BSkyB investors raise governance concerns
Minority shareholders cast doubt on chairman James Murdoch’s position
By CFOWorld.co.uk | CFO UK | Published 15:25, 18 July 11
Minority investors in the British broadcaster BSkyB threw into doubt their chairman James Murdoch’s position by calling for closer scrutiny of the company’s corporate governance.
The primary concern is reportedly that the influence of News Corp, which owns 39 percent of BSkyB shares, is too great and should be looked at more closely in light of the hacking scandal surrounding the media conglomerate.
“We think they should review the composition of the BSkyB board and the influence exerted by those with ties to News Corp,” one top ten investor in the satellite broadcaster told Reuters.
A second top 25 investor in the company said BSkyB's corporate governance remained “tricky” but he denied market chatter that fellow shareholders were determined to drive out Murdoch.
News Corp’s US shares fell 4.7 percent in pre-market trading on Monday and the Australian stock sank to a two-year low after Rebekah Brooks, ex-chief executive of the company’s UK arm, was arrested on Sunday and the head of London’s Metropolitan Police Paul Stephenson quit over the scandal.
Until earlier this month News Corp looked set to acquire the 61 percent of shares in BSkyB it does not currently own but its bid to do so was dropped last week.
On Tuesday last week the shareholder advisory group Pirc raised “governance red flags” with regards to James Murdoch’s appointment as chairman at BSkyB and encouraged its investors to demand greater disclosure on the subject.
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