The first News Corporation shareholders meeting since news of the company's scandalous widespread phone-hacking broke is scheduled for today in California. News Corp. is already facing a shareholder lawsuit and was recently placed on a list of risky investments as a result of poor corporate governance. The New York Times reports that shareholders will vote on the company's board members and speak directly to the Murdochs at the meeting:
The gathering is expected to be the company's most contentious in years, with frustrated shareholders taking the microphone to demand accountability after a phone-hacking scandal in Britain that has embarrassed the company.
Investors will also have the chance to vote on the company's board members, including Mr. Murdoch and his sons, James and Lachlan. While the family's 40 percent stake virtually guarantees they will be re-elected, the chorus of discontent has put the company in an uncustomary defensive position.
MP Tom Watson of the British Labour Party will also attend the shareholder meeting:
The most forceful, and potentially most ominous protest is likely to come from Tom Watson, the British Labour Party legislator who has led the investigation into phone-hacking at News Corporation's British newspaper unit. Mr. Watson, who acquired nonvoting proxy shareholder status to attend the meeting, said he planned to accuse the company of engaging in further criminal wrongdoing involving surveillance techniques that extend beyond the phone hacking. He did not discuss potential evidence.
"A lot of institutional investors do not know the scope nor the implications of what's happening in the U.K.," Mr. Watson said in a phone interview. "You can delegate power but not responsibility, and Rupert Murdoch for whatever reason has failed to put in corporate governance arrangements that prohibit crimes from being committed."