The conviction of former Goldman Sachs Group board member, Mr Rajat Gupta, in the Galleon Hedge Fund case in the US has come as a setback to the Indian School of Business here.

Mr Gupta, one of the co-founders of the B-school and its chairman for ten years, was convicted on charges of insider-trading. It has taken ISB by surprise as the B-school has been a strong supporter of Mr Gupta throughout the case.

He stepped down from chairmanship of the premier business school in March 2011 soon after he quit as director of some other corporations, including Genpact and New Silk Route (a venture fund he had co-started) earlier.

There was lot of sympathy for him then. “Mr Gupta, to my mind, has not been involved in any scam. He is only facing an administrative action,” was how the Godrej Group Chairman, Mr Adi Godrej, described it immediately after he replaced Mr Gupta as the ISB chairman in April last year.

But on Saturday, when Mr Gupta became the talk of the school, Mr Ajit Rangnekar, its Dean, was ‘unavailable' for comment.

An official spokesperson of the ISB told Business Line: “We have heard of the court verdict. It is disappointing for all of us who have known Rajat. But finally, one must respect the verdict.”

“ I am worried about his conviction because it dents not only ISB's image but the country's image as well ,” an ISB student told Business Line.

The founder of Matrix Laboratories, Mr Nimmagadda Prasad, stepped down from the ISB's executive board last month after his arrest by the CBI in an alleged illegal assets case pertaining to the Kadapa MP, Mr Y. S. Jaganmohan Reddy. Mr M. Rammohan Rao, a former ISB Dean, too had to step down after his alleged involvement in the Satyam Computer Services scam of 2009.

(This article was published on June 16, 2012)
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