Govt likely to intervene as tensions rise within Tata Trusts: Report

The conflict centres on how Tata Trusts exercises control over Tata Sons and the extent of information being shared by the Trusts’ nominee directors on the Tata Sons board.

The government has taken note of tensions within Tata Trusts, which holds a 66 percent stake in Tata Sons, and may intervene as the rift among trustees deepens, a source close to the Tata Group told CNBC-TV18.

A source said that the government cannot be a mute spectator to the developments within Tata Trusts, adding that the issue could have implications for both Tata Sons’ operations and the wider Indian economy.

According to CNBC-TV18, Tata Trusts Chairman Noel Tata and Tata Sons Chairman N Chandrasekaran are expected to meet senior government officials later today to discuss the governance crisis.

The meeting is likely to include top Cabinet ministers amid concerns that the ongoing discord could affect the functioning of Tata Sons and, by extension, the broader Tata Group.

Four trustees, Darius Khambata, Jehangir HC Jehangir, Pramit Jhaveri and Mehli Mistry, are seeking a greater say in oversight decisions, including the approval of independent directors chosen by the Nomination and Remuneration Committee (NRC) of Tata Sons, according to the report.

They also reportedly want to review the minutes of Tata Sons’ board meetings, a move that has raised questions about the autonomy of the holding company.

According to the CNBC-TV18 report, several insiders have stressed the need to clearly separate the roles and powers of Tata Trusts and Tata Sons.

“Tata Trusts must work harmoniously with Tata Sons, and trustees cannot undermine the leadership of Noel Tata,” one source told CNBC-TV18.

They also cautioned against attempts by any group of trustees to create friction between Noel Tata and N Chandrasekaran, warning that such moves could weaken the leadership unity required to maintain the group’s stability.

“There is clearly a crisis within the Tata Group that must be resolved at the earliest,” another source told the channel.

A board meeting of Tata Trusts is scheduled for October 10, and sources said it will be crucial in determining whether an internal reconciliation can be reached.

Moneycontrol reported on October 6 that the tensions within Tata Trusts have intensified since Noel Tata took over as Chairman on October 11, 2024, following the death of Ratan Tata.

The conflict centres on how Tata Trusts exercises control over Tata Sons and the extent of information being shared by the Trusts’ nominee directors on the Tata Sons board.