Tata Group Chairman Succession Search Stalled by Regulatory Roadblock

More than two weeks after Natarajan Chandrasekaran announced he would not seek another term as Tata Group chairman, the search for his successor is still stalled due to a regulatory roadblock involving a key shareholder.

The search process is being held up because Sir Ratan Tata Trust — one of the 13 charities that make up the majority shareholder in Tata Group’s holding company — remains barred from conducting internal meetings under restrictions tied to an ongoing probe, according to people familiar with the matter. As a result, SRTT is unable to nominate its representative to the five-member joint search panel, the people said.

To move the process forward, Tata Trusts, which collectively hold 66% of Tata Sons Pvt., has asked the Maharashtra Charity Commissioner to permit SRTT to appoint its representative to the panel announced by Sir Dorabji Tata Trust, said the people, asking not to be identified discussing internal matters.

The limbo deepens the leadership uncertainty set off by Chandrasekaran’s shock announcement on Aug. 12 that he would step down when his term ends in February, reflecting how unprepared India’s oldest conglomerate was for managing succession amid the power struggle between the outgoing chairman and Noel Tata, who heads the Trusts.

The maneuverings required also spotlight Tata Group’s complex ownership structure, which has led to concerns around governance and reduced transparency in Tata Sons.

Any further delay will pile pressure on Noel to reassure investors, regulators, and policymakers that the conglomerate can still deliver on Prime Minister Narendra Modi’s ambitious manufacturing and tech goals.

Representatives of Tata Sons and Tata Trusts did not immediately respond to requests for comment.

Legally, Chandra, as he’s known, can remain in office until February, while the Registrar of Companies has granted Tata Sons a three-month extension to hold its annual shareholders’ meeting, the people added.

The freeze on meetings by SRTT has already forced Tata Sons to adjourn its annual general meeting last month over lack of quorum. The Charity Commissioner’s decision is awaited, even as the Tata holding company’s next board meeting is scheduled for Sept. 17, the people said.