An engineer by training, few would have predicted the publicity-shy Cyrus Mistry would become known for one of the ugliest feuds in Indian corporate history, shaking the foundations of one of India’s most respected conglomerates, Tata Sons.
Mistry, who has died in a road accident aged 54, was born into a successful industrial household in south Mumbai, the younger son of patriarch Pallonji Mistry. But it was the family’s 70-year-old alliance with the Tata dynasty, fellow members of the tight-knit Parsee business community, which would shape the billionaire scion’s life of him.
Educated at Mumbai’s elite Cathedral and John Connon School, founded five years before his family’s business, in 1860, Mistry studied civil engineering and management in London before taking the reins at Shapoorji Pallonji & Co in 1991. The construction company, one of India’s biggest, had already delivered high-profile buildings including the Reserve Bank of India. Under Cyrus’s leadership it took on even larger projects such as stadiums and factories.
The Mistrys were major shareholders in Tata Sons, with an 18 per cent stake, and Cyrus took the family’s board seat in 2006. After Tata Group patriarch Ratan Tata took mandatory retirement aged 75 in 2012, Mistry became the first chair of the conglomerate from outside its founding family.
“I thought he had all the credentials for the role and would serve for many decades”, said Mukund Rajan, who served on Mistry’s executive council at Tata Sons and now chairs an investment firm. He described Mistry as “extremely well read”, with a sharp financial mind: “He could look at a balance sheet and know exactly what was going on.”
Although Mistry had spent a year as the patriarch’s deputy before stepping up as chair, his task was difficult. Ratan Tata, who ran the group for more than two decades, had made a series of blockbuster acquisitions, including British carmaker Jaguar Land Rover and European steel company Corus. However the UK steel operation was haemorrhaging money, and Mistry sought an exit.
“Cyrus inherited a situation where [Tata] Motors and [Tata] Steel faced major challenges, including a large volume of debt taken on just before the global financial crisis, and he had to act quickly, ”said Rajan.
But Ratan Tata still chaired the Tata Trusts, a charitable body which is the majority owner of Tata Sons, and tensions between the two men over the group’s future were widely reported. After four years of worsening relations, Mistry was unceremoniously fired, shocking a Mumbai business society used to a genteel Tata way.
Mistry, determined to defend his reputation and family’s position, contended his dismissal was unlawful and unleashed a fightback against India’s most powerful company at the time.
“This is about governance – it’s not about me, it’s not about my position,” Mistry told the FT in a rare interview in 2016, alleging that Ratan Tata had undue influence over the Tata operating companies, a claim which Tata Sons strongly denied. “Whatever I have said has been said for the long-term interests of the group,” Mistry said.
The ensuing battle wound through the court system, sullied the esteemed Tata brand and directed a floodlight on to industry governance standards. Many in Indian business were critical of Mistry’s campaign, aimed as it was at India’s best-known conglomerate – and hitting Tata companies’ share prices.
Accusations flew between both sides over conflicts of interest, bad management and governance failings. However, Mistry kept his reputation for fair play: “For an Indian businessman, he was scrupulously honest and meticulous about the rules,” said Coomi Kapoor, journalist and author of a book chronicling the history of India’s Parsee families.
Mistry, who is survived by his wife, Rohiqa Chagla and their two children, had an unexpected win in 2019, when a lower court ruled that he should be reinstated. But by 2021, the long battle was over – India’s Supreme Court overruled the earlier judgment in favor of the Tata Group.
Although current Tata Sons chair Natarajan Chandrasekaran quickly paid tribute to Mistry, Indian business has noted the silence from his old foe, Ratan Tata.
Mistry’s untimely death has triggered re-evaluation of the feud in many quarters. “He came to grips with the challenges of the job, and perhaps, in the process of consultation and execution, he might have been misunderstood or he misjudged,” tweeted R. Gopalakrishnan, an author and former director of Tata Sons. The writer added: “He was a good soul.”