For example, there is talk of why Africa is emitting more greenhouse gases than Europe, while Africa accounts for less than four per cent of global greenhouse emissions,” said an individual close to the Summit.
One such US-backed climate-fighting theme is the Carbon Credit Market, which activists say has suddenly been given bigger space in the summit's agenda.
Proponents of carbon credit—where a company pays someone else to either reduce their emissions or capture their carbon—reckon that firms can compensate for their environmental footprint and even, in the most ambitious cases, use carbon credits to get to carbon-neutral status.
However, critics argue that carbon credit is a false solution which only gives companies in the West, including those dealing in fossil fuels, a license to pollute.
“Plus, who determines the pricing?” wondered one of the activists.
Moreover, there is the issue of how Climate Finance & Carbon Credit have been put on the same level.
“Why not have Carbon Credit as a subset not at the same level as climate finance,” said a source.
This individual also wondered why Kenya was in a hurry to amend the Climate Change Act, 2016?
“There is fear that this is aimed at accommodating the carbon credit market, which is going to affect the communities and land,” he added.
Proposed changes to the Climate Change Act, 2016, contained in the Climate Change (Amendment) Bill, 2023 seek to set regulations for domestic carbon markets.
For instance, trading in carbon credits shall result from bilateral or multilateral agreements, a voluntary carbon market or trades with a private entity.
“The Cabinet secretary may, with the approval of the Cabinet, enter into any agreement to trade in a carbon market established or overseen by an internationally recognised entity that is approved by a recognised credible international body,” reads the bill that was tabled in Parliament last week.
President Ruto has himself been preparing the country for inflows of billions of shillings through the carbon credit market as part of his plan to address food insecurity and climate change.
“To further enhance increase of financial flows for climate action, the government will develop and implement policies and strategies to tap into the global carbon market opportunities, green and climate financing mechanisms such as Green Climate Fund, promote green bonds and debt for climate swaps among others,” said the National Treasury in the Budget Policy Statement of 2023.
The organising committee was initially supposed to have the African Union, African Development Bank (AFDB), UNESCO and Kenya as the host government.
By Wednesday, the organisers of the forum, which Kenya is co-hosting with the African Union, were scrambling to remove any traces of McKinsey from the website as pressure mounted from both States and Civil Society Organizations.
McKinsey is not new to controversy. The global consultancy was accused of signing a lop-side 18-month contract with loss-making Kenya Airways that saw the national carrier cough up to Sh2.3 billion in ten months.
Kenya Airways hired McKinsey to help implement about 400 cost savings and revenue generation initiatives for which the US firm was to earn performance-based fees. But the turnaround plan never materialized.
In South Africa, McKinsey’s global head in 2018 was forced to apologise to South Africans for work the firm did with friends of scandal-plagued former president Jacob Zuma.
This is after it emerged that McKinsey had partnered with local consultancy Trillian in order to win a Sh17.3 billion ($120 million) contract with State power utility Eskom in 2016.
Trillian was then controlled by the Guptas, three brothers who are reported to have used their friendship with Zuma to fraudulently win government contracts worth hundreds of millions of dollars.
This even as reports have emerged that two African Heads of States have expressed reservations over the involvement of the management consultancy for pushing interests of their private clients and the West.
President Ruto, who so far has projected himself as a Pan-Africanist pushing the pro-African agenda in the various global forums he has attended, seems to have struck a conciliatory tone.
Initially, the activists argue, the idea was to have a pro-Africa-led and driven summit devoid of Western interference.
There are also issues with the financiers of the Summit.
