David Prosser: Murdoch in no mood for compromise

 

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The Independent Online

Outlook Rupert Murdoch is not for turning. There is no need for him to consider stepping down as both chairman and chief executive of News Corporation, he has told investors, his son James has the company's confidence too, and there is no case for changes to the board at all.

Never mind the phone-hacking scandal or that Mr Murdoch's faltering appearance in front of MPs in Westminster last month exposed his lack of grasp on the company's operations. For News Corp, it is business as usual – and the idea of reforms such as enfranchising non-voting shareholders didn't even come up.

Instead, shareholders have been offered another sop. In addition to the share buyback unveiled last month (made possible by News Corporation's humiliating retreat from its bid for BSkyB), they are now to receive a substantially increased dividend payment.

Fair enough, for News Corporation is a company that continues to throw off cash. But before you jump to the conclusion that its latest increase in profit suggests Mr Murdoch is at least on top of his game at News Corp, take a look at the note on MySpace in the quarterly update he has just presented. Six years ago News Corp paid $580m for the business. In June, it sold up for $35m.

Every company makes mistakes, of course. But when a chief executive is considering a large and risky acquisition, the counsel of an independent chairman and a board impartial enough to hold the boss to account is invaluable. News Corp needs better governance.

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