The UK parliamentary committee set up to investigate phone hacking by News Corp papers has described Rupert Murdoch as “unfit” to run the corporation. Murdoch and his son weren’t found to have misled Parliament, but the criticism was scathing.
The findings come after extensive testimony by the Murdochs. According to ABC Australia:
"News International and its parent News Corporation exhibited wilful blindness, for which the companies' directors - including Rupert Murdoch and James Murdoch - should ultimately take responsibility," it said.
"Their instinct throughout, until it was too late, was to cover up rather than seek out wrongdoing and discipline the perpetrators.
"Even if there were 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.
"We conclude, therefore, that Rupert Murdoch is not a fit person to exercise the stewardship of a major international company."
It’s unclear what effect these findings may have on News Corp. It is theoretically possible that this finding may have adverse effects on News Corp licensing and expansion plans in the UK. It’s also possible that the troubled, loss making News Corp papers in the UK may become a dead weight on the global corporation if the company stagnates in the UK.
This is an unprecedented level of direct criticism on an official level of any major corporation. Nor is the fact that several News employees were found to have misled Parliament likely to do a lot for the company. Exactly what Parliament and regulators intend to do about the situation is far from well explained, but the likely ramifications are:
Recommendations for legal action- This is may relate to UK corporate law, rather than individuals, although under some laws directors may be disqualified from holding directorships.
Possible legislation against companies involved in malpractices of this type- Likely to be complex process, but inevitable as law continues to play catch up with technologies.
Possible regulation of new areas of media sourcing- This is likely to be a very hot topic, because as it is journalists can be threatened with jail for failure to identify sources of information for courts, even when the information released is in the public interest. Adding a further level of difficulty is unlikely to improve matters.
Murdoch can’t be disqualified from owning a large chunk of News Corp. (A trust holds the Murdoch family interests in News with a major Saudi shareholder as the other main owner of the corporation) Whether his influence can be affected by the UK Parliament’s response is questionable, given that conservative members on the committee were unhappy at the direct criticism of the Murdochs.
So- Will the law avoid making an ass out of itself, or will the UK Parliament find some way of losing a perfect opportunity for creating realistic regulations? We’ll see, but the other side to this very tarnished coin is that the US is also investigating possible phone hacks, which could result in a much bigger hit.
As a test case, the phone hacks and bribery couldn’t be more appropriate for the sleazy world of mainstream media. As an exercise in actual enforcement of law, the case hasn’t done much more than make motions. Whether those motions go anywhere has yet to be seen.
This opinion article was written by an independent writer. The opinions and views expressed herein are those of the author and are not necessarily intended to reflect those of DigitalJournal.com