Expectations of damaging management turmoil at News Corporation, Rupert Murdoch's media conglomerate, appeared to subside, as investors and analysts formed their interim judgements on the mogul's perilous appearance in front of the parliamentary select committee yesterday.
News Corp's board rallied round Mr Murdoch in the hours leading up to the hearing, and the company's shares ticked higher as MPs' grilling went on, as investors judged that the hacking scandal may even have passed its most dangerous point.
In particular, watchers decided that no new information emerged that might eliminate James Murdoch from the long-held succession plan put in place by his father, who once again professed his hope that his children would succeed him. Shortly before he died, the senior Mr Murdoch told the committee, "my father bought a newspaper and said that I should use it to do good, and I would love to see my sons and daughters follow".
Joel Klein, the newest member of News Corp's board and fast emerging as one of its most influential non-executives, was seated directly behind James Murdoch as he gave evidence. As deputy chief operating officer, 38-year-old Mr Murdoch is the No 3 at the company and is being groomed as a future chief executive.
Louise Cooper, markets analyst at BGC Partners, said: "There was a lot of pressure on James Murdoch to prove himself at the hearing this afternoon, and with the exception of a couple of body blows, he stood up to the scrutiny well, delivering a smooth, measured response."
The senior Mr Murdoch made it clear he had no intention of resigning, despite a flurry of speculation overnight that he would soon do so. Now 80 years old, some investors had speculated the scandal may force him to split the chairman and chief executive roles and promote Chase Carey, the chief operating officer, to chief executive.
But Tom Perkins, a non-executive at News Corp, said: "We are fully supportive of the top management."Reuse content