Tata Trusts aims to streamline operations by reducing management and eliminating multiple roles: report

The Economic Times quoted sources as saying that Tata Trusts is undergoing internal restructuring to optimize operating and management costs.

As part of the restructuring, the roles of chief financial officer (CFO) and chief operating officer (COO) will be eliminated and reliance on outside consultants will be reduced.

Sources told The Economic Times that these cost-cutting measures had been initiated long before Noel Tata was appointed as the new chairman of the trust.

The decision comes after an internal audit and financial review carried out by the trustees revealed a significant increase in staff costs, estimated to be approx. $1.8 billion rupees. Additional costs associated with “direct implementation projects” increase total labor costs to $According to sources, this number will touch Rs 400 crore by 2022.

They added that the trust will also minimize direct implementation projects (i.e. projects implemented directly through contractors as donations) and only undertake these projects when essential obligations are met.

They further said that direct implementation projects (carried out by the trust through contractors as donations) would be minimized and limited to fulfilling basic obligations.

“Trusts should be run like servants of the public. We must be true trustees of the funds and property within the trust. The charity is there to serve the public at large, not its own staff. We don’t need high-cost ceremonial positions, so appropriate checks and controls are being implemented,” a source said.

According to the sources cited above, Tata Trusts has experienced financial experts and skilled in-house staff to ensure smooth operations and effective account management.

About Tata Trusts

The Tata Trusts, the umbrella arm of the Tata Group’s philanthropic organizations, have long played an important role in education, healthcare, rural development and other areas in India.

However, its operating costs are facing increasing scrutiny, particularly as global philanthropic models shift to more agile and cost-effective frameworks. About 66% of the share capital of Tata Sons, the group’s holding company, is owned by a charitable trust set up by members of the Tata family.

On October 11, Tata Trusts appointed Noel Tata as chairman to lead the oversight of the group’s philanthropic organizations. Tata is already a trustee of two major institutions – the Sir Dorabji Tata Trust and the Ratan Tata Trust.