New Delhi, Sep 18(APAC Media): N Chandrasekaran’s return as Tata Sons chairman has opened a fresh governance issue within the Tata Group.
The Tata Sons board has approved Chandrasekaran’s reappointment for another five-year term, despite opposition from Noel Tata, chairman of Tata Trusts. Chandrasekaran’s current term is scheduled to end on February 20, 2027.
Why Noel Tata Opposed The Reappointment
Chandrasekaran had told the Tata Sons board on August 12 that he did not plan to seek another term. Noel Tata said the decision was made by Chandrasekaran himself and was not requested by the board.
According to Noel Tata, Tata Trusts had accepted Chandrasekaran’s decision after it was made public. He argued that the company should now proceed with the succession process rather than reverse the earlier decision.
Tata Trusts’ Role In Tata Sons
Tata Trusts owns about 66% of Tata Sons, giving it a significant shareholder position in the group’s holding company. While the trusts do not manage the Tata Group’s daily operations, their stake gives them an important role in major decisions concerning Tata Sons.
Noel Tata said the board’s latest decision effectively overturned Chandrasekaran’s earlier decision and the shareholder’s acceptance of it.
Legal And Governance Question
Noel Tata also questioned whether the board could decide on the chairmanship while Chandrasekaran’s position as a Tata Sons director remained unresolved.
He pointed to a general meeting that could not proceed due to a lack of quorum and said the issue concerning Chandrasekaran’s directorship should be settled before deciding on the chairmanship.
Noel Tata further warned that proceeding with the chairman’s appointment before resolving the directorship issue could expose Tata Sons to a potential legal challenge.
What The Board Decided
Despite the objection, the Tata Sons board approved Chandrasekaran’s reappointment for another five years. The decision keeps him at the helm of Tata Sons beyond his existing term and adds a new layer to the ongoing discussion around succession and corporate governance at the Tata Group.
