ArpitGarg's Weblog

We haven’t heard the last of Tata vs Mistry. New revelations are coming out each day. Leaked emails, sound bytes, sources and what not. I don’t want to take sides here, but a bad image of India Inc is going out to the world. For investors looking to invest in in India, the feud is a red flag.

I was puzzled as to the manner of removal of Mistry (not the removal itself). Removal of a chairman is the prerogative of Board of Directors, which was well within its right. However the manner was puzzling. There was a report that Mistry was asked by Ratan Tata prior to the board meet to step down, but Mistry turned it down. There has been no clarification on this from either Mistry or Tata’s. Mistry, who has been a lot vocal on a lot of things, is conspicuously silent on this report.

I see a deep rift and a suspicion that Board members had with Mistry, so much so that they thought that giving Mistry 2 week notice might be detrimental. Maybe they feared sabotage. That can be the only logical explanation. Mistry has not covered himself with glory by badmouthing Tata Group. That’s not what grownups do. It is his conduct post the exit that makes me and a lot of us wonder. Outing privileged information is just not a done deal.

If you see the ouster as Chairman as a reputation loss that you need to salvage by going with a hammer after the organization, you were wrong to become the chairman in the first place. After all it’s a job and it comes with a threat of termination.

I think the issue here is that he was a Chairman with 20% stake in the company. He was not an employee but the owner. He was too rich for his ego to take the termination in right spirit. Any employee level chairman would not have done so. He/She would have been worried about the prospects of next job. But not Mistry. He doesn’t need to find another job. He is hell of a rich guy and has his reputation loss to take care of.

I urge Mr. Mistry not to wash dirty linen in public. It doesn’t suit the stature of ex-chairman of Tata Group. As this moment, his conduct since exit makes me believe his ouster was the correct decision.