International investor attention is focused on scandal-plagued Newscorp in the lead up to its annual meeting on October 21. Last month, the Australian Council of Superannuation Investors (ACSI) called on shareholders to oppose the re-election of six directors. “The upcoming annual meeting provides an opportunity for investors to convey their clear view on improving the composition of the News Corporation Board” said ACSI CEO, Ann Byrne.
The UK’s Local Authority Pension Fund Forum (LAPFF), which represents £100bn of local government pension funds, has added its voice to the chorus of News Corporation shareholders who are calling for Rupert Murdoch and his son James to be removed from the board of directors. Shareholder groups also want to see greater independence on the company’s board. The LAPFF says that the board must take responsibility for the phone hacking scandal by removing the Murdochs, reorganizing itself, and separating the positions of Chair and CEO. Currently, Rupert Murdoch holds both positions. Glass Lewis and ISS, two prominent proxy voting advisory firms, have also called for the Murdochs to be removed from News Corp’s board.
In an unusual move, the Christian Brothers Investment Service plans to offer a proposal from the floor of the shareholders’ meeting to separate the positions of Chair and CEO.
Unfortunately, the shareholders’ vote will have little direct effect on the company. News Corporation has a dual-class share structure that allows Rupert Murdoch, who owns 12% of the shares, to control 40% of the voting rights.
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