Murdoch survives as BSkyB director

James Murdoch was reappointed as a director of BSkyB at the company's annual general meeting today (Reuters)

Nearly 45% of non-News Corporation shareholders failed to back James Murdoch as he was reappointed a director of BSkyB at the company's annual general meeting today.

BSkyB said that excluding votes cast by News Corporation, Mr Murdoch received the support of 55.7% of independent shareholders, with 31.4% opposed and 12.9% withheld.

There have been calls for the son of media tycoon Rupert Murdoch to resign his role as chairman amid fears that his links to the inquiry into phone hacking at News Corporation will damage BSkyB's reputation.

Mr Murdoch received the support of 76.9% of shareholders, with 17.8% opposed and 7.3% withheld.

Deputy chairman Nicholas Ferguson said: "The board recognises that there have been contrasting views among shareholders on the question of the chairmanship.

"All shareholders have now had the opportunity to vote and we have a conclusive result.

"A clear majority, including a majority of independent shareholders, have voted for James Murdoch to continue in his role."

Protesters calling for Mr Murdoch's resignation gathered outside the meeting at the QEII conference centre in London.

Labour MPs Chris Bryant and Tom Watson also arrived promising awkward questions.

Mr Ferguson took questions about Mr Murdoch's role and said: "He runs an excellent board. Discussions are open and frank, his chairing is very good. He has put in place strong governance procedures. He has a strong strategic view."

Asked if the select committee hearings about phone hacking at the News of the World cast doubt either on Mr Murdoch's honesty or competence, Mr Ferguson said: "We've worked with James for eight years, James is a highly competent man. As for honesty, we've seen nothing that makes us question his honesty."

Guy Jubb, head of governance and stewardship at Standard Life Investments, said its votes would go against the re-election of Mr Murdoch.

He told the meeting: "Standard Life Investments manages over six million shares in BSkyB and we have been an investor for many years."

He said that in September the group wrote to Mr Ferguson to advise him it was concerned that James Murdoch remained chairman and it would like to see a new and independent chairman appointed.

It explained that the unsuccessful bid approach from News Corporation (for BSkyB) had magnified the conflicts of interest which the independent non-executive directors had to deal with and it was inappropriate that the board was led by a representative of its largest shareholder.

"We pointed out that our misgivings had been heightened by the revelations of stewardship shortcomings at the News of the World, a title for which Mr Murdoch bore a measure of responsibility.

"In summary, we told Mr Ferguson that we believe that a change in Mr Murdoch's board responsibilities would be in the best interests of the company.

"Since we wrote our letter to Mr Ferguson in September, nothing has changed to cause us to change our view. Therefore, we are voting our clients' shares against the re-election of Mr Murdoch."

Mr Murdoch, who serves as deputy chief operating officer at News Corp, BSkyB's controlling shareholder, was expected to survive as he receives the backing of 39% shareholder News Corp and other investors such as Capital Research Global Investors.

Mr Murdoch, who earlier this month faced tough questioning from MPs over reporting practices at the News of the World, has been BSkyB chairman for just under four years and recently resigned as director of News Group Newspapers, publisher of The Sun and The Times.

He told MPs he "disputed vigorously" claims from former editor Colin Myler and ex-legal manager Tom Crone that they informed him of the significance of an email indicating phone hacking was widespread.

Phone-hacking allegations ignited over the summer when it emerged the phone of murdered teenager Milly Dowler was hacked by a private investigator employed by the News of the World - eventually leading to News Corp shutting the paper down.

Mr Bryant said afterwards: "It's a stark result for James Murdoch. I didn't anticipate the vote against him to be anywhere near as high.

"Only 1.7% of independent shareholders voted against him last year.

"He's got the rules, funds and family behind him - but I still think, as this row goes on, the writing's on the wall.

"I strongly suspect Sky will have dispensed with his services by this time next year."

PA