Anil Kumar

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This article is about the business leader. For other people named Anil Kumar, see Anil Kumar (disambiguation).
Anil Kumar
Born 1958
Chennai, Tamil Nadu, India
Residence New Delhi, India
New York City, NY, USA
Saratoga, CA, USA
Ethnicity Indian-American
Citizenship United States
Alma mater Doon School
IIT Bombay
Imperial College London
The Wharton School
Occupation Consultant, Management expert
Years active 1986-2009
Employer McKinsey & Company, Inc.
Known for Knowledge Process Outsourcing
Business Process Outsourcing
Salary $ 5 - 10 million + (estimate)
Net worth $ 50 - 100 million + (estimate)
Title (Former) Senior Partner
Spouse Malvika
Children 1

Anil Kumar (born 1958) was a longtime top senior partner and director at management consultancy McKinsey & Company, the co-founder of the Indian School of Business with Rajat Gupta, and the creator of two different types of outsourcing. He graduated from The Doon School and the Indian Institute of Technology Bombay in India, Imperial College London in the UK, and The Wharton School in the US.

In 2010 he pleaded guilty to insider trading in a dramatic “descent from the pinnacle of the business world.”[1]

Contents

[edit] Career

Kumar was “one of McKinsey’s most senior employees [and] brightest stars,”[2] where he pioneered the concepts of Knowledge Process Outsourcing and Business Process Outsourcing.[3] He was a protégé of longtime former managing director (chief executive) Rajat Gupta,[4][5] though following Gupta's retirement never ran in the elections for chief executive himself.[6][7] Anticipating the rise of India and Silicon Valley, he co-founded (and later directed) McKinsey offices in Silicon Valley in the 1980s and in India in the 1990s. During the dot-com bubble he headed McKinsey's technology and Internet consulting operations, where he and Gupta created a program to allow the firm to accept stock in lieu of consulting fees.[8][9] At McKinsey Kumar was also Chairman of the Knowledge Center and Chairman of the Asia Center.[10][11] He was a director and corporate officer of the firm. He lived and worked from multiple offices in New Delhi, New York, and Silicon Valley, traveling over thirty thousand miles a month.[12][13]

Kumar co-founded the Indian School of Business in 1997, today ranked among the top 15 business schools in the world by The Financial Times.[14][15] He is a member of the Council on Foreign Relations and the Young Presidents' Organization, a founding charter member of TiE, and was the US chairman of India's largest business lobby, the Confederation of Indian Industry.[16]

Criticism of Kumar centered around his close relationship with Gupta and a perception of arrogance. According to The Financial Times, “the two operated as a forceful double-act to secure business for McKinsey, win access in Washington and build a brotherhood of donors around the Hyderabad-based ISB and a handful of social initiatives.” [17] Also, “as much as Mr Kumar was admired for his business ability and sharpness, he also drew fire for what was seen as his arrogance.”[16]

[edit] Galleon case

Main articles: McKinsey insider trading scandal and Relationship with Rajat Gupta

Kumar remained hidden from the media and outside McKinsey until an October 2009 arrest in conjunction with an ongoing and wide-ranging US governmental investigation into insider trading.[18] Former mentor Rajat Gupta was later arrested by the FBI in a related case,[19] prompting inquiries into McKinsey’s senior leadership and business model.[20][21]

As of December 2009, Kumar was no longer at the consultancy.[22] In January 2010 he pleaded guilty to insider trading charges[23] and was the government’s star witness in March 2011 in U.S. v Rajaratnam against his billionaire friend and Galleon Group founder Raj Rajaratnam.[24][25] In the sprawling case his involvement was unusual; according to a Reuters blog, “He’s the only informant who could be considered even more successful than Raj was, at least professionally if not in terms of raw cash. Raj had money, more money than he really knew what to do with, but Kumar had much more societal acceptance and prestige.”[26] He settled with the SEC in May 2010 for $2.8 million, the amount after gains he received from Rajaratnam through a Swiss bank account in a domestic worker's name.[27] Gupta, Rajaratnam, and Kumar were all close friends and had founded the $1.3-billion private equity firm New Silk Route together, though Rajaratnam and Kumar withdrew before the firm began operation.[28]

Kumar was represented by respected attorney Robert Morvillo,[29] who had previously led billionaire Martha Stewart’s defense in her own insider trading case.[30][31]

International media, business, and finance industry observers have analyzed extensively his actions in aiding Rajaratnam.[1][32][33][34] Consensus remains divided on the precise motivators of money, respect, and relationship, with The New York Times asking, “Why would people who seem to have it all — wealth, prestige, powerful jobs and infinite access to others with the same — risk that, and more, to provide inside information to the Sri Lankan-born billionaire?”[35] Rajaratnam's annual payments were estimated at less than 5% of Kumar's annual income (and just 1-2% excluding a one-time bonus), further raising the question of motivation.[36]

[edit] Personal life

Kumar maintained a low personal and professional profile externally, though was friends with other leaders in technology and Indian business such as telecom mogul Sunil Mittal.[28]

He lived and worked for decades in New Delhi, New York, and Silicon Valley simultaneously. He had a Manhattan apartment in the Time Warner Center and a “housekeeper in Saratoga, California.”[13]

[edit] References

  1. ^ a b Pulliam, Susan and Michael Rothfeld. “Motive for Stock Leak Can Be Respect, Love”. The Wall Street Journal. March 14, 2011.
  2. ^ Rushe, Dominic. “McKinsey Jettisons Troubled Star Kumar”. The Sunday Times. December 6, 2009.
  3. ^ McDonald, Duff. “Galleon Scandal Creates Investing Conundrum for Executives”. CNN. October 23, 2009.
  4. ^ Newmark, Evan. “Mean Street: The Disgrace of Rajat Gupta”. The Wall Street Journal WSJ Blogs. March 18, 2011.
  5. ^ Rushe, Dominic. “McKinsey Implicated in Galleon Trial”. The Guardian. March 14, 2011.
  6. ^ Byrne, John. “At McKinsey, the Winner Is…”. BusinessWeek. March 7, 2003.
  7. ^ Stern, Stefan. “McKinsey Turns To Asia Chief Barton for Top Job”. The Financial Times. February 23, 2009.
  8. ^ Leonhardt, David. “Big Consultants Woo Employees by Offering a Piece of the Action”. The New York Times. October 22, 1999.
  9. ^ Helyar, John, Carol Hymowitz and Mehul Srivastava. “Rajat Gupta Secretly Defied McKinsey Before SEC Says Rajaratnam Was Tipped”. Bloomberg Markets Magazine. May 16, 2011.
  10. ^ Bhambal, Juhi. “Knowledge@McKinsey: A Case Study”. Global Services Media. November 30, 2005.
  11. ^ Talgeri, Kunal. “The McKinsey Way”. Outlook Business. May 16, 2009.
  12. ^ Lattman, Peter. “Jury Hears Dozen Taped Calls at Galleon Trial”. The New York Times. March 14, 2011.
  13. ^ a b Packer, George. “A Dirty Business”. The New Yorker. June 27, 2011.
  14. ^ “Anil Kumar Seeks Leave of Absence From ISB Board”. The Economic Times. October 20, 2009.
  15. ^ “The Global MBA Rankings”. The Financial Times. Retrieved March 1, 2011.
  16. ^ a b Masters, Brooke, James Fontanella-Khan and Justin Baer. “McKinsey Partner’s Arrest Casts Shadow”. The Financial Times. October 22, 2009.
  17. ^ "Financials - Elite takes sides as Gupta fights SEC charges". Ft.com. http://www.ft.com/cms/s/0/39076346-49ae-11e0-acf0-00144feab49a.html. Retrieved 2011-05-15. 
  18. ^ de la Merced, Michael. “Hedge Fund Chief Is Charged With Fraud”. The New York Times. October 16, 2009.
  19. ^ Rothfield, Michael, Susan Pulliam and Chad Bray. “Ex-Goldman Director Gupta Charged in Insider Case”. The Wall Street Journal. October 26, 2011.
  20. ^ Gapper, John. “McKinsey Model Springs a Leak”. The Financial Times. March 9, 2011.
  21. ^ Salmon, Felix. “McKinsey's Corrupted Culture”. Reuters. March 9, 2011.
  22. ^ Bray, Chad, “Galleon Figure Kumar No Longer with McKinsey”. The Wall Street Journal. December 4, 2009.
  23. ^ Kouwe, Zachery. “Guilty Plea in Galleon Insider Trading Case”. The New York Times. January 7, 2010.
  24. ^ Rothfeld, Michael and Susan Pulliam. “Calling Miss Manners: Tapes in Galleon Case Show Some Snark”. The Wall Street Journal. March 17, 2011.
  25. ^ Rothfeld, Michael, Susan Pulliam and Chad Bray. “Fund Titan Found Guilty”. The Wall Street Journal. May 12, 2011.
  26. ^ Salmon, Felix. “How to Set Up An Insider-Trading Network”. Reuters. May 12, 2011.
  27. ^ Bray, Chad. “Kumar Settles SEC Charges in Galleon Case”. The Wall Street Journal. May 17, 2010.
  28. ^ a b Scannell, Kara. “Insider Trading Star Witness Challenged”. The Financial Times. March 17, 2011.
  29. ^ SEC v. Galleon. “Notice of Appearance”. Doc 50. November 24, 2009
  30. ^ Smith, Chris. “Can This Man Save Martha?” The New Yorker.
  31. ^ Lattman, Peter and Benjamin Weiser. “Robert Morvillo, Legal Pioneer, Dies at 73”. The New York Times. December 25, 2011.
  32. ^ Jenkins, Holman W. “A Hedge Fund's Neurotic Tipsters”. The Wall Street Journal (editorial). April 23, 2011.
  33. ^ Gapper, John. “Anil Kumar’s Cheap Betrayal of McKinsey’s Soul”. The Financial Times (blog). January 8, 2010.
  34. ^ Kim, Jim. “Life Of A Hedge Fund Informant: Easy Or Nerve-wracking?”. Fierce Finance (blog). March 16, 2011.
  35. ^ Cohan, William D. “Why Is Enough Never Enough?”. The New York Times (blog). April 27, 2011.
  36. ^ Calculation

[edit] Further reading

[edit] External links

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