Surprise! James Murdoch Leaves The Glaxo Board
2 CommentsBy Ed Silverman // January 27th, 2012 // 8:56 am
Months after we asked whether James Murdoch should remain on the GlaxoSmithKline board (back story), the embattled scion of the Murdoch media empire has decided not to stand for re-election at the upcoming annual shareholder meeting to be held this May. At least, that is the wording in an official statement released this morning by the drugmaker.
His three-year stint as a non-executive director has been under a cloud ever since a scandal erupted over charges that various employees in the Murdoch media empire in the UK hacked into phones belonging to families of murder victims, terror victims, police and politicians. Ironically, one of the two committees that Murdoch will be departing is the corporate responsibility committee, which usually implies a board member knows something about being a good corporate citizen (see here).
His tenure may also have become a bit of an embarrassment for Glaxo, especially since he also sits on the remuneration committee, which means that he is one of a select few who gets to decide such matters as the compensation that is given to Glaxo ceo Andrew Witty. And just last month, Witty - we mean Sir Andrew - was knighted as a member of the Order of the British Empire, which has not been pleased with the Murdoch clan (see this).
The younger Murdoch, you may recall, has been criticized and second-guessed ever since he offered his version of the sordid events. As deputy chief operating officer of the empire built by his father, Rupert, he has had to defend himself against charges that senior execs at his UK newspaper operation knew that hacking was going on for quite some time.
When we first raised the subject last summer, a Glaxo spokeswoman wrote us to say that “the full facts must be established and the ongoing investigations be allowed to take place and come to a considered conclusion” before the drugmaker may consider any steps. In other words, there was not going to be a rush to judgment. Now, though, the situation may have grown, shall we say, distracting.
As noted previously, the Glaxo board could use a few directors who can offer useful guidance not just about strategy, but also for conducting affairs in a way that enhances corporate standing and builds needed relationships with shareholders, government, partners and patients. In late 2010, Glaxo paid a hefty $750 million fine to settle charges over production problems - contaminated meds, mislabeled packaging and incorrect dosages - at a facility in Puerto Rico and the feds say the investigation is ongoing (see this). The drugmaker also agreed to pay $40.8 million to 37 US states and the District of Columbia as well.
Observer
Given your last paragraph above, was it a surprise that young Murdoch was on the Board. May I observe that “like attracts (or selects?) like?” NOT that I would cast aspersions upon Glaxo and “Sir Andrew,” simply observing …..
John Stone
Please note that the Sunday Times unleashed a new wave of allegations against Andrew Wakefield in 2009 just six days after the announcement that James Murdoch was to join the board of GSK with a brief “to review issues which might have the potential for a serious impact on the group’s business reputation”
http://www.ageofautism.com/2011/07/james-murdoch-is-still-supported-by-glaxosmithkline.html