Republican Representative Brandon Gill (TX-26) is one of the hardest chargers in the House of Representatives at the moment. In his work with the House Oversight Committee, he’s been adept at holding witnesses’ feet to the fire in hearings; he doesn’t suffer fools or dissemblers, and he has a knack for getting to the bottom of things. In his latest foray, Rep. Gill took on the consulting group McKinsey & Company for their work fostering discriminatory hiring practices.
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On Thursday, the House Oversight Committee issued a press release describing the state of that investigation.
“McKinsey published four reports titled Why Diversity Matters (2015), Delivering Through Diversity (2018), Diversity Wins (2020),and Diversity Matters Even More (2023). These reports allege strong links between companies with increased levels of racial and gender ‘diversity,’ emphasizing that increased diversity in companies causes a greater likelihood of improved financial performance,” wrote Task Force Chairman Gill. “These McKinsey reports have been highly influential, being cited by publicly traded companies, asset managers, proxy advisory firms, and banking institutions, among others, as cause for embedding illegal racial and sex-based targets into hiring, promotion, executive compensation, and asset manager proxy voting policies.”
There’s just one problem with McKinsey’s work; no other firm was able to replicate the findings in those reports.
Researchers assessing McKinsey’s DEI reports have been unable to replicate the results, and suggest that McKinsey likely swapped the cause and effect in its DEI conclusions. The broad implementation of discriminatory DEI hiring and promotion practices has cost the U.S. economy billions of dollars in foregone revenue, including roughly $94 billion in just 2023 alone. McKinsey continues to stand by its findings, even though no such correlation between a company’s racial and gender diversity and its financial performance exists. While the Civil Rights Act of 1964 prohibits discrimination based upon race and sex, McKinsey’s DEI reports encourage companies to discriminate in that way, and are ultimately based upon unverified and questionable data. This letter is part of the Task Force’s larger investigation into harmful DEI practices and its commitment to rooting them out of American industries and institutions.
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McKinsey has refused to release the data that was used in developing these reports and their conclusions, which in and of itself is reason to be suspicious.
In other words, the very implementation of DEI practices flies in the face of the Civil Rights Act, which prohibits precisely these kinds of hiring practices, and McKinsey’s work supporting those practices is, at the very least, suspect. And that’s where the damage is done; several corporations and government agencies have depended on these suspect reports to justify their own discriminatory hiring practices, including the California Public Employees Retirement System (CalPERS) Investment Office, among others.
Aside from the legal and financial issues, there is a matter of principle involved here. If discrimination in hiring on grounds of race, ethnicity, religion or any other related factor is wrong on one hand, then it is wrong on the other. Principles, not principals. It appears as though the McKinsey & Company reports were developed for and are still being used to implement just such discriminatory practices in the public and private sectors. That’s not only very likely illegal, it’s also immoral, and it’s bad business practice.
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