JAMES MURDOCH’S decision yesterday to step down as chairman of British Sky Broadcasting was prompted by fears that a House of Commons inquiry would sharply criticise him later this month.
The departure of Mr Murdoch, son of Rupert Murdoch, was not unexpected, but it had been ruled out repeatedly for months by Murdoch loyalists.
In a statement announcing his decision, Mr Murdoch jnr said: “I believe that my resignation will help to ensure that there is no false conflation with events at a separate organisation.”
Mr Murdoch’s reputation has been badly damaged by the phone-hacking scandal at News International, News Corporation’s UK newspaper subsidiary.
Mr Murdoch and his father are expected to give evidence shortly to the Leveson Inquiry into British press standards, prompted by the News of the World’s hacking of murder victim Milly Dowler’s phone.
Mr Murdoch, who will remain as a non-executive director of BSkyB, is being replaced as chairman by Nicholas Ferguson, the company’s deputy chairman.
Following discussion with friends, Mr Murdoch is believed to have decided that it was better to stand down now, rather than doing so after negative findings by a parliamentary inquiry.
Mr Murdoch’s reputation has been damaged by two appearances – one alongside his father – before the House of Commons’s culture, media and sport committee.
In one of them he was forced to say that he had not read a detailed e-mail from a News International executive warning that phone-hacking had been rife at the News of the World.
The Commons inquiry into phone-hacking is due to report shortly, although the final language to be used to criticise Mr Murdoch is still being debated, Westminster sources say.
Since his appearance before MPs, the scandal has spread wider within News International with a series of arrests of journalists working on the Sun – the most profitable arm of News International’s operations.
Last month Mr Murdoch stood down as chairman of News International, while he has resigned as a director of British-based companies Sotheby’s and GlaxoSmithKline.
His efforts to put distance between himself and the UK may be an attempt to ensure that the UK’s broadcasting regulator, Ofcom, does not withdraw BSkyB’s licence. It is investigating whether News Corp – BSkyB’s biggest shareholder – and Mr Murdoch are “fit and proper” owners of a broadcasting licence.
His decision to step down has come as a relief to other BSkyB directors, who feared they would be faced with the choice of asking or telling him to quit if the crisis worsened.
Last year, News Corporation was forced to abandon a €10 billion bid to take over the remaining 61 per cent share of the successful broadcaster set up by Mr Murdoch’s father.
Paying tribute to his son, Mr Murdoch snr, who is chairman and chief executive of News Corporation, said he had shown successful leadership.
“He has played a major role in propelling the company into the market-leading position it enjoys today – and in the process has been instrumental in creating substantial value for News Corporation shareholders,” he said.
