October 17, 2012: Two-Thirds of Independent Shareholders at News Corp. Vote for Independent Chair and Elimination of Dual Class Stocks
Approximately two-thirds of independent News Corp. shareholders voted for resolutions calling for an independent chairman—in effect, stripping CEO Rupert Murdoch of this position—and the elimination of the company’s dual-class share structure, which gives the Murdoch family de-facto control with just 13 percent ownership. This vote casts doubts on whether shareholders see their interests as aligned with the Murdoch family.
“While Mr. Murdoch claims that the interests of his family are in line with those of all shareholders, this vote proves that most independent shareholders would disagree,” said Julie Tanner, Assistant Director of Socially Responsible Investor for CBIS. “We are looking for long-term value in the company, which requires substantive change to the weak corporate governance practices that have brought us to this point.”
“These results demonstrate the need for a one vote, one share structure,” said Laura Campos of the Nathan Cummings Foundation. “The company has failed to convince shareholders that the status quo is in our best interest. We deserve a say in the running of our company, and Murdoch should not continue to be insulated from shareholder concerns.”
“The message from an overwhelming number of shareholders is clear: it’s time for reform at News Corp.,” said Ian Greenwood, Chair of the LAPFF, which manages $185 billion in assets. “These issues of fundamentally flawed corporate governance are not going away.”
The independent shareholder calculation was made by removing the CEO Rupurt Murdoch’s shares from the votes cast.
The resolution to strip Rupert of his chairmanship was jointly introduced by the UK-based Local Area Pension Fund Forum (LAPFF) and Christian Brothers Investment Services (CBIS). The Nathan Cummings Foundation asked News Corp to adopt the same one-share, one-vote structure that is in place at more than 90 percent of the S&P 500.