US pension funds want Murdoch out
THE two largest public pension funds in America have voted to oust Rupert Murdoch as chairman of News Corporation, putting pressure on the media chief executive before a showdown with investors this week.
THE two largest public pension funds in America have voted to oust Rupert Murdoch as chairman of News Corporation, putting pressure on the media chief executive before a showdown with investors this week.The California Public Employees' Retirement System (CalPERS) and the California State Teachers' Retirement System (CalSTRS), which together control nearly $US400 billion ($A390 billion) of assets, have thrown their weight behind a resolution calling for News Corporation to split the roles of chairman and chief executive that Mr Murdoch has held since founding the company.CalPERS, the bigger of the two American funds, with $US273 billion of funds, has said it would not back the re-election of Rupert Murdoch and his sons, James and Lachlan, to the News Corp board, while CalSTRS has voted against the re-election of every News Corp director. A third pension fund with $US12.5 billion of assets, Calvert Investments, is also thought to have voted against their re-election.The pension funds join a growing list of 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 Austra-lian Council of Superannuation Investors, a peak body for super funds, called for a "genuinely independent chair" and for the News Corporation board to replace family members, affiliated and executive directors with credible, skilled outside directors.One Australian fund, the industry fund First Super, which controls $1.6 billion in funds for members in the timber, pulp and paper and furniture and joinery industries, said it would follow the ACSI's recommendation.In July, Legal & General Investment Management, The Co-operative Asset Management and Aviva were among 18 blue-chip pension funds with more than #1 trillion ($A1.5 trillion) of assets between them that said they would vote against Mr Murdoch at tomorrow's annual meeting amid concerns over the company's corporate governance structure.The meeting will be 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.The expected revolt will put pressure on Mr Murdoch but it is unlikely he will be dislodged. The Murdoch family owns around 12 per cent of the company, but its dual-class shareholding structure means it has nearly 40 per cent of the vote.The Murdochs have also been bolstered by support for all of the News Corp directors from ISS, an influential US shareholder advisory body despite calling for Rupert Murdoch to go last year.Mr Murdoch last week made it clear that he had no intention of relenting, declaring on Twitter that "any shareholders with complaint should take profits and sell!"