The U.S.-India Business Council board of directors voted unanimously to split from the U.S. Chamber of Commerce.
The board voted 29-0 to put an end to a year’s long battle with chamber president Thomas J. Donahue that climaxed during the recent visit to Washington, D.C., by Indian Prime Minister Narendra Modi, according to a Washington Post report.
Among the members who took part in the vote include chief executives from major companies such as Pepsi’s Indian American CEO Indra Nooyi, Mastercard’s Ajay Banga and Cisco’s John T. Chambers, and others.
According to the Post report, Donahue wrote to USIBC board members July 1 before the vote and explained that the group “cannot separate from the U.S. Chamber of Commerce without our concurrence.”
The Chamber of Commerce founded USIBC, which Donahue said is a program without “autonomous existence outside of the U.S. Chamber,” the Post reported. The chamber president reiterated those sentiments in a public letter to the 350 USIBC members July 11.
The fight between the USIBC and the chamber was largely about turf and independence, according to the report. A member of the USIBC board said that Donohue was unhappy that the USIBC invited Vice President Mike Pence to a meeting because Donohue wanted to invite Pence to a different event, it added.
A person close to the USIBC board said that Donohue also wanted to oust certain members of the USIBC board and install others, according to the report.
Additionally, leading up to Modi’s visit last month, the chamber reportedly removed USIBC president Mukesh Aghi, among other council heads, the Post said.
Since Modi’s visit and the separation vote, the chamber has dismissed Aghi and another USIBC senior official, USIBC officials said, according to the report.
Aghi said in a letter that the chamber dismissed him because he would not agree to report to the chamber instead of to the U.S.-India group, the report said. A chamber spokesman said in the Post report that “our view is he walked away from the chamber, and therefore he resigned.”
The U.S. Chamber of Commerce established the USIBC in 1975, and it has become one of the biggest of 15 bilateral business groups under the chamber umbrella whose staff members work out of the chamber's office.
The Post reported that tensions began during Terry McGraw’s tenure as chairman of the USIBC. McGraw and Donohue butted heads on who was in charge of what to do regarding policy.
Later, in February 2011, the two sides signed a memorandum of understanding that gave the USIBC autonomy on policy matters and strategic planning, with a governing committee that included three members of the USIBC’s executive committee and the chief operating officer of the chamber, the report said.
The memorandum also spelled out financial details, saying that the chamber would open an account in its name but for the benefit of the USIBC with restricted funds, it added.
The USIBC was to receive all the funds except those given to the chamber to cover administrative costs. The account currently has millions of dollars that each side claims as its own, the board member said in the Post report.
Donohue said in his July 1 letter said “all of the assets of the USIBC program are in fact the legal assets of the U.S. Chamber,” according to the report.
The USIBC executive committee wrote to Donohue July 7 after its vote, urging him to pick a date during the week of July 17 “so that we can work out an amicable way to resolve this,” the Post reported.