Murdoch reinstated as BSkyB chair despite resignation calls

James Murdoch has been re-elected as chairman of beleaguered media group BSkyb despite calls from fund management groups for his resignation.

At the company's annual meeting, 81.24% of shareholders voted for him to continue as chairman while 18.76% voted against him.

Standard Life Investments joined the growing list of fund management groups calling for the resignation of Murdoch this morning with Guy Jubb, head of governance and stewardship, writing a statement sayig a change in Murdoch's board responsibilities would be in the company's best interests following the unsuccessful bid approach by News Corporation.

This highlighted the "conflict of interest" on the board and the News of the World phone hacking scandal, for which Murdoch should be partly-responsible.

BSkyB's share price moved upwards on the news. Shares were down just over 1.2% earlier this afternoon but were only slightly in the red, down 0.60% at around 13.15.

The Telegraph revealed yesterday Legal & General, Franklin Templeton and Kames Capital were all expected to oppose Murdoch's re-election as chairman while lobby group Pensions & Investment Research Consultants (PIRC) has also urged shareholders to oppose his re-election.

Standard Life Investment's statement from Jubb said: "In September, we wrote to Nicholas Ferguson, the deputy chairman and senior independent director, to advise him that we were concerned that James Murdoch remains chairman of the board and that we should like to see a new and independent chairman appointed.

"We explained to Ferguson the unsuccessful bid approach from News Corporation had magnified the conflicts of interest which the independent non-executive directors have to deal with and it is inappropriate for the group's board to be led by a representative of its largest shareholder and putative offer.

"We pointed out our misgivings had been heightened by the revelations of stewardship short-comings at the News of the World, a title for which Murdoch bore a measure of responsibility.

"In summary, we told Mr Ferguson that we believe that a change in Mr Murdoch's board responsibilities would be in the best interests of the company.
"Earlier this month Ferguson sent to us a considered reply which sadly concluded by reflecting the unanimous view of the independent directors that Murdoch should remain as chairman. I want to let the independent directors know we are deeply disappointed that not one of them shares our belief it is inappropriate for Murdoch to chair the board."

Shares in BSkyB were down 1.21% to 736.5p.