The next chairman of the Trusts will be an Indian, but not necessarily a Parsi or a member of the Tata family, Tata’s long-time confidant R K Krishna Kumar told TOI on Thursday. The Trusts’ investments in the listed Tata companies alone are worth $41 billion.
The 79-year-old Tata is unlikely to remain a trustee once he hands over the reins to the new chairman. It would bring to an end his decades-long association with India’s largest conglomerate. It would also put to rest charges that he continues to control Tata Sons through his leadership at the Trusts even after leaving Tata Sons and that the next chairman of the holding company would remain in the long shadow of the patriarch.
The move comes even as Tata Sons itself is in the midst of naming a chairman by end-February. When Ratan Tata made way for Cyrus Mistry as chairman of Tata Sons in 2012, he stayed on as head of Tata Trusts. It was the first time in the history of the Tatas that the two positions were uncoupled, all previous Tata Sons chairmen had also headed the Trusts. The reason, according to a long-time insider at Bombay House, is that Mistry isn’t a Tata.
Tata’s close aide and managing trustee R Venkataramanan told TOI that he too was likely to exit the Trusts “in the event of Ratan Tata demitting office”.
Ratan Tata’s confidant R Venkataramanan, who has been the target of several attacks by the Mistry camp, is expected to move overseas and manage Tata’s personal investments, notably the $250 million venture capital fund UCRNT, in association with University of California.
Tata has been an active early-stage investor in several prominent Indian start-ups. A former executive assistant to Tata, ‘Venkat’ rose to become managing trustee three years ago when the Trusts started expanding the scope of their activities from granting funds to building institutions.
“The next chairman has to be someone who has the right vision and be in complete alignment with the will of the Tata Group founders,” said Krishna Kumar, a group veteran and Tata trustee. Tata’s successor at the Trusts could be an external person even though the current trustees are free to suggest potential candidates, he indicated.
Krishna Kumar said the chairmen of Tata Trusts and Tata Sons would be different in the immediate future. Since some of the Tata trustees are in their late 70s to 80s, the preference would be for someone in the mid-50s to early 60s so that the person has adequate time to leave an impact. He said there was no surety that it would be a Parsi. If so, Ratan Tata’s successor would be the first non-Parsi chairman in the history of the Tata Trusts. “It is very unlikely that it will be a foreign passport holder. The person needs to be an Indian and understand what is good for India,” Krishna Kumar added.
He indicated that the incoming Trusts chairman would initially work with Ratan Tata, possibly as deputy chairman, before taking over. Although a trustee is appointed for a period of time, there is no term limit and he can therefore serve for life. JRD Tata was the chairman of Tata Trusts till his death in 1993 while Ratan Tata took over at Tata Sons in 1991. In that sense, Ratan Tata would differ from some of his predecessors who headed the influential Trusts for life.
Tata Trusts’ history goes back to Sir Ratan Tata Trust, which was set up in 1919 according to the will of Sir Ratan Tata, the younger son of the group’s founder, Jamsetji Tata. Sir Ratan Tata Trust holds 24% in Tata Sons. After 13 years, Sir Dorabji Tata Trust was set up in 1932. In his book, The Heartbeat of a Trust, R M Lala said Sir Dorabji Tata, the eldest son of Jamsetji Tata, placed his entire possessions, including shares, landed estates and jewellery worth Rs 1 crore in 1932 in a Trust Sir Dorabji Tata Trust holds 28% in Tata Sons.