The Ontario Teachers Pension Plan (OTPP), at C$140.8bn (€110.8bn) the largest single-profession pension plan in Canada, says it voted against James Murdoch at the British Sky Broadcasting (Sky) annual meeting last week, in part over his phone hacking “history”.
Murdoch, son of media tycoon Rupert Murdoch, was backed as a director at the pay-TV satellite broadcaster’s AGM November 21 with 95.65% of shareholder votes.
But some significant investors resisted his appointment. Toronto-based OTPP said: “We note the history of Mr. Murdoch with respects to the phone-hacking scandal and what we view as poor governance records of other boards with which he is affiliated, we have concerns with his ability to adequately represent all shareholders’ interests. Given these concerns, we do not support his election to the board.”
The phone hacking scandal erupted in 2011 when it emerged that the now defunct News of the World had hacked into the phone of missing schoolgirl Milly Dowler. Fellow Canadian giant AIMCo, the Alberta Investment Management Corporation, also voted against Murdoch, citing a “poor governance record”.
Other investors voting against Murdoch specifically included the Florida State Board of Administration, according to voting records. And CalSTRS, the California State Teachers Retirement System, went so far as to vote against the entire 14-member board slate at the company.
The Local Authority Pension Fund Forum (LAPFF), which represents 61 public sector pension funds based in theUK with combined assets of some £150bn (€189.6bn), had urged fellow shareholders to vote against Murdoch’s re-election. The body said it has “consistently raised concerns about James Murdoch’s role” on the board since 2011, over conflicts of interest and his suitability.
Pay was also an issue at the firm for investors. AIMCo voted down remuneration policy (binding) and the remuneration policy (advisory); on the latter, AIMCo’s comment is one word: “Excessive”.
Dutch pension asset manager APG abstained on the remuneration report, while its peer PGGM voted against the remuneration report citing “serious concerns” adding that incentive plans could result in “directors being rewarded twice for the same performance”.
The Florida SBA also voted against both remuneration policy and report. CalSTRS backed up its opposition to the board with votes against both pay policy and report.
Murdoch has been on the Sky board since 2003, and was formerly its chief executive and then its chairman.
Elsewhere in the UK, the National Association of Pension Funds (NAPF) trade body has released its tenth annual Engagement Survey which looks at pension funds’ engagement with their investee companies. Respondents were “almost unanimous” (94%) in their recognition that they have stewardship responsibilities. And some 80% of respondents stated they now take stewardship activity into account when selecting their investment managers. Sixty percent weren’t content for managers to simply be a signatory to the Principles for Responsible Investment – rather they will actively question prospective managers about their stewardship approach.