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Business News/ Opinion / Online-views/  Lessons in Rajat Gupta’s phone call
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Lessons in Rajat Gupta’s phone call

Lessons in Rajat Gupta’s phone call

Guilty? : Gupta is accused of insider trading.Photo by Ramin Talaie/Bloomberg Premium

Guilty? : Gupta is accused of insider trading.Photo by Ramin Talaie/Bloomberg

There is a Sanskrit saying that I grew up hearing, Vinasha kaleshu viparitha buddhi. My grandfather used it to sketch out doomsday scenarios, the idea being that as one’s doom approaches, one’s mind works perversely like Ravana when he kidnapped Sita or Duryodhan before the Mahabharat. What fascinated me was the corollary. If your mind works perversely in bad times, can you avert the bad times by adjusting your mind and your behaviour? The original phrase is not predictive. It is fatalistic and talks about a certain doom. But could it be watered down somewhat and applied predictively to prevent mistakes? Let me explain.

Also Read | Shoba’s previous Lounge columns

Why would a person who has spent a lifetime and a stellar career keeping client confidences break off from a board meeting to make a call to a hedge fund manager? If it was a misstep, could he have somehow intuited it and stopped himself? Perhaps he was simply returning a phone call that he didn’t need to at that moment? Could he have realized that his mind was playing perverse tricks on him; that he was making avoidable mistakes?

Guilty? : Gupta is accused of insider trading.Photo by Ramin Talaie/Bloomberg

I don’t follow astrology, but I don’t dismiss it either. Astrology claims to let us know when we are going through bad times and offers palliative measures such as wearing certain gemstones. But you don’t need astrology for that. Each of us can tell when we are going through a bad period. Most of us blame others or external events for our misfortunes and in many instances, that is the case. Corporate lobbyist Niira Radia didn’t know that her phone calls were being tapped and even adding that numerological extra “I" to her name didn’t prevent it. The flip side is that wrong-doing, at least in the case of usually honourable people, can begin with an honest mistake that then snowballs out of control. It is possible to catch this snowball to face up to your mistakes, but that takes attention, courage, and a certain amount of wisdom. You could withdraw, publicly admit wrong-doing and change your actions. This, to me, is the most compelling idea in that ancient Sanskrit phrase, and indeed in all of astrology: predictive prevention. Change your behaviour and change future events. US presidential history is rife with examples of powerful men who were going through a bad phase and compounded it through their actions—Nixon’s Watergate cover-up; Clinton’s denials about Lewinsky; Reagan during the Iran-Contra affair. During bad times, your mind behaves perversely. These men could have changed history, and prevented their own downfall, had they caught themselves, as Obama did in the aftermath of his pastor Jeremiah Wright’s inflammatory rhetoric.

Although I have admired him from afar, I have encountered Gupta only twice. The first was eight years ago at the home of a friend who threw a book party for me, and had invited the entire “Westchester set", as we called the CEOs and industry titans who lived in Westchester County, New York. Gupta was there, as was PepsiCo head Indra Nooyi with her husband and daughters, as was the wife of Berkshire Hathaway’s Jain. Dressed in relaxed Sunday slacks, Gupta was charming and gracious to me, a novice author.

The second time was two weeks ago, in Bangalore. I spotted him at the VIP enclave in the Chinnaswamy Stadium at the start of the England-India cricket match that ended in a tie. Gupta was with Parag Saxena, with whom he co-founded New Silk Route Partners, an Asia-focused growth capital fund. Gupta looked as dapper and distinguished as ever. If he was worried about what would transpire the following week, he didn’t show it.

The coming weeks will reveal exactly what the US Securities and Exchange Commission (SEC) knows about this case. In his letter to the ISB, Gupta has stated that there are no transcripts of his conversation with Rajaratnam and that relations between him and the hedge fund manager were “strained" because he had lost his entire $10 million (around Rs45 crore) investment in one of the hedge funds run by Galleon. Gupta will defend himself “vigorously", and may come out innocent. But in the cut-throat world of global business, he has already been tainted by association and that will affect the rest of his life.

To me, the most haunting question is this: Was this whole thing preventable? If Gupta had caught himself acting out of character (the whole “perverse mind" syndrome that the verse describes), could he have stopped himself from making that phone call? Or does the lure of power and money change people in a fundamental way? Of the two, the latter is the scarier scenario.

For his sake and for India’s, Shoba Narayan hopes that Rajat Gupta is proven innocent. Write to her at

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Published: 10 Mar 2011, 01:21 AM IST
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