RAJAT GUPTA

22 de Agosto , 2 0 1 9
Luis Diego Prado

LO:GO
 1
Rajat Gupta, corporate director at Goldman Sachs (and once
at Mckinsey).

2 Found guilty of 3 securities frauds and of relaying confidential

Goldman Sachs boardroom information to hedge fund titan
Rajaratnam at Galleon Group

Caught via government-placed wiretaps listening to

BACKGROUND 3 Rajaratnam and Gupta discussing Warren Buffett's Berkshire
Hathaway Inc.’s $5 billion investment and Goldman Sachs’s
first quarterly loss.

4 Rajaratnam bought Goldman Sachs shares for profit.

55 Found guilty of 3 securities frauds and of relaying confidential

Goldman Sachs boardroom information to hedge fund titan
Rajaratnam at Galleon Group..
 3
Mandate
Identifying the primary problems

¿Would a virtuous person have leaked the

information to Raj Rajaratnam? Rajat Gupta
showed a failure of character:

Análisis Externo Análisis Interno Alternativas Solucion Implementación Conclusión

 4
Ethical Analysis

Honest Integrity
He was not honest- with Goldman -
Sachs and his fellow board members Rajat Gupta does not show integrity
to whom he implicitly promised not to to his company Goldman Sachs,
Self- where he was a Board of Director.
share inside information. Control Instead gives away insider
If Rajat Gupta had self-control information for personal benefits.
he would not have leaked
inside information to
Rajaratnam for personal gain.
.

Fairness Trust
Rajat Gupta broke. the trust to other
Rajat
. Gupta’s actions
- are not fair for two - .
Directors on Goldman’s board and to
reasons. First, other investors who do not have
of other people with whom he has
the information on Buffett’s deal are at a
done business. His actions affect the
disadvantage. Second, he uses the information
relationship with McKinsley &
entrusted to him to benefit himself and
Company.
Rajaratnam.
 Analysis

Type of Ethical Problem: Duty and character

Duty Character-Based
• Boardroom information is meant • He was an advisor.
to remain confidential (unless
company has a specified reason • If he was higher up, this scandal
for disclosure). could have cost employees their
jobs.
• Breaching of rules has affected
trust in Goldman Sachs. • He was supposed friends with
Rajaratnam – may have done
• Rajat is a face of the company. this because of that if he was
truly at fault.
• He was an advisor who can no
longer fill his role.
 Insider Training 6

Causes of the Problem

• The moral problems connected with insider information

concern the use that individuals may make of such
information while they are still members of the firm.

Two aspect of the problem

One is that of some one within the firm using information for his
1 or her private gain, at the expense of the firm. This is called
conflict of interest

The other is the use of insider information by someone within a

2 firm advantage over those not in the firm.

Análisis Externo
EXTERNAL ANALYSIS AnálisisANALYSIS
INTERNAL Interno Alternativas
ALTERNATIVES Solucion
SOLUTION Implementación
IMPLEMENTATION Conclusión
CONCLUSION
 Who Is Affected by Insider Trading?

01. The insiders 02.Market 03.Liquity 04. Investors

professionals traders • Small or large shareholders
• Officers, directors, and other
key employees of a firm • Informed non insiders, • Sometimes referred to as
including securities analysts, “noise” traders, are
brokers, or arbitrageurs, short-term stock market
participants
 WHY RAJAT GUPTA IS CONVICTED
OF THIS INSIDER TRADING

Authority to sit in board meetings and access to

1 confidential information in premier American
companies.

Passed non-public information to GALLEON Group

2 president Raj Rajanatnam.

Total profits from illegal trade tuned up to $ 17.5 mn

3
 Example

• Insider trading where a company director knows that the company is in a bad financial state and
sells his shares in it knowing that in a few days time this news will be made public together with an
announcement of a cut in dividend payment.

• Likewise, the director would be insider dealing if, on being informed before it was generally known
by the public, that the company has discovered oil or gold on its own land, he bought more shares
in the company in the not unrealistic expectation of an increase in their market value as a result of
the subsequent public announcement.
 10

Earning money is good, but not enough: you have to look for
Memebers and personal improvement at the same time

stakeholders The company is like a big man: if people seek to promote

their own improvement and that of others, companies also
The link with the company is
establishes based on the Tf we focus the company solely on the generation of
contribution that wealth, we will stop taking advantage of personal growth
does each one and human dignity
 • He was sentenced to two years in prison after
being found guilty in 2012 of passing confidential
boardroom information about Goldman Sachs to
then hedge fund founder Raj Rajaratnam, who is
COOPERATION
TO EVIL
currently serving 11 years in jail for insider
trading.

• Gupta disappoint
• Gupta was commended by
people who knew him as a SOLIDARITY
Ethical PROXIMITY
many people for all
the action he makes
person who helped others. principles
He was very active in
providing medical and
humanitarian relief to the
developing countries.

In practice, all actions cause pernicious

COLLATERAL
DAMAGE damages, but they must be: Compatible
with equity and no damage is chosen as an
end or as a means for further good.
 Deontological and Virtue 12

Ethics/Recommendation
Business associations between people empathizing with each other can be catastrophic.
enhanced corporate governance, and increasing the awareness of customers.

Consult the rest of your board before taking any action.

A person´s hardships are not are not be considered against their crime.

Include tighter government regulations, better systems and

processes in financial institutions

EXTERNAL
Análisis ANALYSIS
Externo INTERNAL
AnálisisANALYSIS
Interno ALTERNATIVES
Alternativas SOLUTION
Solucion IMPLEMENTATION
Implementación CONCLUSION
Conclusión
 CONCLUSION 13

Rajat Gupta case is a message to business leaders and

managers to study ethics and establish a clear ethical
framework for their business to live by. By upholding
strong business values and engaging in cooperate social
responsibility, business can strengthen their reputation and
trustworthiness and will ultimately be more sustainable in
the long run.

INFOGRAPHICS | TEMPLATE
 14

Thank you
 16
Industry analysis

Vdsgds
Highlighted

Analisis Externo Análisis Interno ALTERNATIVES SOLUTION IMPLEMENTATION CONCLUSION

 LIFE CYCLE OF THE COMPANY 17

The company is in the maturity stage, it is important to implement an effective strategy that encourages the consumer to purchase in order that the
Highlighted
I N F O G R A P H I Ccompany
S | TEMdoes
P L not
ATE reach the decline.

Análisis Externo Análisis Interno Alternativas Solución Implementación Conclusión

 18
M
A
T
R
I
X

B
C
G

INFOGRAPHICS | TEMPLATE
SWOT ANALYSIS Strengths
19

Analyzing internal factors • Unprecedent year-to year sales growth

• Focus on R&D and Innovation
• Focus on quality and design

Opportunities Threats
• The entry Of Chinainto the World Trade • The new trends of customers.
• Organization. • Many companieschange ther focus to winning in the
• emerging markets

Weaknesses
• Economic disaster

• .

Análisis Externo Internal Analysis Alternativas Solución Implementación Conclusión

SWOT DIAGRAM 21

Agressive Differentiation,
innovation.

Exploitation Defensive

After the analysis, it can be seen that the company has strengths that give it the ability to take advantage of existing opportunities, defending
Highlighted
weaknesses and threats through the differentiation and innovation.

Análisis Externo
EXTERNAL ANALYSIS Análisis Interno
INTERNAL ANALYSIS Alternativas
ALTERNATIVES Solución
SOLUTION Implementación
IMPLEMENTATION Conclusión
CONCLUSION
 22
4 P´s Analysis
Current situation of the company

Product Price
— --
IMPROVE KEEP

Product Price

Place
Promotion
iMPROVE —

Place Promotion
IMPROVE

EXTERNAL ANALYSIS
Análisis Externo INTERNAL
Análisis ANALYSIS
Interno ALTERNATIVES
Alternativas SOLUTION
Solución IMPLEMENTATION
Implementación CONCLUSION
Conclusión
 POSITIONING MAP

Innovation
Market share

Análisis Externo Análisis Interno Alternativas Solución Implementación Conclusión

 POSITIONING MAP

Innovation
r

Market share

Análisis Externo Análisis Interno Alternativas Solución Implementación Conclusión

Análisis Externo Análisis Interno Alternativas Solución Implementación Conclusión
 CONSUMER ANALYSIS
CONSUMER: AGE INCOME ACTIVITIES

USE:
LOOK FORWARD:

Highlighted
INFOGRAPHICS | TEMPLATE
Análisis Externo Análisis Interno Alternativas Solución Implementación Conclusión
 27
Financial Analysis
Analyzing the actual situation

Análisis Externo
EXTERNAL ANALYSIS Análisis ANALYSIS
INTERNAL Interno Alternativas
ALTERNATIVES Solución
SOLUTION Implementación
IMPLEMENTATION Conclusión
CONCLUSION
 ALTERNATIVES 28

Qualitative Analysis

Alternatives

0: Bad
5: Excellent

Key decision
Weight Score Calification Score Calification Score Calification
factors

50%

30%

20%

TOTAL 0.2 3.05 2.95

Análisis Externo
EXTERNAL ANALYSIS Análisis
INTERNAL In
ANALYSIS Alternativas
ALTERNATIVES Solución
SOLUTION Implementación
IMPLEMENTATION Conclusión
CONCLUSION
 ALTERNATIVES 29

Qualitative Analysis

Alternatives

0: Bad
5: Excellent

Key decision
Peso Score Calification Score Calificatión Score Calificatión
factors

50%

30%

20%

TOTAL 0.2

Análisis Externo
EXTERNAL ANALYSIS Análisis
INTERNAL In
ANALYSIS Alternativas
ALTERNATIVES Solución
SOLUTION Implementación
IMPLEMENTATION Conclusión
CONCLUSION
 Short term- 30

Reinforcement
Steps

----

Análisis Externo
EXTERNAL ANALYSIS Análisis ANALYSIS
INTERNAL Interno Alternativas
ALTERNATIVES Solución
SOLUTION Implementación
IMPLEMENTATION Conclusión
CONCLUSION
 31

Target group Product line

Millennial

Generation X

Baby Boomers
 Medium term- 32

Optimization
Steps
----

Análisis Externo
EXTERNAL ANALYSIS Análisis ANALYSIS
INTERNAL Interno Alternativas
ALTERNATIVES Solución
SOLUTION Implementación
IMPLEMENTATION Conclusión
CONCLUSION
 Marketing plan for 33

every segment

Análisis Externo
EXTERNAL ANALYSIS Análisis ANALYSIS
INTERNAL Interno Alternativas
ALTERNATIVES Solución
SOLUTION Implementación
IMPLEMENTATION Conclusión
CONCLUSION
 Long term- 34

Consolidation
Steps
----

Análisis Externo
EXTERNAL ANALYSIS Análisis ANALYSIS
INTERNAL Interno Alternativas
ALTERNATIVES Solución
SOLUTION Implementación
IMPLEMENTATION Conclusión
CONCLUSION
 35
Timeline
How long would it take?

Análisis Externo
EXTERNAL ANALYSIS Análisis ANALYSIS
INTERNAL Interno Alternativas
ALTERNATIVES Solución
SOLUTION Implementación
IMPLEMENTATION Conclusión
CONCLUSION
 36
COST
How much will it cost?

Primary investment:

Análisis Externo
EXTERNAL ANALYSIS Análisis ANALYSIS
INTERNAL Interno Alternativas
ALTERNATIVES Solución
SOLUTION Implementación
IMPLEMENTATION Conclusión
CONCLUSION
 37
Financial Impact
How will it benefit us?

Highlighted

v
EXTERNAL ANALYSIS INTERNAL ANALYSIS ALTERNATIVES SOLUTION IMPLEMENTATION CONCLUSION
 38
Risks and solutions
Risk Probability Importance Solution How

High Average

Low High

Average High

Análisis Externo
EXTERNAL ANALYSIS Análisis ANALYSIS
INTERNAL Interno Alternativas
ALTERNATIVES Solución
SOLUTION Implementación
IMPLEMENTATION Conclusión
CONCLUSION
 39

Decision factors for this strategy: