In Indian family businesses, there is no dearth of successors. The Tatas, however, are an exception. As there’s no heir apparent to Ratan Tata after he retires in December 2012, a search committee has been formed to find one. The hunt has fuelled speculation with the names of several global CEOs doing the rounds.
The long list of possible successors include Noel Tata, Ratan Tata’s half-brother, current PepsiCo chief Indra Nooyi, former Vodafone head Arun Sarin and Renault Nissan chief Carlos Ghosn. Involved in everything from salt to steel and tea to telecom, the group has a prime place in the annals of both India’s business history as well as that of the Parsi community. And what do Parsis think of the prospect of a non-Parsi at the helm of the $71-billion conglomerate?
While some older Parsis TOI spoke to want one of their own to lead the Tata empire so that it continues to have a strong link with the community, others don’t mind an outsider as long as the person preserves the group’s heritage and legacy. At the annual general meetings of several Tata companies, Parsi shareholders have requested that the septuagenarian Ratan Tata should continue as the group’s chairman.
Jehangir Patel, editor of Parsiana, a community magazine, and a liberal voice of the community, believes that Parsis might feel a sense of emotional loss given the fact that the Tatas are an integral part of Parsi history in India. The loss will be compounded by the fact that the Parsi population is dwindling. The 2001 census showed that there were only 69,601 Parsis in the country. But what matters is not one’s community ties but "that person should be competent and have a strong social conscience", he said. "Anybody can have values. It doesn’t matter if the person is a non-Parsi."
Yet, there are those who want someone from the family to lead the group. "From the community point of view, the Tata name should continue, and if there is someone competent within the Tata family, there would be continuity," Khojeste Mistree, managing trustee of the Mumbai-based Zoroastrian Studies told foreign news agencies. "They’ve (the Tatas) brought a great amount of pride and glory to the community," he said. On the sidelines of the annual general meeting of Indian Hotels last week, a Parsi gentleman who owns stocks of various Tata Group companies said that he would like to see a member of the Tata family carrying the baton forward, hinting at Noel Tata.
But Patel pointed out several global corporations like Du Pont that were started by families but are now run by people not related to the founders. In India, Larsen & Toubro was set up in 1938 by two Danish engineers—Henning Holck-Larsen and Soren Kristian Toubro—but their family members have no connection with the present day company. Similarly, the Central Bank of India was founded by Sir Sorabji Pochkhanawala and was later nationalised. Those who remember the bank’s Parsi origins continue to have a soft corner for it.
Many feel that Parsis will continue to have a strong bond with the Tatas, especially because of its philanthropy and virtue that the community sets great store by. And it is a given that the group’s social responsibilities will not change no matter who heads it. The group’s charitable trusts lead in supporting various social causes. The Tata trusts earn huge dividends by virtue of their holdings in several group companies, including Tata Sons, Indian Hotels Company (Taj), Tata Consultancy Services and Tata Investment Corp. In 2008-09, the Tata trusts disbursed Rs 260 crore towards educational and medical grants. Jointly, the Tata trusts are the largest foundation in India.
The Parsis have historically contributed to the growth of the Indian economy, producing prominent business surnames such as Mistry, Godrej, Wadia, Forbes, Poonawalla and Rustomjee. Also it was the Parsi community that pioneered the stock broking business in the country. They are also known for bequeathing a significant portion of their wealth for public causes.
Parsis have a strong Mumbai link. JJ in Mumbai’s Sir JJ Group of Hospitals and JJ School of Arts refers to Jamsetjee Jeejeebhoy. The Petits, founders of the first cotton mill in India, set up several educational institutes, including JB Petit High School, in Mumbai. Even the iconic structure that towers over Dalal Street and houses the Bombay Stock Exchange is named after Sir Phiroze Jamshedji Jeejeebhoy, one of the bourse’s chairmen.
The man who sowed the seed of philanthropy at the Tata Group was its founder Jamsetji Tata. He established the JN Tata Endowment scheme in 1892 to support deserving students for higher studies abroad. The group’s historian R M Lala, in his book, The Heartbeat of a Trust, notes that Jamsetji believed in using wealth in a constructive manner. In fact, Jamsetji was a contemporary of Andrew Carnegie and John Rockefeller, the world’s best-known philanthropists. The Tata family poured all their assets into trusts, which today control 66% of Tata Sons, the apex holding company of the group.