IN Chennai, the TVS Group’s patriarch filed caveats in court against his wife and daughter, who did the same against him.
In New Delhi, the scion of the Godfrey Phillips empire accused his mother of orchestrating an assault on him. Pune’s prominent industrialists, the Kalyanis, took their two-decade-long inheritance dispute to mediation. The list goes on.
India’s corporate landscape is littered with family feuds.
Venerable business groups, some built over centuries, are splintering into petty fiefdoms once their patriarchs die or step away, and the heirs’ pursuit of wealth, power and control descends into bitter infighting.
The opportunity cost to the nation is enormous.
As owner-families get distracted, business stalls, brand loyalties erode, employees lose direction, and shareholder wealth is destroyed.
It can be years before personal scores are settled.
The dragging conflicts impair the country’s reputation for a stable and regulated business environment, and narrow its appeal to foreign investors.
It’s time for India to put an end to this circus. Self-regulation alone can’t fix the problem.
The government must step in with legislation to prevent family disagreements from becoming corporate-governance crises.
It should ensure that succession is settled through transparent, fair, timely and legally enforceable processes.
Since India abandoned socialism and embraced market reforms in 1991, family- run enterprises have modernised and become more professional.
Yet one aspect has remained stubbornly feudal: ownership. The question of where family ends and business begins has never been settled.
The richest surnames have zealously clung to their stakes in their companies, often dividing key management roles among trusted relatives, much like the grocery shop around the corner.
These cozy arrangements prevent the creation of a rules-based system that would free businesses from depending on a patriarch (yes, it is usually a man) who holds together competing family interests and keeps internal conflicts at bay.
Once he goes, a prolonged period of transitory managements ensues, leaving investors – especially foreigners – in limbo over their stakes.
Consider Tata, the group that helped usher India into the industrial age more than 150 years ago.
Today, it channels much of its wealth into philanthropy. But the very structure embodies a tension: When capital must choose between reinvesting in businesses and funding charities, which takes priority?
In patriarch Ratan Tata’s time, his personal authority and values held the two sides together. Since his death in 2024, that delicate balance has unravelled into open conflict.
Succession of India’s biggest and greatest business empires is too consequential for the economy to be left to patriarchal discretion, private bargaining power and family goodwill alone.
This does not mean the government should intervene in individual disputes.
Its role should be to guarantee fairness and transparency, while leaving families to decide how their wealth is divided.
In the TVS saga, for example, the key question is whether a memorandum of understanding signed in 2024 is merely a division of managerial responsibilities, or an irrevocable division of the 115-year-old automobile group’s assets worth more than US$5bil.
That is a question for the family – or courts – to resolve.
The larger problem is that decisions with generational consequences can be made all too casually.
That is where legislation should begin: with a succession framework requiring independent valuations of all businesses, assets, liabilities, trusts and ownership interests. Every eligible heir should have equal access to the relevant financial information.
Independent advisers and oversight should ensure that one powerful faction can’t swing the process in its favour.
All heirs should have an opportunity to challenge valuations and proposed allocations.
Two decades ago, the Ambani brothers, Mukesh and Anil, were embroiled in a bitter feud after their father, Reliance founder Dhirubhai Ambani, died without leaving a will.
A succession legislation might have helped the siblings reach a fair settlement sooner and spared the Reliance Group – and its shareholders – years of bitterness and uncertainty.
Crucially, such a law should take effect while the founder is still alive.
It should also protect the patriarchs – they can sometimes be cut off from their own wealth once they have apportioned it among heirs.
That’s what happened to the late Vijaypat Singhania, who built Raymond into a major textile and apparel business before transferring control to his son Gautam. Their relationship subsequently collapsed.
“He has thrown me out of my own house,” Singhania said.
The charismatic businessman, who held world records for high-altitude ballooning and a microlight flight from London to New Delhi in 23 days, died earlier this year without reconciling with his son.
The law should address gender discrimination, too.
The progressive face of corporate India can hide antiquated attitudes. It’s not uncommon for daughters to be left with meagre inheritances or even excluded from family settlements.
When Chennai-based conglomerate Murugappa Group’s patriarch MV Murugappan died, his daughter Valli Arunachalam was denied a board seat by her own family. She was repeatedly told that she lacked the necessary business experience – even though she had a doctorate and 24 years of experience in multinational companies.
There are precedents that India can follow. Italy’s patto di famiglia is a legal mechanism that allows family-business owners to hand the company to the next generation before they die.
But New Delhi must be more ambitious: It needs to create broader legislation to prevent disagreements from escalating even when the founder’s intent is unknown or the family disagrees with it.
The Bhagavad Gita reminds us that families are the conduits through which values and responsibilities pass from one generation to the next.
For India’s business clans, that carries a clear moral imperative: to ensure that wealth is handed down to its rightful heirs through an orderly and fair process.
Leave succession of the largest economic drivers to the law of the jungle, and India risks being seen as unsafe for private wealth. Investors place a low value on assets in such countries. — Bloomberg
Srinivasan Sivabalan is a Bloomberg Opinion columnist covering Indian markets and corporates. The views expressed here are the writer’s own.
