Trustees’ nominee dispute triggers discord at Tata Trusts: Report

The nominee issue has also brought to the surface longer-standing concerns about how information from Tata Sons' board is shared with trustees who are not directors

Tata Trusts has been hit by internal tensions over the appointment of a nominee director to the Tata Sons board, underscoring a larger debate on how the charitable bodies should exercise influence over India's largest diversified business group, valued at over Rs 27 lakh crore, The Economic Times reported.

The disagreement traces back to an October 2024 resolution passed after Noel Tata became chair of the Trusts following Ratan Tata's death. The resolution required that Trusts-nominated directors on Tata Sons' board seek annual renewal of their positions once they turned 75.

This provision applied to Vijay Singh, 77, a former defence secretary who has been a nominee director since 2013 and a trustee since 2018. At a meeting on Thursday, four trustees - Mehli Mistry, Pramit Jhaveri, Jehangir Jehangir and Darius Khambata - opposed Singh's reappointment, according to people familiar with the matter.

Singh, whose position was under review, did not attend the discussion and subsequently resigned from the Tata Sons board. The group that opposed Singh's return proposed appointing Mehli Mistry in his place. However, Noel Tata and Venu Srinivasan objected, arguing that the process needed to adhere to established governance standards aligned with Tata traditions and the stature of the Trusts.

Sources cited by The Economic Times described the move as an effort by some trustees to consolidate authority within Tata Trusts and, by extension, Tata Sons. They added that any such decision requires consensus, and criticised the approach as inconsistent with the organisation's values. For now, Tata Sons will continue with two nominees from the Trusts until a resolution is reached.

According to the report, one option under consideration is hiring an external search firm to recommend candidates for the vacant position, with trustees free to include themselves in the process.

The nominee issue has also brought to the surface longer-standing concerns about how information from Tata Sons' board is shared with trustees who are not directors. Some believe updates are inadequate, while those on the board argue that fiduciary duties and regulatory norms limit what can be disclosed, given that several Tata Sons subsidiaries are publicly listed.

Another related concern is whether nominee directors should draw board fees from Tata Sons while representing the Trusts' oversight interests. Beyond Singh's vacancy, Tata Sons also needs to fill positions left open by Ralph Speth, Ajay Piramal and Leo Puri, the newspaper added.