Final decision on the subject to be taken by Tata Sons chairman N Chandrasekaran
Indian Hotels (IHCL) CEO Rakesh Sarna has been exonerated of sexual harassment accusations made by a former employee, according to people with knowledge of the matter. An independent panel constituted by IHCL, part of the Tata group, found no evidence to support the claim, they said. The employee, who left the group in 2015, said she was sceptical of the nature of the inquiry and its findings.The matter didn’t come up for discussion at the first IHCL board meeting attended by new Tata Sons chairman N Chandrasekaran on Friday. The issue will be discussed separately with the new chairman, executives told ET. It will be up to Chandrasekaran to take a final decision on the subject, they said. IHCL runs the Taj group of hotels.

The panel of HDFC Standard Life CEO Deepak Satwalekar, Kashmira Mewawala, head of business development at Tata Capital, and Sonal Mattoo, an independent advocate, was set up in June last year. Its findings were reported to IHCL’s audit committee led by independent board member Keki Dadiseth.

Sarna, a former Hyatt executive, had been handpicked by former chairman Cyrus Mistry to turn around the business. The matter had come to public attention amid row that broke out when Mistry was ousted as chairman of Tata Sons in October 2016.

An IHCL response spokesperson said: “We ha ve no knowledge of this development. Given that reputations of people are involved, we request that all speculation is best avoided.“ Tata Sons did not respond to emailed queries.

Mistry’s office said he had done all that he could to ensure that the matter was investigated expeditiously and the woman was protected. “Mr Mistry would not wish to be drawn into comment on the merits of the matter,“ his office said in an email. “As stated earlier in October 2016, when an attempt had been made to use PR machinery to tarnish his reputation about the supposed lack of pace in Mr Mistry’s response, it must be remembered that as soon as Mr Mistry heard about the allegations, he met with the employee and assured that the Tata group stands fully committed to doing justice in the matter through a proper enquiry as per the company’s guidelines.“ An enquiry hadn’t set up at the time based on the wishes of the complainant, the spokesperson said.

“At that time, acceding to the request to put the matter behind, an enquiry was not set up.However, looking at the seriousness of the allegation, Mr Mistry did institute a committee at the Tata Group level to fully probe the matter. A committee, independent of IHCL, involving a senior independent director of IHCL was formed and extremely senior resources forming part of it,“ his office said.

The complainant expressed her dissatisfaction with the outcome. “I am not sure if this was a real enquiry ,“ she said, likening it to a process “where the woman says she has been harassed, the man denies it and the matter is closed.“

She characterised the result as the failure of a system that purported to protect women. “My issue is that such misbehaviour should not be tolerated in any good organisation if they want good quality women talent to join the workplace,“ she said. “The meaning of sexual harassment is the same across countries and laws have to be made simpler and stronger for both men and women and not such that a woman has to always leave the workplace. A leader has to be well rounded in all qualities and uphold the respect of all employees and clearly that has failed here.“

The woman executive had initially worked with members of Mistry’s Group Executive Council before Sarna asked her to move to the Taj group. The woman executive first complained about Sarna in early 2015, following which she was moved to another department in the Tata group. Then, just before she resigned in November that year, she sent a letter recounting the developments that had led her to quit.