Australian industry superannuation fund First Super has announced it will sell its holdings in global media company News Corporation, citing concerns over the company's corporate governance.

The $1.7 billion fund has ordered its fund managers to dispose of its share in News Corporation over the coming months, following the voting down of proposals to change the current corporate structure at News Corp's annual general meeting (AGM) in October 2012.

"Open, transparent, representative governance is not only overdue but essential for improved risk management within the company," said the fund's co-chair Michael O'Connor, who is also national secretary of the Construction, Forestry, Mining and Energy Union (CFMEU), which partly controls the super fund. "The interests of minority shareholders have too often been compromised."

In particular, First Super objected to the executive salaries offered within News Corporation. "News Corp executives are paid outrageous amounts of money," Mr O'Connor said. "The aggregate cash pay of their top six executives last year was US$65.5 million, more than three times the amount received by the top nine executives of BHP Billiton, and they are by no means underpaid."

First Super was among a number of institutional investors in the media company to raise concerns at the AGM over executive chairman and the power wielded by News Corporation CEO and chairman Rupert Murdoch in his dual role.

The California Public Employees' Retirement System (Calpers) and California State Teachers' Retirement System (Calstrs) - two of the US's largest public pension funds - strongly supported a resolution to split the leadership role into two positions.

In response, Mr Murdoch urged investors who oppose the corporate structure to sell their shares and go elsewhere.

Mr O'Connor says First Super has now "decided to take his advice."