Ratan Tata strategically used retirement policies to reshape the Tata Group and solidify his leadership during his tenure as chairman, starting in 1991. When he took over at the age of 54, he encountered resistance from influential senior leaders such as Russi Mody, Ajit Kerkar, and Darbari Seth, who had significant autonomy over their respective companies, often conflicting with the group's unified vision.
In 1992, Tata introduced a policy requiring directors to retire at the age of 75. This marked a turning point for the group. One of the first significant changes came in 1993 when Russi Mody, who had served Tata Steel for 53 years, was forced to retire. Prior to his departure, Mody promoted his adopted son, Aditya Kashyap, to deputy managing director without the board’s approval. Tata disagreed with the move, and the promotion was reversed. Both Mody and Kashyap subsequently left Tata Steel.
Similarly, Darbari Seth retired from Tata Chemicals and Tata Consumer Products in 1994. Before stepping down, Seth appointed his son Manu Seth as managing director of Tata Chemicals. However, Manu resigned in 2000 due to "differences in professional perception."
Ajit Kerkar, chairman and managing director of Indian Hotels, opposed Tata’s efforts to implement reforms. In 1997, Kerkar resigned following accusations of violating foreign exchange laws.
These retirement policies were part of Tata's broader strategy to reinforce his authority and modernize the group. In 2000, the retirement age for non-executive directors was reduced to 70, but it was later raised back to 75 in 2005, allowing Tata to remain chairman until 2012. Eventually, the age limit was returned to 70, leading to further questions about the consistency of these policies.
In 2016, Tata Sons removed the age limit for nominees of Tata Trusts, which was the group’s largest shareholder. This allowed Ratan Tata, who chaired Tata Trusts, to return as interim chairman of Tata Sons, ultimately leading to the removal of Cyrus Mistry from the chairman position.
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