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Boston Consulting Group has appointed a new chief risk officer to oversee tougher internal controls and whistleblower procedures after the controversy over its work in Gaza.
Amyn Merchant had been given executive responsibility for risk management and compliance, having overseen those functions more broadly as head of BCG’s audit and risk committee, the consulting firm said on Tuesday.
The previous chief risk officer, Adam Farber, resigned from the role in July after revelations that BCG helped establish the Israeli-backed Gaza Humanitarian Foundation. The launch of the aid effort, which was designed to supplant the UN, was marred by the deaths of hundreds of Palestinians.
In June, BCG fired two partners who led “unauthorised” work with GHF. The Financial Times reported the following month that the project had been discussed at senior levels of the firm and extended to developing a postwar plan for Gaza that envisaged the voluntary relocation of a quarter of the population.
Merchant will implement what BCG has internally called “Project Reinforce”, reflecting the conclusions of an investigation into the Gaza work conducted by the law firm WilmerHale.
“The investigation concluded that this work was the result of individual misconduct, enabled by unwarranted process exceptions, gaps in oversight, and misplaced trust,” BCG said. “While it confirmed that BCG’s core processes and culture remain strong, it also identified areas that can be further reinforced.”
The FT reported last month that BCG would train staff on humanitarian principles and impose extra oversight on sensitive projects.
On Tuesday, it added that it was reinforcing business acceptance controls across all of its client work and “improving visibility and access to independent and confidential Speak-Up channels for all BCGers”.
Merchant has been at BCG for more than 30 years in roles on three continents and has chaired its audit and risk committee for the past five years.
“The ARC is a governance committee responsible for overseeing financial integrity, risk management, compliance and internal controls, not the day-to-day running of operations,” a BCG spokesperson said. “Its role is to challenge management on why controls failed, whether accountability has been enforced, and what corrective actions are being implemented.”
Merchant also chairs the firm’s senior leadership development programme and oversees relations with alumni. He previously led BCG’s New York office.
“His global perspective and commitment to responsible leadership will be instrumental as we continue to evolve BCG’s processes and safeguards in step with the scale and breadth of our global operations,” said Christoph Schweizer, chief executive.
Unlike at rival McKinsey, the chief risk officer is not a member of BCG’s main executive committee.
