Hermes EOS the latest investor body to line up against News Corp.

Pressure intensifies on embattled media giant

Hermes Equity Ownership Services, the shareholder advisory group that’s ultimately owned by the £35bn (€40bn) BT Pension Scheme, is to withhold support from News Corp. founder and CEO Rupert Murdoch and his sons James and Lachlan at the firm’s annual meeting next week.
It’s the latest investor response to the phone hacking scandal which rocked the media giant earlier this year.
Hermes EOS, which has 23 clients globally with over £85bn in assets under advice, also called for an independent investigation into the scandal. It will also withhold support for directors Arthur Siskind and Andrew Knight.

Hermes, which says it has engaged with News Corp. since the scandal erupted, also called for an independent chairman to replace Murdoch senior. It’s known that at least one major institutional investor, the $155bn (€112.6bn) California State Teachers’ Retirement System (CalSTRS), has voted against 13 News Corp. directors.And there has been opposition from proxy firms PIRC, Glass Lewis and, most controversially, ISS. Shareholder groups the Local Authority Pension Fund Forum and the Australian Council of Superannuation Investors have also voiced their disapproval. The Christian Brothers Investment Services (CBIS) plans to call for a separate chairman and CEO in a rare motion from the floor at the AGM, which takes place in Los Angeles on October 21.

Hermes EOS director Jennifer Walmsley said: “News Corp. has not reacted with sufficient urgency to investor concerns about its board composition and corporate culture.
“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.”

Earlier this week, News Corp. hit back in a filing saying the “disproportionate focus” on the phone hacking saga was “misguided.”