Rumblings Among Partners

One morning last fall, Mr. Barton sat in his London office overlooking Piccadilly Circus and discussed the efforts he had made to bring the firm to account. He sat across an ebony table — actually an antique Chinese door — and was surrounded by photographs of his family and Asian dignitaries. Mr. Barton spent 12 years in two Asian countries; his wife, Sheila Labatt, of the Labatt brewing family, is a glass artist who studied her craft in China.

Image Rajat K. Gupta, a former managing director of McKinsey, was convicted of leaking boardroom secrets to the hedge fund manager Raj Rajaratnam. Credit... Timothy A. Clary/Agence France-Presse — Getty Images

To be a McKinsey partner is to be a global citizen. The firm, now 87 years old, had $7 billion in revenue in 2013 and advises everyone from chief executives to heads of state. It was that history and reputation that Mr. Barton felt the need to protect after Mr. Kumar’s arrest.

“I want to retain the heritage of the values-driven, trust-based partnership culture,” he told me. “But I feel we have to modernize and strengthen it by using some of the cutting-edge technologies and behavioral techniques out there.”

One of the first initiatives he championed in 2010 met with stiff resistance from some of McKinsey’s top partners. A new personal investment policy would prohibit employees of the firm and members of their households from trading in securities of any of the firm’s clients. It would also require consultants, regardless of rank, to complete online tutorials on sensitive subjects like investing.

McKinsey’s United States partners, who had seen pictures of Mr. Kumar being paraded in handcuffs, needed little convincing about the need for new policies. But McKinsey’s European partners were angry. In the past, McKinsey consultants were free to trade in stocks of client companies so long as they did not serve those clients personally or have material, nonpublic information about them. Almost as soon as top partners in Europe got wind of the new policies, they began bombarding Mr. Barton with emails and cornering him in the hallways.

“How childish it is that we have to pass a test,” Mr. Barton recalls one colleague saying to him. “Is that what adults do?” Mr. Barton held firm, but says that the partner didn’t back down, either, saying: “You are reminding me of what it was like in Eastern Germany when the Stasi was checking.”

Larry Kanarek, McKinsey’s director of professional standards, a position created by Mr. Barton in 2010, said critics had concerns about efficacy and trust. “Is this really going to stop anything? We are not here for show. We are not comfortable voting for something unless you can show me it actually deters bad behavior,” is how Mr. Kanarek characterized their objections.