The Tata Sons board has backed N Chandrasekaran for another five-year term and agreed to pursue a listing, but Tata Trusts has challenged both moves, setting up a fresh corporate governance dispute.
Mumbai: The Tata Sons board on Thursday backed executive chairman N Chandrasekaran for another five-year term and agreed to initiate the process of listing the Tata group’s holding company, setting up a fresh confrontation with Tata Trusts.
The decisions were taken at a board meeting in Mumbai, weeks after Chandrasekaran had informed directors that he did not intend to seek reappointment when his current term ends on February 20, 2027.
Following the board vote, the Nomination and Remuneration Committee is expected to formally ask Chandrasekaran to reconsider his decision, according to people familiar with the matter.
The board’s decision on listing comes days after the Reserve Bank of India (RBI) rejected Tata Sons’ application to surrender its registration as a core investment company. The move has revived the possibility of a stock-market listing that Tata Sons had sought to avoid.
The RBI had classified Tata Sons as an ‘upper layer’ non-banking financial company in 2022, requiring it to be listed within three years. The deadline expired in September 2025 while the company’s application to surrender its registration remained under consideration.
Tata Sons had earlier repaid more than ₹21,000 crore in outstanding debt in an attempt to qualify for an exemption from the listing requirement.
According to the reports, board members favoured continuity in leadership as the company moves towards a potential listing, with management stability considered important for prospective investors.
The decision, however, has been opposed by Tata Trusts, which collectively control around 66% of Tata Sons. Noel Tata, chairman of Tata Trusts and one of its nominee directors on the Tata Sons board, voted against Chandrasekaran’s reappointment. The resolution was nevertheless approved by a majority of the board, according to people familiar with the meeting.
Tata Trusts subsequently described the resolution as a “legal nullity” under the Articles of Association of Tata Sons. The Trusts said the Articles require a majority of their nominee directors to vote in favour of the appointment or reappointment of the Tata Sons chairman.
Venu Srinivasan is the other Tata Trusts nominee on the Tata Sons board.
The Trusts also maintained that Chandrasekaran’s decision, communicated to the board on August 12, not to seek another term had already been accepted and could not subsequently be reversed. The Trusts said they had advised Tata Sons to begin the process of selecting his successor.
Noel Tata also submitted a legal opinion from former Chief Justice of India D Y Chandrachud supporting the Trusts’ position, according to the Trusts’ statement. The board did not accept the interpretation.
The dispute could also put on hold a succession exercise initiated to identify Chandrasekaran’s replacement. Names reportedly considered in that process included Tata Steel CEO T V Narendran, Tata Sons Group CFO Saurabh Agrawal and National Stock Exchange CEO Ashish Chauhan.
The proposed listing could have major financial implications for shareholders. The Shapoorji Pallonji Group, which owns about 18% of Tata Sons, has been pushing for a listing to unlock the value of its stake and support debt repayment.
Tata Sons controls stakes in more than a dozen listed companies across sectors including automobiles, steel, information technology, hospitality and aviation. Media reports have estimated its potential valuation at nearly ₹20 lakh crore, although the eventual valuation would depend on the structure and terms of any listing.
