The Curia of Francis, Paradise of the Multinationals
McKinsey, Promontory, Ernst & Young, KPMG. From the Vatican the race is on to sign up the most prestigious and expensive consulting companies in the world. At what price is not known
by Sandro Magister
ROME, January 17, 2014 – It may be "poor and for the poor," the Church dreamed of by Pope Francis. Meanwhile, however, the Vatican is becoming the cash cow of the most exclusive and expensive firms in the world of management and financial systems.
The latest one signed up is the legendary McKinsey & Company, with the task of coming up with "an integrated plan for making the organization of the Holy See's means of communication more functional, effective, and modern." Enough to sow panic in the ranks, which at the Vatican recently have not diminished but expanded, in a crescendo of confusion.
To Fr. Federico Lombardi, director of the press office and the official spokesman, has been added a "senior communications adviser" in the person of the American journalist Greg Burke, a member of Opus Dei, with an office in the secretariat of state.
Not to mention the two press agents that the president of the Institute for Works of Religion (IOR), Ernst von Freyberg, brought to Rome last spring from his native Germany, Max Hohenberg and Markus Wieser, both of Communications & Network Consulting.
Then there is Vatican Radio, directed by Lombardi, with a 30 million dollar annual budget and with as many journalists as it once took to broadcast on shortwave in the most obscure languages and to the most remote regions of the globe, but now excessive in number.
There is "L'Osservatore Romano," another money pit with the few thousand daily copies of its main edition.
There is the Centro Televisivo Vaticano, which has good revenues thanks to its exclusive worldwide rights to the images of the pope but must face prohibitive expenses with Sony and other major firms for technology updates.
And then there is the pontifical council for social communications, a bureaucratic rattletrap that should have done the work now entrusted to McKinsey but evidently was not thought capable of it.
In this disorder it has been clear for some time that Pope Francis prefers to follow his own lights. Of the three interviews of his that have made the biggest splash, he gave two of them to the Jesuits of "La Civiltà Cattolica" and one to the ultra-secularist founder of "la Repubblica," without Fr. Lombardi or Burke or anyone else having anything to do with it.
Another big name recruited by the Vatican is Promontory Financial Group, based in Washington. Since May, a dozen of its analysts have been set up in the offices of the IOR sifting through the accounts of the institute one by one, hunting for illicit operations. And they are doing the same with the accounts of the APSA, the Administration of the Patrimony of the Apostolic See.
Not only that. Top-level managers of Promontory have become part of the permanent leadership of the IOR. One former Promontory officer is Rodolfo Marranci, the new director general of the Vatican “bank.” And the senior advisers of the IOR include Elizabeth McCaul and Raffaele Cosimo, who at Promontory were respectively the heads of the New York and European branches. Also coming from across the Atlantic is Antonio Montaresi, called in to manage the risk office, a role that did not exist at the IOR before.
A similar multiplication of roles and personnel at the Vatican also concerns the Financial Information Authority, created at the end of 2010 by Benedict XVI, today directed by the Swiss René Brülhart, an expensive international star in this area who will soon be doubling his staff.
The balance sheets of the IOR are certified by Ernst & Young, to which the Vatican has also entrusted the verification and modernization of the finance and management practices of the governorate of the tiny state.
And another renowned multinational, KPMG, has been called to bring up to international standards the accounting practices of all the institutes and offices based in Vatican City.
In spite of the boasts of transparency, no information is coming out about the costs of this recourse to external contractors, costs that are presumed to be enormous, particularly those charged to the IOR.
As if this were not enough, the Vatican “bank” has had to spend 3.6 million euro to cover part of the debt of 28.3 million, calculated by Ernst & Young, for the world youth day in Rio de Janeiro.
And it has had to use roughly ten million euro to cover half of the chasm left in the diocese of Terni by its former bishop Vincenzo Paglia, the current president of the pontifical council for the family.
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This commentary was published in "L'Espresso" no. 3 of 2014, on newsstands as of January 17, on the opinion page entitled "Settimo cielo" entrusted to Sandro Magister.
Here is the index of all the previous commentaries:
> "L'Espresso" in seventh heaven__________
To the external firms mentioned in the article to which the Vatican is making recourse can be added Banco Santander, asked to provide a training course for the administrative personnel of the prefecture of economic affairs of the Holy See.
The president for Italy of Santander Consumer Bank SpA is Ettore Gotti Tedeschi, called to the presidency of the IOR in September of 2009 and removed from it on May 24, 2012 in a procedure he rightly called “unjust and brutal” in an interview with “Il Messaggero” of January 10, 2014, in which he asked Pope Francis to “listen to what I have to say, even in confession, if he thinks it appropriate,” because “I would like to be sure that he also knows my side of the story”:
> Gotti Tedeschi: "Il papa deve conoscere la mia verità sullo IOR"After his removal Gotti Tedeschi was completely ostracized. At the Vatican no one charged with studying the reform of the IOR has yet spoken with him, not even to listen to his reconstruction of events.
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One measuring stick for the costs of the leading consulting companies is the contract drawn up shortly before Christmas by the Italian ministry of the treasury with KPMG - one of the companies recruited by the Vatican - to study how to rehabilitate the accounts of the seven regions most indebted in health care services: Abruzzo, Calabria, Campania, Lazio, Molise, Piedmont, and Sicily.
The cost of the contract with KPMG - which will also include the services of Ernst & Young, another of the companies recruited by the Vatican - is estimated at 38 million euro, to be paid for by the indebted regions.
It is therefore not surprising that IOR president von Freyberg has told Rachel Sanderson of the "Financial Times" that the compensation of Promontory Group costs "well above seven digits:"
> The scandal at the Vatican bank_________
McKinsey & Company is not a newcomer at giving advice to the Catholic Church. The diocese of Berlin turned to the director of the Munich branch, Thomas von Mitschke-Collande, to get its accounts back in order. And the episcopal conference of Germany did the same, to save on costs and personnel.
In 2012, Mitschke-Collande published a book entitled: “Does the Church want to destroy itself? Facts and analyses presented by a business consultant.” And last summer he offered a detailed plan for the reform of the Roman curia to the eight cardinal councilors of Pope Francis.
At the Vatican, McKinsey & Company was asked in 2008 to help bring order to the administration of the governorate of the pontifical state.
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One case of twofold membership, at Ernst & Young and at the same time on the commission instituted by Pope Francis to reorganize the economic-administrative structure of the Holy See, is that of Francesca Immacolata Chaouqui, who works in public relations at the Anglo-American multinational.
But more than for conflict of interest, the young PR rep has raised much more substantial objections in the Vatican and outside of it, from the moment of her appointment:
> Ricca and Chaouqui, Two Enemies in the House (26.8.2013)
> Francesca Immacolata Chaouqui si confessa due volte (18.9.2013)
> Chaouqui e Vallejo Balda, la strana coppia (17.1.2014)
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English translation by
Matthew Sherry, Ballwin, Missouri, U.S.A.
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For more news and commentary, see the blog that Sandro Magister maintains, available only in Italian:
> SETTIMO CIELO
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17.1.2014
