Putting all speculation to bed, Chairman of Trent and Ratan Tata’s half-brother Noel Naval Tata has become the latest member of the industrial family to join the Tata Trust board.
Now, with his induction, all three Tata brothersRatan, Jimmy Noel – are on the board of the Trusts, continuing the family’s legacy in the decision-making body.
This confirms what has long since been the talk of the town, regarding Noel’s prospects in the Group and the future of its charitable organisation which commands a majority 66% stake in the $100 billion Tata conglomerate’s holding company, Tata Sons.
Meet Noel Tata
Noel’s entry coincides with the exit of managing trustee, R Venkataramanan, after five years of overseeing the Trusts’ operations, although has it that Noel was and is being groomed to succeed his half-brother Ratan Tata as chairman of the Tata Trusts, ever since he took on key roles in several of the company’s verticals.
Kicking his career off at Tata International, a relatively small group company, Noel has served at senior levels in the industry over the years, at Trent, Voltas, and Titan, amongst others. Now 62, his portfolio reflects extensive experience in various fields including marketing, administration and investment.
After graduating from the University of Sussex and INSEAD business school in France, Noel has served as the chief executive officer at Trent, chairman of the Board of Directors of Trent Hypermarket Private, non-executive chairman at Voltas, managing director at Tata International, and non-executive non-independent director of Titan, before being cast into his most prominent role so far.
Among his notable achievements is the development and success of Trent’s retail store Westside, a one-store operation in 1998 which under Noel’s direction evolved into a chain of successful stores. Westside has now become immensely popular with India’s middle and upper-middle classesestimated to be 25% of the populationfor its affordable clothing, household products, toys, and cosmetics.
A highly profitable group company, Trent operates retail chain Westside, Landmark, a family entertainment format store, and Star Bazaar, a hypermarket chain which is a joint venture with UKs supermarket chain, Tesco. In January, it acquired 5 floors of prime office space at Lodha Developers building at New Cuffe Parade in Central Mumbai, where it will soon house consolidated offices of the new brands.
Representation of a community
Speculation about Noel’s entry was gathering momentum especially as the Parsi community began to vocally endorse the idea of a Tata family member to the Trust, especially after courting controversies over numerous tax law violations recently, which ended in Venkataraman’s resignation.
This also followed a historic decision last December, when the Trusts appointed TVS Group Chairman Venu Srinivasan and former secretary Vijay Singh as vice chairmen of the seven public charitable bodies under its fold. This marked the first time that non-Tata, non-Parsi members have been given leadership roles at the Trusts.
Chief among those rooting for a Parsi inductee was trust member Noshir Soonawala, who has been voicing concern about dwindling representation of the small but prolific community on the board for quite some time.
Parsi philanthropist Jehangir H Jehangir was also appointed to the board this Wednesday.
With trustees having no retirement age, Ratan Tata, 81, is expected to continue on as chairman. Ratan’s younger brother Jimmy has served as a trustee for three decades.
The Trusts have courted many recent woes
The Tata Trusts have disbursed Rs.1,200 crore in FY2018-19 for philanthropic projects, after playing a massive role in the social sector for decades, while serving as the front to Tata Group’s $111-billion salt-to-steel industry. Its contributions in sectors including healthcare, nutrition, education, rural upliftment the arts are around the world.
The Trust’s former Managing Director had come under legal scrutiny last year over non-compliance of tax laws after Venkataramanan’s Rs 2.66-crore annual compensation came under the income tax scanner.
The Income Tax Department, upon finding that the managing trustee’s salary had exceeded permissible limits, immediately withdrew tax exemptions to the Sir Dorabji Tata Trust, the largest of all the trusts, in December 2018. IT Officials also sought to revoke the Trusts’ licenses on account of non-compliance of fund usage rules.
More prominently, however, Venkataraman features in an ongoing CBI case for trying to obtain an allegedly illegal international flying license for Air Asia India. Tony Fernandes, CEO of Air Asia, and Venkataramanan were booked for allegedly manipulating government policies to acquire the license for Air Asias Indian venture, Air Asia India Limited where Venkataramanan is a director.
The news of his leaving was first reported last week, made formal through a statement on Thursday, and will come into effect on 31.
The press release announcing his exit did not name his successor although it is believed that R Pavitra Kumar would be serving as the interim CEO of the Trusts. According to the grapevine, Venkat, as he is popularly known, may shift to London in some new role within the Tata group.
That aside, Venkataraman’s was not the only exit from the Trusts in the recent past. Amit Chandra also stepped down from the board of Sri Ratan Tata Trust last November, which holds 24% stake in Tata Sons, citing preoccupation with independent philanthropic work.
This week, Noel was appointed as a trustee of the SRTT, the second largest among the dozen-odd charities that make up the Tata Trusts.
Latest could go on to play larger roles
Although Noel’s name is believed to have been under consideration for the Chairman of Tata post since 2011, he has been passed over at least twice.
In 2011, his brother-in-law Cyrus Mistry was made Chairman of Tata Sons, only to be removed five years later, following which Noel reportedly found his name among the top contenders again. The company’s search committee, however, chose to go with then Tata Consultancy Services (TCS) CEO N Chandrasekaran for the post.
Rarely seen together and reputed for their limited interactions, the friction in Ratan and Noel’s relationship, if any, seems to have reduced with time, as the half-brothers were confirmed returning from a leadership summit last July “together in the same car.” Noel’s own and his closeness to Ratan is evident in his outspoken support of the oligarch in Tata’s battle against Mistry.
According to Tata Sons’ Articles of Association, Trusts can nominate one-third of the twelve directors on the holding company’s board and it is believed that Noel would soon represent the Trusts’ interests on Tata Sons board as well. The latest conferment of trusteeship, which automatically offers ownership of controlling stake in the company, is being widely regarded as a stepping stone for the media-shy Tata’s ascendance to the spotlight and perhaps even to the coveted position in due course.
Prarthana Mitra is a staff writer at Qrius