BREAKING NEWS

Trying to Loosen Things Up

(TIME) -- Executives' walls are being replaced with glass panels at the Park Avenue headquarters of The Blackstone Group, one of the U.S.'s premier private investment and advisory firms. That's because Hamilton James, 52, who stepped into the firm's No. 3 position a year ago from Credit Suisse First Boston, wants to encourage "openness and connection, that we're all in this together" -- the kind of culture he remembers from his 25 years at investment firm Donaldson, Lufkin & Jenrette. Blackstone is a powerhouse, with $14 billion raised for private-equity investment, including a recent move into the pub division of British beermaker Scottish & Newcastle. It has also raised $4 billion for real estate investment and claims a top-tier restructuring advisory group that counts Enron and Xerox among its clients.

As Blackstone tries to achieve its next goals -- expanding in Europe, beefing up its mergers-and-acquisitions practice and adding new businesses -- it will need the guiding hand of a manager like James. Some believe that James, whose average-guy nickname, Tony, fits his amiable demeanor, is next in line for the CEO job, though current CEO and president Stephen Schwarzman, who co-founded the firm, is just four years James' senior. For now at least, Schwarzman's office has kept its walls.

-- By Barbara Kiviat/New York