News Corp.'s Second Biggest Shareholder Says Phone Hacking Scandal Has Damaged Company's Reputation
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Prince Alwaleed bin Talal, News Corporation's second biggest shareholder, has reportedly said that the company's phone hacking scandal "is not helping the name of the company" and is "not something to be proud of."
Alwaleed also said that his backing of embattled News Corp. CEO and chairman Rupert Murdoch "is definitely unwavering." A British government panel recently concluded that Murdoch is "not a fit person" to lead a major company, citing his "willful blindness" to unethical behavior.
From The Guardian:
Alwaleed said that although News Corp was "very diversified," with interests covering books, magazines, newspapers, television and film, the phone-hacking scandal was having a company-wide effect. "I really hope that this is behind us because really it is not helping the name of the company," he said. "We hope that this page is folded and put behind us because really it is not something to be proud of."
News Corp investors have voiced concerns about the phone-hacking scandal since it erupted last year and, at the company's AGM in October, several shareholders, including powerful pension fund CalPERS, called for the appointment of an independent chairman. Murdoch currently holds the position of chairman alongside that of chief executive. Alwaleed is one of Murdoch's staunchest supporters and had never before spoken publicly about the wider impact of the scandal.
His most public previous involvement was to suggest the resignation of Rebekah Brooks as chief executive of News Corp's UK newspaper division, News International. Brooks was editor of the News of the World when its journalists hacked the phone of murdered schoolgirl Milly Dowler and in July last year Alwaleed told the BBC's Newsnight: "If the indications are for her [Brooks's] involvement in this matter is explicit, for sure she has to go, you bet she has to go ... Ethics to me is very important." Brooks resigned the following day.
News Corp holds a significant stake in Alwaleed's Saudi Arabian film, TV and music business Rotana Media Group and he said: "We have a strategic alliance with Rupert Murdoch for sure and I have been with him for the last 15 or 20 years. My backing of Rupert Murdoch is definitely unwavering."
Alwaleed said that although the scandal had had an impact on News Corp's reputation, its financial results had not been damaged. "The share price is really separating from what is happening in the UK," he said. "We see the price is hovering around $20 and the results are very good."