Why Murdoch can't brush aside lawmakers' report

Rupert Murdoch 'not fit' to run company
Rupert Murdoch 'not fit' to run company

    JUST WATCHED

    Rupert Murdoch 'not fit' to run company

MUST WATCH

Rupert Murdoch 'not fit' to run company 02:07

Story highlights

  • Cathcart: UK lawmakers' report has no force in law but it does carry a moral weight
  • For News Corp shareholders, Murdoch is not just the boss, he is the guru, says academic
  • Murdoch knows in his heart that committee's verdict will changes things for him, says Cathcart
  • Academic: We have learned from Murdoch's recent appearances that he cares more than we thought about his reputation

What does it mean, when a UK parliamentary committee says you are not fit to run your company? If you're 81 and you have built a fabulously profitable global empire, you might be inclined to say, not much.

And Rupert Murdoch, condemned today by the House of Commons Culture, Media and Sport Committee, can pick from plenty of other rationales for rejecting the critics. He can say they are his political enemies, since it is clear that the Conservative minority on the committee did not back the 'unfit' criticism.

He can say, as he has always been quick to say in any British context, that the "establishment" has always hated him. He can say, since his papers still lead the market in Britain, that he knows better than the MPs what British people really care about. He can say, and it is true in a way, that he has weathered worse storms than this.

But while he may indeed say (or even Tweet) some of these things, in his heart he will surely know that the committee's verdict is a landmark for him, and that it changes things for him whether he likes it or not.

It has no force in law but it has a moral weight and his own editors, from the London Times to the Wall Street Journal, are giving the story prominence because they recognize that moral weight.

Britain's parliamentary committees may not yet have acquired the authority of U.S. Senate and House committees, but they are heading that way, emerging as a significant counterweight to the power of the executive and also a kind of court of judgment in public affairs.

In more than 40 years of operating in the UK media, Murdoch has never encountered such a thing. Only four years ago, when the House of Lords communications committee wanted to interview him for a report on media ownership, the committee went to him in New York -- a pilgrimage rich in symbolism. Now the positions are reversed.

He is accountable where he wasn't before. And he has been found seriously wanting.

He is 81, and whatever happens now, he will carry that verdict around with him for the rest of his life, much as his tabloid papers have habitually dragged up the worst they could find in the past of anyone they wrote about. He'll care about that -- one thing we have learned from his recent public appearances is that he cares more than we thought about his reputation.

But of course he will worry even more about what his News Corp shareholders think. He has enriched them over the years and they have paid him back with a trust bordering on devotion. Rupert is not just the boss; he is the guru. He can see the future and make it work for him -- and them.

That too has changed, however. At the AGM last October, a notable minority sent him a signal when they withheld support for the advancement of his sons, James and Lachlan. Now they have cause to think hard about the old man.

He himself admitted serious failings to the Leveson Inquiry into press standards only a week ago, failings very similar to those listed by the committee report. Meanwhile Britain's TV regulator, Ofcom, is formally investigating whether the Murdochs are fit and proper people to hold a broadcasting licence, and unlike the MPs' Ofcom's verdict (which may not come for months) does have the force of law.

If you were a shareholder, would you wait to be told whether you had to get rid of your top man? If you were Murdoch himself, knowing that the dream of a dynasty is surely in tatters, how hard would you cling on?

There is a big problem with the UK operations and it just seems to get bigger. A change at the very top would not make it go away altogether, but it would achieve something that Murdoch himself has tried and conspicuously failed to do: it would make the problems a part of the past, and not a part of the future.

      The hacking scandal

    • Former News of the World editor and Downing Street communications chief Andy Coulson arrives at the phone-hacking trial at the Old Bailey court in London on January 27, 2014.

      Who is Andy Coulson?

      Britain's phone-hacking scandal has seen former tabloid editor Andy Coulson move from the newsroom into the full glare of its spotlight.
    • Timeline of hacking scandal

      How did phone hacking grow into a scandal that threatened Rupert Murdoch's hold on his global media business? Track all the major events.
    • Caption:LONDON, ENGLAND - DECEMBER 21: Prince William, Duke of Cambridge and Catherine, Duchess of Cambridge attend a reception during a visit to Centrepoint's Camberwell Foyer on December 21, 2011 in London, England. The national charity, Centrepoint, provides housing and support to improve the lives of homeless young people aged 16-25. (Photo by Ben Stansall-WPA Pool/Getty Images)

      7 amazing things we learned

      The phone hacking trial revealed much about the inner workings of Rupert Murdoch's sex-and-scandal tabloids.
    • Rupert Murdoch (R) his wife Wendi Deng (C) and son Lachlan (L) leave their London home on April 26.

      Why media fights back so hard?

      Media expert Brian Cathcart says Fleet St. has grabbed its megaphone and started bellowing out its usual message: leave us alone.
    • How Murdoch bounced back

      Could the phone-hacking scandal prove to be a blessing in disguise for Murdoch? He claimed to have been "humbled" by the scandal.
    • Read: The Leveson Inquiry report

      The Leveson inquiry is a British government-backed inquiry into illegal eavesdropping and bribery by journalists. Read the final report by Lord Leveson.