Rupert Murdoch gets backing for re-election
MUMBAI: Rupert Murdoch has got a major backing from shareholder advisory group ISS, as it recommended that shareholders vote to re-elect News Corp‘s board of directors at its annual meeting on 16 October.
The move is a reversal for ISS – Institutional Shareholder Services – one of the most influential shareholder advisory firms in the US, which last year was highly critical of News Corporation in its advice to investors ahead of the company‘s annual meeting, according to a report by The Guardian.
The support comes after a number of investors and advisory firms joined an action on Wednesday launched by dissident shareholders seeking to break Murdoch control of News Corp. The campaign includes Hermes, a British fund manager that controls ?2.4bn in assets, and Glass Lewis, which advises institutions holding $15tn (?9.6tn) worth of investments. Glass Lewis took the same stance in 2011.
Murdoch and his family own about 12 per cent of News Corp but control 40 per cent of its voting rights.
Glass Lewis has insisted on shareholders’ vote for appointment of an independent chair.
Hermes global head of corporate engagement Hans Hirt told The Guardian, "While we acknowledge the recent board changes made by the company, News Corp has still not sufficiently addressed the significant shareholder concerns about its board structure and corporate culture highlighted at last year‘s annual meeting. The time is right for the company to appoint an independent chair in order to rebuild trust, and ensure that the interests of all investors are more properly represented."
According to The Guardian, the ISS report said shareholders should vote for the current directors and expect to see independent action from the board to address any findings, allegations or penalties against the company when the phone hacking investigations conclude.
ISS, which advises more than 1,700 clients on corporate governance issues, said last year the phone-hacking revelations at News of the World exposed a "striking lack of stewardship" and it called on shareholders to vote against the re-election of nearly all of the media group‘s board, including Rupert Murdoch and his sons James and Lachlan.