When News Corporation (NSDQ: NWS) ran an ad in multiple newspapers across the UK this weekend, it promised “further concrete steps” to right the wrongs that have engulfed the company and its key executives in scandal. Today we got an example of one of these: the company has announced the “formal establishment and extension” of the Management and Standards Committee, independent of News International, which will cooperate with the current investigations and also provide standards for ethics and governance in the future.
News Corp has appointed Lord Grabiner QC as the independent chairman of the MSC. Grabiner is a commercial lawyer, who is also non-executive chairman of the retail holding company Arcadia Group, and has been a past head of the London School of Economics.
The MSC will work with authorities that are currently investigating News International in relation to the phone hacking scandal and the police corruption that has emerged as a by-product of that investigation. By appointing an outsider — not just to News Corp but to the media world as a whole — it is hoped that this will give the arm’s-length independence that the MSC will need to be credible.
According to the release, Grabiner and the MSC will report to Joel Klein, EVP and board director. Klein reports to Viet Dinh, an independent director and chairman of News Corp’s nominating and corporate governance committee.
The move comes at a time when there are increasing reports of the mess going down in the UK threatening to spill over into markets like the U.S. Last week, the first murmurs of questions started to emerge from investors, who will surely get louder if News Corp isn’t seen to be trying to improve practices with regards to ethics. Pointedly, the MSC looks like it is very much a UK committee, which is how News Corp would like to isolate the problem.
News corp notes that the board has given the MSC its “full support.”