Government Monitors Boardroom Rift
Sources close to the Tata Group told CNBC-TV18 that the government is closely monitoring the situation and may intervene if the dispute threatens the stability of Tata Sons, the group’s principal holding company. Officials described the internal friction as a “coup attempt” by four trustees, signaling a serious challenge to Noel Tata’s authority within the Trust.
The disagreement centers on board appointments and control mechanisms within Tata Sons. A faction of four trustees – Darius Khambata, Jehangir HC Jehangir, Pramit Jhaveri, and Mehli Mistry – is reportedly acting as a “super board”, creating friction and undermining the influence of other trustees, including Noel Tata. These differences have raised concerns about potential disruptions to the functioning of the $180-billion conglomerate spanning around 400 companies.
Recent Flashpoints
Some key triggers include an equity infusion of Rs 1,000 crore by Tata Sons into Tata International, chaired by Noel Tata, to cover losses. Additionally, suggestions to create a deputy managing director position at Tata Sons and appointments to the board have further heightened tensions. Trustee Mehli Mistry also objected via email to the reappointment of independent director Anita George without prior consultation, emphasizing collective trustee authority.
Upcoming Board Meeting
The Tata Trusts board is scheduled to meet on October 10. Sources indicate the meeting will address philanthropic activities worth Rs 1,000 crore and is not directly related to recent tensions. Government officials have been engaging with both sides to ensure the dispute does not spill over into Tata Sons’ operations.
Expert Commentary
Governance experts note that disputes within influential shareholder groups can significantly impact corporate decision-making and investor confidence. Tata Sons, which oversees some of India’s most prominent companies, could experience operational and strategic setbacks if internal conflicts are not resolved promptly.