Rupert Murdoch’s media conglomerate joins the Church’s blacklist which includes companies involved in military products and services, pornography, alcoholic drinks, gambling, tobacco, human embryonic cloning and high interest rate lending.

The Church of England Pensions Board and the Church Commissioners sold their shares following advice from the internal Ethical Investment Advisory Group (EIAG), which has been engaging with News Corp since July 2011.

The Church felt the company failed to address concerns raised in the aftermath of allegations that employees at News of the World hacked into the phones of celebrities and members of the public, like murder victim Milly Dowler.

Church Commissioners secretary Andrew Brown said after a year of continuous dialogue the media group has not brought about “sufficient change”.

He said: “Last year’s phone hacking allegations raised some serious concerns amongst the Church’s investing bodies about our holding in News Corporation.

“Our decision to disinvest was not one taken lightly and follows a year of continuous dialogue with the company, during which the EIAG put forward a number of recommendations around how corporate governance structures at News Corporation could be improved.

“However the EIAG does not feel that the company has brought about sufficient change and we have accepted its advice to disinvest.”

The News Corp disinvestment follows a slew of negative press for the Church after the pensions board invested £60m in some of the world’s largest hedge funds.