Tata Sons has reappointed N Chandrasekaran as its executive chairman for another five years, ensuring leadership continuity even as the owner of one of India’s oldest conglomerates syncs itself with the new business environment. Its board, which met on Friday, reviewed the last five years’ performance of the $103 billion conglomerate and decided to renew his term, which ends on February 20.
In a statement, Tata Sons said that chairman emeritus Ratan Tata, who was a special invitee to the board meeting, expressed his satisfaction on the “progress and performance” of the conglomerate under Chandrasekaran’s leadership and “recommended his term be renewed for a further five-year period”. Since the Tata Sons chairman is also the chairman of companies promoted by it, many of them being publicly listed, the development reassures investors of leadership stability and continuation of Chandrasekaran’s business strategy.
The reappointment will be effective after a majority of Tata Sons shareholders support the ordinary resolution enabling Chandrasekaran’s chairmanship continuation and his revised remuneration at its annual general meeting expected to beheld in August. Chandrasekaran is one of the country’s highly paid professional CEOs with an annual compensation package exceeding Rs 60 crore. Since Tata Sons is majorly owned (66%) by Tata Trusts, which is chaired by Ratan Tata, the resolution is expected to be passed.
A Tata lifer, Chandrasekaran was appointed chairman after Tata Sons removed Cyrus Mistry from the top post following his differences with Ratan Tata.
It inducted Chandrasekaran, now 58, as an additional director on October 25, 2016 and subsequently, designated him as chairman on January 12, 2017. He officially took charge as chairman on February 21, 2017.