With the conviction of Rajat Gupta, former managing director of McKinsey & Co and independent director on the boards of Goldman Sachs and Procter & Gamble, for insider trading and securities fraud, a spectacularly successful career has come to a tragic end. It is yet another example of how greed and envy can get the better of even the most brilliant minds. By Vivek Sharma
It is a sad end to an amazing success story, a story almost incredible that it reads like a fairytale.
Orphaned at a young age, Rajat Gupta had to take over the responsibilities of his younger siblings. Despite the hardships that life threw at him, he still managed to be one of the toppers in the IIT entrance exam.
After Gupta earned his undergraduate degree in mechanical engineering, his brilliance did not escape the attention of the admissions committee at Harvard Business School. Armed with a Harvard MBA, the 25-year old Rajat joined McKinsey & Co and rose to heights few India-born executives have scaled.
Slightly more than a decade after joining McKinsey, Gupta was made a partner of the firm. In another six years, he became head of McKinsey's Chicago office. He started his first three-year term as McKinsey's global managing partner in 1994, just over two decades after he joined. By the time he completed his maximum allowed three terms in 2003, the firm's annual revenues had almost tripled. He remained a senior partner for another four years, and as senior partner emeritus after Gupta relinquished full time responsibilities in 2007. By then he was regarded as one of the most well-known and respected global corporate figures, a position that won him directorships at Goldman Sachs, Procter & Gamble, American Airlines and Sberbank of Russia.
Why would such an accomplished person, who is well aware of the pitfalls of sharing insider information and who has seen several corporate figures being jailed for doing so, still take on the risk of throwing away everything he had achieved in life? Why would a man, having a wonderful family with four grown up daughters and estimated current networth in excess of $100 million, foolishly believe that he could get away with it?
Rajat Gupta didn't have to prove anything, either to himself or to the world. What could he possibly have gained by joining hands with hedge fund promoter and manager Raj Rajaratnam?