News Corp investors have voiced their discontent with the running of News Corp. At Friday’s AGM, they attempted to oust the Murdoch brothers from the board and dilute the family’s influence in the company.
Around 35% voted against James Murdoch, News Corp’s deputy chief operating officer, while 34% voted against elder brother Lachlan. News Corp chairman Rupert Murdoch didn’t escape entirely unscathed either. The media mogul received 14% of ‘no’ votes.
James Murdoch, who won the unpopularity contest, was implicated in the recent phone hacking scandal for his alleged knowledge of underhand practices at the News of the World. However, Lachlan plays no part in the day-to-day running of the firm, having resigned from News Corp in 2005.
So, did the shareholders succeed in their coup? Of course not. The Murdoch family controls a 40% stake. Another private investor, Saudi Prince Alwaleed Bin Talal, holds a further 7%. Outside of this pool, the majority of shareholders voted against the Murdoch brothers. Nevertheless, all 15 members of the board were re-elected.
Anne Simpson, senior portfolio manager at the California Public Employees Retirement System (Calpers), voted against James Murdoch’s re-election. She told the BBC World Service: ‘I think this really tells the board that investors are looking for change, they're looking for robust independence.’
Yesterday, News Corp.'s shares rose 1.1%, to close at $17.40. The share price is still subdued – down 3% – since the phone-hacking scandal broke in early July. Following revelations about the alleged hacking of missing 13-year-old Milly Dowler’s phone, among hundreds of others, News Corp closed the News of the World and dropped its $12bn bid for full control of BSkyB.
But News Corp’s not out of the woods yet. James Murdoch, heir apparent, will appear before the House of Commons Culture, Media and Sport committee once again on 10 November for more questions on his role in the saga.