Putting an end to shareholder derivative litigation arising from News Corp.’s phone-hacking scandal, the company’s directors agreed last week to a record-breaking $139 million cash settlement. According to the plaintiffs’ lawyers, the deal is the “largest cash derivative settlement on record.” The settlement will be funded by directors’ and officers’ insurance proceeds.

Plaintiffs initially filed suit in the Delaware Court of Chancery in March 2011, asserting claims based on the company’s proposed acquisition (since completed) of Shine Group Ltd., a television and movie production company owned by the daughter of News Corp. Chairman Rupert Murdoch. According to plaintiffs, the News Corp. directors breached their fiduciary duties by permitting the purchase of Shine at an excessive price. The court later consolidated various related cases, and plaintiffs’ allegations expanded to include claims that the company’s directors failed to properly investigate the UK phone-hacking allegations that led to the demise of News Corp.’s News of the World.

Apart from its large cash value, the settlement is also notable for the wide-ranging corporate governance reforms that News Corp. has agreed to enact as part of the deal. The agreement calls for the establishment of a Compliance Steering Committee, to be responsible for setting compliance policies and overseeing their implementation, which must report at least quarterly to the Audit Committee, at least semi-annually to the independent directors, and at least annually to the full board. The board’s independent directors will approve a Chief Compliance Officer who will report directly to the Audit Committee, and the company will also establish an anonymous whistleblowing hotline. Finally, in what one commentator has called a “historic concession,” News Corp. has agreed to make annual public disclosures to its shareholders of political contributions made directly by the company to state or local candidates and various political organizations.

The agreement remains subject to court approval, and plaintiffs’ attorneys’ fees—which will be deducted from the $139 million settlement payment—are yet to be negotiated.