As Ratan Tata informed PM Modi about the decision, it seems that a lengthy legal battle will start on this big corporate shake-up. Tata Sons has already hired senior lawyers such as Tatas hiring Abhishek Manu Singhvi and Harish Salve. When Mr. Mistry was appointed as Executive Vice-Chairman in 2011, he was informed that he should distance himself from his family enterprise - Shapoorji Pallonji & Company and the otherShapoorji Pallonji Group entities of which he is a major shareholder by putting his shareholding in an arms-length Trust. This was suggested keeping in mind good corporate governance principles. Mr. Mistry agreed but after some time, Mr. Mistry retracted his position and indicated that he could not find a way of doing so. Such
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Mistry was the Executive Chairman and primarily responsible for its performance. During Mr. Mistry’s tenure as Executive Chairman, dividend income (other than from TCS) declined continuously and on the other hand, staff costs more than doubled. All this would have resulted in losses but for the TCS dividend. Mr. Mistry did not show concern about these issues and the increasing dependence of Tata Sons on TCS. The Board could not accept this any further as it had the potential to risk the financial viability of Tata …show more content…
Tata companies have always been managed by dedicated professionals under the supervision of their Boards which, till recently, comprised a judicious mix of persons representing the promoters, the management and independents - as prescribed by the applicable regulations and which is also the case in almost all corporate entities in our country. This structure ensures that the interests of all constituents, namely, shareholders (big and small), employees and consumers are protected and good corporate governance is followed and constantly improved upon. Tata companies must therefore quickly return to focusing on financial consolidation, prudent and strong Balance Sheets and sustainable returns and values to their shareholders, big and
Mistry was the Executive Chairman and primarily responsible for its performance. During Mr. Mistry’s tenure as Executive Chairman, dividend income (other than from TCS) declined continuously and on the other hand, staff costs more than doubled. All this would have resulted in losses but for the TCS dividend. Mr. Mistry did not show concern about these issues and the increasing dependence of Tata Sons on TCS. The Board could not accept this any further as it had the potential to risk the financial viability of Tata …show more content…
Tata companies have always been managed by dedicated professionals under the supervision of their Boards which, till recently, comprised a judicious mix of persons representing the promoters, the management and independents - as prescribed by the applicable regulations and which is also the case in almost all corporate entities in our country. This structure ensures that the interests of all constituents, namely, shareholders (big and small), employees and consumers are protected and good corporate governance is followed and constantly improved upon. Tata companies must therefore quickly return to focusing on financial consolidation, prudent and strong Balance Sheets and sustainable returns and values to their shareholders, big and