Cape News

U.S. Senators Josh Hawley (R-Mo.) and Marco Rubio (R-Fla.) have sent a letter to Bob Sternfels, Global Managing Partner of McKinsey & Company, urging the firm to sever its ties with the Chinese Communist Party (CCP). Senator Hawley has introduced legislation aimed at prohibiting federal agencies from engaging with consulting firms that have contracts with the Chinese government or its affiliates. The bill, known as the Time to Choose Act, recently passed the Senate Homeland Security and Governmental Affairs Committee (HSGAC) with bipartisan support. HSGAC Chairman Gary Peters (D-Mich.), Senator Rick Scott (R-Fla.), and Senator Rubio are co-sponsors of the bill.

"Your company’s inability to come clean about its dealings with the PRC disqualifies it from future work with the United States government," wrote the Senators. "We will continue to work to ensure McKinsey does not receive another dollar from the U.S. government until such time as the company owns up to its work on behalf of the Chinese government, severs all ties to the PRC, and commits to patriotic service on behalf of the United States of America."

In February, Mr. Sternfels testified under oath that McKinsey had no ties with China. However, reports revealed that an initiative led by McKinsey, called the Urban China Initiative, contributed directly to China's Made in China 2025 industrial plan.

The Financial Times reported earlier this year that a think tank led by McKinsey produced a report informing China's 13th Five-Year Plan and Made in China 2025 strategy. The report made recommendations to enhance China's military and industrial capabilities.

While McKinsey claims that "[t]he Urban China Initiative is not McKinsey," evidence suggests otherwise. The think tank was based at McKinsey's Beijing office address, and its website directed press inquiries to McKinsey’s Beijing office.

Other notable pieces of evidence include:

- Work performed for State-Owned Enterprises (SOEs) in China.

- A disclosed commercial relationship with "the Chinese government" in a September 2020 court filing.

- Consulting services provided for over 20 different central, provincial, and municipal government agencies in China.

- A corporate retreat held in Xinjiang Uyghur Autonomous Region in 2018.

The Senators concluded their letter by reiterating their stance: "We will continue to work to ensure McKinsey does not receive another dollar from the U.S. government until such time as the company owns up to its work on behalf of the Chinese government, severs all ties to the PRC, and commits to patriotic service on behalf of the United States of America."

Sincerely,

Josh Hawley

United States Senator

Marco Rubio

United States Senator