TATAS IN TURBULENCE

Given the goodwill of the Tatas, the crisis surrounding the unceremonious ouster of Cyrus Mistry from the office of Tata Sons Chairman will soon be tided over with minor repercussions for sure. The reinstatement of Ratan Tata as Group Chairman, this time in interim capacity, will hopefully smooth things over, given the stature, experience and lineage of Mr. Tata. The world watches anxiously as to the outcome of this corporate drama and its effect on the share market, and also on brand TATA. Just over a decade ago the world had witnessed a fratricidal feud over a father's fortune when the Ambani brothers, Mukesh and Anil, had partitioned their patrimony before peace would prevail at their mother's intervention, or, so the books say. Now Ratan Tata has to bring the house of the Tatas to order and here, of course, there is not the remotest possibility of a dismemberment of the conglomerate, although there lurks the slight probability of a courtroom battle issuing from this boardroom coup which could severely mar the value of brand TATA in the near future and also ruin the Shapoorji Pallonji group for in such a litigation their share price will irreparably plummet. Thus, wisdom dictates that the adversaries hold artillery, keep things civil and avoid law suits which will suit neither. Meanwhile, the 79 year old Ratan Tata is set to write another chapter to his business biography and steer the house home.

Mr. Tata has been made Interim Chairman of Tata Sons for the next four months, that is, till February 2017, within which period of time the new chairman will have to be selected by a committee comprising five members, namely, Mr. Ratan Tata, Mr. Venu Srinivasan, Mr. Amit Chandra, Mr. Ronen Sen and Lord Kumar Bhattacharyya.

This is murky business, all this ouster and nomination, but then these are the imperatives of the hour thrust upon the house by the dynamics of business dealings done by the exiting chairman somewhat against the ethos of the Tatas operational for over a century. Acquisition of assets, their development and integration into the body of Tata Sons has been the hallmark of this prestigious business house that has set standards of fair-play, protection of the interests of stake-holders, especially the employees, and business integrity across the world for which it has acquired enormous goodwill globally. Brand TATA is valued so much in India at least that consumers blindly trust Tata products knowing their impeccable quality. But it seems since some years there has been an erosion in the values so very intrinsic to the Tatas and there has been a cash-craving for the company by its highest hierarchy whose apex personality is the Chairman. The acquisitions made by Ratan Tata with the long-view of making Tatas go global even at the cost of incurring sizeable debts such as Corus did not go well with the young Mistry who sold a fraction of the UK wing of the business for a nominal share price when profits dried up and the debt burden multiplied. The decision to sell off at least a significant portion of the remaining steel holdings of Tata in the UK was also taken earlier this year. Several other businesses in Europe were also on the pipeline for being sold off. This alarmed the Tata Sons' old guard for in their eyes it threatened the very health of the corporation in the long run. Communication links broke down between the errant Chairman and the group's veterans who deemed this radical shift in the business philosophy of the conglomerate as thoroughly not in keeping with the Tata ethos and dangerous for the group's future survival at the highest level. When parleys did not work with the Chairman, ouster became an imperative and the result was what happened in the boardroom yesterday.

Today, we have the old septuagenarian once again at the helm of affairs resettling things. The dust of the hour will settle down and once more the house will flourish to the cheer of all. Tata Sons will prosper and so will the world from its continued support for philanthropic causes through its trusts, collectively organised as Tata Trust. May the spirit of Jamsetji Nusserwanji Tata, founder of Tata Sons, animate Ratan Tata and his associates to re-dedicate themselves to building up this premier business house that has rendered yeoman's service to the national cause in the past and continues to raise Indian aspirations in the present. Glory unto the Tatas whose business ethics and integrity have been iconic in a country given to much corruption! May God bless the house for all they have done for humanity thus far and all they will likely do in the future! Jai Hind!