Tata Trusts plans to cut senior management roles as part of cost-cutting measures: report

Tata Trusts is reportedly planning to carry out an internal restructuring to streamline operating and management costs, media reports said. As part of the overhaul, the trust will remove the chief financial officer (CFO) and chief operating officer (COO) positions from the organization.

The trust will also reduce its dependence on external consultants, according to an Economic Times report. The report cited sources familiar with the matter and said the decision was made following an internal audit and financial review conducted by the trustees.

This review revealed that personnel costs have increased sharply to reach nearly Rs 180 crore. Further costs associated with direct implementation projects have also pushed up total labor costs to Rs 400 crore in the period up to 2022, the report said. However, these cost-cutting measures were initiated long before Noel Tata was appointed Chairman of the Foundation.

Direct implementation projects are usually carried out by the trust directly through contractors as the domain. However, now these projects will be reduced to a minimum and only to fulfill obligations.

The trusts also plan to redirect resources by reducing senior management roles to core charitable missions and reducing administrative overhead costs.

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The report quoted sources and noted: “The trust must act as a servant of the public. We must be true custodians of the money and property within the trusts. Charitable activities are intended for the community as a whole, and not for its own employees. We don’t need ceremonial posts with high costs, so appropriate checks and controls are being put in place.”

Tata Trusts is the parent company of several philanthropic organizations of the Tata Group and operates in several sectors such as healthcare, rural development, education, skill development, etc.