News Corp has now attracted the public displeasure of at least five shareholder groups and advisory firms ahead of its annual meeting this month, one of which wants Rupert Murdoch off the board, and all of which have concerns about a board stacked with deferential directors.
Shareholder advisory firm Glass Lewis told US investors on Friday to vote against the re-election of James and Lachlan Murdoch, as well as long-term directors David DeVoe, Andrew Knight and Arthur Suskind, plus Natalie Bancroft, whose family sold The Wall Street Journal to News Corp.
Glass Lewis said shareholders should ''carefully consider the nature of the relationship'' each director had with the Murdoch family - which controls the company through a two-class share structure giving it 40 per cent of the votes from just 12 per cent of the shares - so the company could have a board with ''proper independence'' and oversight.
The firm said last month that ''applying rigorous oversight has not been a strength of the News Corp board'' and that it had ''consistently failed to achieve standards of good governance due to the board's historical deference''.
News Corp has won some support by launching a popular $5 billion share buyback, but the board composition remains contentious.
The Local Authority Pension Fund Forum in Britain has joined the criticism, telling its members that James Murdoch's presence on the board was ''causing significant reputational damage'' to the company, and his re-election should be opposed.
Unlike the other groups, it wants his father removed from the board, as Rupert Murdoch remains both the chairman and chief executive in contravention of Australian Securities Exchange guidelines. Forum chairman Ian Greenwood said: ''We believe that to secure News Corp's long-term future such reform is necessary.''
Last month, the Australian Council of Superannuation Investors made the same recommendation as Glass Lewis against the Murdoch brothers and four other directors, and advisory firm Pension Investment Research Consultants in Britain has made similar recommendations.
In July, the largest US public pension fund, the California Public Employees Retirement System, called the two-class share structure ''a corruption of the governance system'' and said it was considering its options for forcing reform.
The strength of the Murdoch family's hold on the voting shares makes the moves unlikely to succeed, but the ACSI believes a message of change needs to be sent to the board and opposition at the October 21 annual meeting in Los Angeles would do that.
Meanwhile, News Corp has recovered almost all the A$8 billion hit to its value on the Australian sharemarket from the phone hacking scandal.
On July 5, the day after the scandal entered its most intense phase after The Guardian revealed that News of the World had hacked a murdered schoolgirl's voicemail, News Corp shares in Australia were trading at about A$17.10. A month later, they were down 19 per cent to about A$13.80.
On Friday, they closed at A$16.47, 4 per cent below their July 5 value.