Since assuming the role of Executive Chairman in 2017, Chandrasekaran has guided the group through a phase marked by restructuring.
Tata Sons CEO N Chandrasekaran has asked the board to postpone deliberations on extending his tenure for a third term after disagreements emerged during a Tata Sons board meeting on Tuesday, according to people aware of the developments.According to an ET report, Noel Tata, Chairman of Tata Trusts, at the meeting raised concerns over losses in some of the Tata Group’s new projects, leading to an in-depth discussion. Other managers expressed support for Chandrasekaran’s continuation, noting that the losses were related to new projects that typically require time before returns are provided.Noel Tata serves on the board of Tata Sons as a nominee for Tata Trusts, along with Venu Srinivasan.
Chandrasekaran’s current term still has about a year remaining, till February 2027. The ET report said the meeting was attended by all directors, including Noel Tata and vice chairman Srinivasan.Any extension of Chandrasekaran’s tenure would need to be approved through a special resolution and would require a waiver of Tata Sons’ retirement norms, which sets a minimum age of 65 for non-executive positions.
Chandrasekaran will turn 63 in June.Since assuming the role of Executive Chairman in 2017, Chandrasekaran has guided the group through a phase marked by restructuring, balance sheet strengthening and stricter discipline in capital deployment.Tata Trusts Chairman Noel Tata is believed to have identified four conditions that he wants to address before any extension to Chandrasekaran’s tenure is considered.
The first condition is for Tata Sons to remain unlisted, in line with the Reserve Bank of India’s requirements applicable to top-tier non-banking financial entities, a category that includes large conglomerates like Tata Sons.The second requirement: The company must operate without debt. The third condition aims to prevent excessive capital spending on high-risk projects that could drain the company’s financial reserves.
The fourth requirement relates to limiting losses from acquisitions such as Air India and BigBasket.Anita George, who chairs the reappointment committee of the board, supported the proposal to extend Chandrasekaran’s tenure, noting that losses in new projects were expected and had been taken into account.After the discussion, some directors suggested putting the issue to a vote, but Chandrasekaran suggested postponing the decision, noting that the Tata group works best when Tata Sons and Tata Trust remain aligned in their decisions.