Civil War

At the core of the ongoing boardroom battle at the $103-billion Tata group, one of India’s most important corporate institutions, is a serious deficit of trust. How it plays out will have ramifications not just for group companies but also for Corporate India.

- Sourav Majumdar & Aveek Datta

To better understand the unprecedented power struggle currently playing out at Bombay House, the headquarters of the storied Tata group, it would be worthwhile to get one’s hands on the epilogue, written by Ratan Naval Tata, to RM Lala’s book The Creation of Wealth: The Tatas from the 19th to the 21st Century.

Ratan Tata writes that after his predecessor and uncle JRD Tata informed him in 1991 that he would be the next chairman of the group, Tata, who turns 79 in December, had told JRD that he would always look to the latter as someone he could turn to. “And although I said that and I meant it, I did have some concerns that Jeh [as JRD was fondly known] would be in the office every day, and he would interfere and that he would forget that he was no longer the chairman, that he would be irritable and render somewhat impotent the moves that I was hoping to make.”

But Tata admits that his initial apprehension with respect to JRD’s interference was unfounded. “He acted as a senior statesman. He was available for counselling, he was available for advice, he was available for guidance. He was my best advisor,” Tata says of his predecessor.

Later in the epilogue, Tata explains the “moves that he was hoping to make,” which he eventually made, to restructure the diversified group to become more competitive, to provide better returns to shareholders, and to be more nimble- footed. “Broadly, the plan was to critically look at various companies through a group mechanism, which in fact did not exist.”