Tata Group Faces New Boardroom Battle as Leadership Rift Widens

According to reports, internal conflicts within Tata Trusts, the largest stakeholder in Tata Sons, have gotten so bad that the government is stepping in to help the Tata Group, one of India’s largest conglomerates, deal with a governance crisis.

According to sources close to the Tata Group, who have been cited in numerous media publications, the government is keeping an eye on events out of concern that the dispute may affect how Tata Sons and the larger conglomerate operate.

With a nearly 66% controlling position in Tata Sons, the Tata Group’s parent company, Tata Trusts has long served as a compass, ensuring the organisation stays true to its long-term strategic and charitable values.

Why Tata Group has Turn into a Battlefield?

The group’s hundreds of businesses, which include those in consumer products, steel, autos, IT services, and other industries, are managed by Tata Sons. This division of responsibilities is essential; Tata Sons oversees operational execution, while the Trusts provide ownership control. However, media reports have cited sources that indicate this equilibrium has been strained. A power struggle within Tata Trusts, the charitable arm that owns a majority share in Tata Sons, the holding company that manages the Tata Group’s activities, is the root cause of the current crisis.

Allegedly, four trustees—Darius Khambata, Jehangir HC Jehangir, Pramit Jhaveri, and Mehli Mistry—went above their customary supervision responsibilities, thus establishing themselves as a “super board” that attempts to sway important Tata Sons decisions. According to reports, these trustees attempted to review the minutes of Tata Sons’ board meetings and approve independent directors who were selected by the Nomination and Remuneration Committee of the company—tasks that are typically performed by Tata Sons’ management.

According to sources, such actions would directly question Noel Tata’s power as chairman of Tata Trusts, posing “serious corporate governance concerns”. The possibility of operational friction at the top is evident, but it’s unclear if these measures have really hindered or obstructed important decisions. Since the death of former Tata Sons Chairman Ratan Tata in October 2024, tensions within Tata Trusts have been simmering, but in recent months they have grown increasingly noticeable. There is now a governance vacuum at the top as a result of this impasse, raising worries that if the divide persists, strategic choices and daily operations across the hundreds of firms in the Tata Group—from Tata Steel and Tata Motors to TCS and Titan—may be delayed or complicated.

Government Stepping in to Ease the Situation at the Tata Group

According to reports, the government has chosen a tough stance on the issue. Finance Minister Nirmala Sitharaman told Tata Trusts Chairman Noel Tata, Vice-Chairman Venu Srinivasan, Tata Sons Chairman N Chandrasekaran, and trustee Darius Khambata that internal conflicts must not cause Tata Sons to become unstable during a nearly hour-long meeting at Home Minister Amit Shah’s house.

The ministers urged the leadership to restore stability “by whatever means necessary”, even hinting that it could be necessary to take drastic measures like firing destabilising trustees. According to reports, officials reminded the Tata leadership that, considering the Trusts’ impact on the Indian economy and corporate governance norms, their majority stake bears a “public responsibility”.

It should be mentioned that the government, investors, and the Tata Trusts itself would all be keenly monitoring the company’s October 10 board meeting.