The Church of England’s investing bodies have sold their combined £1.9m (€2.4m) stake in media giant News Corporation over the phone hacking scandal that hit the company last year.
It comes despite a year of dialogue on the matter with the company.
“The Church Commissioners and the Church of England Pensions Board have today announced the sale of their shares in News Corporation on the advice of the Church’s Ethical Investment Advisory Group (EIAG),” the Church said in a statement.
The Church – whose combined investments total £8bn – first raised concerns with the company’s board after the scandal broke.
“After a year of dialogue between the company and the EIAG, the Church of England was not satisfied that News Corporation had shown, or is likely in the immediate future to show, a commitment to implement necessary corporate governance reform,” the statement went on.
Church Commissioners’ Secretary Andrew Brown said the decision was not taken lightly. “However the EIAG does not feel that the company has brought about sufficient change and we have accepted its advice to disinvest.”
The Church of England already excludes companies involved in weapons manufacture, pornography, alcohol, gambling, tobacco, human embryonic cloning and high interest rate lending.The exclusion shows the strength of responsible investors’ feeling about the company, which is already facing a legal case brought by the Central Laborers Pension fund of Illinois stating the company turned a blind eye to illegal conduct.
Last month, a group of 18 global institutional investors with combined assets of more than $1.6trn (€1.3trn) wrote to News Corp. in support of a shareholder resolution – from Christian Brothers Investment Services (CBIS) and members of the UK’s Local Authority Pension Fund Forum (LAPFF) – seeking an independent chair.
“No commitment to implement governance reform”
And earlier, in May this year, a UK Parliamentary committee said the scandal demonstrated “huge failings of corporate governance”.
Last month CEO and Chairman Rupert Murdoch stepped down as a director from a range of boards that oversee News Corporation newspapers The Sun, Times and Sunday Times in the UK. It followed plans to split the company into two separate companies.