Ratan Tata may soon resign as chairman of Tata Trusts; succession plan in process

While Tata group is in the midst of holding extra ordinary general meetings (EGMs) of several group companies over the next one week to dispel the ousted chairman Cyrus Mistry as director from these firms, media reports suggest that Ratan Tata could resign as chairman from Tata Trusts. The Tata Trusts controls 66 percent in Tata Sons, which is the holding company of the Tata Group. Speaking to Times of India, R K Krishna Kumar, a veteran with Tata group and long-time aid of Ratan Tata, said the process to induct a new chairman of Tata Trusts could be complement by June next year with the advise from an external consultant. [caption id=“attachment_3101132” align=“alignleft” width=“380”]  Ratan Tata, current chairman, Tata Trusts[/caption] On being asked, if the new chairman will be a Parsi or a member associated with the Tata family, Kumar said the new incumbent will be an Indian, and not necessarily a Parsi, the TOI report said. In an interview with financial daily Business Standard, Krishna Kumar said the group has been discussing a succession plan for Tata Trusts, even before the current imbroglio started in late October. “Yes, only two months before the imbroglio, we had discussed putting a successive plan for the Trusts in place. It is in the process,” said Krishna Kumar in an interview with BS. The role of the Trusts has been at the centre of the ongoing feud between Tata and Tata Sons’ ousted Chairman Cyrus Mistry. Tata Trusts and Tata Sons were not immediately reachable for comment on the Times of India report. “The next chairman has to be someone who has the right vision and be in complete alignment with the will of the Tata Group founders,” said Krishna Kumar, a group veteran and a trustee of the Tata Trusts, according to the report. He added that Tata’s successor at the Tata Trusts could be an external person even though the current trustees are free to suggest potential candidates, the report said. In public letters to group company shareholders, Mistry has said the trustees abused their position by calling for information and seeking discussions on matters they considered material and dictating Tata Sons’ decisions using veto right of their nominee directors. Tata Sons has rejected those claims, and has blamed Mistry for governance lapses. With inputs from Reuters