Australian funds urged to demand axe of Murdoch execs

29th September 2011, Comments 0 comments

A top body representing some of Australia's major pension funds on Thursday urged its members to demand News Corp directors -- including Rupert Murdoch's sons -- are axed from the media firm's board.

The Australian Council of Superannuation Investors (ACSI), a group

whose members manage some Aus$250 billion in retirement funds, said six of News Corp's directors including James and Lachlan Murdoch should be dropped.

Listed on both the New York and Sydney stock exchanges, News Corp is among the 50 biggest companies trading on the Aus$1.4 trillion Australian bourse, of which pension funds and insurers account for about 28 percent.

ACSI chief Ann Byrne said the call followed the British phone-hacking scandal which felled Murdoch's News of the World tabloid and saw the media magnate hauled before a parliamentary committee.

"Responsibility for this, as well as setting the ethical tone throughout News Corporation and affiliated organisations rests with the News Corporation Board," Byrne said.

Murdoch interests own about 40 percent of voting stock and Bryne conceded that there was "no prospect of any of the incumbent directors having a majority vote against their re-election."

But she said ACSI wanted to send a "clear message" to News Corp's board on the need for improved standards of oversight and greater independence.

"Progress on these issues is occurring too slowly, if at all," she said.

"The upcoming annual meeting provides an opportunity for investors to convey their clear view on improving the composition of the News Corporation Board."

The recommendation to sack the Murdochs, Natalie Bancroft, and three other long-serving directors David De Voe, Andrew Knight and Arthur Siskind, was not a reflection on any individual's boardroom abilities, she added.

"In our view, the whole Board is responsible for failures of oversight, however we regard it as impractical to recommend against the election of the whole Board," Byrne said.

Just five of News Corp's directors were classed as independent, something Byrne said "fails to provide safeguards to ensure that the company is run in the best interests of its shareholders."

US-based News Corp reshuffled its board of directors earlier this month, with two long-standing members standing down and venture capitalist James Breyer to stand for election at the October 21 annual general meeting.

Australian-born media baron Murdoch, now 80, has backed chief operating officer Chase Carey as his immediate successor, also expressing confidence in son James, who refused a bonus this year following the hacking scandal.

© 2011 AFP

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