The Tata Sons board has approved a fresh five-year term for N Chandrasekaran as executive chairman, while also moving ahead with plans to list the Tata group’s holding company.
The decision comes as Tata Sons faces renewed pressure from the Reserve Bank of India (RBI) to meet listing requirements for an Upper Layer non-banking financial company (NBFC). The RBI had rejected the company’s application to surrender its Certificate of Registration and exit the regulatory framework for shadow banks.
Under the rules applicable to an Upper Layer NBFC, Tata Sons is required to be publicly listed.
Tata Trusts oppose reappointment
The board’s decision has, however, triggered opposition from Tata Trusts chairman Noel N Tata, who voted against Chandrasekaran’s reappointment at Thursday’s meeting.
The Tata Trusts, which together hold a majority stake in Tata Sons, argued that the resolution was not valid under the company’s Articles of Association. According to the Trusts, the appointment or reappointment of the chairman requires the support of a majority of Trust nominee directors.
“Given that Mr Noel Tata, being one of the Trust nominee directors, voted against the proposal, it was rendered legally void and without any basis,” the Trusts said.
The Trusts also maintained that Chandrasekaran’s August 12 decision not to seek another term had “attained finality”. They said Tata Sons had been advised to begin the process of identifying his successor.
Chandrasekaran had announced exit
The board’s latest move reverses Chandrasekaran’s decision last month not to offer himself for another term after his current tenure ends on February 20, 2027.
Tata Sons said the Trusts had unanimously passed a resolution on July 28, 2025, appreciating Chandrasekaran’s leadership since 2017 and resolving that he be reappointed for another five years.
The board subsequently agreed in principle in September 2025 to extend his tenure and planned to seek the required formal approval at its February 2026 meeting.
However, the issue remained unresolved after discussions in February, May and June. The February resolution had been deferred in the absence of unanimity.
Chandrasekaran announced on August 12 that he would not seek another term, citing continued uncertainty over the leadership question.
The nomination and remuneration committee later asked him to reconsider and backed another five-year term, leading to Thursday’s board decision.