With the company’s annual general meeting planned for October 21, two shareholder advisory groups have now recommended that investors vote against any member of the Murdoch family for reelection to the board. “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,” said the director of Hermes Equity Ownership Services, alluding to the sweeping corruption charges that have plagued the media conglomerate since the phone-hacking scandal exploded. Earlier in the week, Institutional Shareholder Services Inc. also recommended the ouster of Murdoch and ten loyal News Corp. directors, arguing that the ongoing investigation has “laid bare a striking lack of stewardship and independence.”
“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,” admitted one shareholder adviser, who said she was committed to protecting minority interests. “There is a huge problem with shareholder democracy at News Corp. — it breaches what we see as a fundamental shareholder right of ‘one share, one vote,’” she explained.