Sky investors challenge appointment of another Fox board member | Media | The Guardian
21st Century Fox chief financial officer to be non-executive director of European pay-TV business

A group of investors has challenged the appointment to the Sky board of another top executive from 21st Century Fox, arguing that the lack of independence will not help the company in the eyes of anti-trust regulators.

Sky, which held its annual general meeting in London on Wednesday, officially announced the appointment of John Nallen, chief financial officer of 21st Century Fox, as a non-executive director.

The Local Authority Pension Fund Forum (LAPFF), which includes 25 members that control about 2% of Sky, asked the company what the appointment of Nallen “would add” compared with an independent director.

“We have engaged Sky with governance issues in the past,” said Lara Bletcher, corporate governance researcher at advisory firm Pirc which represented LAPFF at the meeting. “Especially given the scrutiny around anti-trust issues at the moment.”

Sky chairman Nick Ferguson defended the appointment, saying he saw no reason to change the policy, which has seen more than a quarter of Sky’s board made up of senior executives from Fox, which owns 39% of Sky.

“21st Century Fox, who as you know are a large shareholder, have been in my experience wonderful in their representation on the board,” he said. “We are a TV company. We buy an immense amount of product from the US. People from 21st Century Fox – James Murdoch, Arthur Siskind, David DeVoe, Chase Carey – are very, very important members of the board. They provide great wisdom and experience. I certainly see no reason to change that.”

Sky’s 14-strong board has had four Fox executives, 28.5% of all non-executive directors.

However, as of the annual meeting on Wednesday David DeVoe, senior adviser to the Fox board and a director, and Arthur Siskind, until recently an adviser to Fox chairman Rupert Murdoch, stepped down from the Sky board.

The restructure, which saw the board reduced from 14 to 12 members, included the official appointment of Nallen.

Sky now has three Fox members on its board – Murdoch, Carey and Nallen – or 25% of the total number of non-executives.