Christian Brothers Investment Services Introducing Resolution to Split News Corp. CEO, Chair Duties at Annual Shareholders Meeting
NEW YORK, Oct. 18, 2011 /PRNewswire/ — Christian Brothers Investment Services (CBIS), a leader in socially responsible investing, will introduce a floor resolution calling for the separation of the Chief Executive Officer and Chair of the Board positions at News Corporation when the company holds its annual shareholder meeting on October 21st in Los Angeles.
Julie Tanner, Assistant Director of Socially Responsible Investing at CBIS, will be at the meeting and introduce the resolution. According to Ms. Tanner, the allegations of phone hacking and bribery earlier this year that prompted News Corp. to cease operations of its scandal-ridden News of the World publication and resulted in ongoing government investigations in the U.K. and U.S. demonstrate a clear need for an independent Chair who is separate and apart from the CEO function.
“The purpose of our resolution is to ensure that an independent voice with an independent view is leading News Corp.,” says Ms. Tanner. “As the company’s shareholders, including CBIS, and the rest of the world have seen, ethical lapses appear to be endemic to News Corp. and not just a single, isolated incident. This resolution seeks to restore responsibility at the top of News Corp. and ensure the company operates in accordance with the highest standards of corporate governance and transparency, which at present are sadly lacking.”
CBIS is introducing the measure as a floor resolution because the deadline for filing proxy resolutions in accordance with the usual News Corp. procedures was in May, well before the extent of the News of the World scandal became public. As a consequence, only shareholders who are physically present at the News Corp. annual meeting will have the opportunity to vote on the resolution.
“While News Corp.’s shareholder voting rules and corporate structure limit investor opportunities to voice their concerns, investors can still send a powerful message to the board,” says Ms. Tanner. “We urge all News Corp. shareholders in attendance at the annual meeting to use their vote to demonstrate to the board that sweeping changes are needed by supporting our resolution to split the duties of News Corp.’s Chair and CEO and vote against the reelection of members of the company’s board, including Rupert Murdoch as Chair.”
Many major global institutional investors and governance firms are lining up behind the CBIS floor resolution. The California Public Employees Retirement System (CalPERS), which is the largest public pension fund in the U.S. with approximately $235.8 billion in assets under management (AUM), supports CBIS’s call for separating the CEO and Chair duties at News Corp.
In issuing its proxy voting decision, CalPERS stated: “CalPERS is a firm supporter of proposals requesting an independent Chairman of the Board. We believe if the Chairman is independent the board may be able to exercise stronger oversight of management. Additionally, to vote on this proposal shareowners must physically attend the annual meeting. CalPERS staff will be in attendance to cast a vote in support of the resolution.”
Similarly, the U.K.’s Local Authority Pension Fund Forum (LAPFF), which represents $157 billion of U.K. public sector pension funds, is also recommending “investors vote for the CBIS resolution from the floor.”
Glass Lewis & Co., a leading international governance analysis and proxy voting firm that advises firms with $15 trillion of investments, is encouraging “any shareholders present at the [News Corp.] annual meeting to vote in favor of the proposal. Further, we believe the appointment of a fully independent chairman is even more necessary at the Company due to the level of family control of the Company and its board.”
“Shareholder concerns about News Corp.’s board members go well beyond the question of, ‘Who was minding the store when the hacking scandal occurred?’ We have serious doubts about their independence on a whole range of issues from the high number of affiliated directors with close ties to Rupert Murdoch and his family to excessive executive compensation,” says Ms. Tanner.
In fiscal year 2011, News Corp. paid its named executive officers more than $109 million in total compensation, which included $29 million in cash bonuses. Chair and CEO Rupert Murdoch received $33.3 million in total compensation, including a $12.5 million cash bonus.
CBIS is also joining with CalPERS, PIRC, ISS, and other large News Corp. shareholders in opposing the reelection of Rupert Murdoch as Chair. Like ISS, CBIS is also recommending votes against the reelection of 13 of News Corp.’s 15 board members to create more independent oversight of management.
In August, a coalition of News Corp. shareholders and members of The Interfaith Center on Corporate Responsibility (ICCR), with $24.7 billion in AUM issued a statement requesting that the board be led by an independent chair, consist of a substantial majority of independent directors, and eliminate its dual class structure to provide all shareholders with equal access to the proxy ballot. Please go to http://www.cbisonline.com/page.asp?id=1126 to see the full text and signatories of the statement.
Disclosure: CBIS owns 600,000 News Corp. Class A shares and 500 Class B voting shares.
For the complete text of the CBIS resolution, please go to
For more information about Christian Brothers Investment Services (CBIS), please contact Rachael Fisher-Layne of JCPR, at 973.850.7318 or firstname.lastname@example.org; or go to http://www.cbisonline.com/.
About Christian Brothers Investment Services
Christian Brothers Investment Services, Inc. (CBIS) is a leader in Catholic socially responsible investing (SRI) with approximately $4.0 billion in AUM for more than 1,000 Catholic institutions worldwide, including dioceses, religious institutes, educational institutions and health care organizations. CBIS’ combination of premier institutional asset managers, diversified product offerings, and careful risk-control strategies constitutes a unique investment approach for Catholic institutions and their fiduciaries. CBIS strives to integrate faith-based values into the investment process through a disciplined approach to socially responsible investing that includes principled purchasing (stock screens), active ownership strategies (proxy voting, dialogues, and shareholder resolutions) and community investment. Visit CBIS at www.cbisonline.com.
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SOURCE Christian Brothers Investment Services