Australian pension fund First Super will sell down its £4.6m stake in News Corp after Rupert Murdoch's failed to comply with the governance standards set by the scheme.

Reuters reported on Thursday that the scheme would pull out of the controversial news corporation following "the failure of proposals for a more independent board".

Murdoch stayed on as chairman last October when investors raised concerns and fierce critics claimed he and his family had far too much power over the company.

First Super, the largest pension fund in Australia with assets under management worth an estimated A$1.7bn, is now said to have asked its fund managers to sell News Corp shares over the next few months. Reuters reports that "the lack of a more independent board meant inadequacies of the governance structure and posed 'unacceptable' risks for investors".

"These issues are apparently of no concern to Rupert Murdoch, so our Board decided to take his advice and sell down our shareholding," Michael O'Connor, the fund's co-chair, reportedly said in a statement.

Despite all the controversy News Corp shares have gained in value over the past year, by 40%.

"Certainly the timing has been good for us, but clearly we are a long-term investor as a superannuation fund and we take a long-term view," O'Connor told Reuters.

First published 11.01.2013

azeevalkink@wilmington.co.uk