More News Corp. Investors Join Drive to Oust Rupert Murdoch as Chairman (Report)
The conglomerate's planned split provides a chance for "serious governance reform," including an independent chairman, they say.
LONDON - A group of 18 News Corp. investors has signaled it plans to join activist shareholders in voting against founder and chairman Rupert Murdoch at the entertainment conglomerate's shareholder meeting this fall, the Daily Telegraph reported.
They said that the planned split into an entertainment and a publishing company presents an opportunity for News Corp. to improve its corporate governance, including the independence of its board of directors.
The group of investment firms includes Legal & General Investment Management, Co-Operative Asset Management and Aviva and holds some 13.4 million Class A shares in the company, it said.
In a letter to Murdoch, they have declared that they would back a motion filed by the Local Authority Pension Fund Forum in the U.K. and Christian Brothers Investment Services in the U.S. that calls for an independent chairman. Amid the company's phone hacking scandal, the investors want News Corp. to address what they called its “lax ethical culture and lack of effective board oversight."
The motion has been submitted for the annual meeting in LA on Oct. 21.
The Murdoch family together with long-time investor and ally Prince Alwaleed of Saudi Arabia, the company's second-largest investor, controls about half of the News Corp. shareholder vote. He has also had support from many institutional investors.
“Given the recent reputational, legal and regulatory risks brought about by allegations of phone hacking and payments to police officers by News Corp. subsidiaries…we believe the board is in need of independent leadership,” the Telegraph cited from the supporting letter.
The company's planned split provides “a unique opportunity for serious governance reform,” they argued.