Code of Ethics Case Study: News Corporation
News Corporation, under the leadership of Rupert Murdoch, has unparalleled power and reach in the news media industry. The Murdoch Empire spans several continents, with significant footholds in Australia, United States and the United Kingdom. Founded and headquartered in Australia, the company now boasts of being the number one newspaper publisher in the world, with a cumulative daily readership of 14 million in these three countries alone. Murdoch has a near monopoly in the media space in Australia, owning two-thirds of all newspaper circulation in the country. Across the Tasman Sea, in New Zealand, he owns nearly half. Further, he is the owner of two fifths of the Australian Associated Press. (Knowlton & Parsons, 1995, p. 200) These holdings are notwithstanding his considerable market share in Britain and the United States. These statistics bear testimony to the Murdoch’s media monopoly. Between the lines one can read the dangers posed by monopoly in an industry that is crucial to socio-cultural discourse. This report will evaluate how News Corporation holds up to the scrutiny of their stated Code of Ethics as well as against the triple bottom line criteria for ethical evaluation.
Official Standards of Business Conduct proclaimed by News
News Corp’s official Standards of Business Conduct (SBC) document makes some bold claims. In the area of building trust with business partners and customers, it claims that trust and integrity are of utmost importance. The SBC goes on to outline generic principles that “underlie the culture of trust that is at the heart of News….While it is impossible to formulate rules to govern every possible situation, these Standards seek to assist us in continuing to avoid misconduct and the appearance of misconduct.” (Standards, 2013) Further, under the heading ‘Ensuring integrity and transparency of conduct’, the SBC defines what constitutes a conflicting situation and how the News Corp Management will resolve it:
“A conflict of interest arises when personal interests or divided loyalties interfere with our ability to make sound, objective business decisions on behalf of the Company. We are committed to a work force that is clearly and obviously motivated by the best business interests of our Company.” (Standards, 2013)
Under the heading ‘Maintaining Credibility’, the SBC lays out three commandments for ethical management of news gathering and reportage. These rules were also meant to apply to its relationship with other business partners, government contacts and the readership. These are:
“We do not make deliberately false or misleading statements about our businesses, or about other companies….We obtain competitive information legally. We do not obtain information about competitors through theft, blackmail, wiretapping, trespassing or other methods prohibited by law.” (Standards, 2013)
The Triple Bottom Line (TBL) Standard
At the core of the TBL standard is the principle of sustainability. Equally applicable to nonprofits, governments as well as businesses, the TBL measures the “degree to which an organization is being sustainable or pursuing sustainable growth can be difficult.” (Slaper & Hall, 2013) Scholars like John Elkington were instrumental in devising quantitative measurement scales for TBL. Under the system, conventional focus on profits is excluded. It its place, new parameters such as environmental and social effects of business actions were added to the usual measures of return on investment and shareholder value. By focusing on comprehensive investment results—
“that is, with respect to performance along the interrelated dimensions of profits, people and the planet—triple bottom line reporting can be an important tool to support sustainability goals. Many businesses and non-profit organizations have adopted the TBL sustainability framework to evaluate their performance, and a similar approach has gained currency with governments at the federal, state and local levels.” (Slaper & Hall, 2013)
TBL is an apt choice for evaluating News Corp’s business practices because it encompasses all relevant ethical dimensions. News Corp’s SBC also briefly mentions the environmental and people dimensions, but its main concern is its ‘stakeholders’, which is usually limited to shareholders, partners and consumers. Hence, TBL offers a more comprehensive ethical framework compared to the limited guiding principles written into the SBC.
Comparison of News Corp’s Practices under TBL and SBC
Undue Intrusions into Political Processes
One of the first instances of News Corp’s opportunistic use of political connections came to light in1995. Murdoch struck a book deal with the then House Speaker Newt Gingrich for a substantial sum of $4.5 million. The ethical problem was obvious in this case. Murdoch, who was even at that time an influential and trans-global media personality, owned a newspaper chain and several television stations. He stood to gain enormously through the relationship with the Speaker. It was only after severe public backlash that Gingrich decided to return the advance and settled for sales-driven royalties. (Tolchin & Tolchin, 2001, p. 5)