Thursday, September 29, 2011

#hackgate :#Murdoch : Super Council Wants Murdoch Board Members Rolled

Sarah Collerton

A peak superannuation industry group is urging members who are News Corporation investors to vote against the re-election of James and Lachlan Murdoch to the global media empire's board.

The Australian Council of Superannuation Investors (ACSI) says the sons of media baron Rupert Murdoch and other long-standing board members must be replaced with "credible, skilled outside directors" in the wake of the UK phone hacking scandal.
The hacking scandal has seen billions of dollars wiped off the value of News Corporation's shares and it forced the company to drop its bid for the UK pay TV network BSkyB.

But ACSI does not only have the Murdochs in its sights; it has recommended its investors vote against the return of four other board members, including executive David De Voe, at the upcoming annual meeting.

ACSI chief executive Ann Byrne says the current board members are not the best for the company.

"Such an arrangement does not reflect good corporate governance practice and fails to provide safeguards to ensure that the company is run in the best interests of its shareholders," she said.

"All boards should comprise a majority of independent non-executive directors who are sufficiently motivated and equipped to fulfil the function of independent scrutiny of the company's activities."

"Board renewal at News Corporation is required to ensure that the interests of all shareholders are at the forefront in every board discussion."

Ms Byrne holds the board accountable for the hacking scandal, however she says it is not realistic to replace the entire board.

"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," she said.

But the council, which represents funds that manage assets worth more than $250 billion, admits it is unlikely these directors and board members will be voted out.
"Given that the Murdoch interests own approximately 40 per cent of the voting stock, there is no prospect of any of the incumbent directors having a majority vote against their re-election," Ms Byrne said.

"However in an endeavour to keep pressing for skilled independent directors to join News Corporation and raise the standard of oversight, a clear message needs to be conveyed to the board."

Earlier this month, James Murdoch, the boss of News Corp, turned down his bonus after News Corp awarded him and his father big compensation increases.

As head of international operations at US-based News Corp, James Murdoch has been under media and government scrutiny since the hacking scandal erupted at the London tabloid the News of the World on July 4.

Rupert Murdoch, now 80, has backed chief operating officer Chase Carey as his immediate successor.