07.21.11

Rupert’s Willful Ignorance

Just because Murdoch and Rebekah Brooks claim ignorance about the hacking scandal doesn’t mean they weren’t responsible. Management guru Roger L. Martin on how leadership shapes culture.

Rupert Murdoch has told British Parliamentarians that he was not responsible for the phone hacking at The News of the World. And Rebekah Brooks has done the same. I believe they are both speaking honestly. But speaking honestly and telling the truth can be two very different things.

I’ve no doubt that Brooks and Murdoch believe they were not responsible for the actions at the heart of this scandal, just as Col. Oran K. Henderson, the brigade commander who ordered the attack on My Lai in 1968, was certain he wasn’t responsible for that outcome. Henderson had urged his officers to “go in there aggressively, close with the enemy and wipe them out for good,” an order that immediately preceded his men executing between 350 and 500 Vietnamese women, children, and unarmed men. Accused of then taking part in an elaborate coverup, Henderson denied being told about the murder of civilians. Ultimately, the military court backed him up. But of course we all know that “not guilty” is a legal outcome that should not be confused with “innocent.”

Henderson, Brooks, and Murdoch all disavowed responsibility for the actions of their subordinates; they denied all knowledge of the illegal activities and claimed that they had never ordered, nor authorized, any such actions. It may well be true that Brooks and Murdoch never told anyone to hack into Milly Dowler’s cellphone, nor even knew that it had happened. But that doesn’t mean they weren’t responsible for it.

The truth is that when superiors put substantial pressure on their subordinates to achieve aggressive goals, and don’t check up on just how those subordinates accomplish those goals, something sinister can happen. The intense pressure to perform can lead to unethical and illegal behavior on the part of the subordinates, while giving the bosses wonderful “plausible deniability” protection: “I never told them to do THAT!”

It’s a fairly simple dynamic. Imagine you are the CEO of a manufacturer that makes military aircraft. You recognize that it is difficult to close billion-dollar jet-fighter deals with foreign countries, but you want to spur those sales nonetheless. So, you tell your sales teams that it is absolutely crucial to meet annual goals and give big incentives to close those billion-dollar deals before the end of the year. Under these circumstances, you will almost certainly get your billion-dollar deals before the end of the year.  But if you don’t audit pretty carefully just exactly how those deals are closed, chances are that you will find yourself in front of some review panel, not unlike Murdoch and Brooks, trying to explain that you are not responsible for the massive bribes, hiring of prostitutes, etc. that helped facilitate those deals.

Under Brooks, News of the World made its mark and maintained its circulation on the basis of scoops—the more salacious the better. It is said that Rebekah Brooks was loved and feared by her reporters in equal measure and Rupert Murdoch—well, if he can get prime ministers to grovel at his feet, I think it goes without saying that he is feared by his people. If Brooks or Murdoch pounded the table and ordered NotW reporters to “get me some damn scoops,” there is little doubt that those folks would have scrambled to deliver—even if it meant that the "investigative journalism" got a bit too investigative.

Perhaps it is true that, in the desire to maintain plausible deniability, Brooks made sure to never ask “so how did you get that scoop anyhow?” Yet simply failing to ask the question would have sent an extremely powerful signal to the troops that it didn’t matter how you got the scoop, just that you do indeed get it: Hack the cellphones of kidnapped children, bribe police, do whatever it takes. Brooks may not have explicitly given the order, but that does not mean that her actions didn’t create the atmosphere in which such behavior was not just acceptable but essential.

I suspect that we will never truly know just how much Rebekah Brooks or Rupert Murdoch did or did not know about the hacking or the police bribery, because journalists prefer that other people be the object of their scoops, not themselves. But for me, I would feel a hell of a lot better about the empire that controls so much of our media—including The Wall Street Journal—if Rupert Murdoch had been more reflective than apologetic while on the proverbial hot seat. Murdoch apologized for the wrongdoing at The News of the World, while in the same breath denying any responsibility for it, making it clear he had been betrayed by disgraceful rogue reporters at a part of the empire that represented less than 1 percent of his employee base.

If Murdoch can get prime ministers to grovel at his feet, I think it goes without saying that he is feared by his people.

Instead he pointed to the company’s 56-page code of conduct manual to say that it is clear in stating that the sorts of actions in which these rogue reporters engaged are truly, absolutely, and utterly out of bounds, which in wonderfully circular fashion proves the rogue reporters are indeed rogue. In all organizations, informal practices trump formal structures. If the rule says that you will be fired if you show up five minutes late, but nobody is fired even though most people show up for work 10 to 15 minutes late, then printing up the rules was a waste of paper.  Enron had a code of conduct manual; WorldCom had a code of conduct manual and both were trumped by informal behavior, as was the case here.

What we didn’t get was either Murdoch or Brooks taking true responsibility, by saying:

“We are terribly sorry. While we would like to believe that this was the work of disgraceful rogue reporters, we have to ask ourselves what is it about our managerial behavior that would have caused our employees to think that we wanted them to illegally hack phones and to pay police officers for information? Did we push them so hard for scoops that they felt they needed to cross ethical lines to get there? Did we show such reckless disregard for the lives of the targets of our scoops that our people didn’t think twice about hacking the phone of a murdered girl? Did we turn a blind eye to these practices to such an extent that we gave the impression of tacit support? While it would be comfortable to distance ourselves from responsibility for these actions, to do so would be profoundly irresponsible. They worked in our organization and engaged systematically in these practices while on our payroll. We have a lot of work to do to repair the managerial flaws that have given rise to these despicable acts; we are committed to doing that work. We will report to our public on our findings and on the changes we intend to make.”

Until something of this ilk is forthcoming, I think that America should be very concerned about the Murdoch family owning any media assets in this country.  News International should be seen as a rogue organization, not an organization with rogue reporters buried deep inside it.