News Corp directors rally support behind Murdoch family

The independent non-executive directors at Rupert Murdoch's News Corporation have hired their own law firm, to advise them on good corporate governance at the family dominated company and how they should respond to the hacking scandal at its British newspapers.

By hiring the law firm Debevoise & Plimpton, the directors have added a powerful non-Murdoch voice into decision making at the company, in the hope of calming shareholders who fear that the scale of the crisis has not been properly appreciated by the board.

The firm will also advise on the issues raised by corporate-governance campaigners and dissident shareholders, who have claimed in lawsuits and in protest votes at News Corp meetings that the board is too clubby and too entrenched to hold the Murdochs properly to account.

Only nine of the 17 board members are deemed independent, since the rest are either current or former executives, or members of the Murdoch family. The nine have been meeting weekly to examine the latest developments, it was revealed last night. But one of them, Tom Perkins, denied reports that they had discussed replacing Mr Murdoch as chairman or chief executive.

In a string of interviews in support of the status quo, Mr Perkins, a veteran venture capitalist, said there was no reason to believe senior executives knew about the extent of phone hacking. "We are fully supportive of the top management," he said, and added in an interview with News Corp's The Wall Street Journal: "The board honestly thinks Rupert is a genius and we need him and the company needs him. Our worry is the shareholders at this point... the next step is to not let the company go down the drain on this thing because we're focused on events in London that are a small percentage of our business."

One of the most important responsibilities of the board is to ensure a succession plan that can be enacted if Mr Murdoch steps down. Joel Klein, the newest independent director, was seated directly behind James Murdoch as he gave evidence to Parliament yesterday. As deputy chief operating officer, the 38-year-old Mr Murdoch is the No 3 at the company and is being groomed as a future chief executive. But as the executive in charge of News International since 2007, he has been drawn into the scandal.

Louise Cooper, a market 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."