Government Operations Committee on March 20th, 2023

[LGen Jennie Carignan]

When the McKinsey consultants worked with us, it was strictly with the subject matter experts. In our case, they were specialists in diversity and inclusion, culture, and related matters such as handling complaints digitally. We were dealing directly with subject matter experts and continually interacting with them to ensure that they were doing what they were supposed to be doing for us.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you. I will now move on to a matter that you raised briefly a short while ago. McKinsey was hired to conduct an internal culture review of the Canadian Armed Forces and the Department of National Defence further to allegations and problems.

But a report had already been prepared on this matter in 2015, by Ms. Deschamps. Not only that, but a second report, the one prepared by Ms. Arbour, was already in progress at the same time as the McKinsey study. I'd like to know why it was decided to proceed with an internal culture review when a rather exhaustive report had already been prepared. Why weren't the recommendations of these two reports acted upon? Didn't this amount to a duplication of expenditures, given that the two studies were on the same subject?

[Anita Anand, Liberal, Oakville, ON]

I understand your question. I was appointed Minister of National Defence at the end of 2021. The decision to hire three experts had already been made. My role was to implement these recommendations, and in December 2021, I presented a road map to this effect in the House of Commons.

That's why we confirmed the contracts with a third party. We have to continue to implement these recommendations. The decisions were made and we have to continue to work towards achieving this objective, completing this mandate and effecting these changes in culture.

[The Chair, Conservative, Kelly McCauley]

That's your time.

Mr. Johns, you have six minutes, please.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Thank you, Minister, for being here and for taking on this role in such a difficult time.

General Eyre, and all men and women in the military, thank you for your sacrifices. This is an incredibly challenging time for the military. Of course, I have to give a special shout-out to those at the CFB at Nanoose Bay and 19 Wing Comox right across the way. Thank you for the important work you're doing.

Shortly after General Eyre took over as the acting chief of the defence staff, the Department of National Defence announced the defence team conduct and culture consultation. The summary of the report said, “The effort was supported by an external contract partner, including a team of experts in the fields of diversity, equity, and inclusion, as well as in organizational transformation initiatives.”

Was McKinsey the expert external contract partner?

[LGen Jennie Carignan]

Yes, that external expert was McKinsey.

In fact, we had support from experts in terms of how to organize consultations. There was also an area where members from diverse groups or marginalized groups were coming in via McKinsey to consult on our culture. The aim of these consultations was to address the question of what problem we were trying to solve.

I absolutely agree that the external reviews and recommendations are key to the work that we are doing, but they are not going to the source of the issue, which is understanding culture and understanding what informs our culture so that we can craft a strategy that will address the various pillars that inform our culture. Leadership, identity, service before self and teamwork are the four pillars we have crafted our strategy on.

[Gord Johns, NDP, Courtenay—Alberni, BC]

I appreciate that. Thank you for your service as well.

Did McKinsey employees conduct any interviews with military sexual trauma survivors directly? Did they have them relive their stories in interviews on behalf of the armed forces?

[LGen Jennie Carignan]

They have. They consulted with a variety of defence team members.

I have to add that the 280-plus listening sessions were conducted personally by me and my team. McKinsey was there to enable, via taking and consolidating notes and making sure this was professionally consolidated into actionable items.

[Gord Johns, NDP, Courtenay—Alberni, BC]

The Ottawa Citizen recently reported on an analysis provided for General Eyre on how to handle the sexual misconduct scandal.

General Eyre, I think you claimed that the situation “has become a battle over the narrative” and recommended the creation of avenues for survivors to be heard internally to prevent more public news stories.

Was the recommendation referring to the creation of the chief, professional conduct and culture? Was it the creation of the conduct and culture consultations, or was it both?

[General Wayne D. Eyre, Chief of the Defence Staff, Canadian Armed Forces, Department of National Defence]

Mr. Chair, at that period of time, I was receiving much advice. That particular article was one of many opinions that were offered over that time frame. It is important to hear as many voices as possible. That's the reason why CPCC embarked on this widespread consultation to hear those voices.

[Gord Johns, NDP, Courtenay—Alberni, BC]

We've seen so far that it seems McKinsey is more experienced in PR repair than in handling interpersonal and organizational issues of such great importance and sensitivity.

Why was McKinsey selected as an equity and organizational culture expert in this situation?

[Anita Anand, Liberal, Oakville, ON]

Across the board, I want to first and foremost allude to a Treasury Board policy that encourages independent advice for large transformational projects. As I have indicated and, I think, as is generally well known, changing the culture of any organization is extremely difficult. The Canadian Armed Forces are no exception.

We recognize the massive change that is before us. We also believe that the moment is pivotal and that change must happen now for moral and operational reasons. The complementary expert advice we received from the third party enables us to embark on this systemic change with greater rapidity and efficiency.

[Gord Johns, NDP, Courtenay—Alberni, BC]

I would have really hoped that this review would be led by people with lived experience of sexual assault and trauma, and people who have inside experiences of the department's organizational culture.

How have people with those experiences been consulted in this process?

[Anita Anand, Liberal, Oakville, ON]

I want to reiterate that these are targeted and this is by far not the only third party being consulted.

We consulted hundreds of victims and survivors. General Carignan can speak to this. The work with this third party expert is just one small part of the work we are doing overall to change the culture in the Canadian Armed Forces. We are using every mechanism we possibly can to ensure that this change happens.

[The Chair, Conservative, Kelly McCauley]

Thank you, Minister.

We'll continue with our five-minute rounds.

Go ahead, Mr. Genuis, please.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Thank you, Mr. Chair.

Thank you, Minister.

I will build on MP Kusie's questions.

There's a basic problem with McKinsey. Part of their business model—as we all know—is that they work for everybody. Some consulting companies say that they only do work for one client within a particular industry. The issue with McKinsey, and part of their selling proposition, is this: Within a particular industry, they are working for everybody and, perhaps, with the regulators, at the same time. They are gaining operational knowledge about how some companies operate, which informs how other companies operate.

That may be okay in certain cases, but it is a problem when we have issues of conflict of interest and security. In fact, aspects of operational culture and approaches in the Canadian military are not something we want learned by a third party that is then consulting with foreign militaries.

I want to ask you this, very specifically: Can you tell us which other countries have retained McKinsey to do work for their defence departments?

[Anita Anand, Liberal, Oakville, ON]

I am focused, in this appearance and in my day job, on the Department of National Defence. I am here to comment on the contracts with this third party vis-à-vis the work of the Department of National Defence.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Minister, you can see how this would be relevant. If McKinsey is working for your department and learning things about the operations of the Canadian military, while, at the same time, working for a foreign military with interests very much contrary to our own.... You could see how, if you have the same analysts or people learning things from Canada and applying those things while working with our adversaries, that would be a problem relevant to our security.

I'll ask the question again. Are you aware of which other countries have retained McKinsey to do work for their defence departments?

[Anita Anand, Liberal, Oakville, ON]

The government expects all contractors to lawfully conduct their activities. We have policies relating to conflicts of interest. The vendor has to warrant that no real, apparent or perceived conflict of—

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Minister, respectfully, I'm asking for a specific answer to a specific question.

Do you have the names of those countries? Can you provide the names of those countries?

[Anita Anand, Liberal, Oakville, ON]

I am speaking to the security processes we have in place.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Is any other witness able to answer that question?

Again, which other countries have retained McKinsey to do work for their departments of defence? Does anybody on the panel know the answer to that question?

I'm sorry, General Eyre. Could you answer on the mike? I see that you're responding.

[Gen Wayne D. Eyre]

Mr. Chair, I shook my head to indicate no.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Okay.

[Gen Wayne D. Eyre]

I will say that, when something—