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The Nine-Fairfax 'independence' myth

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Despite claims of media diversity, the Farifax Charter of Indpependence has not been signed by Peter Costello or the board of Nine (Screenshot via YouTube)

When Nine acquired Fairfax, Australians were assured they needn't worry about media diversity as Nine would be bound by the Fairfax Independence Charter but there is only one problem. Anthony Klan reports.

NINE ENTERTAINMENT’S board never signed the independence charter that governed Fairfax Media, the 180-year-old media company it took over in a mega $4.2 billion merger two years ago.

We can reveal Nine has failed to sign – or to ratify in any legally binding way – the storied charter, which underpinned the editorial integrity of several of Australia’s biggest and most influential newspapers – including the Sydney Morning Herald, The Age and The Australian Financial Review – for the past three decades.

That is despite Nine bluffing for the past two years and implying that it had done so.

The explosive revelations go to the heart of the independence of media in Australia and come just three weeks after a Senate Inquiry into media ownership was called.

Nine spokesman Nic Christensen confirmed Nine had never signed the Fairfax Charter of Editorial Independence.

That confirmation came just over two weeks ago and was in response to a series of questions put to Nine management and its board of directors.

Hours after that confirmation, Nine CEO Hugh Marks announced his shock resignation.

In subsequent correspondence with us, Nine has failed to provide a single document – or any written evidence whatsoever – showing that it is in any way bound by the former Fairfax charter.

The Fairfax Media Charter of Editorial Independence has long been a bedrock of the Australian media landscape, especially given the size and influence of the Fairfax papers and websites and the nation’s extremely concentrated media ownership.

The charter required Fairfax journalists to be truly “independent” of whoever owned the newspapers for which they worked.

It was signed by staff of The Age in March 1988, and by the board of John Fairfax Limited (the company later changed its name to Fairfax Media) two months later, in May 1988.

It was broadened in 1990 and from February 1991, the Fairfax Charter of Editorial Independence covered staff at The Sunday Age, Sydney Morning Herald, Sun-Herald and Australian Financial Review.

The charter stated, among other things, that journalists at Fairfax publications must report

'fairly, fully and regardless of any commercial, political or personal interests,” including those of “any proprietors, shareholders or board members.'

It stated that management couldn’t force journalists to do anything in breach of the Australian journalism Code of Ethics and that 'full editorial control of the newspapers' would vest with the newspapers’ editors.

'The editors alone shall determine the daily editorial content of the newspapers', the Fairfax Charter of Editorial Independence stated.

The importance of the charter was seen to be such that in 1991 it brought together two of Australia’s most famous political rivals, Gough Whitlam and his nemesis Malcolm Fraser.

The pair attended an October 1991 rally, organised by The Age independence committee, and urged the then ALP Hawke Government to do everything it could to prevent further media concentration.

The existence of this charter is important for many reasons. 

At a practical level, for example, if a reporter were to refuse directions because while legal, they were not in line with the charter, they would likely have little recourse if they were subsequently fired for not following those directions.

Yet not only has Nine not signed the charter, or put anything in its place, the charter doesn’t actually exist. At least not in any real or legal sense. It was a signed agreement between journalists at the then Fairfax papers and the Fairfax board.

On December 7, 2018, when Nine took over Fairfax, the Fairfax board ceased to exist. As a result, so too did the independence charter.

Weasel Words

On 26 July 2018, under Nine chairman Peter Costello, a senior LNP figure and former Federal Treasurer, Nine announced its plans to take over Fairfax.

Ten months earlier, the Federal Coalition, under Prime Minister Malcolm Turnbull, had succeeded in its push to water down media ownership laws, a goal it had been pursuing since it was elected in 2013.

The changes meant Nine could now buy Fairfax.

Before the changes, the long-standing “two-out-of-three” rule meant media moguls could not own television, radio and newspapers in the one market.

Nine had television and radio — Nine Radio (previously called Macquarie Media) owns many stations including 2GB, 4BC, 3AW and 6PR. Now it could finally own newspapers too.

Allowing Nine to buy Fairfax had long been seen as a key motive behind the Coalition’s campaign to scrap the decades-old ownership restrictions.

It has delivered Nine, already a major media player, enormous influence over the nation’s media and social discourse.

Nine’s July 2018 takeover announcement raised serious concerns.

Alongside the fact that it would further erode Australia’s already woeful media ownership diversity, the news sparked widespread concerns that the quality of the Fairfax mastheads would diminish under Nine and be subject to political interference and improper commercial influence.

Nine was well aware of these concerns and the danger they posed to it getting the Fairfax takeover over the line. It made a number of statements to hose down the concerns.

The closest thing to suggesting any actual connection whatsoever between Nine and the Fairfax Charter of Independence is a two-sentence statement on page 30 of Nine’s 354-page "Fairfax scheme” takeover document, released to the market on 12 October 2018.

It says that under the takeover the Fairfax papers will be owned by Nine. It gives a description of the Nine Charter of Editorial Independence. Then it says Nine’s Charter of Editorial Independence 'has been unanimously endorsed by the Nine Board'.

That statement has underpinned Nine’s monstrous bluff.

And Nine continues to hold it up as alleged evidence it is actually bound by the charter.

The statement was the single piece of written evidence that Nine could provide us when we pushed Nine (repeatedly) in recent weeks to provide us with any written evidence whatsoever that there was a connection between Nine and the charter.

But the statement that Nine’s board had “endorsed” the Fairfax Charter of Independence meant little to nothing on 12 October 2018.

At the time, Nine did not own or have any control over Fairfax and it had zero legal or ethical relationship with Fairfax reporters.

In other words, any statement Nine made about honouring, “adopting” or “endorsing” the Charter of Independence before it actually owned Fairfax was effectively meaningless. Nine’s takeover of Fairfax happened on 7 December 2018.

We asked Nine when its board had made the “decision” about the Fairfax charter?

“It occurred at a board meeting prior to the merger,” Christensen wrote.

Nine’s wrangling with the truth and omissions regarding the Fairfax independence charter date back to the announcement of the takeover plans in mid-2018.

At that time, CEO Marks said Nine was “more than happy to adopt the principles of the independence charter”. However, he did not say Nine would actually sign it.

When asked on ABC’s 7.30 shortly afterwards, chairman Costello skirted around the issue.

“In a further media interview today, Costello was silent on the charter of independence,” it was reported at the time.

The journalists union, the Media Entertainment and Arts Alliance (MEAA) was unequivocal.

MEAA president Marcus Strom said at the time:

'Until Peter Costello...formally signs a binding document that commits Nine to adopting the charter of independence, our members will continue to be concerned and sceptical about how genuine Nine’s commitment to editorial independence really is.' 

Sirens

Alarm bells that Nine may never have actually signed the Fairfax charter sounded last month. We had exposed that Nine’s A Current Affair had orchestrated the stunt involving far-right Senator climbing on Uluru, ostensibly as part of a “protest” against the then-upcoming closure of the sacred site to climbers.

It was revealed that despite assurances from Nine, including a public statement from A Current Affair host Tracey Grimshaw, Nine had deeply misled the public about its involvement in the stunt, which involved its reporter Martin King and Pauline Hanson climbing on Uluru against the wishes of its custodians and Federal agency Parks Australia.

Nine had instead obtained alleged “approval” from an Indigenous “group” that existed only on Facebook, and which we revealed was set up just one week before Nine kicked off its divisive stunt. Nine allegedly then gagged that Indigenous group.

Our exposé caused a backlash over Nine’s “disgraceful”, “shocking” and “unconscionable” behaviour, including from a string of high-profile and respected journalists who demanded answers.

Despite the Hanson-Uluru expose being widely covered by media – including by The Guardian, The West Australian and the Daily Mail – not one word of it appeared in any of the former Fairfax newspapers.

That was despite the Sydney Morning Herald and The Age having run “news” of Hanson’s Uluru climb last year, both papers editorialising about her climb last October and the fact that both papers continue to carry the advertising slogan, “Independent. Always”.

Just like Hanson’s Uluru climb, it appears the “signing” of the Fairfax independence was a monumental stitch-up orchestrated by Nine Entertainment.

Early in the afternoon of Friday, November 13, two weeks ago, The Klaxon wrote to Nine. We wanted to know, simply, whether Nine had ever, in fact, signed the Fairfax Charter of Editorial Independence.

At 9.11pm that night Nine spokesman Nic Christensen responded.

'I’d direct you to the multiple statements we made at the time of the merger about the board agreeing to sign up to the Fairfax Charter of Independence,' he wrote.

We persisted. 

While it is true that Nine has made several vague statements regarding the Fairfax charter – that’s a matter of record – we had not seen any evidence, anywhere, that Nine had actually signed it.

We asked again: Was the Fairfax charter ever actually signed by Nine? 

At 10.25 pm on that Friday night, the response came back:

'No.'

The following morning, a Saturday, Nine chairman Costello called an emergency meeting of Nine’s board members via video conference.

Hours later, Nine CEO Marks announced his shock resignation.

Nine’s annual general meeting – where succession matters are dealt with – had been held just two days earlier. No mention had been made of Marks leaving Nine, or that he had anything other than the full support of Nine’s board.

Nine has given no explanation for Marks’s departure.

Marks, who is unmarried, has said it was related to a relationship he was in with a former Nine senior executive Alexi Baker. Baker had reported to Marks as managing director of commercial, before she resigned on October 1, so their newly-formed relationship could continue without causing any governance concerns. 

Nine's chairman, Costello, has repeatedly declined to comment when asked why Marks had left Nine. This raises serious governance concerns at the $4.2 billion company.

If there was any wrongdoing, or suggestions of wrongdoing or failures by Marks, CEO for five years and on Nine’s board since February 2013 before his shock resignation, investors need to know to help ensure the appropriate steps are taken to help prevent that failure, or those failures, from happening again.

When Nine took over Fairfax, the Fairfax board was dismantled. Three people who had been on the Fairfax board, Mickie Rosen, Nick Falloon and Patrick Allaway, joined the Nine board after the takeover.

Costello declined to comment when asked whether Rosen, Falloon and Allaway had been aware that Nine had never actually signed the Fairfax Charter of Editorial Independence – or ratified it in any legally binding way – before The Klaxon approached Nine about the matter on November 13.

The second response from Nine came at 10.25 pm.

'Each new board doesn’t physically sign it,' Christensen wrote.

This is incorrect. 

In fact, not only was the former Fairfax charter signed by the Fairfax board (and so remained in place under Fairfax was shut down) The Age Independence Committee has previously made expressly clear the requirement that it be signed by any new owner of the newspapers.

That committee has said.

'The charter was signed by the then editors of The Age and The Sunday Age and was endorsed by the Fairfax board, including chairman Sir Zelman Cowen. We would expect any new owner to sign the charter.'

The former Fairfax Charter of Editorial Independence. Source: Supplied | The Klaxon

Independent. Always?

The Klaxon’s revelations raise serious questions around Peter Costello. The former long-time Federal Treasurer and senior LNP figure has been chairman of Nine since March 2016. Having a conspicuously, closely politically aligned figure overseeing a major TV and media network has drawn serious concerns around governance and political interference since Costello’s appointment.

The Fairfax takeover threw petrol on the situation.

It has delivered Nine, already a major media player, enormous influence over the nation’s media and social discourse.

Adding yet further to concerns of politicisation of the former Fairfax mastheads, Costello has himself previously expressed his distaste for the Fairfax Charter of Independence.

In 2012, mining billionaire Gina Rinehart, who is Australia’s richest person and known for her “far-right” political views and opposition to climate action, was seeking to take a controlling stake in Fairfax.

That move was heavily opposed by Fairfax’s journalists, who saw it as a ploy by Rinehart to gain control of the papers in order to influence their coverage and so, public opinion.

Anthony Klan is an investigative journalist. You can follow him on Twitter @Anthony_Klan. This article was originally published at The Klaxon and has been republished with permission.

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