Tata Trusts To Meet On November 20 Amid Governance Rift; Khambata To Step Down

A potential change in the composition of the Sir Ratan Tata Trust (SRTT) board is adding to the governance challenges facing Tata Trusts, even as several trust boards prepare to meet on November 20 amid an ongoing rift over the administration of the trusts and the future of Tata Sons.

Senior advocate Darius Khambata has decided against seeking another term as a trustee of either the Sir Dorabji Tata Trust (SDTT) or SRTT, reported The Financial Express, citing people familiar with the matter. His departure could leave SRTT with four trustees, while vice-chairman Venu Srinivasan’s tenure is also approaching its expiry in December.

The November 20 meetings are expected to cover routine matters, including grant approvals and account reviews. However, it remains unclear whether trustees will discuss complaints filed with the charity authority by Srinivasan and fellow vice-chairman Vijay Singh.

Trustee Complaints Bring Tata Trusts’ Governance Under Scrutiny

The complaints have raised questions about how the trusts are administered, the appointment of trustees, Chairman Noel Tata’s role and the trusts’ participation in Tata Sons’ commercial decisions.

The November 20 meeting will be the first SDTT board gathering since the complaints were lodged. Srinivasan had previously approached the charity commissioner over compliance with the Maharashtra Public Trusts Act, particularly the number of lifetime trustees serving on the board.

The Sir Ratan Tata Trust, however, remains unable to hold meetings following restrictions imposed by the Maharashtra charity commissioner. The curbs were introduced ahead of a scheduled board meeting.

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Tata Sons Restructuring Proposal Adds To Trusts’ Differences

The dispute has also centred on a proposed restructuring of Tata Sons. Srinivasan and Singh have objected to being excluded from discussions on a plan to merge two group companies into the holding company.

The proposed arrangement is intended to allow Tata Sons to retain its unlisted status while meeting regulatory requirements applicable to upper-layer non-banking financial companies.

The governance questions carry significance for Tata Sons, given that Tata Trusts together hold around 66% of the company.

Khambata Cites Independence Concerns In Reappointment Decision

Khambata informed Noel Tata and Tata Trusts Chief Executive Siddharth Sharma earlier this week that he would not seek reappointment to either trust. His term at SDTT is scheduled to end on November 9, and he will not attend the November 20 meetings.

In a letter dated November 2, Khambata said that asking fellow trustees to approve his reappointment could compromise his independence. He also criticised recent developments at Tata Sons, including the September 17 board meeting where N Chandrasekaran was reappointed chairman.

SRTT Board Could Face Further Uncertainty In December

Khambata’s decision to step down leaves SRTT with four trustees, of whom three are lifetime trustees.

Srinivasan’s term at SRTT is due to expire in December. If the trust remains unable to convene its board before then, it may not be able to renew his tenure, potentially leading to his exit.

The November 20 meetings will take place against this backdrop of contested governance, trustee appointments and disagreements over Tata Sons’ future structure.

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