Friday, July 06, 2007
Death by Rupert (Or, Shame on the Bancrofts)
The death of an institution:
"...Under the terms of this agreement, News Corporation will have the ability to hire and fire the top editors and publishers (a matter on which Murdoch would not budge); but a nominally independent five-person committee will have the right of veto on these decisions.
Murdoch and Dow Jones will jointly agree the membership of this panel, which will have the power to choose its successors."
Wow, what a farce. It guarantees as much independence as Bush's Clear Skies bill combats global warming.
I don't know who was advising the Bancrofts, but, to be blunt, they really suck at what they do. My goldfish knows more about corporate governance - and my goldfish also knows that the mechanism they came up with is about as hard to game as Digg is.
Contrast it with, for example, the Economist for a real governance mechanism that has kept the sharks at bay for...centuries.
There's certainly a need for fresh blood in this space. But it's a sad end for one of America's few real media institutions (versus cheezy fast-buck artists). I mean, it doesnt take much to --
Oh, wait. The whole thing was just an elaborate hara kiri ritual for the Street anyways...
"...The arrangement is a tougher version of the one put in place by the British government when Murdoch bought The Times and The Sunday Times in 1981. Murdoch will have less control over the independent directors at the Journal than he does at Times Newspapers, where they are regarded as weak and ineffectual. But one source, acting for the Bancrofts, admitted privately that the Dow independent panel was only a 'fig leaf' to facilitate the sale and that over time Murdoch would get round it.
John Biffen, the Tory cabinet minister who signed off on 1981 deal to establish independent directors for Times Newspapers in London, has since conceded that the arrangement was also a 'fig leaf' designed to allow the sale to proceed."
I guess that merits a serious round of high-fives for the boardroom (and an extra serious round of shame-on-yous for the Bancrofts).
Oh, double wait -- it turns out the story is probably just actually classic Murdochian FUD designed to pressure the rest of the shareholders into accepting the deal.
When you dance with the devil...