Stephen Foley: News Corp investors should reject Murdoch's minimalist shake-up

 

US Outlook: Rupert Murdoch's message to the corporate governance campaigners snapping at News Corp could not be any bolder if he had written it on the front page of one of his tabloids: Stick it up your punter.

The shake-up announced by News Corp yesterday was breathtaking in its minimalism. The hacking scandal has revealed just what a sclerotic band of Murdoch cronies stuff the boardroom around there. But instead of the wholesale clear-out that is needed, we got the retirement of two directors with a combined age of 155 and just one fresh independent director to replace them.

It is a start, I suppose, in bringing the company into genuine compliance with rules that require a majority of board members to be independent of management and the major shareholders (i.e., of the Murdochs). Both of the retirees were ludicrously categorised as "independent" under News Corp's legalistic reading of the Nasdaq rules, but Ken Cowley used to run the company's Australian operations for Mr Murdoch, and the venture capital veteran Tom Perkins has been enjoying News Corp's clubby boardroom lunches for 15 years now, enough to make anyone go native. Mr Perkins, you will remember, was the first director to go public at the height of the hacking scandal to declare Mr Murdoch "a genius" who must not be dislodged from either the chairmanship or the chief executive post.

In comes Jim Breyer, a sprightly 50, who is one of those serial non-executives who are above reproach. He is on the board of Facebook, bringing a little internet savvy to a News Corp still wounded from its ownership of MySpace, and of international giants Wal-Mart and Dell.

As well as appointing Mr Breyer, News Corp is taking some cheekier little steps to prevent dissension among shareholders. Chief among these is decamping the annual meeting this year to Los Angeles, so fewer might be in attendance to vote on a floor motion to strip Mr Murdoch of the chairmanship. However, the corporate governance campaigners will surely be out in force, and so they should be.

Shareholders should also vote against the re-election of every pretend-independent board member, from the opera singing Natalie Bancroft (of the family that sold the Wall Street Journal to Mr Murdoch) to Andrew Knight, the veteran journalist who has been on Mr Murdoch's board for 20 years now and still runs its generous compensation committee.

Most egregious of all, though, is the position of Sir Rod Eddington who, in his role as lead independent director, is supposed to be the go-to guy for shareholders on corporate governance issues and a counter-weight to the power of the Murdochs. He also runs the audit committee, which is in charge of vetting so-called "related-party transactions", such as when Mr Murdoch wants to buy one of his children's businesses. But before running British Airways, Sir Rod was in charge of an airline part-owned by News Corp. He has also been on the board for more than a decade, another reason he would not be considered independent in many jurisdictions, the UK included.

So three sarcastic cheers for News Corp's shake-up yesterday. Now, shareholders, do your worst.

Start your day with The Independent, sign up for daily news emails
Sport
England's women celebrate after their 3rd place play-off win against Germany
Women's World CupFara Williams converts penalty to secure victory and bronze medals
Arts and Entertainment
Ricardo by Edward Sutcliffe, 2014
artPortraits of LA cricketers from notorious suburb go on display
News
newsHillary Clinton comments on viral Humans of New York photo of gay teenager
Arts and Entertainment
The gang rape scene in the Royal Opera’s production of Gioachino Rossini’s Guillaume Tell has caused huge controversy
music
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Sales Assistant / Buyer

£15000 - £17000 per annum: Recruitment Genius: This company offers a range of ...

Recruitment Genius: Customer Service Advisor

£15000 - £16000 per annum: Recruitment Genius: Customer Service Advisors are r...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....

Recruitment Genius: Compliance Manager

£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...

Day In a Page

The Greek referendum exposes a gaping hole at the heart of the European Union – its distinct lack of any genuine popular legitimacy

Gaping hole at the heart of the European Union

Treatment of Greece has shown up a lack of genuine legitimacy
Number of young homeless in Britain 'more than three times the official figures'

'Everything changed when I went to the hostel'

Number of young homeless people in Britain is 'more than three times the official figures'
Compton Cricket Club

Compton Cricket Club

Portraits of LA cricketers from notorious suburb to be displayed in London
London now the global money-laundering centre for the drug trade, says crime expert

Wlecome to London, drug money-laundering centre for the world

'Mexico is its heart and London is its head'
The Buddhist temple minutes from Centre Court that helps a winner keep on winning

The Buddhist temple minutes from Centre Court

It helps a winner keep on winning
Is this the future of flying: battery-powered planes made of plastic, and without flight decks?

Is this the future of flying?

Battery-powered planes made of plastic, and without flight decks
Isis are barbarians – but the Caliphate is a dream at the heart of all Muslim traditions

Isis are barbarians

but the Caliphate is an ancient Muslim ideal
The Brink's-Mat curse strikes again: three tons of stolen gold that brought only grief

Curse of Brink's Mat strikes again

Death of John 'Goldfinger' Palmer the latest killing related to 1983 heist
Greece debt crisis: 'The ministers talk to us about miracles' – why Greeks are cynical ahead of the bailout referendum

'The ministers talk to us about miracles'

Why Greeks are cynical ahead of the bailout referendum
Call of the wild: How science is learning to decode the way animals communicate

Call of the wild

How science is learning to decode the way animals communicate
Greece debt crisis: What happened to democracy when it’s a case of 'Vote Yes or else'?

'The economic collapse has happened. What is at risk now is democracy...'

If it doesn’t work in Europe, how is it supposed to work in India or the Middle East, asks Robert Fisk
The science of swearing: What lies behind the use of four-letter words?

The science of swearing

What lies behind the use of four-letter words?
The Real Stories of Migrant Britain: Clive fled from Zimbabwe - now it won't have him back

The Real Stories of Migrant Britain

Clive fled from Zimbabwe - now it won’t have him back
Africa on the menu: Three foodie friends want to popularise dishes from the continent

Africa on the menu

Three foodie friends want to popularise dishes from the hot new continent
Donna Karan is stepping down after 30 years - so who will fill the DKNY creator's boots?

Who will fill Donna Karan's boots?

The designer is stepping down as Chief Designer of DKNY after 30 years. Alexander Fury looks back at the career of 'America's Chanel'