New Delhi: Tata Trusts is undergoing a substantial internal restructuring aimed at reducing costs and cutting operational expenses, according to an Economic Times report citing sources familiar with the changes. This plan involves the elimination of several senior positions and a reduced dependence on external consultants.
Notably, this restructuring decision was made prior to Noel Tata’s recent appointment as chairman of Tata Trusts. The move follows an internal audit report that highlighted overstaffing, which raised expenses by Rs 180 crore. In 2022, additional costs from direct implementation projects increased the total workforce expense to Rs 400 crore. Trustees also reviewed this report.
Direct implementation projects—initiated by the Trusts through contractors as part of its philanthropic donations—will now be limited to essential activities. However, Tata Trusts has not issued any comments on this matter.
CEO Siddharth Sharma is introducing checks and balances to strengthen governance and ensure ongoing monitoring of internal processes, according to the Economic Times. The Trusts are restructuring management by cutting top-heavy roles to more efficiently allocate resources towards their core philanthropic goals and lower administrative costs. Decision-making and governance will increasingly rely on a streamlined executive committee.
"A trust should serve the public, acting as a true custodian of the funds and assets it holds," noted one of the sources. "The charity’s purpose is to serve the public, not its own staff, so high-cost ceremonial positions are unnecessary, and proper checks and controls are being enforced."
The Trusts will rely on senior finance experts and internal talent to manage operations and accounts efficiently, sources told the Economic Times.
Anand Desai, managing partner at DSK Legal, stated that while an organisation’s size and operational scope determine the need for specific costs, including senior roles, cost-consciousness is vital for philanthropic organisations. "Beneficiaries of such philanthropy can be held accountable through documentation, with oversight from the board and Trust employees," said Desai, adding that cost pooling and selective use of domain experts can also drive efficiency.
