Adverse Event Update: News Corporation
ESG Analysis Kept News Corporation Out of Calvert’s Signature® Portfolios
Calvert Investments is following the growing controversy involving the hacking of voicemail by The News of the World, which is owned by News Corporation (NWS). The company’s actions have harmed many people, undermined trust in the media, and shaken the British political establishment. Calvert deplores the violations of ethics that the company has admitted and views this scandal as a failure of corporate governance with clear damage to shareholder value.
News Corporation does not meet the Calvert Signature Strategies® investment criteria for corporate governance and ethics. A significant cause for concern is Chairman and CEO Rupert Murdoch’s domination of the company’s share-ownership, voting rights and governance authority. Calvert has also previously noted concerns related to privacy.
Shares of News Corporation may be held in portfolios which apply the Calvert SAGE StrategiesTM investment criteria. SAGE stands for Sustainability Achieved through Greater Engagement and emphasizes shareholder advocacy with companies that do not meet our comprehensive environmental, social and governance criteria. Calvert has written to the company prior to the most recent events detailing our serious governance concerns. We have urged the company to establish greater shareholder accountability, curb conflicts of interest, and promote better risk oversight by separating the roles of Chair and CEO and strengthening board independence. Calvert also called on the company to enhance its diversity programs and performance, including at the board level.
Calvert will continue to monitor the situation and discuss News Corporation with our SRI peers. We expect to follow up with the company at a future date.
Calvert Investment Management, Inc., 4550 Montgomery Avenue, Bethesda, MD 20814.
Calvert Investment Management, Inc., an affiliate of Calvert Investment Distributors, Inc. and a subsidiary Calvert Investments, Inc., was named Calvert Asset Management Company, Inc. prior to 4/30/11.