Established in 1878, The Hindu Group of publication has a long history, and the organization has managed to survive many a transition and family fight over this long period. Being a private institution, it has no obligation to publicise these disputes, though the many cases fought in the company law board (CLB) and the courts have been reported and form the corpus of information of who fought whom at different points in time.
One such squabble that came to public light was in 2013 when the group chose to disband the structure prevailing then and did away with the professional editor who was in charge and reverted to the family managing the editorial. An extract of the news reported by ‘business standard’ at that time helps to understand the complex ownership structure spanning multiple families.
Who owns editorial control?
There have been allegations of mismanagement at various times and the extract of the statement made by N Ram given below brings out the grievance of one section of the family as made in 2013.
On the many changes being made, Ram said: “The board decided the CEO will no longer function as CEO,” adding transparency was missing and the board was taken for granted, big appointments were made and not reported. “Feeling of alienation was growing inside the organisation.”
On another occasion when the family was in the SC the Chief Justice Kapadia said, “If you go on law there are difficulties. Under the articles of association should the editorial panel be set up by the owners or the editor-in-chief?” he asked. Thus the vexed issue of editorial control has been dogging the organization since long.
It is noted based on the news items that publicly surfaced from time to time that in these conflicts the family alignment was not the same and there was fluidity on who aligned with whom.
Fracas among family members…
The latest in this saga of infighting seems to have broken out in the open recently with the current editor Malini Parthasarathy going public with her decision to end her tenure as the chairperson of The Hindu group of publishing and announced her resignation as well from the board of THGPPL, heralding a fresh chapter in the fracas among the family members.
It is not clear as to who is aligned with whom at this juncture. It also appears that Kasturi and Sons Ltd which featured in the various past litigation has been supplanted by THGPPL, as the new entity housing the newspaper. This is just an incidental information that has no bearing on the evolution of these disputes. The clear inference from the reported information on the group is the lack of understanding and trust among the family members. The constant feature has been groupism though the dramatis personae often changed and like an IPL side anyone can play for any sub group in a given episode and change sides later!
Logically, this level of distrust and dispute must have resulted in a family split like in many other instances and a set of dissenting family members monetising their interest and pursuing different business or goals. In the absence of public information of the financials of the group it can only be guessed that little leverage exists to make such settlements whereby some of the family members not ad idem on the management could have cashed out.
Another factor could be the restriction on ownership of media companies under the government regulations, constricting the options to raise external funds. Recently it was reported that the family owning ‘Times of India’ (BCI) underwent a family settlement. The brothers split the interests among the various components of the group and there was also a report of a sizeable cash settlement.
Will the legacy be taken ahead?
There is a public stake in a newspaper like the Hindu irrespective of its editorial policies and many in the age group of 60s and 70s would have developed their political perspective by reading the newspaper. Writing from outside will be incorrect. But it is not difficult to read the writing on the wall, the newspaper may not survive more such family conflicts.
In the absence of finding an investor who may have an interest to carry forward the legacy of almost 150 years, the family should find a professional board to steer the company and insulate it from the vagaries of the family alignments. It is not clear if the present board structure facilitates provision of independent and impartial advice.
It is also for the consideration of the regulators to enforce publication of the financials and prescribe the governance standards applicable to a listed company, to all news paper and media companies as there is a significant public interest involved in the manner of internal governance and full transparency is called for in such businesses.
