 "Noel Tata, the 67-year-old, has been appointed as the Chairman of Tata Trusts. This comes a day after the last rites of former Tata Sons Chairman Emeritus Ratan Tata. File image/PTI")
Millions continue to grieve as the country bid adieu to the former chairman of the Tata Group, Ratan Tata, who breathed his last on Wednesday night at the Breach Candy Hospital in south Mumbai. The mortal remains of the 86-year-old were consigned to flames after the Maharashtra government accorded him a state funeral, acknowledging his countless contributions to the world of business and philanthropy.
But away from the emotions and the grief, the question that emerged was: Who would head Tata Trusts, the charitable entities that hold the key to the sprawling empire that is known as the Tata Group? After all, the 86-year-old Ratan Tata didn’t leave a succession plan in place — not that one is known of.
And on Friday (October 11) that was answered when the Tata Trusts unanimously elected Noel Tata as the chairman_._
But why is it that people are talking about the Tata Trusts? What influence does it exert on the Tata empire? And who is Noel Tata? We get you the answers.
Who is Noel Tata
Initially, the choice was between Tata Trusts trustees Noel Tata, former Defence Secretary Vijay Singh and Venu Srinivasan of the TVS Group — the latter two being vice-chairmen of the Trusts. However, Noel Tata, Ratan Tata’s half-brother, edged out the others.
The 67-year-old was made trustee of the Sir Ratanji Tata Trust as late as 2019 and of the Sir Dorabji Tata Trust in 2022. A source speaking to The New Indian Express earlier said, “He (Noel) is from the Tata family which carries a lot of trust and faith, and two, he has long years of experience in working with the trusts and thirdly, Tata Sons also have to look at the Parsi community’s sentiment for the Tata name. All these, I believe have him leading the trust soon.”
And it seems this statement held true.
Noel, the 67-year-old, has been the chairman of Trent Ltd, Tata International Limited, Voltas & Tata Investment Corporation and the vice chairman of Tata Steel and Titan Company Limited. He has been associated with the Tata group for 40 years.
As managing director of Tata International Limited, the trading and distribution arm, Noel grew the company from having a $500 million turnover to over $3 billion between August 2010 and November 2021.
Noel was also considered a likely candidate to take over as chairman of Tata Sons in 2012 when Ratan Tata stepped down. However, at the time, he was passed up for Cyrus Mistry, who was Noel’s brother-in-law.
Many believe that Singh and Srinivasan were strong contenders. However, because historically only Parsis have headed the Trusts, even if they were not directly related to the Tata family, their chances were slim.
Tata Sons, Tata Group and Tata Trusts
But how does Tata Trusts connect to Tata Sons?
The Tata Sons is the holding company and promoter of Tata Group, which has hundreds of companies under it. There’s also the Tata Trusts which has several foundations under it. At the heart of the Tata Trusts are two entities — Sir Ratan Tata Trust and Sir Dorabji Tata Trust, named in memory of Sir Jamsetji Tata’s sons. For the unaware, Sir Jamsetji was Ratan Tata’s great-grandfather while Sir Ratan Tata was his grandfather and Sir Dorabji was his granduncle.
Constitution of the Trusts and power it wields
The combined Tata Trusts own nearly 66 per cent of Tata Sons. The two Trusts comprise 13 trustees, with five being common to both. These five are former defence secretary Vijay Singh, Venu Srinivasan of the TVS group, Ratan Tata’s half-brother Noel Tata, businessman Mehli Mistry and lawyer Darius Khambata.
The others are former Citi India CEO Pramit Jhaveri at Sir Dorabji Tata Trust, Ratan Tata’s younger brother Jimmy Tata and Jehangir Hospital CEO Jehangir H C Jehangir at Sir Ratan Tata Trust.
On Friday (October 11), these members convened to choose amongst them the chairman of the Tata Trusts, a post that Ratan Tata held under his demise. This position will wield significant power over the entire group. This is because the Trusts own such a large stake in Tata Sons. Also, the laws of the group allow the two main trusts to nominate one-third of the directors to Tata Sons and act as the final authority of appointment and removal of all directors.
Notably, this power given to the two Trusts comes out of rules that Ratan Tata made in 2012 when he retired as Tata chairperson. This was only made possible after the government of India brought about changes in the Companies Act, which then permitted Tata Trusts to vote directly on the Tata Sons Board.
Now, Noel Tata has a tough road ahead. He will have to maintain a balance between the Tata Trusts and Tata Sons.
With inputs from agencies