New Delhi: Not one to just give up, ousted Chairman of Tata Sons Cyrus Mistry on Tuesday vowed to continue his fight against chairman emeritus Ratan Tata and moved the National Company Law Tribunal alleging oppression and mismanagement of minority interest.


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In an exclusive interview with Press Trust of India (PTI), Mistry ruled out any chances of truce with Tata stating that his fight against emiritus chairman is for larger issue of governance.


He also stated that he will slug it out without giving up his family's 18.5 percent holding in the USD 103-billion conglomerate.


Given below is the full transcript of the interview to PTI.


Q: What went wrong between you and Ratan Tata? Is it some personal issue which led to the Oct 24 development? You have not spoken about it at all?


A: I think October 24 was action taken by Mr Tata and the board under his this thing (leadership). My views can only be an analysis of what is in his mind because I did not crystallise the actions. I am now sitting and reflecting eight weeks from then, saying what could have been the reasons which went wrong and what were those? Those were two areas where I was very clear that we needed reform. One of them is in the governance area particularly and that was the discussions that were going on. We had multiple discussions on governance and on the day that I was removed, there was actually a tabled draft note for understanding what is corporate governance in terms of roles of Tata Trusts, Tata Sons board and the operating company boards. How does that interface work and that was not only tabled that day, it was being discussed from much before.


As you see, there was another (reason). That was on the ethics side. The board meeting before the last one (in Sept) I had raised the issue of collecting our money from Sivasankaran. It is very clear that Mr Sivasankaran is very close to Mr Tata, I think that is part of history. There are some questionable transactions which have happened over time which have been reported in the newspapers and effectively we need to recover a significant amount of money that we are talking about, over Rs 650 crore.


Q: The companies say they have collaterals for that.


A: That was originally, when there were Rs 250 crore...This is the last meeting. Originally before that Rs 200 crore was given as loan to Mr Sivasankaran, he gave shares which effectively he valued at a high price of TTSL. The company has written off those... Tata Capital did an adjustment against those shares and no payment was made against those shares.


That is largely written off by Tata Capital, even that information was given selectively outside. There was no pre- payment against that. The shares are TTSL shares and we know very frankly, what the situation of TTSL is. This is separate, this is against the Docomo put-option, where he had also signed an agreement where he had to give his shares against the Docomo put-option which was discussed at the (Tata Sons board) meeting on September 15. Within two or four days of us discussing at the board meeting, rather than us recovering the money, he puts a claim on us. That is absolute nonsense, very frankly.


The second one is on Air Asia. On the day I was removed, we had tabled a summary of the forensics report which showed that there was a fraud in the company. Eight weeks have gone by, actually the report was with the company even before that. No concrete steps have been taken in terms of fixing the blame. And now eight weeks have gone. Again showing that there is no action. In the next board meeting, they funded it. They put much more money into the company.


Q: When did you actually come to know about what you call malafide practices both on ethics and governance side? You were a director on Tata Sons much before you took over chairmanship.


A: When I was a director of Tata Sons, clearly I was one of the few directors who were from outside of the group. Therefore, there is no question of knowing any of these things when I was a director from outside. I was chairman for more than three years. During my watch as the chairman, my aim was that no malafides can happen under me. If anything malafide was happening, I would put in a due process to make sure that it would not happen. All transactions with Siva happened much before my took over, whatever happened with Air Asia, as it came to my knowledge I bought it to the knowledge of the board.


Q: Can it legally stand that Air Asia was thrust on you?


A: I am not saying from a legal point of view. I am saying from the point of view of good governance. When you look at good governance, you also need to look at how you approach the subject. When you go for two airline ventures in a short span and in a space where effectively everybody is losing their money at that point in time, and what I have documented with the board is that these ventures are on the basis of...Because I do not have the experience in the aviation business, so I have gone on the basis of Mr Tata's judgement. These are not illegal acts, but these are not in the best form of corporate governance and the question mark is if you look at all these acts together, one can say that these are not legal acts. If you look at them in isolation, questions do come up.


Q: You have been invoking the need to protect the Tata brand, but your actions --- not resignations per se, but protracted battles ahead. Shareholders are saying whatever you are doing publicly stating will have a debilitating impact on the brand.


A: At the end of the day, everybody has to take the right decisions for the right reasons. I think when you take decisions, you should take them not on the basis of what you believe is a convenient outcome, but what you believe is the right outcome. That's something that is important. If we all wanted to sweep things under the carpet, we would not take any decisions. This decision to remove myself from the EGMs is taken to show the people that it is not a battle about me, not a battle about my position, but this is a battle about doing the right thing for the right reasons.


Q: End of the day, you drag the group to the court.


A: Nirmalya Kumar (close confidante of Mistry who was also sacked by Tata Sons): The important thing here is that if you do not clean up, you won't be stronger in the long run.


Cyrus Mistry: Today, if you have a situation where the Trusts will go into the wrong hands and wrong governance happens, what will happen to the companies? That is where today Tatas is. That is what I am pointing out to all of you. If wrong decisions, both from a governance perspective and ethics, happen, this is a slippery slope that we will go down. Unless and until you recognise this, you will not take the right decisions.


Q: Report said you have written to the government for doing away with the exceptions made to Tata Trusts to own more than 1 percent in listed companies and get Tata Trusts get listed itself.


A: I have not done any comment like that, that is not my comment.


Q: What is the solution otherwise?


A: Many institutions go through a phase where they actually...This is an inflection point of this institution. When an institution goes through an inflection point, it has to institutionalise itself. That institutionalisation requires governance to be put in place, governance processes. For example, how do you look at succession planning? How do you ensure that the most competent person can be a family member or an outside member...Today, 600,000 employees depend on that person. You have not one person, but it has to be an institution. How do you create that frameworks? Or are we going to leave that situation to the whims and fancies of one person?


Q: If at all we get an outsider, the chairman of the Trusts will finally control them?


A: Let us look at international institutions and trusts. Trusts have a certain roles and unless you define what their roles are, what is it that they control? Are they controlling the day-to-day operations? If you do that, then what is Tata Sons for? What are the operative companies for? Effectively, you need to have clarity on the roles of different


players inside a structure. That is the governance framework. Thats a very big difference. It is not a 'Lalabhai company' where we can say that there is one person and he is going to control everything.


Nirmalya Kumar: People can say at IHCL or Timbaktoo that he is causing loss of shareholders value. It is like saying I got slapped and you should not do anything, because you might hurt me. I am sorry.


Cyrus Mistry: Shareholder value gets lost when things are done illegally, when corporate governance is not adhered to, when cohesive action is not taken. Have I taken any one of those? I have not done any one of those. I think that is important to understand.


Q: The group survived Radia tapes and many others. Now this. When it comes to corporate governance and ethics does this cause more harm when you take immense pride on being ethical and values?


A: What I am bringing to the fore is that we need to put the process where we live up to those values. We do not only project values without living up because if you don't do that now, you will not...


Q: Social media comments say you are protecting your own commercial interests in the name of protecting their interests.


A: Let us not confuse. Should I not protect my interests? Should I not protect my interest in the right way? There is a difference. Have I protected my personal interest by asking for position? I have not asked. Consistently! Have I protected the interests of the shareholders, whether those shareholders are of operative companies or of the Trusts? Yes I will do that. I don't see why I shouldn't do it. I think there is a very big difference.


Q: Are you discounting any chances of a truce, like industrial families have done?


A: This is not about a business group fight. It is not about those type of things. If that was the situation, I would like to sit in the position. That is why I am removing myself from the position, because it is not me looking for position or power. This is about governance and reform. If governance reform happens, I benefit, I am not saying no.


Q: If you lose the battle, will you quit the Tatas?


A: I will fight for that. I have fought for that...We have been there for 50 years, it's not one day or two days.


Q: Will you seek more board positions to assert your rights?


A: I am not looking for board positions, I am looking for good governance. We will see what happens in the future.


 


With PTI Inputs