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March 02, 2012
James Murdoch Steps Down at News International
    by Robert Kropp

Christian Brothers Investment Services welcomes the move as a small first step, but calls for additional corporate governance reforms at the media giant.


James Murdoch, the son of News Corp's Chairman and CEO Rupert Murdoch, resigned Wednesday from his position of Executive Chairman of News International, whose corporate parent is the scandal-plagued News Corp.

While Murdoch was in the position at the newspaper arm of the media giant, he oversaw the closing of News of the World, at the time the largest Sunday newspaper in the UK, in the aftermath of revelations that the news source had hacked into the phones of crime victims and public figures. However, in an indication that severe corporate governance issues persist at the company, James Murdoch will retain his role as chief operating officer of News Corp.

In a statement following Murdoch's resignation, Julie Tanner, Assistant Director of Socially Responsible Investing at Christian Brothers Investment Services (CBIS), said, "The resignation of James Murdoch as Executive Chairman of News International is a welcome small first step in the right direction toward improving the corporate culture at News Corporation, the parent company of News International."

"As News Corp. shareholders, we remain troubled by what we see as the company's failure to move quickly and decisively to address and correct the ethical lapses that continue to come to light at News Corp.," Tanner continued. "This continues to damage the company's reputation, threaten the value of all shareholders' investments in the company, and diminish their confidence in management and the board."

"Yet News Corp. still has not implemented substantive corporate governance reforms or management practices, such as establishing robust press standards and a substantive code of ethics."

Last year, CBIS filed a
shareowner resolution at News Corp., calling for the separation of the positions of Chair and CEO. Tanner indicated in the yesterday's statement that CBIS will be filing the resolution again this year. "The only way to ensure proper corporate governance and transparency at News Corp. is with an independent Board Chair," she said.

 

 
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