Ethical Breaches at News of the World
| Case Code: BECG119 Case Length: 15 Pages Period: 2011 Pub Date: 2012 Teaching Note: Available |
Price: Rs.500 Organization: News Corp., News of The World Industry: Newspaper Countries: UK Themes: Business Ethics, Media Ethics, Corporate Governance |
Abstract Case Intro 1 Case Intro 2 Excerpts
Introduction
'Thank You and Goodbye' read the headlines of Britain's best-selling Sunday tabloid , the News of the World (NOTW), as it rolled its last edition off the presses on July 10, 2011.The tabloid had sold around 4.5 million copies in July 2011. On July 7, 2011, the parent company of the 168-years-in-print tabloid, News Corporation (News Corp), announced that the NOTW was being permanently closed. The tabloid was forced to shut down after the unethical practices it had been following came to light and kicked off a major controversy in 2011. The tabloid NOTW was entangled in a series of controversies which included hacking the phone lines of celebrities and the royal family, and those of murder and terror victims. It was also accused of paying bribes to police officers for obtaining information and so on.
The revelations that the phone of a murdered schoolgirl Milly Dowler had been hacked generated a public outcry. Public enquiry reports later showed that employees of NOTW had also tapped the phones of deceased British soldiers and their families, the victims of the London bombings and their relatives' phone and voice mails. Following the phone hacking controversy, many top senior executives resigned from News Corp and a few, including the former News International CEO Rebekah Brooks (Brooks) and ex-NOTW editor Andy Coulson, were arrested on suspicion of conspiring to intercept communications and unlawfully accessing voicemail messages. News Corp had to withdraw its US$12.5 billion bid for British Sky Broadcasting (BSkyB) Group following a public protest and a political backlash against the phone hacking scandal. Advertisers too began to boycott the tabloid. The loss of revenue eventually led to the tabloid's closure.
The closure of NOTW and the exposure of the scandal brought to the fore the issue of ethical standards at News Corp and the lack of self-regulation. The cut-throat competition in the media industry had paved the way for yellow journalism or 'gotcha journalism' . "Quite simply, we lost our way. Phones were hacked, and for that this newspaper is truly sorry", said a message posted on the tabloid's website. In its last issue, Rupert Murdoch, CEO of the media conglomerate, issued an apology. He acknowledged the fact that NOTW had been involved in phone hacking and had bribed police and investigating officers for information.
The last edition carried no advertisements and the company decided to donate the sales proceeds to charity. The front page of the last issue had an epitaph, "The world's greatest newspaper 1843 - 2011", with a strapline: "After 168 years, we finally say a sad but very proud farewell to our 7.5m loyal readers."
In July 2011, News Corp., whose credibility had been questioned following this crisis, released a code of ethics and distributed it to all its employees. The move prompted observers to comment that the next big challenge for News Corp would be the effective implementation of the code. The question before Rupert and James Murdoch and the senior management at News Corp. was: Is releasing a code of ethics enough? What else should they do to address this issue?
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