Noel Tata, Ratan Tata’s half-brother, was appointed head of Tata Trusts. He has a background in various Tata companies and serves as chairman of multiple firms.
There is much speculation regarding the impact of Noel Tata’s appointment as chairman of the Tata Trusts by its Board of Trustees. Many view him as the successor to Ratan Tata, which he certainly is at the Trusts. However, they mistakenly believe that he is succeeding Ratan at Tata Sons and that his appointment at the Trusts will provide the Tata Group with new thrust and direction.
This confusion arises from the role of the Tata Trusts and their relationship with the group’s holding company, Tata Sons. To clarify, the Tata Trusts— a group of trusts established by the Tata family at various points in time—are a charitable organisation and technically report to the Charity Commissioner.
At least, that was the case until recently, when they sought to avoid being classified as a trust for multiple reasons. Noel Tata, half-brother of the late Ratan Tata, has been appointed as the new Chairman of Tata Trusts, the philanthropic umbrella that wields influence over the $165 billion Tata Group.
The Tata Trusts hold a commanding 66% of the equity in Tata Sons, which is the group’s holding company, and in that sense, ‘controls’ the Tata companies. However, control has never been the modus operandi at Tata Sons, which generally acts as a cohesive and strategic force for the group.
Another reason Tata Sons cannot completely control group companies is that the Tata companies are not total subsidiaries of Tata Sons; they are independent companies with their own boards of directors. Each of these companies also has executive councils that strategise their own growth and operational initiative.