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The battle over the future of Tata Sons acquired another dimension after the roles of two key directors, N Chandrasekaran and Venu Srinivasan, on the Reserve Bank of India’s Central Board came into focus. Both served as non-official directors of the RBI, but their tenures did not overlap.
Chandrasekaran served on the RBI Central Board from March 2016 to March 2022. He became Tata Sons chairman in January 2017. Srinivasan joined the RBI Central Board in June 2022 and remained there until August 2026. The RBI was examining Tata Sons’
The regulatory issue stems from the RBI’s scale-based framework for NBFCs. In September 2022, the central bank classified Tata Sons as an upper-layer NBFC. Such entities face enhanced regulatory requirements, including a listing obligation.
Tata Sons subsequently sought to surrender its certificate of registration and operate as an unregistered Core Investment Company. The RBI rejected that request on September 11, effectively requiring the company to comply with the applicable regulatory framework.
The decision intensified the debate over whether Tata Sons should remain privately held or prepare for a public listing. However, there is no evidence that the director’s RBI appointment influenced the central bank’s later decisions on Tata Sons. Tata Sons also pointed out that Chandrasekaran’s RBI tenure ended before the company’s upper-layer NBFC classification process began.
On September 17, the Tata Sons board voted to proceed with steps towards a listing. Venu Srinivasan, Harish Manwani, Anita M George and Saurabh Agrawal supported the move, while Tata Trusts chairman Noel Tata opposed it.
The board also backed a fresh five-year term for Chandrasekaran. Noel Tata opposed that decision as well and has since questioned the procedure followed during the meeting.
The dispute is significant because Tata Trusts collectively own 66% of Tata Sons. Yet Srinivasan, who is both a Tata Sons director and a Tata Trusts trustee, emerged on the side supporting the listing. Noel Tata further explained that the company should explore permissible alternatives to avoid a public issue.
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