Tata Group chairman Cyrus Mistry has said that he is "not embarrassed" to admit that exits for the group, which has exited over 40 businesses in 20 years, are usually the last resort and the conglomerate does not take decisions about exiting through a "short-term financial lens".
Mistry cited the turnaround and growth of Tata's jewelery brand Tanishq and its IT arm Tata Consultancy Services as examples "within the group where persistence and a long-term perspective have paid off." He said "equally" the Tata Group has exited over 40 businesses in the last 20 years.
"And as we push the boundaries, there will always be failures, and we must expect these as part of our entrepreneurial model. Of course, critics could argue we could have been more aggressive with our exists and they most probably would be right if we were to take all our decisions through a short-term financial lens," Mistry said here last week.
Mistry was in New York for an event to unveil the membership of FCLT Global, a body dedicated to encouraging long-termism in business and investment decision-making.
He is among the top global industry leaders, including Unilever CEO Paul Polman and McKinsey & Co Global Managing Partner Dominic Barton, who are appointed as board member of FCLT Global. "I am not embarrassed to admit that exits for us are usually a last resort, and we invest considerable time to evaluate all options before taking such decisions.
A healthy level of debate at our boards helps us to improve the decision?making and balance in favour of all stakeholders," he said at the event.
48-year-old Mistry, who succeeded Ratan Tata in 2012 to head the global conglomerate, said for the Tata Group, long-term stakeholder value creation is also about identifying long-term trends and seeding businesses that can capitalise on some of these trends as they collide and create social and business paradigm changes.
"For us sustainable profitable growth is the Tata Group's value creation philosophy and the fundamental lens through which we evaluate the performance of our group companies.
In line with this philosophy, apart from the unique industry? specific strategic levers, there are a number of common directional themes that we urge our group companies to follow.
"These would include generating unique insights and consistently improving our customer experience over time with the intent of strengthening our brand; creating organisational structures and mindsets that enable engagement and agility; developing intellectual property that results in a sustainable competitive advantage and constructing robust risk management processes at the strategic and operational level," he said.