Senior figures at News Corporation have attempted to see off an investor rebellion over Rupert Murdoch's dominant position at the head of the media empire.
Two of News Corp's non-executive directors – Sir Rod Eddington, the company's senior independent director, and Andrew Knight, a former chairman of News International – held discussions in London last month with representatives of the powerful Local Authority Pension Fund Forum (LAPFF), which has backed a resolution calling for Mr Murdoch to stand down from his position as chairman and chief executive of News Corp.
The resolution, which will be discussed at News Corp's annual shareholder meeting in Los Angeles in October, is supported by several British investors including Aviva and Legal & General. A consortium of 18 heavyweight investors are calling for Mr Murdoch to stand down as chairman in the interests of good corporate governance and be replaced by an independent figure who is seen to be acting in the best interests of shareholders.
LAPFF, a coalition of pension funds with total assets of £115bn, said the meeting on "governance issues" had been "very positive" and that it had been encouraged by the willingness of the News Corp non-executives to engage in discussion on governance reform. It is thought that the News Corp non-executive directors have met other investors with similar concerns.
The resolution is the latest in a series of attempts to wrest power from the Murdoch family. But following the turbulent recent history of the company, in which its share price has been damaged by the phone-hacking scandal and it has failed in an attempt to take full control of BSky B, the new resolution is thought to have a stronger chance of success than previous actions.
"If it gets anywhere near 50 per cent [support] of independent shareholders then I think the company has a problem if it doesn't decide to act," said Ian Greenwood, the LAPFF chairman.
Rhodri Phillips, a journalist from The Sun has been arrested by officers from Operation Tuleta, which is investigating privacy offences.Reuse content