Tata Companies EGMs – InGovern Vote Recommendations

Six of the seven Tata listed group companies where Mr. Cyrus Mistry serves as a Director, have called for EGMs between 13th December and 26th December 2016 for removal of Mr. Mistry as a Director, after having received requisition from the promoter shareholder Tata Sons Limited. Tata Global Beverages, having already replaced Mr. Mistry as Chairman, is yet to announce the date and notice of its EGM.

Access our detailed report and voting recommendations from here: Tata Group Company EGMs – InGovern Recommendations

The summary of the reasons for our recommendations:

  • Tata Sons Limited hasn’t provided any compelling reasons for the removal of Mr. Cyrus Mistry as a Director from the Boards of the operating companies.
  • Tata Sons Limited hasn’t articulated any new plans or visions for the operating companies than what the Boards under Mr. Cyrus Mistry had adopted.
  • Mr. Cyrus Mistry continues to have beneficial shareholding of 3 to 13% in the listed companies, through the 18.4% minority shareholding in Tata Sons Limited. His presence as a Director on the Boards of the listed companies should be a balance on the Boards and a representation of the minority shareholder. In many operating companies, Mr. Cyrus Mistry continues to have the confidence of the Independent Directors.
  • Shareholders need to question inherent assumptions made regarding the Group structure and the “Tata” brand and demand greater disclosures on information flow between Tata Sons and operating companies.
  • Minority shareholders should decide on their votes independent of the actions of the promoter shareholder.