James Murdoch looking safe at BSkyB despite the brickbats

29th July 2011

As reported in the Denver Post, the board has given its unanimous backing to James Murdoch.

However as yesterday's Financial Times reported two non-executive directors, Allan Leighton and David Evans are likely to step down.

Just two days ago, the Daily Telegraph was reporting that Adrian Sanders MP was "astounded" that Mr Murdoch was unfamiliar with the term "wilful blindness" and urged BSkyB's shareholders to question his ignorance closely.

"I think there may be questions shareholders would want to ask that their top man doesn't understand the clear corporate governance terminology that brought down Enron in 2000/2001," the paper quotes the MP as saying.

However, the paper also reported that one major shareholder, fund manager Crispin Odey had backed Murdoch to stay though he also wanted NewsCorp to lose one director from off the BSkyB board to ‘loosen its hold on the company".

The Guardian's city editor Nils Pratley is convinced that big City investors have flunked the issue by not demanding that James Murdoch go.

He writes: "City fund managers are often disgracefully slow to stir on matters of boardroom governance. Even by their standards, however, the silence over James Murdoch's continuing chairmanship of BSkyB is extraordinary. Presented with an opportunity to force the broadcaster to adopt a properly independent board, the big investment houses flunked it."

Breaking Views columnist Hugo Dixon suggests the board should have had two questions for Murdoch following his meeting with MPs.

He writes: "The key question is how Murdoch explains the discrepancy between his evidence and that of the former employees on whether he was aware of a key email when he agreed a pay-off for one of the hacking victims. The email appeared to suggest that hacking was not confined to a single rogue reporter.

"The follow-up question is why Murdoch authorised a payment, thought to be 425,000 pounds, given that outside counsel had advised that the victim would receive 250,000 pounds if the matter went to court. The select committee asked this question but didn't get a satisfactory answer.

"Murdoch may give perfectly good answers if BSkyB's directors ask him. But if he is evasive, they should ask him to step aside."

One can only wonder if the board asked these questions and if they got satisfactory answers. But at the end of this week, James Murdoch doesn't look like he is going anywhere soon.

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