Leonardo Del Vecchio and Rupert Murdoch have plenty in common. The chairman of Luxottica, the eyewear group, and the chairman of News Corp and 21st Century Fox were born in the 1930s. Both are billionaire patriarchs of family businesses they largely built themselves but now share with outside investors. Both have six children from different relationships, and both have wrestled with the question of succession.
My first reaction to the latest news of changes at the top of the Murdoch empire was: did the shrink get involved?
Succession planning at family businesses is often full of unlikely twists and shrieking. After the phone-hacking scandal broke over Rupert Murdoch’s UK newspapers in 2011, Vanity Fair claimed that the Murdoch siblings had discussed succession with a “family counsellor”, partly in an attempt to smooth the process. Read more
Stephen Elop, ex-Nokia, soon-to-be ex-husband
I firmly believe boards need to be less squeamish about prying into their senior executives’ private lives, particularly when divorce is looming, because the corporate consequences can be grave. Now researchers at Stanford’s Graduate School of Business have broadened the debate to suggest that shareholders should worry about chief executives’ marital disharmony, too.
Divorce, they write, could undermine CEOs’ control and influence, affect their “productivity, concentration and energy levels”, and have an impact on their attitude to risk. They cite Rupert Murdoch’s split from Wendi Deng and the divorce of Harold Hamm, CEO of Continental Resources, from his wife. News of the first, thanks to a pre-nuptial agreement, left News Corp shares unmoved; news of the second, with no pre-nup, knocked 2.9 per cent off Continental Resources’ stock price as investors worried about the fate of Mr Hamm’s 68 per cent stake in the group. Read more
So the revelation in FT Weekend’s interview with David Cornwell, better known as John Le Carré, that Mr Murdoch once lunched with the master espionage novelist is a delicious one. Mr Le Carré is no fan of the media mogul, telling one interviewer in 2010 (even before the phone hacking scandal engulfed News Corp) that his empire was guilty of “pretty horrendous manipulation of the media” and “enormous intrusions into our domestic affairs”.
But some years ago, he relates in the FT interview, he met the proprietor of The Times, after taking offence at one of the newspaper’s stories about him. Read more
The return of the “soap opera” with a digital twist – thanks to multi-million pound deals struck by Unilever with Viacom and News Corp – is a further indication that there really is nothing new in marketing.
As I wrote recently, in relation to the spat between BrewDog, a Scottish independent brewer, and the beverage giant Diageo, the tools of communication and promotion may change, but the underlying challenges and responses are the same as they ever were. Read more
It will be a shame if bitter and partisan debate over whether Rupert Murdoch is “a fit person to exercise the stewardship of a major international company” obscures the more important conclusion of the UK parliament’s culture, media and sport committee on phone-hacking: that he and his son James were wilfully blind to what was going on.
Whether BSkyB, controlled by the Murdoch-owned News Corp, is a “fit and proper” owner of a broadcasting licence is a question for Ofcom, the regulator, which has now entered an “evidence-gathering” phase of its probe.
But as even the dissenting members of the committee said on Tuesday, if the “fit person” line had been omitted from the report, they would have voted unanimously to back it, including the charge that the Murdochs oversaw a culture of wilful blindness. Read more
Warren Buffett’s early stage prostate cancer is so commonplace and treatable that you might legitimately ask whether it was worth declaring. But there is no question that it was better for Berkshire Hathaway’s chairman to make his statement than to conceal the condition.
While there are good reasons to respect the privacy of patients, Apple’s failure to detail Steve Jobs’ condition during his leave of absence for health reasons in 2009 spread unnecessary uncertainty about the future of the company and its succession planning.
If Mr Buffett had any doubts about whether to make his statement, he could have asked a fellow senior citizen: Rupert Murdoch. Read more
By Ben Fenton
In an extended Vanity Fair piece that people who know the Murdoch family say is “horrifying in its level of detail” and “strikingly accurate in most respects”, Sarah Ellison has laid out how the phone hacking scandal at one of News Corp’s UK newspapers derailed dynastic plans for the media group.
One element of a long history – the claim that the four eldest Murdoch siblings had discussed the “succession” to their father as chairman and CEO with a “family counsellor” or psychologist – stood out, both for being hard to picture and for what it says about how little other shareholders views appear to enter into the Murdoch family considerations on succession planning. (Rupert Murdoch and the elder four of his six children control 38 per cent of voting shares, but own only 12 per cent of the total equity). Read more