Sky deal: James Murdoch faces shareholders at annual meeting

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James Murdoch is poised to defend his position as Sky’s chairman at its annual shareholder meeting on Thursday.

A trio of advisory firms have called on shareholders to vote against his re-election, objecting to Mr Murdoch’s position as chairman of Sky and chief executive of 21st Century Fox.

Fox is attempting to buy Sky, which investors argue presents a conflict of interest for Mr Murdoch.

One investor, Royal London criticised the dual position as “inappropriate”.

However, a Sky spokeswoman said Mr Murdoch was “uniquely well-placed” to be chairman, saying he had “deep knowledge of the global media industry”.

Royal London, which owns a stake worth £31m , has raised its concern over Mr Murdoch’s position.

“Minority shareholders at Sky would be better served by a truly independent chairman,” said Ashley Hamilton Claxton, the firm’s corporate governance manager.

“Independent oversight of the board is particularly important given Fox’s ongoing bid to acquire Sky.”

The Institute of Directors supports that view. Its director general, Stephen Martin said: “The issue is the lack of independence. James is in a difficult situation because he is currently chief executive of the controlling shareholder and also he’s the chairman of Sky so there is a conflict, potentially, there.”

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Three advisory groups – Institutional Shareholder Services, Glass Lewis and Pirc – are urging shareholders to vote against Mr Murdoch’s re-election and executive pay at the company.

Royal London’s Mr Claxton said the current remuneration arrangements were “unnecessarily complex” and could lead to “unacceptably high” levels of executive pay.

Sky’s spokeswoman said: “We have one of the lowest levels of fixed pay in the FTSE 100 and shareholders have continuously voted in favour of the policy since 2014.”

More than 28% of shareholders voted against Mr Murdoch’s comeback as chairman last year, four years after he stood down from the position in the wake of the phone-hacking scandal at the News of the World.

Profits up

Fox’s bid to buy the 61% stake in Sky which it does not already own is now the subject of a Competition and Markets Authority investigation.

Telecoms regulator Ofcom earlier has said the deal risks giving the Murdoch family “increased influence” over the UK’s news agenda and political process.

Sky’s latest results showed sales in the three months to 30 September – the first quarter of its financial year – rose 5% to £3.3bn with underlying earnings up 11% to £582m.

The company added 160,000 new customers in the quarter, which was up more than 50% than a year earlier.

Sky shares have made modest gains trading at £9.19. That is still below the price of £10.75 per share that Fox offered for Sky when it made its bid back in December of last year.

Sky deal: James Murdoch faces shareholders at annual meeting

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