After taking over as chairman of Tata Sons in 1991 from JRD Tata, Ratan Tata has been at the centre of many a battle in Bombay House, the headquarters of the group. Tata took on satraps, who considered their companies as their personal fiefdoms, before showing them the door one after another0.
JRD Tata, who headed Tata Sons from 1938 till 1991, allowed people like Russi Mody to come up in Tata Steel, Darbari Seth in Tata Chemicals and Tata Tea and Ajit Kerkar in Indian Hotels. JRD never interfered in the operations of these satraps. Ratan Tata, after the takeover, was keen to bring more cohesiveness in the group, increase Tata stake in group companies, strengthen the Tata brand and expand through organic and inorganic routes.
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Russi Mody put up a tough fight to retain control over Tata Steel as its CMD. Mody joined Tata Steel in 1939 and became its chairman in 1984. Tata Sons, led by Ratan Tata, then dusted the group’s forgotten retirement policy that directors above the age of 75 would have to resign from Tata boards. Mody had no choice but to go. The next was Darbari Seth. He had to leave Tata Chemicals and Tata Tea as per the retirement policy, but he managed to get his son Manu Seth appointed as MD of Tata Chemicals. He also resigned later. However, Ajit Kerkar who was running Indian Hotels put up some resistance and the retirement policy did not work here as Kerkar had a few more years. The Tatas prepared a dossier including alleged FERA violations to get Kerkar out.
It was in 1992 that Tata first brought out a retirement policy to force out Tata group satraps. In 2002, the group lowered the age of executive directors to 70 from 75 while keeping the retirement age of executive directors at 65. But again in 2005 it raised the retirement age limit of non-executive directors to 75.