News Corp investors to vote against Murdochs

Fri Oct 14, 2011 1:18pm EDT
 
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By Sinead Cruise

LONDON (Reuters) - Rupert Murdoch's multi-million dollar campaign to win back the hearts and minds of News Corporation's independent investors suffered a new blow on Friday after another key shareholder group called for his eviction from its board.

Hermes Equity Ownership Services (HEOS), the shareholder advisory service affiliated to Britain's largest pension fund, issued a rallying cry to investors to vote against all Murdoch family re-elections to the board of the embattled media group at next week's annual general meeting on October 21.

"The time is right for the company to appoint an independent chairman to rebuild trust, help correct the governance discount, and ensure that the interests of all investors are properly represented," Jennifer Walmsley, Director of Hermes Equity Ownership Services, said.

"We have a battle on our hands to demonstrate the strength of shareholder opposition because so many shares are held by the family or by people affiliated with the family," she told Reuters.

The organization, which votes on behalf of the BT Pension Fund and more than 20 other institutional clients running $140 billion of assets, has also called for an independent investigation into the phone hacking scandal that led to the closure of top-selling British tabloid The News of the World.

Besides seeking the removal of Murdoch and sons James and Lachlan, HEOS -- whose members hold 0.5 percent of News Corp's shares -- Hermes is also withholding support for the re-election of directors Arthur Siskind and Andrew Knight, citing concerns for their independence.

The statement from HEOS is the latest in a flurry of anti-Murdoch lobbying from corporate governance watchdogs and proxy voting companies all over the world.

Earlier this week, Institutional Shareholder Services Inc. (ISS) said Murdoch and 10 other News Corp directors should be ousted from board in the wake of the phone hacking scandal, which it said "laid bare a striking lack of stewardship and independence."   Continued...

 
<p>News Corporation Chairman and Chief Executive Rupert Murdoch (C) arrives at his home in New York July 20, 2011. REUTERS/Lucas Jackson</p>