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Cyrus Mistry says not returning as Tata Sons chairman, will protect minority shareholders' rights

Mistry said that his legal battle against Tata Sons was never about him, but rather, to protect the rights of minority shareholders

twitter-logoBusinessToday.In | January 27, 2020 | Updated 09:37 IST
Cyrus Mistry denies return as Tata Sons chairman, promises to protect minority stakeholders

Cyrus Mistry has said that he is not pursuing the position of Tata Sons' executive chairman, the office he was unceremoniously terminated from in October 2016, or directorship of any of the Tata group companies. He added that he will, however, "vigorously pursue all options to protect our rights as a minority shareholder".

Mistry's statement on Sunday came in the backdrop of an NCLAT order that reinstated him on the Tata Sons' board and termed the appointment of N Chandrasekaran as the executive chairman "illegal". Tata Sons, the conglomerate's patriarch, Ratan Tata, and its flagship company, Tata Consultancy Services, have all filed separate appeals against the order in Supreme Court.

"To dispel the misinformation campaign being conducted, I intend to make it clear that despite the NCLAT order in my favour, I will not be pursuing the executive chairmanship of Tata Sons, or directorship of TCS, Tata Teleservices or Tata Industries," Mistry said.

ALSO READ:TCS moves Supreme Court against NCLAT order reinstating Cyrus Mistry

"I will however vigorously pursue all options to protect our rights as a minority shareholder, including that of resuming the thirty-year history of a seat at the Board of Tata Sons and the incorporation of the highest standards of corporate governance and transparency at Tata Sons," he added.

Mistry said that his legal battle against Tata Sons was never about him, but rather to protect the rights of minority shareholders. He said that the Shapoorji Pallonji Group has been with the Tata group for the past decades and it is in his family's interest to secure the group's interests.

"As an 18.37 per cent shareholder, it is in our own interest to ensure the. My family, although a minority partner, has been a guardian of the Tata Group for over five decades," Mistry said. "This legal fight has never been about me. It has always been and will always be about protecting the rights of minority shareholders and upholding their right to demand a higher standard of corporate governance from controlling shareholders."

ALSO READ:Ratan Tata moves Supreme Court seeking stay against NCLAT's order to restore Cyrus Mistry

Below is the complete text of Mistry's statement:

This statement is being made in the interests of the Tata Group, whose interests are far more important than the interests of any individual. To dispel the misinformation campaign being conducted, I intend to make it clear that despite the NCLAT order in my favour, I will not be pursuing the executive chairmanship of Tata Sons, or directorship of TCS, Tata Teleservices or Tata Industries.

I will however vigorously pursue all options to protect our rights as a minority shareholder, including that of resuming the thirty-year history of a seat at the Board of Tata Sons and the incorporation of the highest standards of corporate governance and transparency at Tata Sons.

Recent media reports attributed to Mr Ratan Tata and others questioning the NCLAT judgment ahead of an important hearing in the Supreme Court, profess an interpretation of Corporate Democracy as being one of brute majoritarianism with no rights for minority stakeholders. The question in these legal proceedings is whether the oppressive actions of a majority that stifles minority shareholders is beyond reproach and outside judicial oversight.

Globally, and including in India, Company Law has evolved to protect the rights of minority shareholders and strengthen corporate governance. The Companies Act, 2013 has considerably strengthened the statutory protections accorded to minority shareholders from oppressive conduct of the majority shareholders. Indeed, for Corporate Democracy to be strengthened, all stakeholders must operate within the ambit of law and statutorily enshrined protections.

ALSO READ:Tata Sons moves SC seeking stay against NCLAT order on Cyrus Mistry

The founding fathers of the Tata Group had laid a strong ethical foundation that cared for all stakeholders. The relationship between the Tata Group and the Shapoorji Pallonji Group is one spanning multiple decades that was built on common agreement and mutual faith. Former Tata leaders worked together with the minority partner to create value for all stakeholders.

In the last three years, both in conduct and in their statements to the world at large, the Tata Group's leadership has shown scant respect for the rights of minority shareholders. It is time the Group's management introspects and reflects on its conduct as it embarks on future actions.

I am humbled by the NCLAT order, which after review of the enormous material on record, recognized the illegal manner in which I was removed and the oppressive and prejudicial conduct of Mr Tata and other Trustees.

As an 18.37 per cent shareholder, it is in our own interest to ensure the Group's long-term success. My family, although a minority partner, has been a guardian of the Tata Group for over five decades.

This legal fight has never been about me. It has always been and will always be about protecting the rights of minority shareholders and upholding their right to demand a higher standard of corporate governance from controlling shareholders.

ALSO READ:Corporate Affairs Ministry moves NCLAT, seeks modification in its order on Tata Sons

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