Why plan to restructure Tata Sons leadership has hit roadblock
What's the story
Noel Tata, the Chairman of Tata Trusts, has proposed a new leadership structure for Tata Sons, as per HT Mint. The proposal included separate roles of chairman, chief executive officer (CEO) and managing director (MD), as well as a deputy CEO. However, the plan has hit a roadblock due to resistance from some trustees of the organization.
Leadership continuity
Current leadership and proposed changes
Currently, N Chandrasekaran is the Chairman of Tata Sons. The proposal by Noel also suggested that Chandrasekaran should continue as non-executive chairman after his current term ends in 2027. However, some trustees are resistant to the proposed restructuring of leadership roles, although they support giving a third term to Chandrasekaran, who has been leading Tata Sons since February 2017.
Ownership dynamics
Tata Trusts has significant influence
Tata Trusts, the philanthropic organizations led by Noel Tata, hold a majority share in Tata Sons. This ownership structure gives them significant influence over the company. Meanwhile, Chandrasekaran has been instrumental in lowering borrowings by over ₹30,000 crore and making many of the 26 listed companies under Tata Group profitable. He has also spearheaded new business ventures in digital, aviation, and semiconductors sectors.