Seeking support from shareholders of Tata Chemicals, ahead of December 23 extra-ordinary general meeting, Tata Sons ousted Chairman Cyrus P. Mistry on Thursday said the group's governance framework needs urgent repair.Mistry's letter, addressed to the stakeholders, comes ahead of the extra-ordinary general meetings (EGMs) that have been called by several Tata Group companies to remove him from their respective boards."It is for you to decide if such nature and quality of governance is acceptable to you in the oversight of your Company's operations. Necessarily, the governance framework needs urgent repair. This cannot happen in isolation at the level of your company."For the long-term interests of the Tata Group to be protected and for the interests of all stakeholders to be secured, Governance Reform is a must at the level of Tata Sons, and even more importantly, at the level of Tata Trusts," he said in the letter.According to Mistry, it became evident to him that the Tata Group needs the highest norms of corporate governance - something beyond just the imagery that the name evokes and something that is truly institutionalised with rigour and discipline.
The 14-page letter -- "Representation under 169 of the companies Act, 2013. In respect of special notice for removal of Cyrus P. Mistry as Director" -- also said much of the Tata Group's capital was locked down in five "hot spots" which were dragging down performance.Tata Trusts hold 66 per cent stake in the holding company of the industrial conglomerate Tata Sons."Prior to any group-level strategy development and consequent portfolio decisions, I felt a need to understand and assess the strategies of individual companies including your Company. It soon became apparent that much of the Tata Group's capital was locked down in five 'hot spots' which were dragging down performance. These put the entire Tata Group to risk and needed tackling on a war footing," he said."It was evident early on that our strategic risk management processes were not mature and robust. Our decisions affect not just shareholders, but every stakeholder, most vitally, employees and their families. I am proud to say that today some of our companies have in place the best enterprise risk management systems.""The Tata Group is no one's personal fiefdom: it does not belong to any individual, not to the trustees of Tata Trusts, not to the Tata Sons directors, and not to the directors of the operating companies," Mistry said in the letter.