Pressure builds for Murdoch to quit chair
THE two largest public pension funds in the US have voted to oust Rupert Murdoch as chairman of News Corporation, putting pressure on the chief executive in the run-up to a showdown with investors this week.
THE two largest public pension funds in the US have voted to oust Rupert Murdoch as chairman of News Corporation, putting pressure on the chief executive in the run-up to a showdown with investors this week.The California Public Employees' Retirement System (Calpers) and the California State Teachers' Retirement System (Calstrs), who together control nearly $US400 billion ($391 billion) of assets, are supporting a resolution calling for News Corp to split the roles of chairman and chief executive that Mr Murdoch has held since founding the company.Calpers, the bigger of the two funds, with $US273 billion of funds, has said it would not back the re-election of Mr Murdoch and his sons, James and Lachlan, to News Corp's board. Calstrs has voted against the re-election of every News Corp director. A third pension fund, Calvert Investments, with $US12.5 billion of assets, is also thought to have voted against their re-election.The pension funds join a growing list of heavyweight institutional investors on both sides of the Atlantic and in Australia to have called for Mr Murdoch to surrender his position.Earlier this month, the Australian Council of Superannuation Investors called for a "genuinely independent chair" and for the News Corp board to replace family members, affiliated and executive directors, with credible, skilled outside directors.First Super, which controls $1.7 billion in funds for members in the timber, pulp and paper and furniture and joinery industries, has said it will follow ACSI's recommendation.In July at least 18 major shareholders, including Connecticut's state pension fund and Britain's Legal & General, said they would vote against Mr Murdoch at the annual general meeting amid concerns about the company's corporate governance structure.The annual general meeting tomorrow in Los Angeles will be the company's biggest test since the phone hacking and police bribery scandals erupted last year.It is the second investor showdown since then, but the first to include resolutions against Mr Murdoch on the proxy voting form, enabling investors to have their say without travelling to Los Angeles to cast their vote in person.It is unlikely that Mr Murdoch will be dislodged, however. The family owns about 12 per cent of the company and has almost 40 per cent of the voting power.
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