Post-Ratan Tata: Noel Tata to lead the cost-cutting restructuring process at Tata Trusts as it shifts focus to philanthropy
Mumbai, India — The Tata Trusts is undergoing a significant restructuring exercise in the wake of the passing of Ratan Tata, with a primary aim of trimming operational and management costs. This effort will be led by new chairman Noel Tata. As reported by The Economic Times, Tata Trusts is eliminating top-heavy roles and operational costs to refocus the working of its philanthropic work and establish cost efficiency. Consistent with this strategic revamp, the Chief Financial Officer and Chief Operating Officer positions are eliminated, and the reliance on external consultants is reduced.
According to reports, this was done prior to the formal appointment of Noel Tata and follows on from an internal audit claiming that staff costs were rising. The Tata Trusts had to incur around ₹400 crore in staff cost during 2022 as a result of the added costs associated with direct implementation projects. Direct implementation projects are typically those projects, directly implemented by the trust with the contractors, and will be reduced and only for the obligations that are strictly necessary. To tackle expenses, the restructuring leans toward a leaner committee of executives in decision making and governance.
According to a source privy to the reorganisation of the organization, as stated in a statement provided to The Economic Times, "A trust is supposed to operate like a servant of the public. We have to be true custodians of the money and property within the trusts." Tata Trusts, which aims at keeping public trust alive, has been said to strengthen governance measures and resource optimization in its endeavor to keep track.
Part of a far-reaching strategy being adopted by CEO Siddharth Sharma to enhance controls, the much leaner top team that will ensure uninterrupted oversight into cost-effective implementations. Changes in the funding of Tata Trusts approach towards philanthropic funding - where there should be financial transparence and accountability will also fall under the umbrella of change. According to legal luminary Anand Desai, managing partner at DSK Legal: "Cost consciousness is paramount for philantrophic organisation. pool of costs and domain expertise can also contribute selectively for efficiency.
