Choosing Successor to Ratan Tata

Tatas have very loose shareholding pattern of their family in Tata Group of companies and that stake itself is very low may be under 10%.In such circumstances what is holding Tata companies together is Tata spirit and moral authority Ratan has.The other shareholders and

top executives in Tatas know very well that any tinkering with system may invite huge public revolt in India and by FITs and even government

may step in.That is why top people in Tatas are lying low.Be very careful while passing on the mantle to some one.There is a huge risk of group falling apart as actual owners have very small stake though very cleverly made complex through cross holdings.But a smart guy can crack it.Secondly Tata family itself is very loose entity.Most of them are not even direct heirs of previous owners.It is small and fragmented family.I would hardly call it a family.Hence it is very crucial decision for Ratan Tata.Actually Tata group is being run more by Tata brand,moral controls and Tata Ghost rather than financial

ownership control.

In democratic corporate system like all top Industrial groups in world share ownership patterns is most important parameter.The largest shareholder in the Tata Sons must get first offering unless he or she are not found incapable due to some reasons which are sound

and valid.Noel Tata fulfils this criteria being son in law

of largest shareholder in Tatas.Or other way is that the largest 10 shareholders sit together( these may be Is also) and choose a successor.Of Course he or she must have shareholding in Tata

Sons.The head of such vast corporates can't be a non-owner executive.He can then go astray easily having no stake and may even try to grab stake.In any case who so ever becomes Chairman has to be ratified by shareholders of Tata sons and also chairmen of various major Tata companies.Is not that simple solution? I outrightly reject the suggestions sometimes hinted by Ratan Tata that person could be a non Indian or an Indian outside country and who may not be having any financial stake in Tata group.It is not a sound suggestion with due

respect to Ratan Tata.We love and adore him.

We want Tata group pass into hands of a Tata heir if possible and a very competent person with full integrity and who has been part and parcel of Tata culture and thinking.

Now it is another thing that Tatas are not angels either and have been doing all kinds of wrongs for business.There has been huge

corruption in TELCO and Tata Steel that I heard about in past. The Nano stunt by Ratan tata was also unethical to gather pre marketing publicity.All this talk o Rs 1 lac car was a non sense.Every engineer of country knows that. tatas have managed huge concessions from sates to profitably run their projects.

Having said all this, I still believe Tatas are one of finest industrialist india produced and are far more ethical than other industrial names.Lately they have energised themselves and improved a lot.We have to preserve this unique blend of culture,ethics and enterprise that Tatas has woven in last three generations period.

So successor issue is big issue.