Companies

Governance reforms and ethics must not get derailed: Mistry

Suresh P Iyengar Rajesh Kurup Thomas K Thomas Mumbai | Updated on January 27, 2018

Cyrus Mistry (file photo)

Eight weeks after he was ousted as the Chairman of Tata Sons, Cyrus Mistry shifted the battle from the boardroom to the court room. In an interview to BusinessLine, Mistry explains why he has resigned from the boards of various companies. Excerpts:

What made you quit now?

If you allow me to step back a bit, in the last eight weeks, you are all aware that there has been (a) consistent erosion in (the) value of the operating companies. It has been in my DNA that companies are always protected.

This is foremost in my mind. Everything I have done through this process is to ensure that the companies do not get affected.

What I have seen in the past weeks is the significant coercive behaviour of Tata Sons.

It is available in black and white in terms of shareholders’ notice, threatening to withdraw their brand, issues of removal of financial support and a number of other things.

This has created a huge amount of insecurity among our employees. I had to take a call, reflect, sit and back and see what works best (from a) longer perspective. It is extremely important that the journey of governance reforms and ethics does not get derailed, but, at the same point of time, it is equally important that I do not create a disruption and do not let them create a disruption in the interest of the employees and the stakeholders.

I have taken this decision with this in mind. Many of the shareholders I have met have said, “Cyrus, we agree with you, we sympathise with you and we believe governance reform is done. But, Cyrus, we are also concerned and worried that the action that the Tata Group is taking — and effectively they have been taking it without understanding the consequences that will unfold...” Finally, it was on me to take the appropriate decision (to take the case to court) . All these were at the back of my mind when I vacated one forum to concentrate on another forum where I can achieve this battle.

By going to court, are you not creating more uncertainty?

I think the type of uncertainty (by going to court) I create will be less on operating companies and more so for the holding company.

Did the Tatas offer any truce at today’s Tata Sons board meeting?

No. It was a standard and normal board meeting. It was a pre-organised board meeting, and nothing transpired there that could influence my decision.

As I always said, I will take it to the next level. I was waiting for the right time to do so and I believe this is the right time.

Full interview p3

Published on December 19, 2016

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