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Bain SA is poison to Bain Global, it’s time to shut this little shop of horrors

Heinrich Böhmke
By Heinrich Böhmke
15 Aug 2022
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Bain is now an epithet in South African print and social media. They are an entry alongside Enron in updated corporate scandal syllabi. They carry the mark of the MBAs who stabbed Mandela’s people in the back.

It makes sense for Bain & Co to run themselves out of town. This is rather than wait for the inevitable posse to saddle up to show them the road. To be clear, Wanted posters are not yet up, although Judge Raymond Zondo has directed investigations into Bain’s insidious role in stage-coach capture.

Yet even ahead of the law arriving at their door, Bain’s prospects in South Africa are grim. Despite their full-page, half-apology in the weekend’s newspapers, who still trusts them to deal off the top of the deck at the poker table?

South Africa’s Treasury, for one, has urged companies to shun business with Bain. The company’s loss of face is thus accompanied by a potential loss of client pool. Except for a recalcitrant Sasol, few enterprises within government’s long supply chain will want to flaunt Bain on their books.

It appears that Tom Moyane’s alleged banditry at SARS during the Zuma years, disguised in Bain’s flow charts, is Unforgiven. Yes, Bain paid back the money and apologised, but this was with too many caveats for a town tired of horse thieves.

A quick recap. At the Zondo Commission, it emerged that between 2015 and 2017 Bain enriched itself through corrupt procurement at SARS. It did so in league with those who allegedly ransacked this once world-class organisation. Its work was used to “neutralise” any who stood up to these plans. Bain has admitted to “serious mistakes” in its work. It admits this was used to further State Capture. It points out that the implicated consultants have since left. Stephen York, head of Bain’s South African office, appeals for constructive dialogue on its future in South Africa.



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It is thus time to leave the morality play of Spaghetti Westerns and answer York in management consultancy terms. What is truly best for Bain?

Bain is a global outfit. Manny Maceda sits in San Francisco as its Worldwide Managing Partner. Bain has partners looking for work in cities all over the United States, in Singapore, Copenhagen, Oslo, Melbourne, Rome, Seoul, Bangkok, Paris, Istanbul, the Middle East, Warsaw and Toronto. The list truly does go on.

Bain also has several partners in London. Poor Sarah Applebey, Bharat Bansal, Marc Berman, Nigel Cornish and the Jameses, Anderson and Allen, presumably all seek work in the United Kingdom. The London staff are to be pitied for it is in the UK where Bain has recently been banned from doing public sector work. This flows solely from the misbehaviour of its South African partners at SARS.

More precisely, the ban arises from Bain SA’s hedging apology which did not satisfy its victims at SARS or in wider government. Bain SA’s apology was further discredited by a tenacious whistleblower and a Lord who took umbrage at the whole immense mess and leaned in with his compelling cultural capital. York has presided over a reputational fiasco.

Bain is now an epithet in South African print and social media. They are an entry alongside Enron in updated corporate scandal syllabi. They carry the mark of the MBAs who stabbed Mandela’s people in the back. In due course, they will be the point of sermons, but right now, a whipping boy. Who does not enjoy an ordinarily unrebukable global enterprise getting some well-deserved schtick?

Worst of all for Bain SA, it has “succeeded” in entering a rather insalubrious signifying chain. To many, it is synonymous with the treasonous backrooms where State Capture was plotted.

Interestingly, this political meaning was somehow avoided by other enabling corporations like KPMG. But brand association is a harsh and unpredictable mistress. Put it this way, should the Zuma faction regain control of the ANC, is it unthinkable that someone at Bain’s swanky offices will rub their hands, make a few phone calls, and put in an unsolicited bid to fix a state institution once again, neutralising any who oppose these designs?

The question York should ask is this: if Bain Global were to seek advice from a competent consultancy firm about its present predicament, what advice would they receive? Would the answer not be: “you have to cut the South African branch off already”?

Could the rands earned in Pretoria really be worth the dollars lost elsewhere? Indeed, had the South African branch been shuttered in a ceremony of suitable internal censure once the Zondo report was released, London would certainly have escaped the UK ban sponsored by Lord Hain.

Surely Bain Global has intuited by now that paying back the R167-million it earned in wrecking SARS was not good enough? The mood in South Africa has soured after the Zondo report. Accountability is the watchword. Even revenge. Treasury wants blood.

And there is no better target than foreign, Northern financial hitmen who rode into a poor but functioning Southern town and started shooting it up. 

York’s bosses must realise that Bain’s continued presence in South Africa undermines its global brand. It interrupts the credibility of the radical PR gestures the company needs to make amends and contain the questions arising in other places it plies its trade.

Bain SA’s travails undermine the global business’ marketing to new clients. Bain’s business relies on two, subtly contradictory, offers. The first is that Bain complies with global ethical norms. The second is that Bain will break the rules in forging customised strategies so that a client can beat its competitors.

The company has obviously been caught out on the ethical front and that noise is not going away.

Equally damaging, is that Bain SA’s breach of rules to satisfy its State Capture clients ended so badly for the clients. The competitors won. Tom Moyane was fired from SARS and was excoriated by Judge Zondo. So too was Zuma. Bain’s South African branch is thus living dis-proof of Bain’s value proposition worldwide. Bain SA failed to cultivate an air of ethical conduct while successfully implementing its “bold-step” rule-breaking strategies.

Bain SA promised to look good, while doing bad. It failed and the result is ugly.

Bain Global repeatedly invokes True North in its PR. “We’re guided by True North, our unwavering commitment to always do the right thing by our clients, people and communities”.

Given what Bain has come to stand for in this Southern neck of the woods, venality and self-enrichment at the expense of institutions critical to South Africa’s hard-won democracy, is doing the right thing not to leave town?

In accepting this inevitable fate, by embracing it and owning it, Bain Global will amplify an important message. This is a message created originally by the destruction of Bell Pottinger. It is that entanglement with State Capture will and should have drastic, enterprise-altering consequences.

For Bain SA, this may mean closure. Far from constituting an admission of wrongdoing, this will appeal to many of its clients. Ethical failures to one side, Bain should not be seen to tolerate failures in executing “bold steps” for its clients. In self-surgery, it should advertise that it knows how to stop reputational haemorrhage.

The SA branch failed in State Capture. Its current team failed to mop up. On all fronts then, its shop in Johannesburg raises questions about the entire enterprise’s ethical and strategic competence. Bain SA is poison to Bain Global.

A piece of constructive advice York may consider is cauterising his outfit from the global body. If this is a step York cannot take, perhaps it is a bold step Bain & Co will take, facing True North.

Many South Africans will doubtless thank them for it. DM

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