Decision on Chandrasekaran’s third term at Tata Sons delayed:Chairman calls for Trust-Board alignment; Noel Tata sets 4 conditions for tenure extension

The issue of Chairman N. Chandrasekaran’s third term was discussed at Tata Sons’ board meeting on Tuesday, but no final decision was taken. Following disagreements among members, Chandrasekaran proposed that the matter of extending his tenure be deferred for now.
He emphasised that the Tata Group functions most effectively when Tata Sons and the Tata Trusts are on the same page in their decision-making. Noel Tata expressed concern over losses in new businesses According to an Economic Times report, Tata Trusts Chairman Noel Tata raised the issue of losses in some of the group’s new businesses during the meeting. He demanded a detailed discussion on this matter.
However, other directors on the board supported Chandrasekaran, stating that these losses are associated with ‘greenfield projects’ (newly initiated projects). Such large projects take some time to generate profit, and this is part of the pre-determined plan. Noel Tata’s 4 conditions for term extension It is believed that Noel Tata, Chairman of Tata Trusts, has put forward four major conditions for extending Chandrasekaran’s tenure: Chandrasekaran will need an exemption from retirement rules in June N Chandrasekaran will turn 63 this June. According to Tata Sons’ rules, the retirement age for non-executive positions is set at 65 years. If his tenure is extended beyond February 2027, the board will have to pass a special resolution and grant an exemption from the retirement rules. Directors offered voting, chairman postponed the decision Anita George, head of the board’s re-appointment committee, supported Chandrasekaran’s tenure extension. She argued that initial losses in new projects are normal. After the discussion, when some directors proposed a vote on the issue, Chandrasekaran himself suggested postponing it for now.
He believes that complete consensus between Tata Sons and the main shareholder, Tata Trusts, is essential for the group’s future. Dispute in Tata Group, the government had to intervene After Ratan Tata’s demise, his step-brother, Noel Tata, was made the chairman of the Tata Trust in October 2024. Meanwhile, Noel was also included in the board of Tata Sons in November 2024. However, several media reports claimed that this decision was not unanimous within the trust. This directly led to a split over board seats in the Tata Trusts, which control Tata Sons. One faction is with board member Noel Tata, while the other is with Mehli Mistry. Mistry has a connection with the Shapoorji Pallonji family, which holds an 18.37% stake in Tata Sons. Amidst the dispute over Tata Sons’ board seats, senior leadership held a 45-minute meeting at Home Minister Amit Shah’s residence on October 7. According to a report, the government stated that the internal dispute should be resolved quickly so that it does not affect the company. The meeting was attended by Home Minister Shah, Finance Minister Nirmala Sitharaman, along with Tata Trusts Chairman Noel Tata, Vice-Chairman Venu Srinivasan, Tata Sons Chairman N Chandrasekaran, and Trustee Darius Khambata. Tata Sons holds 66% stake in the Tata Group The Tata Group was founded by Jamsetji Tata in 1868. It is India’s largest multinational company, with 30 companies across 10 different businesses operating in over 100 countries worldwide. Tata Sons is the principal investment holding and promoter of Tata companies. 66% of Tata Sons’ equity share capital is held by Tata’s charitable trusts, which work for education, health, art and culture, and livelihood generation. In 2023-24, the total revenue of all Tata Group companies was ₹13.86 lakh crore. It employs more than 10 lakh people. Its products are part of our lives from morning till night. The company offers everything from tea leaves to watches, cars, and entertainment services.