Business Today

Change Agent

He gave India its first world-class business school and now its only public health foundation. What makes McKinsey's Rajat Gupta a social entrepreneur and the only Global Indian(-American) of his kind?

By R. Sridharan | Print Edition: August 12, 2007

Almost a year after this writer put in a request for an interview with Rajat Gupta, he gets to meet the man in a hotel suite in Delhi. It's around five on a June evening, and Gupta, Senior Partner worldwide, McKinsey & Co., is ensconced in an ample sofa, looking just a tad jet lagged. He's wearing a grey suit with bold stripes, a bluish-grey tie over a white shirt with monogrammed cuffs, and cufflinks that bear the Seal of the President of the United States of America.

The 43rd (read: George W. Bush) presented them to Gupta when he visited the Gupta-founded Indian School of Business in Hyderabad in March last year. "I got to make my first visit to the Oval Office day before yesterday," informs Gupta, who is also the Chairman of the Global Fund to Fight aids, Tuberculosis and Malaria, a private-public partnership comprising governments, not-for-profits and private foundations.

Rajat Gupta

At 58, Gupta is one of the best-known global Indians. Thirteen years ago, he had shattered the glass ceiling to become the Managing Director of the world's most prestigious consulting firm. Since then, Gupta has been a mover and shaker in the global arena, thanks in one part to his firm's influence, but to a larger part to his own energy and passion. Former Secretary General of the United Nations Kofi Anan sought him out as a personal advisor on un management; he's invited routinely to speak at the global gabfest in Davos, the World Economic Forum; Fortune 100 CEOs use him as a sounding board, and not necessarily because they have hired his firm for consulting work; Bill Clinton personally came down to take stock of the devastation caused by the earthquake in Gujarat in April 2001 after Gupta told him that it would help with fundraising for the victims; and he's on a first-name basis with the global who's-who, ranging from Microsoft Chairman Bill Gates to former Goldman Sachs Chairman & CEO and current us Treasury Secretary Henry "Hank" Paulson to South Africa's Nelson Mandela to India's own Nobel Laureate Amartya Sen.

It's been four years since Gupta stepped down as Managing Director after serving the maximum permissible three three-year terms, but, in parallel, he has spent more than a decade reinventing himself as a philanthropist-cum-social entrepreneur. Six years ago, Gupta launched the Indian School of Business, arguably the country's only world-class business school. And last year, he unveiled his most ambitious social project yet-the Public Health Foundation of India (PHFI), another public-private partnership aimed at creating public health professionals and research in India. In between, he has also set up the American India Foundation, which works in the areas of education, public health, and livelihood in India. It is this-his incredible ability to marshal a stunning array of global heavyweights around important causes to India's benefit-that makes him stand apart in the galaxy of Global Indians such as Amartya Sen, C.K. Prahalad, Arun Sarin or Indra Nooyi. Says N.R. Narayana Murthy, Chairman, Infosys Technologies, and a friend of Gupta for about eight years now: "I have often compared Rajat to Jawahar Lal Nehru simply because, in contemporary India, I don't know of any other individual who has set up two world-class institutions."

Actually, Murthy made such a comparison at a public forum sometime ago and Gupta, who was sharing the stage, was quite embarrassed by it (by Murthy's own account). No doubt, Murthy is generous with his praise, but he does hit the nail on the head. In contemporary India, there is no one who's not either a billionaire or an administrator who has conceived and launched two path-breaking institutions. So, how does Gupta, who becomes McKinsey's Senior Partner Emeritus end of this year, do it?

Private Skill, Public Benefit

Before we answer the how, it probably makes sense to ask 'why'. Why should a man who's pushing 50s, has nothing left to prove professionally, and is reasonably affluent (Gupta may not be a billionaire, but he's got enough to angel invest and then some more), work his Rolodex like mad and travel around the world on an even crazier schedule (recently, in less than a month, Gupta crisscrossed us-India-Russia-us-South Africa-us) to help with projects that will financially enrich neither him nor his firm?

Gupta's answer is what you would expect of an IIT engineer: efficient and logical. "At one level, I have always believed in giving something back to society, and at another, I have certain skills and some amount of goodwill acquired over the years that I can use for the good of others," he reasons.

Gupta's philanthropic urges have deep roots, and have been shaped to a large extent by one man: his father. Ashwini Kumar Gupta was an officer in the Indian Civil Service who gave up his career to join the freedom struggle. Born in Kolkata in 1948, Gupta Jr was heavily influenced by his father's Gandhian values and eminent friends. After Independence, Gupta's journalist father moved from Kolkata to Delhi in the early 50s to launch Hindustan Standard, but died in 1964, when Gupta was not yet 16. To compound the tragedy, his mother died two years later. As the eldest boy in the family (he has two sisters, one elder to him, and one brother), Gupta decided that the siblings would stay together in Delhi and not be farmed out to aunts and uncles. His father's employer, Ananda Bazar Patrika, offered to continue paying the rent for the house and the school where the kids studied (Modern School), offered them merit scholarships. "Everyone was very, very generous to us," recalls Gupta. At IIT Delhi, too, Gupta studied on scholarship and from there went to Harvard Business School on a mix of loan and scholarship. In the process, he turned down a job with ITC. The rest, as they say, is history.

The idea of ISB, Gupta says, emerged in the mid-90s when he started thinking in terms of giving something back to India. And the reason he chose business education was fairly simple: his firm was one of the biggest recruiters on B-school campuses, and it was an area where he had considerable expertise. So, roping in a handful of people from within McKinsey, including Anil Kumar and Pramath Sinha, Gupta set about putting the school together. Predictably, there were numerous hurdles along the way, ranging from raising money to getting land to striking alliances with global B-schools to roping in a permanent dean and faculty.

For example, the Harvard Business School, Gupta's alma mater, said 'no' when he asked for an affiliation and the founding dean Sumantra Ghoshal had to be wooed over Gupta's several trips to London. "It was a very difficult project. If Rajat hadn't been involved, this thing wouldn't have happened," says Sinha, currently CEO of Ananda Bazar Patrika.

Eventually, though, Gupta managed to woo some of the biggest names in business to be on the school's governing and executive boards. Pharma major Novartis' CEO Daniel Vasella, WPP Group's Martin Sorrell, lvmh's Bernard Arnault, Michael Dell, Anil Ambani, Yogi Deveshwar, Adi Godrej, K.V. Kamath, L.N. Mittal, Shiv Nadar, N.R. Narayana Murthy, Rahul Bajaj, Sunil Mittal are just some members of ISB's all-star boards. Says Ramalinga Raju, Chairman, Satyam Computer Services, who's on the school's executive board: "Quite frankly, I put money into ISB simply because I have great admiration for and confidence in Rajat's leadership abilities."

Into its seventh batch, ISB has alliances with the Wharton School, the Kellogg School of Management, and London Business School. Gupta says he would like the school to graduate a larger number of students every year, and accordingly, ISB's intake in its flagship one-year MBA programme has gone up from 128 to 425. Says Hank Paulson, us Treasury Secretary: "Rajat brings a global perspective to all that he does. He has very strong leadership skills-a great combination of being bright, analytical, and objective and he reads people very well. He comes to play every day."


There are thousands of names in his Rolodex. Here's a representative sample.

Dr Daniel Vasella
Chandrababu Naidu,Former Chief Minister of Andhra Pradesh was instrumental in attracting the school to Hyderabad. Y.S Rajasekhara Reddy, Chief Minister of Andhra Pradesh continues to provide immense support to the school.Dr Daniel Vasella,
 Chairman & CEO of Novartis gave the Indian School of Business more money than was asked for.


Dr Barry Bloom
The Dean of Harvard School of Public Health, Dr Bloom got Rajat interested in global health and put him in touch with Dr K. Srinath Reddy, who now heads PHFI.

Bill Gates
His Bill & Melinda Gates Foundation donated Rs 65 crore to PHFI last year.

Dr. A. Ramadoss
Union Minister for Health & Family Welfare, he orchestrated the Government of India's response and participation.
Some others who've helped ISB with both their time and money:
Rahul Bajaj

Shiv Nadar

Adi Godrej

Anil Ambani

Some others who've helped PHFI with their time and money: 

Desh Deshpande

Vinod Khosla

Rohini Nilekani

Uday Harsh Khemka

Fixing Public Health

While daunting it was, ISB doesn't come close to the challenge Gupta has set himself up with by way of PHFI. For one, what is his competence in the area of public health? In fact, Gupta didn't start looking at health issues seriously until a Harvard classmate of his died of aids in the mid-80s.

K. Srinath Reddy

But his first real brush with public health came in September 2001 when the Dean of Harvard School of Public Health, Dr Barry Bloom, wrote him a blind letter inviting him to join the Dean's council as an advisor. Gupta's initial reaction, understandably, was 'why me?', but as he soon discovered what the good doctor, who worked with the World Health Organization (WHO) in India in the late 60s and ended up being fascinated by the country, really wanted was Gupta's management expertise and his enviable connections.

"Here was this guy who could mobilise important people in India and elsewhere and had this reputation for strong analytical skills. I wanted him, and luckily for me he was so open to new ideas," says Bloom.

The Rajat Essentials 
Name: Rajat Kumar Gupta

Designation: Senior Partner

Born: December 2, 1948

Place of Birth: Maniktala, Kolkata

Education: Modern School, New Delhi, 1966; B. Tech (Mechanical Engineering), IIT Delhi, 1971; MBA, Harvard Business School, 1973

Career: Joined McKinsey in 1973 in New York office; Elected partner in 1980; Moved to Scandinavia in 1981; Managing Partner-Scandinavia, 1983-87; Elected Director 1984; Moved to Chicago in 1987; Managing Partner (Chicago) 1990-94; Elected Managing Director Worldwide (1994-2003); Senior Partner (2003-to now)

Family: Wife (Anita), and four daughters: Geetanjali, Megha, Aditi, and Deepali

Residence: Stamford, Connecticut, USA

Key Affiliations: Chairman, Indian School of Business; Chairman, Public Health Foundation of India; Chairman, the Global Fund to Fight AIDS, Tuberculosis and Malaria; Co-Chair, American India Foundation; Member of the Board-Goldman Sachs & Procter & Gamble

Favourite quote: Karmanye Vadhikaraste Ma Phaleshu Kadachana, Ma Karma Phala Hetur Bhurmatey Sangostva Akarmani.
Rough Translation: You have a right to perform your prescribed action, but you are not entitled to the fruits of your action. Never be associated to not doing your duty.

Fortunately for Gupta, Bloom pointed him in the direction of Reddy, who then was the head of cardiology at the All India Institute of Medical Sciences (AIIMS) in Delhi and a well-known proponent of public health system.

Reddy agreed with McKinsey's conclusion that a pure research-oriented school would not fly. Instead, he suggested that the school should create both public health professionals and practitioners. "Rajat agreed and he also insisted that any such initiative must have the government of India as a partner, although many people advised him against a public-private partnership," says Reddy.

Amartya Sen
Prof of Economics & Philosophy/Harvard University
But since the government is the biggest player in public health, Gupta knew its buy-in would be vital to the success of any such project. Therefore, he and his team began working on a variety of government officials and leaders-from the bureaucrats in charge of the Ministry of Health to the minister to the deputy chairman of the Planning Commission to the Prime Minister himself. In August last year, the government not only put in Rs 65 crore in equity but also nominated Planning Commission deputy chairman Montek Singh Ahluwalia and pm's Principal Secretary T.K.A. Nair to the board. "The financial and political capital that Rajat has been able to raise for PHFI has given it momentum and credibility," says Reddy, who is on a five-year lien from AIIMS. "Frankly, the PHFI wouldn't have been possible without him." PHFI hopes to open its first two institutes by July 2008 or January 2009, followed by one every year for five thereafter.

PHFI's hope: train 10,000 public health professionals each year. Says Lincoln Chen, President, China Medical Board, which focuses on public health issues in China, and a member of PHFI's governing board: "The PHFI is a true innovation in an area where intervention can make the most difference to the lives of poor people." Adds Ranjit Pandit, Managing Director (India), McKinsey & Co., who worked with Gupta on PHFI: "To me Rajat's overarching trait is his sense of humanity; he's genuinely interested in the development of people."

PHFI isn't the only health initiative that's going to keep Gupta busy in the years ahead. In April this year, he was elected Chairman of The Global Fund to Fight aids, Tuberculosis and Malaria, becoming the first person from the private sector to get this job. Although the Fund has about $7 billion in pledge from governments and private foundations, it needs to raise more money to meet its ambitious goal of tackling the three killer diseases in developing countries. That's one reason why a master fundraiser like Gupta may have been put at the helm of the fund. Says Ambassador Mark Dybul, the US government's Global aids Coordinator responsible for implementation of the President's Emergency Plan for AIDS Relief (PEPFAR): "It's very important for the Fund to get the expertise of private sector in terms of accountability, transparency and result-orientation. Besides, Rajat's presence should increase funding from the private sector." Gupta's visit to the Oval Office (mentioned earlier in the story) was part of his attempt to lobby for greater governmental allocations to the Fund under PEPFAR.

Leading from Behind

Coming back to the question, how does Gupta do it? How is he able to bring together a diverse set of people to make things happen? Apparently, by leading not from the front, but behind. His preferred way of working, be it at McKinsey or in the social sector, is to create a vision and assemble the team required to achieve it. That's what he did way back in the late 70s at McKinsey's "boon dock" office in Scandinavia-in four years, he grew the office from a 20-person outfit to a roaring, 160-people centre. "To this day, our competitors find it hard to compete with us in that region," says Ron Daniel, 77, the man who hired Gupta 34 years ago at McKinsey and Senior Partner Emeritus. Needless to say, the Scandinavian stint proved to be a turning point in Gupta's career at the firm. Adds Ian Davis, McKinsey's Managing Director worldwide: "Rajat is extraordinarily competent, (but) he's also a very calm and patient person."

Henry 'Hank' Paulson
US Treasury Secretary

Yet, Gupta is so unlike the stereotypical consultant that it's a wonder he managed to become McKinsey's Managing Director at all or the global networker that he is. For instance, he doesn't play golf and he doesn't socialise with most of his associates outside of work. Heck, despite his 36 years in the us and American passport, he doesn't speak English with an accent (it's more a neutral accent). "But that's him," says Shiv Nadar, Founder and Chairman of HCL and a close friend of Gupta. "At his home (in Stamford, Connecticut), for instance, he likes to be in his kurta-pajama and eat Bengali food just like any other Bengali." Even when it comes to his philanthropic work, says Nadar, who has donated to both ISB and PHFI, it's never about himself. He merely plays the role of a facilitator. "My admiration for Rajat Gupta arises partly from his exceptional combination of professional excellence, humane priorities, and his great ability to provide social leadership in making much-needed changes in India," says Nobel Laureate Amartya Sen, who is on the board of Gupta-founded social sector non-profit, American India Foundation. "It's hard to think of anyone else at all with the same combination of remarkable qualities."

The rare criticism against Gupta actually comes from his wife of 34 years, Anita, two years his junior at IIT Delhi. "He tends to take on too many commitments. He doesn't know how to say 'no'," says the woman who's had to bring up their four daughters. Does Gupta aspire for a Bharat Ratna or, perhaps, the Nobel Prize? "I have no expectations. I truly believe in what the Gita says about doing what you can and must do and not expecting any reward for it," says Gupta.

But given his achievements-and not to forget the names on his Rolodex-it's just a matter of time before some sort of global honour is heaped on him. Just the same, don't expect that to slow him down.

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