HSJ has identified several companies that supply goods and services to the NHS as well as continuing to trade with Russia. Former NHS England chief executive Lord Stevens said: “With [the World Health Organisation] confirming that Ukrainian clinics and hospitals are now being bombed, and their patients and staff murdered, the time for corporate fence-sitting and commercial fudging is long since passed. “Companies – including those selling to the health sector anywhere else in the world – now have to make a clear-cut choice about whose side they’re on.” Chair of the House of Commons health select committee and former health secretary Jeremy Hunt took aim at consultancy McKinsey. The firm has said it would “not undertake any new client work in Russia” and that it would “cease existing work” with state-owned or government entities. However, it also declared it would continue work on other “remaining engagements in Russia” and would keep its Russian office open “so that we may support our colleagues in the country”. Mr Hunt told HSJ: “McKinsey has the highest of reputations for probity and integrity so it is very surprising to see them put profit ahead of principle.” Responding to Mr Hunt’s comment, a spokesperson for McKinsey said: “The safety and security of our people, not any other concern financial or otherwise, is guiding our approach in Russia.” The pandemic has seen McKinsey take on a considerable amount of work with the NHS and Department of Health and Social Care. It has been the sole or joint supplier on at least 31 contracts with DHSC (both for its own sake and on behalf of NHS Test and Trace), NHS England, and NHS Digital since the beginning of March 2020. Most of these contracts were covid-related and were collectively worth more than £60m. This included one with NHSE that started in February this year providing support to developing integrated care systems. It was worth at least £21m and split between seven consultancies, including McKinsey. The firm has also worked directly with local NHS organisations. NHS spend data shows it has been paid more than £47m over the past 12 years by NHS trusts. There has been a rush by major international companies to exit Russia following the invasion more than two weeks ago. These include major international consultancies, the so-called “big four” of KPMG, PwC, EY and Deloitte. These companies are structured as global networks of national firms. All four have said they will remove their Russian companies from their networks. Deloitte said it “will no longer operate in Russia and Belarus” while PwC announced “PwC Russia will leave the network”. KPMG also said its Russian and Belarus firms will leave its network. EY, meanwhile, said its global organisation will not serve any Russian government clients, state-owned enterprises or sanctioned entities or individuals anywhere in the world. It said it “has commenced a restructuring of its Russian member firm to separate it from the global network”. However, it seemed to indicate it may see out its existing contracts, like McKinsey. It said: “As we go through this change, we will work to support those colleagues, as well as our clients, in fulfilling our legal obligations and commitments.” Mid-tier accountancy firm Grant Thornton, which is often engaged as an auditor by NHS trusts, has taken the same approach. McKinsey, unlike the “Big 4” does not operate as a “network” of separately locally-owned businesses, which may continue to trade after their separation from the international business. It would have to shut or sell of its Russian arm to exit the country. Similar businesses such as Bain and Boston Consulting Group seem to be following the approach adopted by McKinsey. A significant number of pharmaceutical companies continue to sell products in Russia. Johnson & Johnson told HSJ: “We remain committed to providing essential health products to those in need in Ukraine, Russia, and the region, in compliance with current sanctions and while adapting to the rapidly changing situation.”
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Source: HSJ
Date: 14 March