Mumbai: Escalating the boardroom brawl, Tatas on Sunday leveled fresh allegations against Cyrus Mistry, including misleading a search panel for selection of Tata Sons Chairman, even as the ousted chief refuted the charges and accused group patriarch Ratan Tata of “eroding the brand and values” with his conduct.
In a communication to stakeholders of Tata firms days ahead of meetings of shareholders of group companies to consider removing Mistry from board of six key listed companies, Tata Sons made several charges against him, including retracting on his promises, concentrating powers and using free-hand given to him to weaken management structures.
The promoter of the major operating Tata companies said it is bringing out “key facts” that resulted “in the loss of confidence” in Mistry and leading to his removal.
Tata Sons said Mistry “misled” the Selection Committee set up in 2011 for selecting a Chairman of Tata Sons to succeed Mr Ratan Tata, by “making lofty statements about his plans for the Tata Group and more importantly indicated an elaborate management structure for managing the Tata Group, given its diversity of business, by suggesting a management structure aimed at dispersal of authority and responsibility”.
Mistry’s office, however, refuted the allegation. “On the contrary if Tata Sons had any point at all to make, it would have complied with law to form a Committee now to logically present charges against Mr Mistry. Armed with nothing better than the limp nature of contents of today’s statement, it was obviously not an option for Mr Tata,” his office said in a statement.
Tata Sons also charged Mistry of “inappropriate” conduct by retracting from his promise to distance himself from his family enterprise – Shapoorji Pallonji & Company to create “a sense of breach of trust” and posing “significant challenge to the high corporate governance principles Tata Sons strived for.”
Tata Sons also claimed Mistry had over the past 3-4 years concentrated all power and authority only in his own hands as Chairman in all the major Tata Group operating companies and “gone about systematically diluting the representation of Tata Sons on the Boards of various Tata Companies.”