Tata Sons chairman, N Chandrasekaran is all set to be appointed for a second term
Tata Sons chairman N Chandrasekaran is all set to be appointed for a second term, having the support and approval of the board of Tata Trusts and its chairman Ratan Tata. A board meeting is being held today at Bombay House to ratify the same, it is learnt. Ratan Tata, chairman emeritus, is most likely to attend the board meet, it is learnt.
Chandrasekaran's second term was assured with the support and approval of the board and trust given his stellar performance as chairman in the last five years.
Several top officials close to the holding company told his reappointment is a “non-issue”. Tata Sons did not comment. An email sent to Ratan Tata went unanswered.
Chandra, as he is usually referred to, joined the Tata Sons board in October 2016, was designated chairman in January 2017 and took official charge in February 2017. He also chairs the boards of operating companies such as Tata Steel, Tata Motors, Tata Power and TCS.
They said a second term had already been “informally ratified” as Chandrasekaran’s performance and conduct had been appreciated by stakeholders.
Chandrasekaran had taken on various challenges, betting on future growth opportunities while seeking counsel from Ratan Tata on crucial group plans and important policy matters.
Chandrasekaran also played a major supportive role in the victory of the Tata group in the long legal battle with Cyrus Mistry, former chairman and estranged shareholder of Tata Sons, which has helped to further strengthen the case for a second term. The recent successful but challenging acquisition of Air India is alao seen as a feather in his cap.
Chandrasekaran's first term officially ends in February 2022, and like the chairman Ratan Tata prior to ousted chairman Cyrus Mistry, term renewala happens a week before the term ends officials told.
The reappoinyment will help stability and continuity to stakeholders and investors, contrary to the tumultuous situation during Mistry’s ouster , a top group officials said.
The Trusts has also taken its time in appointing more nominees on the board, owing to its confidence in the chairman, said a group official.
The chairman of Tata Sons usually gets a five-year term when selected, say insiders.
“The chairman’s reappointment is a non-issue and will appear as a routine board agenda item in any of the forthcoming meets. The previous chairman’s ouster was an aberration in the holding company's history and is certainly not comparable to the current chairman," said a senior group official. Mistry was ousted in October 2016 by the board, citing loss of confidence and non-performance.
“Chandrasekaran has brilliantly managed equations within the group. He accepted the limitations group operations had and worked around it the way an architect handles the restoration of a heritage building. He has also worked on a decent chemistry with the chairman, with his personal support on many issues,” said an insider.
“Unlike the earlier chairman of Tata Sons, there has been a constant engagement between the current chairman and Tata Trusts on critical matters. The interests of the largest stakeholders in the group businesses are taken care. The finance team of Tata Sons has also been closely involved in helping Tata Trusts rewire its governance structure to ensure stricter audits and tighter internal controls,” said a person close to the Trusts.
While some of the hot spots mentioned by Mistry post his ouster have yet to be overcome, factors such as reduction of Tata Steel debt, or getting the telecom issue resolved, albeit at a huge cost, and getting Tata Communications on track by roping in the right talent are positives, say fund managers.