Drumming up support: Lachlan Murdoch. Photo: Rob Homer
LACHLAN Murdoch has been visiting proxy advisers in a last-minute effort to shore up shareholder support for the board of Ten Network Holdings before its annual meeting early next month.
Proxy advisers on Tuesday raised concerns about the troubled broadcaster's $8.37 million executive pay bill, revealed last week amid turmoil at the network that includes a slumping share price, the departure of programming boss David Mott and mass staff redundancies.
Mr Murdoch, who is Ten's chairman and a substantial shareholder, was in Melbourne on Tuesday to visit the Australian Council of Superannuation Investors, which advises the super fund sector, and boutique governance adviser Ownership Matters.
He has also met with the Australian Shareholders Association and Sydney-based proxy adviser ISS.
An industry source said visits by Australia's chairmen to proxy advisers had increased in recent years, with some even walking in off the street without an appointment.
''We did have a chat with him in advance of publishing our report to clients,'' ISS head of Australian research Daniel Smith told BusinessDay. ''It's been challenging times for them.
''Lachlan really hammered in on their focus on ratings and revenue - they've got to bump up both of them.''
While ISS has recommended its clients vote for Ten's remuneration report, Mr Smith said the company's large executive pay bill was ''the big story''.
''Some of our shareholders may be uneasy with that, but that's a problem across the media space,'' he said.
''At the same time, executives didn't get bonuses which gives some credence to the idea the board has been paying attention to the fact performance has been pretty bad.''
Aaron Bertinetti, the director of research and communications at proxy adviser CGI Glass Lewis, said he had not met with Mr Murdoch.
He said CGI Glass Lewis had yet to finalise its report on Ten, but the company was in the bottom 10 per cent of ASX 300 companies when it came to the alignment of pay with performance.
He declined to say how CGI Glass Lewis would recommend its clients vote on the remuneration report.
''But I can say they're paying way too much,'' he said.
Ten's annual meeting on December 6 will give shareholders the opportunity to grill the board on months of bloodletting at the struggling network, that has seen more than 100 journalists made redundant and the departure in August of Mr Mott with a $1.4 million payout.
Up for re-election are former chairman Brian Long and Siobhan McKenna, who runs Mr Murdoch's media investment company Illyria.
Shareholders will also cast a non-binding vote on Ten's remuneration report, which reveals that after being appointed on January 1, chief executive James Warburton received pay worth $1.75 million.
In its report to clients, ISS estimates the maximum payable to Mr Warburton under his contract is close to $4.5 million, more than twice the median pay of comparable listed companies.
Discontent among investors over pay levels in the media sector is running high. At its annual meeting last month, Fairfax Media, owner of BusinessDay, received a ''first strike'' after mining magnate Gina Rinehart voted her 15 per cent stake against its remuneration report.
Seven West, which owns the Seven television network, narrowly avoided a strike last week, with 23.96 per cent voting against the remuneration report. A strike is recorded if 25 per cent or more of shares are voted against the report.