The passing of Ratan Tata has left a crucial leadership void at Tata Trusts, the philanthropic entities that play a pivotal role in steering the $165-billion Tata Group.
Ratan Tata reportedly did not appoint a successor before his death, leaving the decision of who will head Tata Trusts to the board of trustees.
These trusts, particularly the Sir Dorabji Tata Trust and Sir Ratan Tata Trust, are the primary shareholders of Tata Sons, owning nearly 52% of the company. Other trusts together own another 14% in Tata Sons, taking the total holding to 66%. The trustees now face the task of selecting a new chairman, with a potential interim leader to be named until a final decision is reached.
Historically, the leadership of Tata Trusts has been linked to the Tata family and the Parsi community. Ratan Tata’s tenure marked the last time an individual held both the roles of chairman of Tata Sons and Tata Trusts.
The company’s Articles of Association were amended in 2022, ensuring that these roles remain separate, creating a structural shift in governance. With Tata’s death, speculation has grown over who might step into the role of chairman of Tata Trusts, which is a critical position for maintaining stability within India’s largest business conglomerate.
Among the key individuals on the board of trustees are Venu Srinivasan, an industrialist from TVS, and Vijay Singh, a former defence secretary, both of whom serve as vice-chairmen of the Trusts.
They have been involved in the governance of Tata Trusts since 2018, but their prospects of becoming the chairman appear limited. Another trustee, Noel Tata, Ratan Tata’s half-brother and chairman of Trent, is widely seen as a leading candidate. At 67, Noel’s appointment would align with the preference within the Parsi community for a family member to head the Trusts. His experience in the Tata Group, spanning more than four decades, adds to his potential candidacy.
Noel Tata's involvement with the Trusts began in 2019 when he joined as a trustee of the Sir Ratan Tata Trust, followed by his appointment to the board of the Sir Dorabji Tata Trust in 2022. His entry into these roles was interpreted by many as a step towards ensuring continuity in the leadership of Tata Trusts. If selected, Noel would become the 11th chairman of the Sir Dorabji Tata Trust and the sixth chairman of the Sir Ratan Tata Trust, carrying forward a tradition that has often seen Parsis at the helm.
While Noel is a strong contender, the final decision will be made through a consensus among the 13 trustees, including other influential figures like Mehli Mistry, a close confidant of Ratan Tata, and Darius Khambata, a senior lawyer who had advised Ratan Tata on succession matters. The process is expected to consider Tata’s personal wishes, which, though not legally binding, could guide the trustees towards a decision that respects his vision for the Trusts’ future.
The decision on the new chairman is crucial as it will shape the future of Tata Trusts and their relationship with Tata Sons. Whoever is chosen will need to maintain the delicate balance between the philanthropic goals of the Trusts and the commercial interests of the Tata Group.