Parliament: News Corp.'s Murdoch Not Fit To Lead

May 1, 2012
Originally published on May 9, 2012 8:44 am
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From NPR News, this is ALL THINGS CONSIDERED. I'm Robert Siegel.


And I'm Audie Cornish.

Rupert Murdoch has long been one of the world's most powerful media barons. Yet today, members of Britain's parliament declared him unfit to run a major international company. They released a report accusing Murdoch's News Corporation of a huge failure of corporate governance. NPR's Philip Reeves has the story.

PHILIP REEVES, BYLINE: Rupert Murdoch spent six decades building his global empire. Now, in his 82nd year, he's under unprecedented attack. For months, he and his corporation have been under the intense scrutiny of a committee of British parliamentarians, investigating phone hacking at Murdoch's defunct News of the World. Murdoch himself testified before the committee last year, cap in hand.

RUPERT MURDOCH: This is the most humble day of my life.

REEVES: Those apologies were not enough. The committee for Culture, Media and Sport today released its findings. Its 85-page report accuses Murdoch's News Corporation of willful blindness by ignoring evidence of widespread hacking. The report is extremely scathing about its corporate culture and the family in charge.

TOM WATSON: We found News Corporation carried out an extensive cover-up of its rampant law breaking. Its most senior executives repeatedly misled Parliament and the two men at the top, Rupert and James Murdoch, who were in charge of the company, must now answer for that.

REEVES: Tom Watson is on the committee. He's at the forefront of a campaign to unearth the truth about illegal phone hacking. Watson holds Murdoch personally responsible.

WATSON: More than any individual alive, he is to blame. Morally, the deeds are his. He paid the piper, and he called the tune. It is his company, his culture, his people, his business, his failures, his lies, his crimes, the price of profits and his power.

REEVES: The report says testimony from Murdoch's British subsidiary, News International, misled the committee and therefore Parliament itself. So, it says, did three former executives: Les Hinton, Murdoch's right-hand man who headed News International; Tom Crone, the veteran News of the World lawyer; and the paper's editor Colin Mylor.

Rupert Murdoch's son James also took a pounding. He was sent in to take charge of his father's British newspapers. The committee said it was astonished by what it called his lack of curiosity about illegal practices at the News of the World.

On one crucial issue, the committee divided. All but one of its members are from the Conservative or Labour Parties. They argued fiercely over one line.

LOUISE MENSCH: The issue on which no Conservative member felt they could support the report itself was the line, put in the middle of the report, that said that Mr. Rupert Murdoch is not a fit person to run an international company.

REEVES: Louise Mensch is a Conservative.

MENSCH: We all felt that was wildly outside the scope of a select committee, was an improper attempt to influence Ofcom, and to tread on areas that is not the province of a select committee.

REEVES: Ofcom regulates broadcasting in Britain. It's looking into whether the British satellite company BSkyB, under the control of the Murdochs, is fit to have a license. Today's findings could prove significant. News Corporation has responded. It admits the report addresses some hard truths, but it also accuses the committee of making unjustified and partisan comments. How much damage all this is doing to News Corporation isn't yet clear. There's more to come.

Scotland Yard still hasn't completed several very large investigations and a major public inquiry, triggered by the hacking scandal, has yet to report.

MARK WATTS: I think there is the potential for this to really unravel - whether it's the death knell remains to be seen.

REEVES: Mark Watts authored a book on British newspaper journalism and is an expert on the Murdochs. He thinks U.S. regulators may be very interested in the committee's findings.

WATTS: Because corporate governance is a big issue for a major corporation to get right. At the end of the day, the culture is set at the top. The person at the top is Rupert Murdoch, so he has to take responsibility for that, and he enabled - allowed this company to do what it was doing, and he didn't stop it.

REEVES: Philip Reeves, NPR News, London. Transcript provided by NPR, Copyright NPR.