UK fund manager wants Murdochs off News Corp board

A British fund manager today called for Rupert Murdoch to resign as chairman of News Corp as a step toward restoring trust in the global media company.

The British firm Hermes Equity Ownership Services, which manages more than $140 billion of assets, also called for Murdoch's sons James and Lachlan and affiliated directors to be replaced by what it called "credible outside directors".

"News Corp has not reacted with sufficient urgency to investor concerns about its board composition and corporate culture," said Hermes' director, Jennifer Walmisley.

Earlier this week, another group, Institutional Shareholder Services, had urged shareholders to toss out the entire 15-member board at News Corp.'s annual general meeting in Los Angeles on October 21.

Questions about News Corp governance flared after one of the company's British newspapers, the News of the World tabloid, was shut down amid a scandal over illegal telephone hacking and alleged bribery of UK police officers.

The scandal has claimed the resignations of several top Murdoch executives, and several former employees have been arrested.

There was further embarrassment for New Corp this week by reports that the Wall Street Journal Europe had published two articles as part of a deal with a supporter to distribute cut-price copies to students.

Hermes, which represents about one-half of 1% of News Corp shares, said it would not vote next week for the re-election of directors Arthur Siskind and Andrew Knight because of concerns about their independence. Both have been on the board since 1991.