I found the Murdochs to be tough but fair employers: Peter Mukerjea

By Peter Mukerjea

As former CEO of a company (Star TV India) that is similar in size to the News of The World in financial terms at least - it is “less than one percent of the total global empire” that is the News Corporation - it isn’t surprising that I feel involved. Having worked at close quarters with the key characters in this blockbuster, I’m naturally sad, and get more so with revelations and accusations that come out of the woodwork each passing hour.

Media owners, like other business owners and organisations, rely on something simple but crucial - trust. The trust of their patrons, viewers, readers, and also their trust in senior executives to do the right thing. But sometimes things do go wrong. There’s always the occasional bad eggs in a company who break rules in order to go the extra mile and win accolades as long as they never get caught.

I must say, though, that having worked with Rupert (Murdoch) at reasonably close quarters for well over a decade, and his son James for half of that period - at a much closer proximity - I found them to be tough but fair employers with generally a long term view on everything to do with their business. Sure, they would sometimes makequirky business decisions about buying or selling a business or hiring certain people who seemed to be insane or bizarre, but I would always defer to the big guy’s decision given that he is a tremendously sharp and an incisive human being; he could not have built a solid global business empire without knowing a thing or two about hiring and firing the right people and making the right decisions - mostly anyway. I was always sure they would never want to do anything that would be illegal in the slightest for fear of being caught up in precisely the type of scandal that the company finds itself in presently.

Part of the beauty of the company where I spent 17 years (7 years as the CEO) at was that both Rupert and James gave their seniormost executives tremendous independence to carry out their day-to-day tasks without being constantly supervised - except the regular weekly calls or monthly reports or quarterly meetings that would allow for information to be passed up and down the line. Apart from setting the highest of expectations of their executives, they were always mindful of and strong believers in the philosophy and practice of good corporate governance and ethical practices at all levels. I have seen people who deviated from this course being shown the door, no matter how senior they were. When it came to corporate governance, there was zero tolerance. But with the freedom to operate came the basic expectation of trust and the highest integrity to the company, to fellow employees, to suppliers and the consumer; not an unreasonable expectation in most people’s books.

The recent phone hacking allegations that have erupted in the past few weeks - although they had been bubbling for years - are particularly sad. Most outsiders who saw Rupert as a ruthless media dictator will now see him in a different light altogether. Many will reflect on this and apply the same standards to other parts of the Rupert media empire and will perhaps wonder about the corporate structure at the company and the reporting lines to the top.

Comments that come to mind are:

Is this the same pattern that is followed at the helm of other companies that report in to James ?

Does he or does he not have a good firm executive management control on the goings-on there?

Will some of these companies be going through an in-house cleanup as we speak?

Is a fresh approach needed to managing corporate governance, now overdue and inevitable?

What will media regulators in emerging media-active countries like India and China make of this, and are there lessons to be learnt for them in terms of protecting themselves from such practices? Will they now become more stringent and put media owners through a similar ‘fit and proper person’ test -as is now being considered for Rupert and James by Ofcom on the present ownership of SKY - not just for foreign citizens who have no formal accountability in the country where they operate their media businesses?

Will they let this opportunity pass for fear of retribution from these very media owners?

What level of transparency will be required for future interactions between media company heads and political leaders?

The public inquiry in London the day before was indeed interesting to watch. The body language between Rupert and James was there for all to see and it wasn’t a pretty sight. All terribly sad to see. And that there wasn’t sufficient protection to ensure that the personal attack on Rupert didn’t happen. I felt sorry for Rupert at seeing him being grilled for something that he had entrusted to his executives and in this case, his son. Not something that as a former CEO in his company, I would ever have expected to see. Rupert was always the one who was doing the grilling and not the other way round. James will not like to read this, but I didn’t feel sorry for James. That’s what comes with the territory of being a Chief Executive even if the company was built by one’s father, and James, if anyone, would know that better than most. After all he’s been trained by the best - his father - and he did a good job in Hong Kong and then at SKY in London. But at a recent assignment before being moved to the US, James should have had his finger on the pulse a lot more and should have been troubled to pay more attention to detail. He was the one who once told me, rightly - “Peter, the devil is in the details”.

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How could he then let this slip? Or did he leave it to other trusted executives too? How far do you leave things to other executives without being accused of abdication? And where do you draw the line between abdication and delegation? Many would say sure if he wasn’t Rupert’s son, he would have been expected to step down by now. I’d have to agree with that. Having said that, I thought the way Rupert and James publicly stood by Rebekah Brooks was initially commendable and encouraging for other Chief Executives in the company as it showed them to be supportive through thick and thin. They had to accept her resignation eventually but they made their point. If I were James, and at this time - I’m glad I’m not -I would have handled it differently, and certainly have accepted responsibility for this debacle by now and stepped down or at least offered to do so. And I wouldn’t have shut the newspaper to save my skin even if it was less that 1% of the empire. Each to their own, I guess.

I do believe though that he will, sadly, have to step down, in time to come. Let’s wait and see if it turns out that way.

Given the last few weeks’ display of negative publicity to the company here in England, with open letters of apology in newspapers by Rupert and with the possibility of more enquiries being held in Australia and in the US, I sense it’s the end of an era where the media, politicians and public authorities who have all been so cozy with each other that their relationships will never be the same again and regulators everywhere will be looking to step in very quickly. Hospitality is a widely used tool in every business but when it extends to seeking favours in return, it crosses the boundaries of acceptability and that crucial word - trust - pops up again. Self regulation is always the best way forward but only if you don’t get the fox to look after the chicken coop! If that happens, then things like this will inevitably happen. Also perhaps, this seems to be the end of the Murdoch empire. This could well be the script for the next Mission Impossible movie where a company has to come out of this quicksand with it’s reputation altogether intact. Tough one.

I’m sure that for all the tea in China and all the editing facilities that exist in large media companies, the Murdochs would wish to rewind events back to 3 weeks ago and then change the course of how it all played out. Given the benefit of hindsight, this will undoubtedly make a terrific case study for many a business school in the next year or so, on how not to handle a crisis at a corporation.

Despite all that, I wish them the very best and I hope that they are able to overcome these hurdles quickly and get back to running a great media business that history will respect them for. After all we all like happy endings where the good guys win.

Peter Mukerjeajoined News Corporation in1993 as Advertising - Sales Director (India) and soon rose to lead Star TV India. As Chief Executive, he played a pivotal role in relaunching STAR Plus in Hindi and guiding it to become India’s Number 1 channel. He presided over STARS’s expansion and diversification and turn to profitability in India.