Australian super funds urged to vote against News Corp directors

ACSI recommendations follow phone hacking scandal

The Australian Council of Super Investors (ACSI), which represents members with A$250bn (€180bn) in assets, has urged its member funds to vote against News Corp directors at its annual meeting next month in the latest investor response to the phone hacking scandal.

ACSI is calling for investors to vote against company founder Rupert Murdoch’s sons James and Lachlan, Andrew Knight, Arthur Siskind, David De Voe and Natalie Bancroft – who ACSI says are either long-serving, affiliated or executive directors.

ACSI’s plea follows its earlier call with other global institutional investors for the appointment of an independent chair.

“Progress on these issues is occurring too slowly, if at all,” said ACSI Chief Executive Ann Byrne. The October 21 AGM in Los Angeles is “an opportunity for investors to convey their clear view” on improving the board. Separately, Christian Brothers Investment Services plans to table a motion from the floor at the meeting calling for a separate chairman and CEO.Byrne said the scandal brought into question the company’s oversight and risk management. “Responsibility for this, as well as setting the ethical tone throughout News Corp and affiliated organisations rests with the News Corp Board,” she said, although conceding it was “impractical” to recommend against the election of the whole board.

UK proxy advisory firm PIRC is also recommending voting against the company’s directors, although its main focus is James Murdoch over his role in the saga.

“In light of his close association with the phone hacking scandal we are advising shareholders to oppose James Murdoch’s election,” PIRC said in a note this week. It questioned his suitability as a senior executive and potential successor to Rupert Murdoch.

It also advises voting against various other directors, including Rupert Murdoch himself.

News Corp is also facing an amended class action suit from the New Orleans Employees’ Retirement System and Central Laborers Pension Fund alleging “rampant nepotism and failed corporate governance”.