Murdoch warned of ‘Mulcaire 2′ at News Corp shareholder meeting

Some large investors vote against CEO’s re-election to board, but full details won’t be available until Monday Rupert Murdoch has been dealt a blow by shareholders who called on the News Corp chairman and his sons to resign from the scandal-torn media empire. At the company’s annual meeting in Los Angeles on Friday Murdoch made a defiant and uncompromising address, insisting News Corp’s history was the “stuff of legend.” However, he was berated by shareholders and some of the world’s largest investors voted against his re-election, and that of his sons, to the News Corp board. They also did not approve of the $33m (£21m) he was paid as chairman and chief executive this year. Murdoch owns 12% of the company but controls about 40% of the votes because of News Corp’s two classes of shares. But the fact that major investors voted against his re-election and that of his sons and other directors is a major blow for the 80-year-old chairman and chief executive. News Corp plans to release the full details of the vote on Monday. Before the meeting, shareholders told the Guardian that James Murdoch was likely to receive the biggest vote of no confidence. If the votes go against him, it will cast further doubts on his future at News Corp. The youngest Murdoch son is already facing questions about evidence he gave to a parliamentary inquiry into the News of the World hacking scandal and shareholders at Murdoch-controlled BSkyB have called for his resignation. At the meeting Rupert Murdoch said he was “personally determined” to clean up the phone hacking scandal that had led to the closure of the NoW, but said the issue needed to be set in context at a company that had faced “understandable scrutiny and unfair attack”. He argued that the business had a famous history – from the time he took over a single newspaper in Adelaide in 1953 – which had to be set against the revelations that several reporters at the NoW had been engaged in hacking into voicemails left for crime victims, their families, public figures and celebrities. Speaking at the start of the company’s annual shareholder meeting, Murdoch offered no fresh concessions. With most of the votes in his control, there was no prospect of him or his heir apparent James, being voted off the board. However, the scale of the rebellion was expected to exceed 20% of non-family shareholders. Those attending included Edward Mason, secretary of the ethical investment advisory group of the Church of England, which owns about $6m worth of News Corp shares. “There needs to be decisive action in terms of holding people to account,” he said before the event, noting that it was the first time his group had attended a company annual meeting. At the meeting, Murdoch criticised the church’s investment track record, describing it as “not that great”. Julie Tanner, assistant director of Christian Brothers Investment Services (CBIS), which represents more than 1,000 Catholic institutions worldwide, was the first at the meeting to question Murdoch’s track record, saying that the “extraordinary scandals” in the UK required corporate overhaul. Tanner proposed a motion that News Corp appoint an independent chairman, “to empower the board in relation to the Murdoch family”, and asked that the company launch a “truly independent investigation” into the phone-hacking allegations, instead of the work by its London-based internal management and standards committee. The Labour MP Tom Watson, a persistent thorn in Murdoch’s side, travelled to Los Angeles to attend the AGM. He commented on the “deepest irony” of the opening presentation, which included images of Prince William – whom he alleged had been targeted by former NoW private investigator Glenn Mulcaire – and Kate Middleton, whom he claimed had been targeted by another private investigator employed by the now closed Sunday tabloid, Jonathan Rees. Watson warned News Corp investors that they were facing “Mulcaire 2″ in the UK as victims of alleged computer hacking took action against its subsidiary News International. “You haven’t told any of your investors what is to come,” he told Murdoch, although the News Corp boss insisted that his company was co-operating fully with police inquiries. Watson told Murdoch that he had evidence that the Metropolitan police was investigating computer hacking by private investigators who had worked for the NoW as well as other papers. Murdoch said he had no knowledge of the situation. “What happened a few years ago was absolutely wrong and I have said so, and I have said that we’re all ashamed of it,” Murdoch said, adding that “recent rumours” Watson mentioned were under investigation by the police. After the meeting, Watson said: “If my concerns are founded then this company is going to experience even more litigation in the future than it faces now.” Investors, critics and the press were bussed into the high security event from a parking lot in Century City to the Zanuck Theatre at Fox Studios, where a collection of Oscars were on display outside. Outside about 200 protesters had rallied with signs that read “Stop the Lies” and “News Corp Board Has to Go.” Stephen Mayne, an Australian shareholder and long-time critic of Murdoch, said it was an “extraordinarily paranoid” meeting. “I think he’s losing it,” he commented. “He comes across as a paranoid control freak.” A few hours before the meeting began, News Corp confirmed it had reached an agreement to pay the family of murdered teenager Milly Dowler £2m in compensation, with Rupert Murdoch personally donating an additional £1m to six charities. The settlement relates to the hacking of the missing schoolgirl’s phone messages by the tabloid after she went missing in March 2002. “Nothing that has been agreed will ever bring back Milly,” the Dowler family said. “The only way that a fitting tribute could be agreed was to ensure that a very substantial donation to charity was made in Milly’s memory.” News Corporation Rupert Murdoch James Murdoch Media business Phone hacking United States Tom Watson Newspapers & magazines National newspapers Newspapers Dominic Rushe Dan Sabbagh Jason Deans guardian.co.uk

Posted by on October 21, 2011. Filed under News, Politics, World News. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.