Tata Trusts chair Noel Tata has reportedly floated a new leadership structure for Tata Sons, suggesting that the role of chairman be split into three positions—chief executive officer, managing director (CEO and MD), and deputy CEO — Mint reported. Currently, Tata Sons is led solely by chairman Natarajan Chandrasekaran, whose term is scheduled to end in 2027. However, the plan has reportedly stalled after resistance from some trustees.
Trustees favour third term for Chandrasekaran despite age cap
According to Mint, Noel reportedly doesn’t want Chandrasekaran to continue as chairman at Tata Sons after his current five-year term ends in 2027. Whereas he proposes him to continue as non-executive chairman alongwith other titles.
The trustees, however, are against his decision and want him to be granted a third term as Tata Sons chair. This despite him crossing the retirement age cap of 65 in 2027.
“So, essentially, the discussions centered on whether the current chair should continue as non-executive chairman after the completion of his term in 2027, and a managing director from a Tata group company should take over as the Group CEO. A deputy CEO position was also to be created,” the executive told Mint.
“But the discussions ended as we believed there is merit in giving the chairman a fresh five-year term. The growth of Tata Sons has been commendable, and a lot of investments in newer areas have been made, which need time,” he added, according to Mint.
Chandrasekaran’s leadership in Tata Sons
Since taking over in February 2017, Chandrasekaran has overseen Tata Sons’ turnaround, reducing debt by over Rs 30,000 crore and helping several group companies, such as Tata Steel and Tata Motors, return to profitability. He also spearheaded investments in emerging areas like digital, aviation, and semiconductors.
Chandrasekaran’s journey within the Tata Group spans over three decades. He joined Tata Consultancy Services (TCS) in 1987 and rose through the ranks to become its Chief Executive Officer and Managing Director (2009–2017). Under his leadership, TCS emerged as India’s most valuable company and one of the world’s leading IT services providers.
Besides Tata Sons, Chandra chairs the boards of several key Tata companies, including Tata Steel, Tata Motors, Tata Power, Air India, Tata Consumer Products, and Indian Hotels. He also leads Tata Digital, Tata Electronics, Agratas Energy Storage Solutions, and the B20 Global Institute, among others.
Tata Trusts retain decisive role in Tata Sons governance
Tata Trusts has significant influence over Tata Sons, as it holds a majority stake (65.9%) in the company. Noel Tata took charge of Tata Trusts after the death of Ratan Tata last year.
The permanent trustees of Tata Trusts include TVS Motor Co. chair emeritus Venu Srinivasan, retired defence secretary Vijay Singh, businessman Jehangir H. C. Jehangir, Jimmy N. Tata, Mehli Mistry, former Citibank India CEO Pramit Jhaveri, and lawyer Darius Khambata.
Tata Sons, on the other hand, has six board members. Tata Trusts has the power to nominate up to one-third of the board. The Tata Sons board currently includes chairman Chandrasekaran, two Tata Trusts nominees—Noel and Srinivasan—Group CFO Saurabh Agrawal, and independent directors Harish Manwani and Anita Marangoly George.
Financial Express.com has written to Tata Group seeking a clarification on the issue is awaiting their response