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You can find the current article at its original source at https://www.theguardian.com/business/2016/oct/13/sky-shareholders-revolt-against-james-murdoch-appointment-chairman-agm
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| Sky shareholders revolt against James Murdoch's appointment as chairman | Sky shareholders revolt against James Murdoch's appointment as chairman |
| (about 1 hour later) | |
| More than 50% of Sky’s independent shareholders have voted against James Murdoch’s reappointment as chairman. | More than 50% of Sky’s independent shareholders have voted against James Murdoch’s reappointment as chairman. |
| However, 21st Century Fox, Sky’s largest , voted in favour of the appointment, which was approved at the company’s annual general meeting on Thursday. Murdoch is Fox’s chief executive. | However, 21st Century Fox, Sky’s largest , voted in favour of the appointment, which was approved at the company’s annual general meeting on Thursday. Murdoch is Fox’s chief executive. |
| Sky said it noted the “significant vote” against the resolution and would engage with shareholders who opposed Murdoch’s appointment. | Sky said it noted the “significant vote” against the resolution and would engage with shareholders who opposed Murdoch’s appointment. |
| “The board decision to reappoint James as chairman was unanimous and recognised that he is a highly experienced executive with extensive knowledge of the international media industry and has been a strong contributor to Sky since he joined the board in 2003,” the company said in a stock market release. | “The board decision to reappoint James as chairman was unanimous and recognised that he is a highly experienced executive with extensive knowledge of the international media industry and has been a strong contributor to Sky since he joined the board in 2003,” the company said in a stock market release. |
| “The board is confident that with the appointment of Martin Gilbert as deputy chairman and Andrew Sukawaty as senior independent director, there are strong governance processes in place to protect the interests of independent shareholders. Nevertheless, we will engage with those shareholders who voted against the resolution.” | “The board is confident that with the appointment of Martin Gilbert as deputy chairman and Andrew Sukawaty as senior independent director, there are strong governance processes in place to protect the interests of independent shareholders. Nevertheless, we will engage with those shareholders who voted against the resolution.” |
| Murdoch’s reappointment was approved by 71.55%, when Fox’s shareholding is taken into account. | Murdoch’s reappointment was approved by 71.55%, when Fox’s shareholding is taken into account. |
| However, excluding Fox’s stake, a majority of independent shareholders – 50.6% – voted against. Fox owns a 39.14% stake in Sky and holds 37.19% of votable shares. | However, excluding Fox’s stake, a majority of independent shareholders – 50.6% – voted against. Fox owns a 39.14% stake in Sky and holds 37.19% of votable shares. |
| Murdoch had been forced to stand down as chairman of Sky in 2012 after the phone hacking scandal at News International, publisher of the Sun, Times, Sunday Times and now defunct News of the World, where he had also been chairman. | Murdoch had been forced to stand down as chairman of Sky in 2012 after the phone hacking scandal at News International, publisher of the Sun, Times, Sunday Times and now defunct News of the World, where he had also been chairman. |
| Royal London Asset Management, which owns £52m in Sky shares, and shareholder advisory firm Pirc had urged a vote against Murdoch, arguing that the satellite broadcaster needed an independent chairman and criticising the process by which he was reappointed earlier this year. | Royal London Asset Management, which owns £52m in Sky shares, and shareholder advisory firm Pirc had urged a vote against Murdoch, arguing that the satellite broadcaster needed an independent chairman and criticising the process by which he was reappointed earlier this year. |
| Murdoch, a non-executive director at Sky, was the only candidate put forward by its nominations committee to take over from the then chairman, Nick Ferguson. | Murdoch, a non-executive director at Sky, was the only candidate put forward by its nominations committee to take over from the then chairman, Nick Ferguson. |
| Speaking to the Guardian at the AGM, Murdoch dismissed concerns about the conflict of interest of his role. “Well, I’m not qualified as independent because I’m not an independent director, being associated with the major shareholder,” he said. “You saw there were no questions from shareholders here. So it’s not for me to comment on.” | |
| Murdoch was appointed by a three-member committee of Sky directors, including the Aberdeen Asset Management chief executive, Martin Gilbert, now the Sky deputy chairman, and the independent director Dave Lewis, the chief executive of Tesco, who stood down from the board after Thursday’s shareholder meeting. | Murdoch was appointed by a three-member committee of Sky directors, including the Aberdeen Asset Management chief executive, Martin Gilbert, now the Sky deputy chairman, and the independent director Dave Lewis, the chief executive of Tesco, who stood down from the board after Thursday’s shareholder meeting. |
| Murdoch was then unanimously voted in as chairman by his 11 fellow board members, six of whom are independent directors. “No attempts were made to advertise the position externally, or appoint an agency, which goes against the UK corporate governance code,” said Piers Hillier, the chief investment officer at Royal London. | |
| News International, which was rebranded News UK in 2013, is part of News Corp, the newspaper company founded by Murdoch’s father, Rupert. The Fox TV, film and entertainment business was spun out of News Corp as a separately listed company in 2013. | News International, which was rebranded News UK in 2013, is part of News Corp, the newspaper company founded by Murdoch’s father, Rupert. The Fox TV, film and entertainment business was spun out of News Corp as a separately listed company in 2013. |
| The Murdoch family was forced to give up on an £8bn-plus News Corp bid to take full control of Sky in 2011 as the fallout from the phone hacking scandal made it too politically difficult to complete. | The Murdoch family was forced to give up on an £8bn-plus News Corp bid to take full control of Sky in 2011 as the fallout from the phone hacking scandal made it too politically difficult to complete. |
| Asked at the AGM about a potential renewed bid by Fox, Murdoch said the meeting was not the forum to talk about “hypothetical scenarios” but added that Sky had “robust processes and procedures in place to deal with any related party transactions”. | Asked at the AGM about a potential renewed bid by Fox, Murdoch said the meeting was not the forum to talk about “hypothetical scenarios” but added that Sky had “robust processes and procedures in place to deal with any related party transactions”. |
| He handed the investor query to Sukawaty, the non-executive chairman of Inmarsat, who was appointed senior independent director when Murdoch was made chairman. | He handed the investor query to Sukawaty, the non-executive chairman of Inmarsat, who was appointed senior independent director when Murdoch was made chairman. |
| “In terms of the hypothetical transaction you refer to, the company been through that before,” Sukawaty said. “The independent directors on the board have demonstrated how they can be independent in that particular situation. In addition to all that we have shored ourselves up, so to speak. Not only that we have a senior independent director and deputy chairman in Martin Gilbert. | |
| “Together we will stand up and make sure any process that is required to make sure any transaction that is dealt with is dealt with properly. Belt and braces. We [would] take extraordinary measures to deal with that.” | “Together we will stand up and make sure any process that is required to make sure any transaction that is dealt with is dealt with properly. Belt and braces. We [would] take extraordinary measures to deal with that.” |
| The UK corporate governance code is not legally binding and companies only have to “comply or explain”. | The UK corporate governance code is not legally binding and companies only have to “comply or explain”. |
| Sky decided against informing or consulting shareholders about the appointment of Murdoch, although there is no legal corporate governance requirement to do so. | Sky decided against informing or consulting shareholders about the appointment of Murdoch, although there is no legal corporate governance requirement to do so. |
| In the four years since he moved into a non-executive directorship, investors have never voted against his reappointment at an annual general meeting. | In the four years since he moved into a non-executive directorship, investors have never voted against his reappointment at an annual general meeting. |