Disney Wanted to Make a Splash in China With ‘Mulan.’ It Stumbled Instead.

Companies as big as McKinsey and Disney can have equally big blind spots:

Executives at Walt Disney Studios were celebrating. “Mulan,” a $200 million live-action spectacle five years in the making, had arrived on Disney’s streaming service to strong reviews, with critics lauding its ravishing scenery and thrilling battle sequences.

The abundant controversies that had dogged “Mulan” over its gestation — false rumors that Disney was casting a white lead actress, calls for a boycott after its star expressed support for the Hong Kong police — had largely dissipated by Sept. 4, when the film arrived online. Success looked likely around the world, including the crucial market of China, where “Mulan” is set and where Disney hoped its release in theaters on Friday would advance the company’s hold on Chinese imaginations and wallets.

“In many ways, the movie is a love letter to China,” Niki Caro, the film’s director, had told the state-run Xinhua News Agency.

Then the credits rolled.

Almost as soon as the film arrived on Disney+, social media users noticed that, nine minutes into the film’s 10-minute end credits, the “Mulan” filmmakers had thanked eight government entities in Xinjiang, the region in China where Uighur Muslims have been detained in mass internment camps.

Activists rushed out a new #BoycottMulan campaign, and Disney found itself the latest example of a global company stumbling as the United States and China increasingly clash over human rights, trade and security, even as their economies remain entwined.

Disney is one of the world’s savviest operators when it comes to China, having seamlessly opened Shanghai Disneyland in 2016, but it was caught flat-footed with “Mulan.” Top studio executives had not seen the Xinjiang credits, according to three people briefed on the matter, and no one involved with the production had warned that footage from the area was perhaps not a good idea.

The filmmakers may not have known what was happening there when they chose it as one of 20 locations in China to shoot scenery, but by the time a camera crew arrived in August 2018 the detention camps were all over the news. And all of this for what ended up being roughly a minute of background footage in a 1-hour-55-minute film.

Disney declined to comment.

Asked about the credits fiasco at a Bank of America conference on Thursday, Christine M. McCarthy, Disney’s chief financial officer, noted that it was common practice in Hollywood to credit government entities that allowed filming to take place. Although all scenes involving the primary cast were filmed in New Zealand, Disney shot scenery in China “to accurately depict some of the unique landscape and geography for this historic period drama,” Ms. McCarthy said.

“I would just leave it at that,” she said, before allowing that the credits had “generated a lot of issues for us.”

No overseas market is more important to Hollywood than China, which is poised to overtake the United States and Canada as the world’s No. 1 box office engine. Disney has even more at stake. The Chinese government co-owns the $5.5 billion Shanghai Disney Resort, which Disney executives have said is the company’s greatest opportunity since Walt Disney himself bought land in central Florida in the 1960s. Disney is also pouring hundreds of millions of dollars into upgrades at its money-losing Hong Kong Disneyland in hopes of creating a must-visit attraction for families.

Disney worked overtime to ensure that “Mulan” would appeal to Chinese audiences. It cast household names, including Liu Yifei in the title role and Donnie Yen as Mulan’s regiment leader. The filmmakers cut a kiss between Mulan and her love interest on the advice of a Chinese test audience. Disney also shared the script with Chinese officials (a not-uncommon practice in Hollywood) and heeded the advice of Chinese consultants, who told Disney not to focus on a specific Chinese dynasty

“If ‘Mulan’ doesn’t work in China, we have a problem,” Alan F. Horn, co-chairman of Walt Disney Studios, told The Hollywood Reporter last year.

The “Mulan” controversy underscores the dilemma companies face when trying to balance their core principles with access to the Chinese market. The Chinese government shut out the National Basketball Association last year after the general manager of the Houston Rockets shared an image on Twitter that was supportive of pro-democracy protesters in Hong Kong. The backlash cost the league hundreds of millions of dollars. (After mounting pressure from American politicians to sever ties with a basketball academy in Xinjiang, the N.B.A. disclosed in July that it had already done so.)

Disney has long argued that its infractions are unfairly magnified because its brand provides a convenient punching bag. A lot of American companies had operations in Xinjiang in 2018, and some still source goods there.

Apologizing for the Xinjiang credits could anger China and threaten the release of future movies. China blocked the release of Disney’s animated “Mulan” for eight months in the late 1990s after the company backed Martin Scorsese’s “Kundun,” a film seen as sympathetic to the Dalai Lama. The animated “Mulan” bombed in China as a result.

“On one hand, Disney supports Black Lives Matter and the #MeToo movement and has been responsive to calls for inclusion by making a movie like ‘Mulan’ with an all-Asian cast and a female director,” said Michael Berry, director of the Center for Chinese Studies at the University of California, Los Angeles. “On the other, it has to be very careful on the topic of human rights in China. That’s business, of course, but it’s also hypocritical, and it makes some people angry.”

The political realities have shifted drastically since 2015, when Disney started working on “Mulan.” As part of its escalating confrontation with the Chinese government, the Trump administration has started to attack Hollywood for pandering to the country. In July, Attorney General William P. Barr criticized studios for making changes to films like “Doctor Strange” (2016) and “World War Z” (2013) to avoid trouble with China.

The pressure is not coming just from conservatives. PEN America, the free-speech advocacy group, on Aug. 5 released a major report on Hollywood’s censoring itself to appease China.

“Hollywood was already in the election-year cross hairs,” said Chris Fenton, the author of “Feeding the Dragon: Inside the Trillion Dollar Dilemma Facing Hollywood, the N.B.A. & American Business.” “This situation with ‘Mulan’ only makes it worse.”

At least 20 members of Congress have already written Disney to express outrage over the Xinjiang matter and demand more information.

It remains to be seen how “Mulan” will fare in China. The country’s 70,000 theaters have reopened, but most are still limiting capacity to 50 percent as a coronavirus precaution. Rampant piracy and chilly reviews could also cut into ticket sales.

On Friday, theaters in China were decked out with large posters of a fierce-looking Ms. Liu as Mulan, clad in a red robe and wielding a sword as her long black tresses billowed behind her. At one Beijing cinema, moviegoers were invited to test their archery skills.

By the end of the day, “Mulan” had taken in a humdrum $8 million. “The Lion King,” released last year, collected $13 million on its first day in China.

Detail-oriented Disney set out to make a movie that rang true to Chinese audiences in aspects big and small — much as the company approached Shanghai Disneyland. It infused the park with myriad Chinese elements and avoided classic Disney rides to circumvent cries of cultural imperialism.

“I had an army of Chinese advisers,” Ms. Caro, the film’s director, told the Xinhua News Agency. Many Chinese feel an intense ownership of the character of Mulan, having grown up learning about the 1,500-year-old “Ballad of Mulan” in school. The poem has been the source of inspiration for countless plays, poems and novels over the centuries.

In the quest to make a culturally authentic film — and to give “Mulan” sweep and scale — Disney sought to showcase the diverse scenery of China. In keeping with China’s rules on filming in the country, Disney teamed with a Chinese production company, which secured the necessary government permits. A crew filmed in the Xinjiang area for several days, including in the red sandstone Flaming Mountains near Turpan, said Sun Yu, a translator on the film.

“Usually when a lot of foreigners go to Xinjiang, officials there are pretty sensitive,” Ms. Sun said in an interview. “But actually our filming process went very smoothly because the local government was very supportive and understanding at the time.”

To find the perfect Mulan, Disney casting directors scoured the globe before choosing the Chinese-born Liu Yifei. To Disney, Ms. Liu was ideal: physically fit, a household name in China (for playing elegant maidens in martial arts dramas) and fluent in English, having spent part of her childhood in Queens.

Then, last summer, as tensions boiled in Hong Kong over the antigovernment protests, Ms. Liu reposted an image on Weibo, the Chinese social media platform, expressing support for the police there.

The backlash was swift. Prominent Hong Kong pro-democracy activists quickly called for a boycott of the movie.

Mr. Horn told The Hollywood Reporter that her post had caught Disney by surprise. “We don’t wish to be political,” he said. “And to get dragged into a political discussion, I would argue, is sort of inherently unfair. We are not politicians.”

As Disney’s marketing campaign for “Mulan” ramped up this year, other contretemps surfaced. There were complaints about a lack of Asians among the core creative team; cries of sacrilege that Mushu, a wisecracking dragon in Disney’s animated version, had been jettisoned; and grumbles that this telling of the Mulan tale seemed to pander to Chinese nationalism.

The internet storms had mostly died down by the time “Mulan” arrived on Disney+ on Sept. 4. The credits changed that.

As many as one million Uighurs — a predominantly Muslim, Turkic-speaking ethnic minority — have been rounded up into mass detention centers in Xinjiang in what advocates of human rights have called the worst abuse in China in decades. The entities mentioned in the movie’s credits included a local police bureau that the Trump administration blacklisted last year from doing business with U.S. companies.

As the backlash over Xinjiang mounted, China ordered major media outlets to limit their coverage of “Mulan,” according to three people familiar with the matter.

Still, on Friday night, the Emperor Cinema in Beijing was set for a “Mulan” party.

Some moviegoers wore red, in homage to the title character, while others opted for a more traditional Chinese look: flowing robes and bejeweled hair accessories. After the screening, two traditional Chinese opera singers dressed in elaborate red-and-yellow costumes took the stage to perform an excerpt from a well-known Henan Opera rendition of “Mulan” called “Who Says Women Are Inferior to Men?”

The movie had already been playing in China, thanks to pirated versions on the internet. By Friday’s opening, there were more than 76,000 reviews on Douban, a popular Chinese review website. Most were tepid, averaging 4.7 out of 10 stars. (The 1998 animated version had 7.8 stars.)

In a review posted on Weibo, Luo Jin, a Chinese film critic who goes by the nom de plume Magasa, called the film “General Tso’s Chicken” — an Americanized take on Chinese culture.

“Some people are just going to be against these Hollywood takes on Chinese movies no matter how well made the movie might be,” Mr. Luo said in a phone interview. “For them, the thinking is like, ‘Who are you to appropriate our culture for your own benefit?’”

Source: https://www.nytimes.com/2020/09/12/business/media/disney-mulan-china.html?action=click&module=Well&pgtype=Homepage&section=Business

How McKinsey Makes Its Own Rules

Seems like our Ambassador to China got out at the right time…

It’s not easy being McKinsey & Company these days.

For most of its 90-odd-year existence, the prestigious management consultancy prided itself on remaining above the fray. McKinsey consultants plied the executive suites of Fortune 500 companies, counseling chief executives with discretion and quietly building a business that, with $10 billion in annual revenues, is now bigger than many of the entities it serves. The substance of the company’s work, and even the identities of its clients, lie concealed under an institutional code of silence. That reticence, enforced by a nondisclosure agreement, bedeviled Pete Buttigieg’s presidential campaign until last Monday, when McKinsey granted him a rare dispensation to reveal the names of his former clients.

On the occasions when McKinsey’s work has been scrutinized of late, it hasn’t reflected well on the firm. Reporting by The New York Times, ProPublica and others over the past 18 months has raised serious questions about how it does business at home and abroad: corruption allegations against companies McKinsey partnered with in South Africa and Mongolia; a federal criminal investigation into the firm’s bankruptcy practice in the United States; attempts to deny that it helped put into effect controversial Trump administration immigration policies; and evidence that McKinsey cherry-picked nonviolent inmates for a pilot project and made it seem that an attempt to curb violence at New York City’s Rikers Island jail complex was working (it wasn’t). McKinsey has denied wrongdoing in each of these instances.

These and other examples of McKinsey’s recent conduct reveal a common dynamic. An examination of these episodes, including thousands of pages of documents and interviews with dozens of current and former McKinsey consultants and clients from multiple projects, suggests McKinsey behaves as if it believes the rules should bend to its way of doing things, not the other way around.

McKinsey’s self-regard has long been uncommonly high. In the firm’s 2010 internal history, a copy of which ProPublica obtained, partners compare the firm to the Marine Corps, the Roman Catholic Church, and the Jesuits: “analytically rigorous, deeply principled seekers of knowledge and truth,” the history’s authors write. One McKinsey partner went a step further, declaring without a hint of irony that the firm’s trait of shared values is more than “even the Catholic Church can promise.”

This attitude works for the firm in corporate consulting, an unregulated field where McKinsey’s reputation leaves it largely free to do things its own way and where its insistence on not being publicly credited has also shielded it from blame for its failures. But as McKinsey has expanded its consulting empire in recent years, it has taken on a growing book of work for government entities, as well as for corporate clients in areas subject to government oversight, such as advising bankrupt companies on restructuring.

In that field, consulting firms confront a web of contracting, disclosure and ethics rules that are designed to dictate and limit their behavior. These rules exist to prevent governments from wasting taxpayer money on underqualified or overpriced contractors and to protect government integrity and avoid conflicts of interests. In recent years, as McKinsey has burrowed deeper into this world, interviews and records show, it has developed a habit of disregarding inconvenient rules and norms to secure, retain and profit from government work.

Consider McKinsey’s imbroglios in South Africa and Mongolia. The firm did not follow the due diligence protocols commonly deployed to avoid running afoul of anti-corruption laws. The result: Its consultants found themselves working alongside dubious local companies that got them entangled in corruption investigations. Only after McKinsey became embroiled in the South Africa corruption scandal did the firm decide it needed to put more stringent safeguards in place.

In the United States, a damning but largely overlooked report issued in July by the Office of Inspector General for the General Services Administration, the hub for federal contracting, depicted McKinsey as ignoring rules and refusing to take no for an answer. The report examined McKinsey’s attempts to renew a major long-running contract in 2016. The firm was asked to provide additional pricing information to satisfy federal contracting rules. Rather than comply, McKinsey went over the contracting officer’s head, lodging complaints with top G.S.A. officials, who refused to exempt the firm from the rules.

Eventually, the firm found a friendly G.S.A. manager who was willing to not only award the contract, but also manipulated the G.S.A.’s pricing tools to increase the value of the contract by tens of millions of dollars. The report concluded the manager “violated requirements governing ethical conduct.”

The pattern repeated itself when McKinsey failed in multiple attempts to win a separate contract around the same time. Stymied, according to the report, McKinsey browbeat the contracting officer, threatening to resubmit the proposal until it got its way. The G.S.A. manager again intervened for reasons left unexplained by the report and McKinsey got its contract.

The report’s assessment of McKinsey’s behavior was withering, and it revealed that the firm subsequently used the same friendly manager to help secure contracts at three other federal agencies in 2017 and 2018. “Multiple contracting officers,” the inspector general wrote, told investigators that McKinsey’s requests were “inappropriate” and “a conflict of interest.”

The report recommended that the G.S.A. cancel the contracts, which as of earlier this year had earned McKinsey nearly $1 billion over a 13-year span. In a response to the report, the G.S.A. stated that it would ask McKinsey to renegotiate the contracts to lower the price. “If McKinsey declines” or “renegotiations do not yield a result in the government’s best interest,” the agency wrote, it would cancel them. Neither has happened to date, according to federal contracting records. A McKinsey spokesman said: “We have reviewed the report and the relevant facts, and have found no evidence of any improper conduct by our firm. We are in negotiations with G.S.A. and look forward to completing them soon.” A G.S.A. spokesperson said it is negotiating for “better pricing” and will not award McKinsey any further work under the contracts until those negotiations are concluded.

McKinsey has also taken steps to evade public accountability. As ProPublica reported, a senior partner leading McKinsey’s work at Rikers asked top corrections officials and members of the consulting team to restrict their communications to Wickr, an encrypted messaging app that deletes messages automatically after a few hours or days. That insulated some of McKinsey’s work from government oversight and public records requests. (“Our policies require colleagues to adhere to all relevant laws and regulations,” a McKinsey spokesman said. He neither confirmed nor denied the use of Wickr.)

Speaking more broadly, the McKinsey spokesman said: “We hear the calls for change. We are working hard to address the issues that have been raised.”

McKinsey has so far escaped serious repercussions for its reluctance to follow inconvenient rules. That could change next year.

Consultancies such as McKinsey, which advise companies restructuring under bankruptcy protection, are required to disclose potential conflicts of interest. For the past few years, McKinsey has been locked in a complicated set of court disputes with Jay Alix, the founder of a competing advisory firm, and with the Justice Department’s bankruptcy watchdog over whether McKinsey failed to follow bankruptcy disclosure rules, a subject The Times has covered in depth.

McKinsey has, since then, disclosed a number of new potential conflicts in old bankruptcy cases and paid $32.5 million to creditors and the United States trustee to settle claims over insufficient disclosures. The trustee has said that “McKinsey failed to satisfy its obligations under bankruptcy law and demonstrated a lack of candor.” The firm denies wrongdoing and says it settled “in order to move forward and focus on serving its clients.”

Subsequently, McKinsey has moved, in effect, to rewrite the rules. It drafted a protocol ostensibly meant to clarify what advisers like itself need to disclose. Critics pointed out that McKinsey’s protocol allows such firms to avoid disclosing relationships they deem indirect or “de minimis.”

There remains more to come. Apart from the criminal investigation, a judge in Houston has scheduled a trial in February to decide the merits of Mr. Alix’s allegations. The judge, David R. Jones, has described the trial in apocalyptic tones. It will be, Judge Jones has said, “the ultimate career ender for somebody.” For McKinsey, a trial would mean being called on to defend its work in public — with real accountability and real consequences for its actions. The firm might even benefit in the long run from the sunlight.

Source: How McKinsey Makes Its Own Rules

How McKinsey Helped the Trump Administration Carry Out Its Immigration Policies

Yet another illustration of McKinsey’s ethnical and moral blindspots (not as egregious as holding their conference in Xinjiang nor Huawei’s role in surveillance tech Huawei founder defends ‘seamless surveillance’ technology, dismisses criticism it enables human-rights abuses):

Just days after he took office in 2017, President Trump set out to make good on his campaign pledge to halt illegal immigration. In a pair of executive orders, he ordered “all legally available resources” to be shifted to border detention facilities, and called for hiring 10,000 new immigration officers.

The logistical challenges were daunting, but as luck would have it, Immigration and Customs Enforcement already had a partner on its payroll: McKinsey & Company, an international consulting firm brought on under the Obama administration to help engineer an “organizational transformation” in the ICE division charged with deporting migrants who are in the United States unlawfully.

ICE quickly redirected McKinsey toward helping the agency figure out how to execute the White House’s clampdown on illegal immigration.

But the money-saving recommendations the consultants came up with made some career ICE workers uncomfortable. They proposed cuts in spending on food for migrants, as well as on medical care and supervision of detainees, according to interviews with people who worked on the project for both ICE and McKinsey and 1,500 pages of documents obtained from the agency after ProPublica filed a lawsuit under the Freedom of Information Act.

Automation Could Displace 800 Million Workers Worldwide By 2030, Study Says : All Tech Considered : NPR

Impact on labour force needs and immigration levels needs to be considered (most advocates for immigration increases are silent on the issue):

A coming wave of job automation could force between 400 million and 800 million people worldwide out of a job in the next 13 years, according to a new study.

A report released this week from the research arm of the consulting firm McKinsey & Company forecasts scenarios in which 3 percent to 14 percent of workers around the world — in 75 million to 375 million jobs — will have to acquire new skills and switch occupations by 2030.

“There are few precedents” to the challenge of retraining hundreds of millions of workers in the middle of their careers, the report’s authors say.

The impact will vary between countries, depending on their wealth and types of jobs that currently exist in each. In 60 percent of jobs worldwide, “at least one-third of the constituent activities could be automated,” McKinsey says, which would mean a big change in what people do day-to-day.

McKinsey looked at 46 countries and more than 800 different jobs in its research.

In the year 2030 in countries with “advanced economies,” a greater proportion of workers will need to learn new skills than in developing economies, researchers say. As many as a third of workers in the U.S. and Germany could need to learn new skills. For Japan, the number is almost 50 percent of the workforce, while in China it’s 12 percent.

Jobs that pay “relatively lower wages” and aren’t as predictable are less likely to face full automation, because businesses don’t have as much incentive to spend on the technology. This applies to jobs like gardening, plumbing and child care, according to the authors.

Occupations that pay more but involve managing people and social interactions face less risk of automation due to the inherent difficulty in programming machines to do those types of tasks.

In the short term, automation and new technology could mean “significant” displacement of workers, the report says. But the authors argue that in the long term as technology has changed, “it creates a multitude of new jobs, more than offsetting” the number of those lost.

They note, however, those new jobs don’t always pay as much as the old ones.

A rising middle class in countries like China and India, and with it more consumption, will have a big impact on the direction of economies. “As incomes rise, consumers spend more on all categories,” the report says. “But their spending patterns also shift, creating more jobs in areas such as consumer durables, leisure activities, financial and telecommunication services, housing, health care, and education.”

Many countries are getting older as well — Japan is a notable example. And McKinsey researchers expect aging populations to need more medical care — more doctors, nurses, home health workers and aides — while demand goes down for children’s teachers and doctors.

Tech jobs will be needed as technology advances, like “computer scientists, engineers and IT administrators,” who could see job growth as companies spend more in this area, the report says.

Jobs gained “could more than offset the jobs lost to automation,” the researchers say. But, they say, “it will require businesses and governments to seize opportunities to boost job creation and for labor markets to function well.”

The McKinsey researchers recommend “an initiative on the scale of the Marshall Plan involving sustained investment, new training models, programs to ease worker transitions, income support and collaboration between the public and private sectors” to help economies and employment grow in the future.

via Automation Could Displace 800 Million Workers Worldwide By 2030, Study Says : All Tech Considered : NPR