"Mr. Cyrus Mistry misled the Selection Committee set up in 2011 for selecting a Chairman of Tata Sons to succeed Mr. Ratan Tata, by making lofty statements about his plans for the Tata Group and more importantly indicated an elaborate management structure for managing the Tata Group, given its diversity of business, by suggesting a management structure aimed at dispersal of authority and responsibility," read a statement issued by the company.
"These statements and commitments from Mr. Cyrus Mistry played an important role in the Selection Committee’s final selection of Mr. Mistry as Chairman. After waiting for a period of four years, almost none of these management structures and plans have been given effect to. Clearly, in our opinion, the Selection Committee was misled in its choice of Mr. Mistry," it said.
The company said: "When Mr. Mistry was appointed as Executive Vice-Chairman in 2011, he was informed that he should distance himself from his family enterprise - Shapoorji Pallonji & Company and the other Shapoorji Pallonji Group entities of which he is a major shareholder by putting his shareholding in an arms-length Trust. This was suggested keeping in mind good corporate governance principles."
"Mr. Mistry agreed but after some time, Mr. Mistry retracted his position and indicated that he could not find a way of doing so. Such conduct by Mr. Mistry was inappropriate and created a sense of breach of trust on his part. It also posed a significant challenge to the high corporate governance principles Tata Sons strived for. This retraction, created grave concerns on Mr. Mistry’s ability to lead the Tata Group devoid of personal conflicts and put to risk the high standards," the company said.
Tata Sons board had sacked Mistry on Oct 24.
He was replaced with Ratan Tata.
Image:wikimedia commons
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