Murdoch faces shareholders heat ahead of AGM

MUMBAI: News Corp chief Rupert Murdoch is in the line of fire ahead of the company‘s 16 October annual general meeting with the Florida State Board of Administration (FSBA) voting to remove Murdoch and his sons James and Lachlan Murdoch from the News Corp board.

According to Daily Telegraph, FSBA with assets worth $150 billion under its control has backed calls for an independent chairman to be appointed, and voted for the abolition of News Corp?s dual-class share structure, which hands the Murdochs a disproportionate amount of power.

FSBA is the latest among the list of powerful pension funds to have called for Murdoch‘s head. The funds believe that Murdoch has compromised on the corporate governance.

Earlier, California Public Employees? Retirement System (Calpers) and the California State Teachers? Retirement System (Calstrs), the two largest pension funds in America with combined assets of nearly $400 billion, have voted him out. The Calpers and Calstrs had also called on News Corp to split the roles of chairman and chief executive.

However, Murdoch is unperturbed by these developments. ?Any shareholders with complaint should take profits and sell!? the unabashed Murdoch had posted on his Twitter account.

Murdoch is banking on arithmetics to sail through the current crisis. The Murdoch family holds 12 per cent but its dual class shareholding structure gives it 40 per cent of the voting power.

Add to that the backing of second largest investor Prince Al-Waleed bin Talal, who holds seven per cent in the media conglomerate. The dual structure gives Prince Al-Waleed almost 20 per cent voting power.

With 60 per cent voting power in its kitty, the Murdoch family has the ability to push through their decisions and at the same time stall decisions that might not be in their interest.

And much to Murdoch‘s relief, ISS, the influential US shareholder advisory body, has thrown its weight behind Murdoch after calling for his removal from News Corp at the height of phone hacking scandal.

A year ago ISS wanted no less than 13 of the 15 directors to be rejected. However in an about turn, it has thrown its weight behind all the directors.

Talking of phone hacking, former News International CEO Rebekah Brooks was reportedly given a payout package worth about ?7 million pounds after stepping down following the phone hacking scandal.