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Feb 1, 2012

It's a big if, but Gina Rinehart could set Fairfax agenda

There never has been, and is never likely to be, a rule that says someone who owns a company is not entitled to run it as she sees fit, within the limits of the law.

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There never has been, and is never likely to be, a rule that says someone who owns a company is not entitled to run it as she sees fit, within the limits of the law. Nor would such a statute be desirable, if we are serious about personal freedom and freedom of speech.

So in theory, if Gina Rinehart comes to own or control Fairfax Media — and she is a long way off doing that — she could do as she wished with editorial policy, hiring and firing as she saw fit to achieve her aims.

Having said that, media ownership is a complicated thing, full of traps for those who lack experience. The political and cultural issues are quite different from those in most other enterprises.

That media assets present very particular challenges has always been true. Just ask Frank Lowy, for example — an experienced and massively successful businessman in retail, who crashed and burnt when he bought into Channel Ten. The challenges are even greater at present, with the fundamental structural issues the media is addressing.

As well, Rinehart at Fairfax would face a board, which, for all its faults, has already stood up to one theoretically dominant proprietor in the Fairfax family. On the other hand, there is likely a fair bit of difference between the mild-mannered Fairfaxes and the outspoken Rinehart. And on the other hand again, the Fairfaxes at least understood the particular cultures of media, and of Fairfax Media in particular.

Rinehart would likely be an impatient learner, and there are some things that are hard to crash through, including strong boards and long-standing corporate cultures. If we assume she would want to achieve cultural change, she would have her work cut out. And she is not known as a patient person.

The main way a board exercises influence over editorial is in selecting the editor.

The various attempts in Fairfax history to shelter the newsrooms from the powers of proprietors have centred on the charters of editorial independence. These insisted that the editor, once appointed and given a budget, should be left to manage the newsroom as he or she (it was always he) saw fit.

There was no protection against an ill-motivated editor.

And the suasion that persuaded successive proprietors to sign the charter was political and moral in character: not legal. It rested on the political power of campaigning journalists and their supporters. So far, it has always been in the proprietors’ interests to at least pay lip service to the charter.

But we saw the limits of the power of the culture of the Fairfax newsrooms during the reign of Andrew Jaspan as editor of The Age. He was the subject of a virtual no-confidence motion passed by editorial staff over issues of editorial independence. Yet he survived for some time afterwards because he had the backing of the board and in particular the then chair, Ron Walker. What the journalists thought was close to irrelevant.

Senator Stephen Conroy was on the Jon Faine show this morning talking up the expected recommendation of the current Convergence Review, due to report next month. But going by the interim report issued late last year, the main mechanism for protecting diversity in media ownership, should the review’s recommendations be accepted, will be a public interest test.

That might be a good idea for all sorts of reasons, not least because convergence makes almost any other kind of regulation very difficult indeed. So far we have no details on how such a public interest test might be framed, but it is hard to think of any desirable or likely framing that would rule out Rinehart as proprietor of Fairfax just because she has strong views.

“Clearly she is seeking to exert her influence but is she breaking the law by exerting an influence? No,” Conroy told Faine. “Do we need stronger laws in this area? Yes. We want to see a debate around a public interest test.”

Another point: there is a serious body of opinion among media investment analysts that moving to the right is a shrewd commercial move, because that is the point on the political spectrum where the most desirable A-B readers and viewers — those best able to pay for their content — are most likely to seek their media.

Whether or not that view is correct, those who are in any case inclined to the right wing of politics are likely to want to believe it. So Rinehart or others may well argue that changing Fairfax’s culture is good business, not only self-interested politics.

If we assume (and it has not been established beyond doubt) that Rinehart’s motivation for media ownership is the desire to see her political and business views reflected in editorial content, then that might be an issue for editors, journalists and their audiences. But it is hard to see how any legal public interest test would capture that concern.

Of more relevance might be a statutory regime involving a self-regulatory media standards body. This is one possible outcome of the current Finkelstein media inquiry, which reports at the end of this month to the Convergence Review.

Attacks on editorial integrity are more likely to be a breach of any standards adopted by such a body, rather than a breach of public interest tests in law.

If, as he seemed to be contemplating doing in public hearings last year, Finkelstein recommends that membership and funding  of such a body be compulsory for news media outlets, then it is likely to become the forum in which future issues of journalistic integrity are played out, including but not only battles between journalists, editors and proprietors. It had better be robust.

Margaret Simons —

Margaret Simons

Journalist, author and director of the Centre for Advanced Journalism

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29 thoughts on “It’s a big if, but Gina Rinehart could set Fairfax agenda

  1. Jackol

    Thanks Margaret, a good summation of the situation.

    As you introduced it, the crux of the matter is that in law there is basically no distinction between a media company and a company that makes widgets. Of course the owner of the widget making company should be able to do whatever he or she wants with respect to what is produced and how, what colour they are etc.

    However, a media company is not any old company making widgets. The media (as they keep telling us) has a special relationship to our democratic institutions, the health of our polity, with important implications for governance, corruption, how informed the general public is on matters of importance etc.

    If Australia had a thriving diverse competitive media landscape, one media company being taken over here or there by a campaigning owner would not be an issue. We don’t have that. The new media is fostering some diversity, and that is to be celebrated, cherished, encouraged, but it doesn’t alter the reality that Fairfax is one of the handful of media companies in Australia that reaches a significant portion of the population and that has cultural and historical ties that give it a significant input into how the public receives its news.

    To be left with News Limited and Gina Rinehart, both as owners of campaigning journals, and the rest of the media landscape consisting of minor players, is a disaster in the making. Codes of conduct, editorial policies meeting minimum standards, etc etc only stop the grossest of abuses, as we know. They provide a boundary, but they can’t force a paper to produce accurate articles in context with appropriate/proportionate emphasis …

    Sadly, as pointed out in the article, there is no solution in terms of barring Gina Rinehart acquiring a controlling interest in Fairfax. The only solution is to foster a more diverse media landscape to try to dilute the influence of the News Limiteds and Gina Rineharts and Kerry Stokes of the world. How to do it is the billion dollar question.

  2. linda domaschenz

    @John2066 On the ball still/again, she is Austalias and soon to be the worlds biggest bludger.Start paying some tax Gina, Twiggy, Ian and the rest of you lot. The boom may be big in $ for you but there’s no or little flow on. FIFO workers have the highest rate of divorce. l ocals can’t afford to live in their home towns ( some rents exceed $2,000 pw) for a prefab. Ok, it (the boom or kaboom) has created jobs and maintained export quotas exports but at what expense? No training, they poach skilled tradesmen from rural areas and leave us high and dry. Towns devoid of young men gone bush. Other industries short on staff so wanting 457s. How many apprenticeships has Gina on her books? I shudder to think. But at a rough estimate far less per any other business by a long shot.
    Anyone done a true appraisal of the effect in WA re housing, tradesmen, CUBs- I doubt it. the only appraisal is whats being loaded on boats. Not to mention what’s been done in The Pilbara/Kimberley re aboriginal heritage, ancient artworks or is that Twiggies holes and ports. Try the Burrup Burrup peninsula. Most of the equipment to mine this land is imported, they don’t even support own manufacturing base or little. These giants are fed by greed and it is blatantly obvious. Gina, fix up your mess at home before you decide to mess up our lives too with your grab on the national free press. One sad lonely woman with too many $. Remember the caricature of Scrooge in the vault swimming in his sea of $, that’s our Gina. Where are you Donald, Daisy, Heuy, Duey and Louie!
    This situation makes me mad, damn mad.
    John, you are right biggest bludgers the world has ever seen! But at least SB may get the FIN for $2 pffttt. Calling Conroy- where are you, minister!

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