From Jio to TVS, generational change sweeps through India Inc's boardrooms

From rotating chairmanship to handing over firm to professionals, top family businesses have tried different formulae to ensure smooth transition

A generational change is sweeping through the boardrooms of India Inc as the older business leaders make way for their successors. Apart from Reliance Jio Infocomm, which announced on Tuesday that 30-year-old Akash Ambani will be its chairman, new leaders are taking over the reins at several other groups, including Godrej, Emami, and TVS.

Experts say clear succession planning is vital from the point of view of corporate governance and clarity about the organisation’s future. 

“Family-owned businesses in India have come a long way as far as succession planning is concerned. If earlier the process was not clearly defined and codified, a number of family-owned businesses now have a family council, where issues regarding succession planning, roles that family members will perform in the business, and the duration of the role are discussed at length,” said Harish HV, managing partner, ECube Investment Advisors.

Godrej

Earlier this month, Jamshyd Godrej, chairman of Godrej and Boyce Mfg Co, appointed his niece, Nyrika Holkar, as his successor. While Holkar, daughter of Jamshyd’s sister Smita and Vijay Crishna, had been managing strategy, mergers and acquisitions, brand, and legal affairs at the firm for a few years, experts said it was important for Godrej to make a formal announcement.

In 2017, Jamshyd’s cousin Adi Godrej’s group also set in motion a succession plan, when his children Pirojsha and Nisaba were appointed chairpersons of Godrej Properties and Godrej Consumer Products, respectively. Adi Godrej's eldest daughter, Tanya Dubash, is the chief brand officer of the Adi Godrej group.

Adi Godrej remained chairman of Godrej Industries (GIL), the holding company of the group till 2021, when he stepped down from the board of the flagship company, making way for his brother Nadir Godrej.

“Clear cut succession planning is necessary,” said Shriram Subramanian, founder of Ingovern Research Services. “Even the mid-sized and small sized companies are putting in place a clear succession plan,” he said.

Emami

In February, consumer products maker Emami unveiled a succession plan, with the founders donning the “mentor” hat and the next generation taking the driver’s seat. Founders R S Agarwal and RS Goenka, who set up the business in 1974, stepped down from their positions. Agarwal took on the role of chairman emeritus, and Goenka was appointed non-executive chairman.

The board simultaneously re-designated Mohan Goenka and Harsha V Agarwal as vice chairman-cum-whole-time director and vice chairman-cum-managing director, respectively. Mohan Goenka is the eldest son of R S Goenka, and Harsha Agarwal is the younger son of R S Agarwal. The changes were effective from April 1.

Mohan and Harsha had been in key roles for a while, leading important acquisitions like Zandu Pharmaceuticals in 2008.

Dabur

In Dabur India, a family council was set up in 1998 when the family decided to hand over management control to professionals. It includes only members of the Burman family and reviews the strategy of Dabur India. A structured meeting is held every quarter where various independent business ventures are discussed.

It was also decided that no Burman family member would enter Dabur India. They are, in fact, encouraged to set up independent ventures and create another Dabur.

Today, Dabur is completely run by professionals and the family has just four representatives on the 15-member board.

HCL

The only woman chairperson heading an IT services company, Roshni Nadar-Malhotra, took over the reins of HCL Technologies, which has a market capitalisation of $34 billion, from her father Shiv Nadar in 2020. Shiv Nadar is now chairman emeritus of the company. Before becoming the chairperson, Nadar-Malhotra was the vice-chairperson of the company.

In 2019, Wipro announced the handing over of the baton from Azim Premji to son Rishad. The latter was chief strategy officer and was instrumental in the company’s M&A strategy before taking charge. Azim Premji continues to be on the board as founder chairman, but as a non-executive and non-independent director.

TVS

Down South, a major example of an industry veteran passing on the baton to the next generation was when Venu Srinivasan became the chairman emeritus of group companies like TVS Motor Company and Sundaram-Clayton and allowed professionals along with his son and daughter to run the show. This came immediately after the family arrangement of separation into four different branches earlier this year.

While Ralf Dieter Speth, former CEO of Jaguar Land Rover, took charge of TVS Motor as the chairman, Srinivasan’s son Sudarshan Venu was elevated as the MD of the company with effect from May 5. Similarly, former Indian Administrative Service officer R Gopalan was given charge as the chairman of Sundaram-Clayton, elevating Srinivasan’s daughter Lakshmi Venu as the MD.

In Apollo Hospitals, founder Prathap Reddy has lined up a unique plan of rotating chairmanship through which each of his four daughters — Preetha, Suneeta, Shobana, and Sangita — take turns at the top job.

(With inputs from Sharleen D'Souza, Shine Jacob, and Shivani Shinde)