Mumbai: Tata Trusts on Wednesday named Tata group veteran Srinath Narasimhan as their first chief executive, signalling a shift to a more professional leadership framework at the entities that own most of Tata Sons Ltd.
Narasimhan, currently managing director of Tata Teleservices Ltd and Tata Teleservices (Maharashtra) Ltd, will take over his new assignment from 1 April.
The appointment of a chief executive comes three years after a boardroom battle threw up allegations of poor governance at Tata Sons, and of Tata Trusts, through their trustees, interfering in the affairs of the company. The affairs of Tata Trusts, which own 66% of Tata Sons, were so far handled by a managing trustee, along with 20 trustees.
Cyrus Mistry, the ousted chairman of Tata Sons, had written to the government in December 2016 that the very future of the Tata group lies in how the trustees govern Tata Trusts, since the trusts’ main property is their holding of shares in Tata Sons. Since then, Tata Trusts have seen several high-level exits, including that of N.A. Soonawala.
The post of chief executive was created and a hunt for a suitable candidate began after R. Venkataramanan stepped down as the managing trustee last year. During the search period, operations of Tata Trusts were managed by Ratan Tata, chairman of Tata Trusts, along with a core group of officials. The search that lasted about 10 months was led by a committee headed by him.
Venkataramanan’s exit followed a tax scrutiny of his annual remuneration and the subsequent withdrawal of tax exemptions given to Sir Dorabji Tata Trust. The tax department said his remuneration was not commensurate with the philanthropic nature of the trust. He was also summoned by the Enforcement Directorate last month in a money-laundering investigation involving AirAsia, in which Tatas hold a 51% stake.
The new chief executive’s powers will be similar to those enjoyed by the managing trustee.
Born on 8 July 1962, Narasimhan is a mechanical engineer from the Indian Institute of Technology, Madras, and an MBA from the Indian Institute of Management, Calcutta. He has spent his entire career at the Tata group.
Narasimhan has held various assignments in the Tata group, including as managing director of Tata Communications Ltd, where he was credited with turning around a company whose business began to collapse soon after the Tatas acquired it from the government. He spearheaded the company’s transformation from an Indian entity into a global wholesale voice carrier and owner of a vast undersea cable network.
He joined Tata Administrative Services (TAS) in 1986. TAS, Tatas’ equivalent of the Indian Administrative Service, is a training ground for nurturing future leaders for various Tata group companies.
The other big change on Wednesday was the appointment of Pramit Jhaveri, former chief executive of Citi India, as a trustee of the Sir Dorabji Tata Trust, the largest among Tata Trusts. The appointment is effective from 12 February. Jhaveri served at Citi from 2010-19 and was instrumental in expanding the bank’s footprint in India.
Last year, Noel Tata, Ratan Tata’s half-brother, was appointed a trustee of the Sir Ratan Tata Trust, which is the second-biggest trust in the Tata Trusts fold after Dorabji Trust.