The suspense is finally over. Mr Cyrus P. Mistry will take over from Mr Ratan Tata as Chairman of the Tata Group when he retires in December 2012. He was appointed Deputy Chairman of Tata Sons at the company's board meeting here on Wednesday and will work with Mr Tata over the next year.
“This is as per the unanimous recommendation of the selection committee,” a press release said.
The release quoted Mr Tata as saying, “The appointment of Mr Cyrus P. Mistry as Deputy Chairman of Tata Sons is a good and far-sighted choice. He has been on the Board of Tata Sons since August 2006 and I have been impressed with the quality and calibre of his participation, his astute observations and his humility.
“He is intelligent and qualified to take on the responsibility being offered and I will be committed to working with him over the next year to give him the exposure, the involvement and the operating experience to equip him to undertake the full responsibility of the Group on my retirement.” Age has been a major factor that led to the selection of Mr Mistry, a person closely associated with the selection committee said.
The 43-year-old son of Mr Pallonji Mistry, the largest single shareholder in Tata Sons with an 18 per cent stake, is a civil engineering graduate from Imperial College, London. He also has a Master of Science in Management from the London Business School.
‘Deeply honoured'
Mr Mistry is currently Managing Director, Shapoorji Pallonji Group. “I feel deeply honoured by this appointment. I am aware that an enormous responsibility, with a great legacy, has been entrusted to me. I look forward to Mr Tata's guidance in the year ahead in meeting the expectations of the Group.
“I take this responsibility very seriously, and in keeping with the values and ethics of the Tata Group I will undertake to legally disassociate myself from the management of my family businesses to avoid any issue of conflict of interest,” he said in a statement.
Television crews had parked themselves outside Bombay House, the headquarters of the Tata Group in the busy Fort area, for hours. When Mr R. K. Krishna Kumar, Director of Tata Sons, emerged after the meeting, he quickly said, “This is great news and a great moment,” before getting into his car and driving off.
Another Tata company official told Business Line that Mr Mistry's age would hold the Group in good stead for the future. “This is keeping in line with the current trend where a whole lot of top-level managers are in their 40s,” he added.
Within industry circles, the appointment of Mr Mistry has come as a surprise especially when it seemed a near certainty that the other Tata, Noel, would take over the mantleThe five-member panel which had been on this exercise for more than a year had a tough task on hand, especially when it meant finding a successor to fill Mr Tata's boots. It had to be a person with the kind of global perspective that would take the Group into the next level of growth.
Speculation was rife that an expatriate would also be considered and some of the names doing the rounds included Ms Indra Nooyi, CEO of PepsiCo, and Mr Carlos Ghosn, CEO of Renault-Nissan. “All this was complete conjecture,” an industry source said.
Ratan’s letter to executives
Mr Ratan Tata in a letter to executives said: "I am looking forward to working with Mr Mistry in the coming months and sharing with him the complexity, the challenges and the future vision of our group, and trust that you will extend the same wholehearted support to him as you have to me."