A powerful US pension fund, the Christian Brothers Investment Services (CBIS), has tabled a resolution to strip Rupert Murdoch of his role as chairman of News Corporation, arguably making him more vulnerable to a shareholder revolt than ever before.
Christian Brothers Investment Services (CBIS) has filed the petition ahead of the media giant’s annual general meeting in October, in a signal that the row over corporate governance at News Corp will continue to rage into the autumn.
The group has called for Mr Murdoch’s dual role as chairman and chief executive to be split, and an independent chairman appointed, to help address the “lax ethical culture and a lack of effective board oversight”, exposed by News Corporation’s “still emerging scandals”.
CBIS has voiced its opposition to Mr Murdoch’s position as chairman before now, and tabled a floor resolution at News Corp’s last AGM. However, it was barred from including the vote on News Corp’s proxy form because the deadline had passed before the phone hacking scandal errupted, meaning the resolution was only open to the few hundred investors at the Los Angeles meeting.
By filing the resolution now, CBIS has ensured its resolution will be open to all News Corp shareholders will vote on, heaping pressure on Mr Murdoch to relinquish at least some of his power.“It’s time for News Corp to be run for the benefit of all shareholders, not just the Murdoch family,” CBIS said.
“Given the dual-class share structure and level of family control, it is particularly important for News Corp to have an independent chair who is empowered to challenge management, to foster a culture of accountability, and to reflect the interests of the wider shareholder body,” it added.
News Corp's dual class voting structure means that Mr Murdoch’s family controls nearly 40pc of voting rights in the media giant, but he was still opposed by 14pc of shareholders at its last AGM, up from just over 2pc in 2010.
News Corp declined to comment.