Murdoch 'not fit' to run News Corp

 

The committee itself does not have the power to impose sanctions

The bombshell is on page 70 of the report by the Culture Media and Sport Select Committee into News International and phone-hacking.

It is worth quoting in full:

"If at all relevant times, Rupert Murdoch did not take steps to become fully informed about phone-hacking, he turned a blind eye and exhibited wilful blindess to what was going on in his companies and publications.

"This culture, we consider, permeated from the top throughout the organisation and speaks volumes about the lack of effective corporate governance at News Corporation and News International.

We conclude therefore that Rupert Murdoch is not a fit person to exercise the stewardship of a major international company".

That description of Mr Murdoch by the British parliament as "not a fit person" is likely to have significant consequences.

It will force the board of News Corporation to review whether the 81 year-old, who created one of the most powerful media groups the world has ever seen, should remain as its executive chairman.

It will give ammunition to those News Corporation shareholders who would like to loosen the hold over the company of the Murdoch dynasty.

It will push Ofcom, the media regulator, closer to the conclusion that British Sky Broadcasting is not fit and proper to hold a broadcasting licence, for as long as News Corporation owns 39% of BSkyB.

'Savage criticism'

Nor is that the only one of the MPs' conclusions which will shake News Corporation, and its British subsidiary, News International, owner of the Sun tabloid and of the News of the World prior to its closure.

Mr Murdoch's right hand man for decades, Les Hinton, is deemed to have misled the committee in 2009 by "not telling the truth" about substantial payments to Clive Goodman - the News of the World's former royal reporter who was jailed for phone hacking- and how he authorised those payments.

Mr Hinton is also ruled to have "misled" the committee about the extent of his knowledge that phone hacking extended beyond Clive Goodman and Glenn Mulcaire (the private detective who carried out the hacking on behalf of jounalists).

He is, say MPs, "complicit in the cover-up at News International".

As expected, the MPs are savage in their criticism of the former News of the World editor, Colin Myler, and of Tom Crone, the former legal manager of News International's newspapers, for misleading them about what they knew about phone hacking and for failing to pursue alleged hackers.Murdoch 'not a fit boss', say MPs

But more damaging for News Corporation is that MPs say that senior executives, such as Rupert Murdoch's son James, should have seen that the company's official view, that there was a single rogue hacker, was not sustainable.

The MPs say: "if there was a 'don't ask, don't tell' culture at News International, the whole affair demonstrates huge failings of corporate governance at the company and its parent, News Corporation".

The committee says that News International "wished to buy silence" by settling legal actions with victims of hacking that included confidentiality clauses.

And News International executives are accused of exaggerating the thoroughness of reviews of hacking carried out in 2006 and 2007.

As for those deemed to have misled the committee, Mr Hinton, Mr Crone and Mr Myler, the MPs say it is for the Commons to decide whether they are guilty of contempt.

UPDATE 11:42

I forgot to mention one very important conclusion, that the News of the World and News International also misled MPs as corporate entities.

The MPs say these institutions "exhibited wilful blindness", for which Rupert Murdoch and James Murdoch should "ultimately be prepared to take responsibility".

UPDATE 12:02

The report's verdict that Rupert Murdoch is not fit to run a big international public company was not supported by four Tory MPs on the committee. The disclosure that the vote on this divided along party lines may lessen its force.

In particular, News Corporation's board may well view the verdict as a political judgement, rather than a dispassionate one.

 
Robert Peston Article written by Robert Peston Robert Peston Economics editor

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  • rate this
    +2

    Comment number 49.

    40 ECB

    Facts wrong. 60,000 BRITISH casualties on first day of Somme - 20,000 dead. 900,000 in whole of WW1

  • rate this
    +64

    Comment number 48.

    Its astonishing, government after government was subverted but even more incredible was the London police force. The assistant prime minister (Prescott) knew his phone had been tapped and could not shift the police and the same for many others. I feel strongly that many of these senior police officers should gone to prison and lost their pensions in disgrace, they have got away scot free!

  • rate this
    +22

    Comment number 47.

    So, the conservatives are complaining that the report vote was split along party lines, while voting as a party block themselves?

    Hm, interesting tactic, everyone else is voting in favour of these conclusions, vote against them as a block, claim all the voting is political, and get a small amount of favour with a failing media empire.

  • rate this
    +2

    Comment number 46.

    Truths can be dangerous things and people in charge sometimes feel that we, the public, need protecting from them. Sometimes it may have to do with morale, over morality, sometimes it is far more mysterious and frightening. Nobody should have as much power as these people seem to have. Will the last person out of Murdoch,s crumbling empire please turn off the lights.

  • rate this
    0

    Comment number 45.

    38. Perhaps you will make an offer for The Times because I'm pretty certain no one else will. It's been losing £1m a year for some years and the only reason it continues is bec of Murdoch's love of print journalism.

  • rate this
    +1

    Comment number 44.

    Are we really now in a situation when a politician with their own political agenda can demand who should be allowed to run a multi national conglomerate when that individual effectively created it? The Murdochs might be vilified by many but I don't want a society where politicians looking for a sound bite can dictate what companies individuals can create.

  • rate this
    +20

    Comment number 43.

    The Conservative members of the committee have followed the party line here - it is preposterous to suggest it is the reverse! The Government of Schoolboys has it's MPs spit out their collective dummy in order to muddy the water. Even the Murdoch's are implying that they are not fit to run a company, for heaven's sake!

  • rate this
    +3

    Comment number 42.

    4 Tory MPs not happy-happy with some matters of the report, interesting.

    Instructions from above, discreet party policy, united we stand, individual consciences, fell asleep during the evidence or just plain political cowardice?

    The Opposition is led by a half-wit and look at the polls.

  • rate this
    +3

    Comment number 41.

    'Wilful blindness'.Strong words but, in a fast moving environment with a culture of 'don't ask, don't tell', not seeing what is happening until it is too late is quite likely. Hindsight, as they say, is wonderful thing-though obviously not so wonderful if, like the Murdochs, it catches up with you to remind you of how things should have been.

  • rate this
    +8

    Comment number 40.

    I am sorry but Her majesty's Government has ALWAYS tried to control the news media. Please read the book written by the BBC's John Simpson "Unreliable Sources". From the Boer War where we invented the concentration camps to the "success" of the Battle of the Somme where actually 600,000 Englishmen died HMG has a very poor record of telling the truth.

  • Comment number 39.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this
    +25

    Comment number 38.

    'Not fit or proper' was my conclusion month's ago strictly on the basis of the evidence.

    Now, it is up to Ofcom to say so and get the News Corp out of all British media.

    What we need now-

    The forced disposal of:

    1. All BSkyB shareholdings and TV interests
    2. Ditto 'The Times'
    3. Ditto 'The Sun'

    4. Advise the US Regulator and the SEC of the decision.

  • rate this
    +8

    Comment number 37.

    I'm sure the Murdoch empire has a pile of dirt ready to dish on MPs, we've already started to see it in recent weeks. Maybe MPs will now realise that getting in to bed with a viper will result in them getting bitten on the bum! (and quite rightly so).

  • rate this
    +2

    Comment number 36.

    If there has been criminal wrongdoing, prosecute.

    If, according to ofcom rules, it is not 'fit and proper', take action.

    If the rules and laws are no longer appropriate to be effective todays Media, Change them.

    Otherwise shut up. This is just political grandstanding.

  • rate this
    +22

    Comment number 35.

    Why am I not surprised that the Conservative MPs on the committee didnt feel upto supporting a report that cast a very negative light on one of their biggest supporters?

    How much has News Corp, in hard cash as well as soft support given to the Conservative party over the years?

    Obviously they didnt have the bottle to support what everybody else has known to be the truth for ages.

  • rate this
    +15

    Comment number 34.

    It does seem an awful lot of effort to arrive at a conclusion which the rest of us knew 20 years ago.

  • rate this
    -17

    Comment number 33.

    Does anyone care and is this important to anyone other than the politically minded (ie biased and wanting to score points) and the media?

    I can't remember anyone mentioning the Leverson Enquiry or Murdoch in conversation for ages,

    Its just media self indulgence and thus very boring and tedious.

    Move on please to real businesses.

  • rate this
    +3

    Comment number 32.

    Sam Beckett #11

    Robert Peston's article answers your question, if you can be bothered to read it, but perhaps you have read it, and the notion that Parliament and politicians can actually achieve something positive is too unfashionable for you to accept. Anti-politics rules, does it?

  • rate this
    +5

    Comment number 31.

    What this report shows is that MPs are not fit and proper people to hold an inquiry. For inquiries like this to be treated as open and fair, they must be held by independent individuals. The fact that it's been split down party lines is clear evidence of this and has watered down the report to such a degree that nobody with half a brain will take it seriously.

  • rate this
    +22

    Comment number 30.

    @SurfandTurf

    You are completely missing the point. The question the MPs asked was not "Is Murdoch capable of running a huge business?", but "Should he be allowed to?"
    Given the enormous harm his businesses have caused to the country, the obvious answer is "no", and you don't need any business know-how to see that.

 

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