TATA

Tata group

True Hero

The Tata trusts are the unsung heroes of an extraordinary saga of philanthropy that has enriched India and its citizens in myriad ways.

You may wonder why the Tatas — among the country's biggest and most illustrious industrial families for well over a century — never show up on any of those ritual listings of India's richest people. The reason is as simple as it is remarkable. Over generations, the Tatas have sustained a tradition of bequeathing much of their personal wealth to the many trusts they have created for the greater good of India and its people.

That is how the Tata trusts have come to control 65.8 per cent of the shares of Tata Sons, the holding company of the group. The wealth that accrues from this asset supports an assortment of causes, institutions and individuals in a wide variety of areas. The trusteeship principle governing the way the group functions casts the Tatas in a rather unique light: capitalistic by definition but socialistic by character.

India has an old tradition of philanthropy, passed on down the ages by kings, noblemen and rich merchants. Jamsetji Tata, the founder of the Tata group, gave new meaning to this term. In his words: "There is one kind of charity common enough among us… It is that patchwork philanthropy which clothes the ragged, feeds the poor, and heals the sick. I am far from decrying the noble spirit which seeks to help a poor or suffering fellow being. [However] what advances a nation or a community is not so much to prop up its weakest and most helpless members, but to lift up the best and the most gifted, so as to make them of the greatest service to the country."

Support for higher studies

This was the sentiment that led Jamsetji Tata to establish the JN Tata Endowment Scheme for higher education in 1892. The scheme helped bright Indian students of moderate means become administrators, scientists, doctors, lawyers and engineers, funding their education through loans and grants. The maiden grant was to DrFreneyCama, who became one of the first women gynaecologists in India and who would come to have a maternity hospital in Mumbai named after her.

Of the 37 beneficiaries in the first batch, as many as 15 joined the Indian Civil Service, the colonial version of the Indian Administrative Service, realisingJamsetji Tata's objective that Indians should learn how to govern themselves. By 1924, over a third of Indian ICS officers were Tata scholars. Illustrious JN Tata Endowment scholars include former president KR Narayanan, renowned scientists Raja Ramanna, JayantNarlikar and RaghunathMashelkar, and Gyanpeeth award-winning writer and actor GirishKarnad. The Endowment has thus far supported more than 3,500 scholars.

Philanthropy as a means of promoting higher education and research was a novel concept, even in the United States, at the end of the 19th century. Andrew Carnegie's path-breaking endowment of $1 million to set up a 'technical school' in Pittsburgh, now the Carnegie Mellon University, was made in 1900. But Jamsetji Tata preceded him. Two years earlier, in September 1898, he pledged half his personal wealth, an amount of Rs30 lakh (then £200,000), to make his dream of a "university or institute of research" a reality.

That the Indian Institute of Science (IISc) in Bangalore would take another 13 years to be born, aided by a generous donation of 300 acres of land from the Maharajah of Mysore, is quite another matter. Jamsetji Tata died in 1904, unaware that his vision for science in India would indeed be fulfilled. Over the next 50 years it became a prime source of India's technological prowess. When various national laboratories were established in the late 1940s and 1950s, IISc alumni provided the intellectual manpower.

Their father’s sons

Jamsetji Tata's idea of philanthropy was to be given true expression by his sons, Sir Dorab Tata and Sir Ratan Tata, both of whom donated the major chunk of their personal wealth for the public good. Sir Dorab was the quintessential entrepreneur, working tirelessly to make his father's visionary ideas a reality — roaming the jungles of what is now Jharkhand in eastern India in a bullock cart to set up Tata Steel and pioneering the generation of hydroelectric power in the wilds of the Western Ghats — while Sir Ratan was a connoisseur of the arts and a passionate votary of social development.

Sir Ratan gave a grant to support Mahatma Gandhi's work in South Africa and another for Gopal Krishna Gokhale's nationalist activities in India. He also funded the first archaeological excavation at Pataliputra, which resulted in the discovery of the 100-pillar Mauryan throne room of Ashoka's palace. He donated resources that enabled the London School of Economics (LSE) to research the causes of poverty and how to alleviate it, leading to the establishment in 1912 of LSE's Sir Ratan Tata Department, subsequently called the Department of Social Sciences (the department's first lecturer was a bright young man named Clement Attlee, later to become the British prime minister who gave India its independence).

Sir Ratan died in 1918 at the relatively young age of 47. Apart from donating his unparalleled art collection, especially of Chinese jade, to the Prince of Wales Museum in Mumbai, he left directives in his will for his personal wealth to be used for basic and advanced (postgraduate) education, primary and preventive health, rural livelihood and communities, art and culture and public initiatives, for all Indians at a time when almost all trusts were communal in nature. The Sir Ratan Tata Trust was set up that same year.

A few months before his death in 1932, Sir Dorab bequeathed most of his personal wealth, then estimated at Rs1 crore and comprising substantial shareholdings in Tata Sons, Indian Hotels and allied companies, his landed property and his wife's jewellery — including the famous Jubilee diamond, twice the size of the Kohinoor — and even his pearl-studded tie pins and cuff links, to the newly registered Sir Dorabji Tata Trust.

Support for institution

The Sir Dorabji Tata Trust is best known for promoting six pioneering institutions of national importance. Four of these were established in Mumbai: the Tata Institute of Social Sciences, in 1936; the Tata Memorial Centre for Cancer Research and Treatment, in 1941; the Tata Institute of Fundamental Research, in 1945; and the National Centre for the Performing Arts, in 1966. The National Institute of Advanced Studies (set up in 1988) and the Sir Dorabji Tata Centre for Research in Tropical Diseases (1999) are in Bangalore.

In 1931, at the age of 50, Sir Dorab's wife, Lady Meherbai, died of leukaemia. Sir Dorab started two trusts in his wife's memory. The Lady Meherbai D Tata Education Trust enables young women to go abroad and specialise in social work. So far it has supported over 225 women graduates. The Lady Tata Memorial Trust (LTMT) sponsors international research into leukaemia and the alleviation of human suffering. An international committee of experts in London carefully selects the researchers. In 1996-97, the Trust spent £200,000 for research into the subject by nine scientists from four countries. Some of the research that qualified for the Nobel and other international prizes was initially conducted by LTMT scholars at early stages in their careers.

The Sir Ratan Tata Trust and the S

irDorabji Tata Trust and their allied institutions are at the heart of the enduring Tata commitment to community development, but there are several other trusts too. The JRD Tata Trust, established in 1944, gives institutional donations to promote the advancement of learning, supports research grants and scholarships, provides disaster relief and backs social welfare projects. The MK Tata Trust, set up in 1958 by Minocher K Tata with his personal resources, delivers research grants and scholarships for the advancement of learning in all its branches as well as donating medical and other relief during natural calamities.

The Jamsetji Tata Trust, established in 1974 to mark the centenary of the first Tata enterprise, bestows grants for innovation. The RD Tata Trust, named after Jamsetji Tata's cousin and JRD Tata's father, and set up in 1990, gives institutional grants to advance learning and also backs social welfare projects. The Tata Social Welfare Trust and the Tata Education Trust were founded in 1990 and provides grants for institution maintenance and support of education institutes, hospitals and non-governmental organisations (NGOs) working in the sectors of livelihoods and management of natural resources. The JRD and Thelma J Tata Trust, set up in 1991 by JRD Tata with his and his wife Thelma's personal wealth, works to uplift women and children.

A funding agency

How do the trusts operate? Says ShernazVasunia, programme officer of the Sir Dorabji Tata Trust: "Over 75 per cent of our trust's funds come from dividends on the shares it owns in Tata Sons, the group's holding company. The remaining comes from their own statutory investments." Adds Sarosh N. Batliwala, who heads the Sir Dorabji Tata Trust: "Our trusts don't handle corporate social responsibility; they are more of a funding agency, like the Ford Foundation."

The Sir Dorabji Tata supports different kinds of NGOs — some do social work, some research, while others are community based — usually for a period of three to five years. It also works with international agencies such as the United Nations, mostly in times of natural disasters. From time to time the Sir Dorabji Tata Trust also initiates the process for establishing institutes of national importance.

The Ratan Tata Trust, too, depends on dividends from its Tata Sons shares and its investments. Programmes manager ArunPandhi says the Trust’s focus has changed over the years from charity to development funding, though the provisions of Sir Ratan's will are still the trust's principal guidelines.

Both trusts can and do come together sometimes to fund large projects with different components. The two have stringent appraisal, assessment, accounting and auditing requirements for the NGOs they fund. Projects must be aimed towards sustainability for the community, and money is always released in a phased manner that meets the requirements of recipients.

Surprisingly, the trusts do not usually encourage or consider supporting projects run by Tata companies. "The trustees' view is that if a company has started something then it should sustain itself through its own funds instead of asking the trusts for financial support," says MrBatliwala. "But we do consider cases based on merit," says MrPandhi. The Sir Ratan Tata Trust has funded initiatives by Tata Steel and Tata Chemicals. "There is sharing of knowledge," he says. "To die rich is to die disgraced," said Andrew Carnegie, the American business legend who transformed himself from robber baron to philanthropic epitome. For Carnegie, "the surplus wealth of the few will become, in the best sense, the property of the many." The narratives in this subsection are a window to the breadth and depth of the philanthropic endeavours of the Tata trusts, their quiet contribution to the cause of the country's poor and needy, and a ringing affirmation of the values of the group's founders

Charity spread

Ø There are two principal trusts operating under the Tata umbrella: the Sir Dorabji Tata and Allied Trusts and the Sir Ratan Tata Trust.

Ø The 'allied trusts' component of the Sir Dorabji Tata Trust comprises the Tata Social Welfare Trust, the RD Tata Trust, the Tata Education Trust, the JRD Tata Trust, the JRD Tata and Thelma Tata Trust, the Jamsetji Tata Trust, the JN Tata Endowment, the Lady Meherbai Tata Memorial Trust, and the Lady Meherbai Tata Education Trust.

Ø The Sir Dorabji Tata Trust's allocations to NGOs in 2006-07 were in these areas: management of natural resources; health; social development initiatives; education; and livelihoods. Allocations for individuals came under the heads of medical grants and travel or education grants.

Ø The Sir Ratan Tata Trust supports NGOs, individuals and institutions, and the areas it touches are rural livelihoods; health; education; arts and culture; and civil society and governance. Rural livelihoods account for the major part of the Sir Ratan Trust's funding support (50 per cent), with education (25 per cent) coming second.

The origin

The story of the Tata Group of business unfolds with the birth of its founder Jamshedji Tata in the small town of Navasari in Gujarat in 1839. He breathed his last in 1904 in Germany. His parents were Nuseerwanji and Jeevanbai Tata. Nusserwanji was the first businessman in a family of ParsiZorastrian priests. Destiny called him to Bombay where he started trading. Jamshedji joined him at the tender age of fourteen. He took admission in Elphinstone College and while still a student he married HirabaiDaboo. Jamshedji graduated in 1858 and joined his father’s trading firm. Those were turbulent times. The British had just managed to ruthlessly crush the 1857 Revolt. Since the age of twenty-nine Jamshedji continued to work in his father’s firm. In 1868 he started a trading company on his own with a capital of Rs.21, 000/- His first step was to acquire a bankrupt oil mill and convert it into a cotton mill which he renamed Alexander Mill. Two years later he sold it with a good margin of profit. With this he set up a cotton mill in Nagpur in 1874. Queen Victoria had just been declared the Empress and in keeping with the times Jamshedji named it Empress Mill.

Jamshedji was a unique personality. He did not just think of innovative ways of manufacturing textiles but he devised new labor practices that would satisfy the workers. In this way he was far ahead of his times. It was not just his own personal success but also of those who worked for him and his group. Jamshedji was in close contact with revolutionary thinkers and nationalists like DadabhaiNaoroji and Pherozeshah Mehta and strongly influenced by them. He came to the conclusion that economic self-sufficiency should go hand in hand with political independence. The former should be the base of the latter. Jamshedji had three key ideas in mind. He wanted to set up an iron and steel company, world class learning institution and a hydroelectric plant. Unfortunately during his lifetime none bore fruit but he had planted the seed, which later took roots and spread its branches under the care of his successors. The only achievement that he lived to see was The TajMahal Hotel. It was completed in December 1903 for a princely amount of Rs.4, 21, 00,000/-In this too he was inspired by nationalist thinking. In those days the locals, that is Indians, were not allowed into the best European Hotels. TajMahal Hotel was a befitting reply to this discrimination.Tata Group is a private conglomerate with headquarters at Mumbai. The present Chairman is Ratan Tata who took over from J.R.D. Tata in 1991. A member of the Tata family is always the Chairman of the group. Its operations covers many fields related to industry and allied activities concerned with know-how and its application –engineering, information technology, communications, materials, automotive, chemicals energy, telecommunications, software, hotels, steel and consumer goods.

Facts about Tata group

Ø The Tata Group has operations in more than 85 countries across six continents and its companies export products and services to 80 nations

Ø The Tata Group comprises 114 companies and subsidiaries in seven business sectors

Ø 65.8% of the ownership of Tata Group is held in charitable trusts.

Ø The 2009 annual survey by the Reputation Institute ranked Tata Group as the 11th most reputable company in the world. The survey included 600 global companies

Ø Total revenue is $70.8 billion in 2009

Ø Total asset is $51.79 billion in 2009

Ø Group profit $1.8 billion

Ø Shareholder base 3.5 million

Ø Total international revenue $45.8 billion (64.8% of total revenue)

Ø Companies listed in NYSE are tata motors and tata communication

Ø Total employees are 363,039

Management

Ratan N Tata, Chairman, Tata Sons

Members of the Group Corporate Centre

 NA Soonawala, Vice Chairman, Tata Sons

 JJ Irani, Director, Tata Sons

 RK Krishna Kumar, Director, Tata Sons

 R Gopalakrishnan, Executive Director, Tata Sons

IshaatHussain, Finance and Executive Director, Tata Sons

KishorChaukar, Managing Director, Tata Industries

Arunkumar Gandhi

Leadership

Ø Tata Tea: The world's largest integrated tea company

Ø TCS: Asia’s largest software exporter

Ø Titan: The world's fifth largest watch manufacturer

Ø Tata Steel: India’s largest private sector steel producer and the world's sixth

Ø Taj group: Largest 5-star chain of luxury hotels in India

Ø  Tata Chemicals: India’s largest, and world’s third largest manufacturer of soda ash

Ø  Tata Power: India’s largest private sector power utility

Pioneering

Ø Pioneered India’s steel industry

Ø  Introduced labour welfare benefits long before they were enacted by law (providentfund, gratuity, maternity benefits)

Ø  Started first power plant in India

Ø  Pioneered civil aviation in India

Ø  Brought insurance to India

Ø  Started India’s first chain of luxury hotels

Ø  Led commercial vehicle production

Ø Led India’s software development efforts

Ø  Manufactured India’s first indigenous passenger car, the Indica

List of TATA group of companies

Advinus Therapeutics

Brunner Mond

Casa Décor

CMC

Corus

Drive India Enterprise Solutions

Eight O' Clock Coffee

General Chemical Industrial Products

Good Earth Corporation

Hispano Carrocera

Hooghly Met Coke and Power Company

Indian Hotels

Infiniti Retail

Jaguar Land Rover

JAMIPOL

Jamshedpur Utilities and Services Company

Landmark

Magadi Soda Company

mjunction services

Mount Everest Mineral Wat

NatSteel Holdings

Nelco

Nelito Systems

North Delhi Power

Powerlinks Transmission

Rallis India

Roots Corporation

Taj Air

TAL Manufacturing Solutions

Tata Advanced Materials

Tata Advanced Systems

Tata Africa Holdings

Tata AG

Tata AIG General Insurance

Tata AIG Life Insurance

Tata Asset Management

Tata AutoComp Systems

Tata BlueScope Steel

Tata BP Solar

Tata Business Support Services

Tata Capital

Tata Ceramics

Tata Chemicals

Tata Coffee

Tata Communications

Tata Consultancy Services

Tata Consulting Engineers

Tata Cummins

Tata Daewoo Commercial Vehicle Company

Tata Elxsi

Tata Financial Services

Tata Housing Development Company

Tata Industrial Services

Tata Industries

Tata Interactive Systems

Tata International

Tata International AG

Tata Investment Corporation

Tata Limited

Tata Metaliks

Tata Motors

Tata Motors European Technical Centre

Tata NYK

Tata Petrodyne

Tata Pigments

Tata Power

Tata Power Trading

Tata Precision Industries

Tata Projects

Tata Quality Management Services

Tata Realty and Infrastructure

Tata Refractories

Tata Services

Tata Sky

Tata Sons

Tata Sponge Iron

Tata Steel

Tata Steel KZN

Tata Steel Processing and Distribution

Tata Strategic Management Group

Tata Tea

Tata Tea Inc

Tata Technologies

Tata Teleservices

Tata Teleservices (Maharashtra)

Tatanet

Tayo Rolls

Telco Construction Equipment

Tetley Group

The Tinplate Company of India

Titan Industries

TM International Logistics

Trent

TRF

Voltas

Westland