Govt likely to mediate as feud within Tata Trusts escalates into governance crisis at Tata Sons
Mumbai: The government is preparing to step in amid rising tensions within Tata Trusts, the controlling shareholder of Tata Sons, as internal disputes have snowballed into a governance crisis, Financial Express reported, citing several media reports.
Tata Trusts Chairman Noel Tata and Tata Sons Chairman N Chandrasekaran were scheduled to meet cabinet ministers and senior government representatives on Monday (October 7), the report said, quoting CNBC-TV18.
The discussions are aimed at addressing concerns that the growing discord among trustees could affect the functioning of Tata Sons and, consequently, the broader Tata Group.
Listing roadmap, board discord at the centre
The dispute revolves around two major issues — resolving internal differences within Tata Trusts to ensure stability at Tata Sons, and drawing up a roadmap for Tata Sons’ eventual public listing.
The Reserve Bank of India had classified Tata Sons as an “upper-layer” non-banking financial company (NBFC) three years ago, a status that makes public listing mandatory.
Email exchange deepens rift
The situation reportedly worsened after an email exchange among trustees hinted at the possible removal of Tata Sons board member Venu Srinivasan, similar to the earlier ouster of former Defence Secretary Vijay Singh as nominee director.
Officials cited by The Economic Times said the communication triggered apprehensions of an attempt to “hijack Tata Sons” and consolidate power within a limited group of trustees, according to the report.
Governance lapses cited
The CNBC-TV18 report also highlighted recent instances viewed as “serious corporate governance lapses”, including efforts to influence the appointment of independent directors shortlisted by Tata Sons’ Nomination and Remuneration Committee (NRC) and alleged interference in board minutes, the report said.
Trustees accused of forming “super board”
The trustees reportedly leading the dissent — Darius Khambata, Jehangir HC Jehangir, Pramit Jhaveri and Mehli Mistry — have been accused of functioning as a “super board” and undermining Noel Tata’s leadership, according to the CNBC-TV18 report.
Govt seeks to defuse tensions
The Tata Trusts board is set to meet on October 10. The government is attempting to calm tensions before the internal feud spills over into Tata Sons’ management and disrupts the operations of the wider Tata Group.
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