Why the 'Old Boys' network stands up for Rajat Gupta

For all the clubby chumminess of the corporate world that they inhabit, captains of Indian industry don’t always agree on everything. Oak-panelled boardrooms frequently resonate with Mahabharat-esque intrigues by one tycoon against another - and, in extreme cases, by one brother against another.

Yet, when it comes to speaking up in defence of Rajat Gupta, the former global head of McKinsey & Co who is facing trial in Manhattan in the insider trading case in which Galleon hedge fund trader Raj Rajaratnam was convicted, India Inc. has stood up as one man.

Prominent Indian business leaders - from Mukesh Ambani to Adi Godrej to Yogi Deveshwar to Analjit Singh - have offered glowing testimonials to Gupta on the friendsofrajat website put up by his friends and associates. “The roster of endorsers,” notes Bloomberg news agency , “reads like a guest list from the World Economic Forum’s annual meeting in Davos, Switzerland, which Gupta once frequented.”

[caption id=“attachment_321397” align=“alignleft” width=“380” caption=“Gupta commands enormous influence for the fact that as head of a global consultancy, he advised and worked alongside the cream of Indian industry and shaped their business strategy. Reuters”] [/caption]

What explains India Inc.’s affinity for - and public show of solidarity with - someone who, for all his impeccable record of business acumen and philanthropy, today stands accused of having consciously passed on classified market-moving information to Rajaratnam, with whom he shared a personal and professional relationship of long standing? Don’t they fear that they might be tainted by association with what could prove to be a case of corporate misgovernance?

Is it an extension of the desi boys’ network that commentators in the US cynically flagged when Rajaratnam’s case first came up last year?Even Rajaratnam, who is from Sri Lanka, couldn’t see beyond the “Indian” identity of those who fed him to the Feds.

Yet, despite Gupta’s roots and abiding interest in India, the facts may not validate the colourful narrative that this is a case of Indians standing up for one of their own. Gupta commands enormous influence for the fact that as head of a global consultancy, he advised and worked alongside the cream of Indian industry and shaped their business strategy. This wasn’t about provincialism; it was more about power. It was the brotherhood of power that comes accoutred in dapper business suits.

Gupta also mentored an entire generation of Indian entrepreneurs - like Hotmail founder Sabeer Bhatia. Bhatia told Bloomberg that when he wanted to start a school in India and, later, a business venture, Gupta advised him. “Everybody looked up to him,” Bhatia gushes.

In fact, even the friendsofgupta website came up without Gupta’s backing - at the initiative of friends of his who met at a party last October, and felt troubled by Gupta’s ordeal and the manner in which he was misrepresented in US media narratives.

Atul Kanagat, a former McKinsey principal who manages the website, likened Gupta to “a dolphin caught up in a tuna net”; the website, he says, was intended to “tell the story about the other Rajat” - the philanthropist, who gave generously of himself to others.

In that capacity, Kanagat has been battling misperceptions about Gupta - and about the friendsofrajat website wherever he finds them. When business consultant Rohit Bansal wrote a column in The Pioneer in which he suggested that this “high-profile website” was aimed at influencing the jurors in Gupta’s trial, Kanagat wrote in to challenge that assertion.

A modest website such as his was unlikely to make a dent in public perception of Gupta, particularly since media narratives “have already rendered a damning portrait” of him, Kanagat argued. “The real focus of the website,” he claimed, “was to help provide moral support to a person going through a very difficult period.”