Brand Custodian: An insider's account of the Ratan Tata-Cyrus Mistry rift

OFF GUARD: Cyrus Mistry with Ratan Tata before relations soured
It may surprise many readers to know that none of us in the GEC [Group Executive Council] had any inkling about the kind of action that would be taken against Cyrus Mistry. I was in my office on the Monday afternoon of this action when I got a call from his secretary, Bhavesh Mistry, asking me to urgently come to the chairman’s office. I knew something was amiss from his tone, and practically raced to the fourth floor from my second-floor office. As I was ushered into the office, I saw a sombre Cyrus Mistry deep in thought. 

The moment the door was shut he got straight to the point and said, ‘I have been forced out as chairman by the board.’

It took me some time to register what he was saying and when I snapped to, the first question that came to my mind was, ‘Who is replacing you?!’

I was shocked when he said, ‘Ratan Tata. The board has appointed him as the interim chairman, till they find a successor.’

‘Doesn’t that conflict with the retirement policy? Ratan Tata is well over seventy-five!’ I blurted out.

I was even more dismayed when he replied, ‘The board has altered the retirement policy to permit this.’

Just then, Ishaat Hussain and Farida Khambatta — who, I later learnt, had been the only two Tata Sons directors to abstain on the resolution to remove Cyrus Mistry — walked into the chairman’s office, so I made my excuses and left. On my way out, Cyrus Mistry said that a press release was being crafted on his exit, and asked me to take a look at it. Half an hour later, I was summoned to the office of the Tata Trusts, on the second floor of Bombay House, where most of the directors of Tata Sons were huddled together in a tiny conference room, and handed a press statement by one of them with instructions to issue it immediately.

With little choice in the matter, I took this to Cyrus Mistry to show it to him once before the statement was released. He shrugged his shoulders and asked if its release could be withheld till the evening, in order for him to get some time to sort out his personal effects in the office and leave before the media descended on Bombay House. I said I had been instructed to issue the statement immediately, so he said, ‘Okay, let it go.’...

As indicated earlier in this book, I had some initial concerns about Cyrus Mistry’s appointment as group chairman. With the passage of time, though, and as I began to work closely with him, I saw he had many sterling qualities. 

Recognising that he was stepping into large shoes and that all kinds of comparisons would be drawn between him and previous Tata leaders, Cyrus Mistry worked incredibly hard to make a success of his role; he seemed to always be on the job. If I sent him an email at midnight, I would get a response in seconds. If I asked him to join a meeting with stakeholders, such as our CSR officers or our corporate communicators, he would readily agree and contribute very thoughtfully during the deliberations. Even when he was ill, I would see him popping pills and carrying on. And all of this at great personal sacrifice of time with his young family.

At a cerebral level too, Cyrus Mistry is one of the smartest people I have ever met. He lived up to my definition of a great leader by voluntarily surrounding himself with people with great talent, skill and strong opinions, unlike many other leaders I have seen, who feel threatened and become insecure if they have capable managers around them. People like Nirmalya Kumar or Gopi Katragadda brought enormous knowledge, experience and talent to their roles as chief strategist and chief technology officer respectively, but it needed a Cyrus Mistry to shape their energies and outlook in a direction that made sense for where the Tatas needed to go. 

Cyrus Mistry is a voracious reader and would keep sending senior executives material to read to inspire them to think differently and more ambitiously. He is also adept at design thinking and in understanding technological nuances very quickly, which worked perfectly for a company like Tata Motors, where he played a major role in putting in place the attractive product pipeline that is now emerging from the company’s stables, including products like the Tiago, the Hexa and the Nexon…. 

What has troubled me most about the Ratan Tata–Cyrus Mistry spat is the limited role that was ultimately played by senior serving and retired Tata leaders in attempting a rapprochement between the two men. One retired Tata Sons director revealed to me a plan for a group of retired directors to call on Ratan Tata and persuade him to reach a settlement with Cyrus. The plan apparently fell through when some individuals lost the courage to face Ratan Tata. 

A Tata Trusts trustee persuaded me to withdraw a proposed appeal by senior Tata CEOs to both Cyrus Mistry and Ratan Tata to bury their differences and work together for the group’s best interests, saying that he himself would personally intervene in this direction — which did not happen. Suggestions made by several of us who knew both of them, to involve people of stature — like Yezdi Malegam, the respected octagenarian chartered accountant and long-serving member on the RBI board till 2016, or Vijay Kelkar, the well-known economist and policymaker who headed the thirteenth Finance Commission — to bring them together, ran into a wall. 

After a volley of accusations had been traded on both sides, it seemed as if most of the Tata seniors were washing their hands of the matter… rather than try and mediate between the two. Millions of Tata stakeholders around the world, who deserved better, have been forced to pay a price for no fault of theirs. These stakeholders also included three of my GEC colleagues — Nirmalya Kumar, Madhu Kannan and N S Rajan — who were terminated without any notice. The only wrong they had apparently committed was to develop a close association with Cyrus Mistry. 

This action was most unexpected from an institution that prides itself on its core value of ‘unity’ and its treatment of its people with ‘dignity and respect’. My three GEC colleagues were professionals who had contributed their best to the organisation and had each been appreciated for their outstanding contribution — and yet, a week before the joyous festival of Diwali, they found themselves having to explain to their disbelieving families that they had been turfed out of their jobs overnight....

I have been asked by many people about my stand on the Ratan Tata–Cyrus Mistry spat. I have emphasised that I owed my loyalty to the institution of the Tatas, not to the individuals concerned....So long as I was an officer of the group, I would abide by the reasonable orders I might receive from the Tata Sons board and the chairman....

Had I been a director or a peer of Ratan Tata’s, I would not have allowed myself to remain silent on the sidelines. In fact, I was asked by one of the trustees of the Tata Trusts whether I would consider representing their position on national television. I responded that I would not do this unless I was personally convinced about the merits of their position on the matter. No effort was made to share evidence with me to back up the charges that were being bandied about, and I stayed out of the fracas.

On Ratan Tata

On hearing that I was to be the chairman’s executive assistant, I felt it but fair to point out to Ratan Tata that I had not done an MBA and had very little business-related experience. His answer will remain etched in my mind—all I needed to succeed in the corporate world, he said, was ‘good common sense’”. 
“The Ratan Tata whom I saw for most of the next twelve years that I spent in his office was a delightful personality. … He was extremely grounded and well spoken, and in all my years with him I probably heard him raise his voice only on a couple of occasions. He gave his staff a great deal of autonomy, and to have that at a young age was hugely empowering for me.”
The things I liked best about Ratan Tata were his ability to laugh loudly and his incredible mimicry of his colleagues.”

“In the years to come, and certainly after I left his office in 2008, the Ratan Tata I first came to know and appreciate became increasingly invisible. He was replaced by a senior statesman with a larger-than-life figure. Most of his colleagues came to be intimidated by his personality and stature. And the woes that were visited upon the Tata group, particularly the 2008 terror attack on the Taj, the financial struggle in the aftermath of the global financial crisis and the so-called 2G scam and its fallout, took their toll on this essentially decent, fair and fun-loving human being. 

Brand Custodian:  My Years with the Tatas Author: Mukund Rajan
Publisher: HarperCollins
Price: Rs 599 
Pages: 264

 

Excerpted with permission


Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel