Seconds after Rajat K. Gupta, then a director of Goldman Sachs, finished up a board call during which he learned that Warren E. Buffett had agreed to invest $5 billion in the firm, he picked up the phone and called his friend Raj Rajaratnam, regulators contend. Minutes later, Mr. Rajaratnam placed bets on shares of Goldman Sachs that netted his firm, the Galleon Group, $900,000. As Andrew Ross Sorkin’s Dealbook observes, “The fact pattern looks bad, very bad."

Gupta has resigned from the boards of Harman International Industries Inc. in the wake of the SEC's accusations. He has also resigned from the boards of AMR Corp., Genpact Ltd., and Procter & Gamble. It is a rapid fall from grace. In October, Alan Lafley, the former chief executive of Procter & Gamble, described Mr. Gupta thusly. “I think of him like Thomas Aquinas,” the philosopher and priest.

This is why. Gupta has a far longer and more important connection to the world’s most prestigious consulting firm, McKinsey. He worked at the firm for 34 years, eventually rising to become its managing director—the McKinsey equivalent of chief executive. He was elected to the top job at McKinsey by his fellow partners at the firm for three consecutive terms—the maximum allowed by the firm’s rules. NetNet's John Carney worries that Rajat Gupta may destroy McKinsey.  Or at least generate bad publicity for the Firm.

McKinsey, which has watched this story grow over time, is also worried. On 4 March, the day Lloyd Blankfein, CEO of Goldman Sachs, agreed to testify for the U.S. government at the coming trial of Rajaratnam, McKinsey posted a job opening for a reputation risk specialist whose major responsibilities are described thusly:

1. Monitor globally public references to McKinsey, select clients or specific issues appearing in media and consumer generated media (CGM)/ social technologies, which are potential or actual reputation risks for the Firm
2. Collaborate with the Director of Reputation Risk Management to help report key reputation risks
3. Collaborate with the Reputation Risk Management team to help research and prepare for potential and actual situations:

This job may be based in Brussels, Belgium, London, UK or New York, NY

Learn More

If the above moves you to action, but you are not sure what that action should be, consider joining the conversation at the Society's Mission Intangible Monthly Briefings. Our 1 April program is titled, How reputation drives principled performance ; our 6 May program is titled: Economic value of trust.