Revealed: Fox AGM shows democracy done Rupert Murdoch-style

Rupert Murdoch doesn’t listen. Year after year, his independent shareholders vote against him on a range of corporate governance issues and he just doesn’t change.

He also goes out of his way to make it difficult for critics to even raise their concerns at his annual meetings.

Listen to the 26 minute webcast of this morning’s 21st Century Fox AGM at Fox Studios in Los Angeles and you hear the opening announcement restricting individual shareholders to just 1 minute of microphone time.

No wonder there were only 2 brief speakers from the floor.

Rupert mumbled his way through a three-minute statement with no slides, co-chairman and eldest son Lachlan Murdoch managed 6 minutes and apart from that we heard from Roxana Tynan from the Nathan Cummings Foundation and shareholder John Lindsay.

Hollywood Reporter, Variety, Deadline and The Los Angeles Times have all produced reports of what was said at the AGM, but the real news was the size of the protest votes which only became apparent four hours later with this filing to the SEC.

A record 43.2% of participating votes opposed the board and supported the Nathan Cummings Foundation resolution to unwind the Murdoch family gerrymander. This record protest reflects Rupert losing his loyal Saudi Prince.

Strip out the 364.3 million votes controlled by the board (311 million with the Murdochs and 53.3 million with Value-Act’s Jeffrey Ubben) and only 48.2 million votes or some 6% of the 798.4 million voting shares on issue backed the board’s view that the Murdochs should remain in undemocratic control.

Compare that with the 313.7 million votes — 86.7% of the independent votes cast- voted in favour of a move to a one vote one value system.

It was also noteworthy that 156.3 million votes opposed the remuneration report and the only female director of Fox, Delphine Arnault, suffered the biggest board protest vote of 199 million shares. She was a no show at the meeting.

The three Murdoch men received 95%-plus in favour with against votes ranging between 26.9m and 30.8 million. This was a surprise, especially given the $1 billion in salary and bonuses they’ve extracted over the past 20 years, including almost $100 million in 2016-17.

***

Now, to put all this in context, here is a full history of 21 other News Corp and Fox AGMs over the past 19 years where there have often been multiple protest votes.

21st Century Fox 2016: 63.7% of the non-board vote went against the remuneration report.

News Corp 2016: former Spanish President Jose Maria Aznar copped biggest protest vote of 20.7% (including Rupert’s support) and 32.3% backed the proposal to eliminate the dual class voting structure.

21st Century Fox 2015: Murdochs were all strongly supported but Delphine Arnaut attracted biggest protest vote of 71 million votes and 45 million votes opposed the remuneration report.

News Corp 2015: majority of independent votes went against re-election of Murdoch boys and voting gerrymander.

21st Century Fox 2014: 52 million votes against the rem report and James and Lachlan were the least popular directors with 76 million against votes.

News Corp 2014: a record 47.5% of the voting stock supported dismantling the Murdoch family gerrymander, although it later became apparent the Prince had already sold down and wasn’t a decisive factor in these protest votes.

21st Century Fox 2013: the first AGM of the demerged company saw Lachlan Murdoch cop the biggest protest with 125.8 million against votes. A hostile shareholder resolution calling for an independent chair was supported by 147 million votes and the rem report was opposed by 77.6 million votes.

News Corp 2012: more than 100 million votes against Lachlan Murdoch and Natalie Bancroft, 140.4 million votes against the rem report and 156.6 million votes ignored the board’s advice and supported a resolution calling for an independent chair to be appointed.

News Corp 2011: more than 200 million votes against 5 directors with James and Lachlan Murdoch the least popular and only saved by dad voting for them. Rem report also heavily opposed by 232 million votes, a clear majority of the independent shares on issue.

News Corp 2010: James Murdoch least popular director with 62.8 million votes against and the company resisted a hostile say-on-pay resolution which was supported by 215.6 million votes or some of 37.2% of the total.

News Corp 2009: no hostile resolution so shareholders only dealt with re-election of the full board and the appointment of Ernst & Young as auditor. News Corp failed to disclose the voting results with the ASX in 2009 and no voting result ever filed with the SEC as this page demonstrates.

News Corp 2008: nothing hostile on the agenda but no results ever filed with the ASX as this list of ASX announcements demonstrates and nothing filed with SEC.

News Corp 2007: 22.9% supported resolution to unwind the dual class share structure.

News Corp 2006: shareholder resolution for annual election of director defeated, poison pill extended but the actual results were not ever included in this ASX announcement or filed with the SEC where it should be available on this page.

News Corp 2005: excluding the Murdoch/Malone vote, there was almost 50% against the fee rise for directors and protests of between 29.11% and 33.6% against 4 directors, including Sir Rod Eddington who suffered the biggest against vote.

News Corp 2004: relatively strong support for the move to America and 4 directors re-elected with less than 5% voting against.

News Corp 2003: options issue to non-executive directors was defeated because Rupert wasn’t able to vote his own stock. This embarrassment arguably triggered the subsequent relocation to Delaware where shareholders have less rights.

News Corp 2002: 12.89% support for a hostile board candidate opposed by the board, plus biggest incumbent director protest when 10.7% opposed re-election of Aatos Erko due to poor attendance record (he had cancer!). Rem protests continued with 36.3% opposing executive incentives and 33.3% opposed the annual options issue to the non-executive directors.

News Corp 2001: ignored the protests from the previous year and suffered another 21% against an options grant to executives and 16.7% against the options for the non-executive directors.

News Corp 2000: with Rupert unable to vote on certain share and remuneration issues, we got our first major protest votes with 19% against Rupert’s options, 39.2% against options to a range of executives including Lachlan Murdoch, 17% against options to the non-executive directors and 18.5% against another options-issue for executives.

News Corp 1999: 8% protest vote against the issue of options to directors but everything else overwhelmingly supported.