UK’s £5bn church asset chief expects top News Corp. executives to be tried in court

Media giant “not a place where shareholders come first” says Church Commissioners’ Whittam Smith

The chairman of the £5.3bn (€6bn) Church Commissioners’ asset management group, Andreas Whittam Smith, says he believes that the News Corp. executives embroiled in the phone hacking scandal will eventually be tried in court.
“I believe myself that Rebekah Brooks, James Murdoch, and even Rupert Murdoch himself – if he can be extradited from the United States – will find themselves in court answering charges under Section 79 of the Regulation of Investigatory Powers Act,” Whittam Smith said at the weekend.
Whittam Smith is First Church Estates Commissioner and chairs the Commissioners’ Assets Committee, which oversees its securities and property portfolio. The comments came in an opinion piece in The Independent.
The Church Commissioners hold 344.6m News Corp. shares worth around £4m.

Whittam Smith’s broadside coincided with a statement from the Church investors’ Ethical Investment Advisory Group (EIAG), stating it had written to Rupert Murdoch calling on the News Corp. board to take “all necessary measures to instil investor confidence in the ethical andgovernance standards” of the company. The group said it couldn’t imagine circumstances “in which we would be satisfied with any outcome that does not hold senior executives to account” over the affair.
The Church investors prefer to engage with companies but will divest as a last resort, as was the case when they dumped Indian mining giant Vedanta in 2010.

EIAG Deputy Chair Richard Burridge was quoted as saying by the Guardian: “Disinvestment is the ultimate sanction, prior to that it’s engagement. I would love to think that Rupert Murdoch lies in bed quaking in fear of the Church of England but I fear that may not be the case.”

Last month, the Church of England’s three national investing bodies, with combined assets of £8bn, adopted a new ethical investment policy on alcohol following recommendations from the EIAG.

Prince Al Waleed bin Talal, who owns 7% of News Corp., told the Financial Times: “This is the time for a loyal shareholder to stand by his friends and allies, the Murdoch family.” The paper’s influential Lex column said News Corp.’s underperformance against the S&P 500 for the last 15 years is partly down to corporate governance.