Many of the day after headlines covering Rupert and James Murdoch's appearance before Parliament focus on the sensational shaving foam attack, Wendi's left hook and David Cameron's inquisition before the House of Commons. But buried beneath the history of pie throwing and Chinese bloggers' praise for Rupert Murdoch's wife is some stark analysis of what the News Corp. board thought of their aging CEO's absent-eyed performance at the hearings.
After Murdoch's appearance in Parliament Tuesday morning, Bloomberg reported that News Corp. was considering elevating Chase Carey, the company's current chief operating officer, to CEO. Based on interviews with corporate governance experts, Bloomberg suggests in a follow-up story that emboldens their original report, which came from anonymous sources, that Murdoch's refusal to take responsibility will further hurt his credibility with the board:
“If he didn’t know what was going on, he’s doing a lousy job as CEO and the board should replace him,” said Jay Lorsch, a Harvard Business School professor. “The board should be asking, ‘Where were you?’ The buck stops with him.”
Chief executive officers who don’t hold themselves responsible for crises at their companies often have stepped aside under pressure. While Murdoch’s almost 40 percent voting control makes an involuntary ouster unlikely, the weight of the crisis may ultimately persuade him to give up the CEO post, said Sydney Finkelstein, a professor of management at Dartmouth College’s Tuck School of Business in Hanover, New Hampshire.
Bloomberg's bullish take on Chase Carey replacing Murdoch is echoed in the British press. The Telegraph reports that the company's directors could use Murdoch's "doddery" performance as an excuse to challenge the family's grip on the company. "I would absolutely prefer Chase Carey," a manager at a hedge fund that invests in News Corp. told the paper. "I don't put much weight on the Murdochs' outward appearance [before the Select Committee] but I do put weight on how the independent directors feel. They may use this as an opportunity to push Rupert Murdoch upwards to be a non-exec."