Boards and owners need to be stewards

IN THE first quarter of 2015, Tata Steel reported sharp drop in profits in the face of competition from China, and raw material shortages.

But this is a company with a long history of battling back against adversity. The Tata Iron and Steel Company was first floated in 1907. In 1924, it had to fight for its life. There had been an earthquake in Japan, prices had collapsed. According to the company's biographer R M Lala, major shareholders R D Tata and Sir Dorab Tata received a message from the mill that there was not enough money to pay the wages. They could have cut their losses and walked away.

Instead, Sir Dorab pledged his entire personal fortune of ten million rupees, including his wife's jewellery, to obtain a loan of ten million rupees from the Imperial Bank of India for the company. Throughout this struggle for surviva…