Shareholders of Tata Sons and Tata Trusts are likely to meet in order to vote to decide the splitting of the chairmanship of Tata Sons and Tata Trusts later this month.
Ratan Tata, chairman emeritus of Tata Sons
Tata Sons shareholders are seeking to separate the positions of chairman of Tata Trusts and Tata Sons soon, Business Standard reported on August 17.
The shareholders are expected to vote on the new articles of association (AoA). According to the Tata Sons annual general meeting notice, the voting for this decision will happen on August 30, the report said.
Reportedly, Tata Trusts owns a majority stake in the $ 103 billion Tata conglomerate’s holding company Tata Sons. At present, both trusts, which have a combined shareholding of nearly 52% in Tata Sons, are headed by—Ratan Tata, the chairman emeritus of the Tata Group.
Moneycontrol could not independently verify these reports.
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Ratan Tata has held the position of the chairman of the trusts since 1995. The businessman was the last person to be chairman of both Tata Sons and the Tata Trusts after JRD Tata. Current Tata Sons chairman N Chandrasekaran is likely to become the chairman of either of the two organisations only after Ratan Tata’s retirement.
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According to ET Now, the idea behind the proposal to split the chairmanship of the two trusts appears to be to increase corporate governance within the group by preventing the concentration of power.
It may be recalled, market regulator Securities and Exchange Board of India (SEBI) on February 15 had changed the requirement for listed companies to separate posts of chairperson and managing director (MD) or chief executive officer (CEO) to voluntary from mandatory.
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