The sudden removal of Cyrus Mistry as Tata group chairman and the subsequent daily saga of charges and counter charges will make it difficult for the group to find another Parsi to come in as chairman, says Adar Poonawalla, chief executive officer and executive director of the Serum Institute of India, Asia’s largest vaccine maker, and a strong voice in the Parsi community.
“It is sad that Cyrus, who had been putting in so much of good work to improve the Tata group, had to take this flak. It is a big loss to the Tatas. While we don’t know the reasons for his ouster, the takeaway from all this, I think, is that it will be very difficult (for the Tatas) to find another person with similar experience and credentials,” Poonawalla told HT from his office in Pune. “I don’t know if they can find another Parsi,” he added.
Adar Poonawalla, heir to the $12 billion Serum Institute, is being groomed to take over from his father, Cyrus Poonawalla, India’s seventh richest man with a fortune of $9.7 billion, according to Bloomberg Billionaire’s index. This is the first time that a prominent Parsi industrialist has come out openly in support of Mistry.
The boardroom battle for control at the Tata Group caught most members of the community by surprise after Tata Sons board voted out Mistry on October 24. Subsequent developments, including a defamation notice against the Tatas by Wadia group chairman Nusli Wadia, another well-known Parsi industrialist, has added to the disappointment.
Known to be quiet and peace-loving, the Parsis are equally famous for their hard work and philanthropic nature. “They should have found a better way of addressing the issue,” says Jehangir Patel, editor of the community magazine Parsiana, adding that it would be difficult to bring in an independent person to resolve the dispute which has dented the Parsi business reputation. “The community looks up to these two business families (Tatas, Shapoorji Pallonji Mistry). They are very prominent people and at the same time very private. Who can come in to mediate?”
Incidentally, growth of Indian business has been parallel to the rise of Parsi businesses, which relied on close-knit relationships among families. For example, the relationship between the Wadia and the Tata families dates back to the nineteenth century when Indian businesses grew in the form of clusters via close relationships among large Parsi families such as the Tatas, Wadia, the Godrejs, Cama, Jeejeebhoys, Dadabhoys, Readymoney, Petit.
Parsiana’s Patel feels that the lack of adequate community representation on the board of the Tatas could also be a factor for the delay in addressing the issue. “But this was expected. With the actual number of Parsis overall fast dwindling, it isn’t unusual for the board to lack Parsis. We are very few in number. Now there are only 57,000 Parsis left,” he added.
In an editorial in his magazine, Patel says many believe that while Ratan (Tata) and Cyrus may have had their differences, “Ratan should have handled the situation more tactfully, not let it become an unseemly, public spat. If there is one thing both Tata Sons and Shapoorji Pallonji have had in common, it’s their ability to settle disputes out of the public glare. What lessons can one draw from the imbroglio? We’ll never know unless the people closely involved tell us the story. Right now it remains a tragic enigma.”
Other Parsi industrialists have been non-committal, while agreeing that the public spat could have been avoided. “I am quite saddened to see something like this happen at India’s most renowned business group. It is not good for Indian business,” Godrej group chairman Adi Godrej had said immediately after the announcement of Mistry’s ouster.