Noel Tata says Chandrasekaran’s decision to step down has ‘attained finality’

Noel N. Tata, Chairman of Tata Trusts, has opposed the proposed reappointment of N. Chandrasekaran as Tata Sons chairman, calling the move “illegal” and arguing that Chandrasekaran’s decision not to seek another term had been accepted by the Tata Trusts and had “attained finality”.

In a statement at the Tata Sons board meeting on September 17, Noel Tata said Chandrasekaran had, in a letter dated August 12, informed the board that he would not offer himself for another term after his current tenure ends on February 20, 2027.

“That was his own decision. It was freely taken and clearly expressed,” Noel Tata said, adding that the decision was not sought by the board, was not the subject of any board resolution and was not the outcome of any review process.

Noel Tata said the Tata Trusts had subsequently accepted Chandrasekaran’s decision and requested Tata Sons to constitute a selection committee in accordance with its Articles of Association for appointing a successor.

“A resolution now for re-appointment moved at this meeting would therefore ask this Board to set aside three things at once: the Chairman's own stated decision, the acceptance of that decision by the majority shareholder, and the further process which that shareholder has asked this Company to set in motion,” he said.

“The page has turned. The majority shareholder has acted upon it,” Noel Tata added.

He also argued that the question of Chandrasekaran’s reappointment as chairman was premature because his position as a director of Tata Sons remained uncertain. The general meeting at which that question was to be determined had not been able to proceed for want of quorum, he said.

“The chairmanship of this Company is an office held by a director of this Company. The Chairman's own position as a director is presently uncertain,” Noel Tata said.

He warned that a decision on the chairmanship before the director question was resolved could expose Tata Sons to a legal challenge by shareholders.

“We cannot put the cart before the horse,” he said.

Noel Tata also said the company’s regulatory issues and the succession question should be dealt with separately. According to him, the two matters “are not, however, of the same kind, and they do not answer one another”.

“It would not serve this Company for a regulatory development to determine the outcome of a succession process, and it would not serve this Company for a succession process to shape its regulatory posture,” he said.

In his concluding remarks, Noel Tata said the Tata Trusts’ acceptance of Chandrasekaran’s August 12 communication had “attained finality”.

“The Chairman has conveyed his decision; the shareholders have conveyed their acceptance; it is now time to move on,” he said.

Noel Tata requested that his statement be recorded in full in the minutes of the meeting and that a copy be circulated to all directors along with the draft minutes.