Rupert Murdoch Backed by News Corp. Board Member Amid Phone Hacking Scandal
His son Lachlan, who stepped down from his day-to-day company role in 2005, is also advising him again; an analyst says the media mogul is unlikely to give up the CEO title just yet.
NEW YORK – Prominent venture capitalist Tom Perkins, an independent board member at News Corp., has become the first to publicly express support for chairman and CEO Rupert Murdoch and the rest of the company’s top executives amid the phone hacking scandal, the New York Times reported.
The public support comes after a late Monday report that some independent directors have explored elevating president, COO and deputy chairman Chase Carey to the CEO role now to let Murdoch focus on the chairman role. One company source said that Murdoch considered handing the CEO title to Carey in the past - as long as about a year ago, and that scenario could well come into play one day. But the source said Murdoch is likelier to take that step at a less troubled time.
Observers have also wondered what may happen to Murdoch son and deputy COO James Murdoch who has been seen as a contender for the CEO post one day. Some have wondered whether he may give up his role as chairman of U.K. pay TV operator BSkyB.
James and Rupert Murdoch along with Rebekah Brooks, who resigned as head of U.K. newspaper unit News International on Friday, are scheduled to testify in U.K. Parliament Tuesday morning ET.
Perkins said the News Corp. board is “fully supportive of the top management,” even though he acknowledged that independent board members “were stunned to discover the magnitude of the scandal over the last 10 days.”
He also said: “The board did discuss this several times two or three years ago, maybe earlier…We were told and top management, I’m sure, believed that the early news was the whole story. There’s no reason to believe top management was lying. That’s my very strong belief.”
Tuesday morning, Wunderlich Securities analyst Matthew Harrigan addressed the question of Rupert Murdoch’s future. "Both board support and centenarian family genetics suggest [Murdoch] remains as CEO,” he said. “Although it does not negate the miasma at News International, Rupert Murdoch is likely genuinely contrite and is determined to avoid winding down his career in disgrace.”
Commenting on other key players, Harrigan in a report said: “Chase Carey did a yeoman job of executing and improving business processes at DirecTV, but Rupert Murdoch still provides the overriding strategic vision.” However, Murdoch son James, who has been seen as a potential CEO successor one day, will face a rockier road, he echoed other observers. “Seemingly high-strung James Murdoch is now in the penalty box, with CEO potential only with maturation after a Chase Carey interregnum,” the analyst said.
Meanwhile, the Wall Street Journal reported that Lachlan Murdoch, the older of Rupert Murdoch's two sons, has played “a significant role advising his father” during the current crisis. He left his day-to-day executive job at the company in 2005, but has remained a board member. The Journal said the son along with Carey and former New York City Schools Chancellor Joel Klein, who joined the conglomerate just a few months ago as executive vp, have been Murdoch’s closest advisors as they have not been involved in the U.K. newspaper affair.