The Guardian: The path back to trust, truth and integrity: "Corporate social responsibility can be defined in lots of different ways, most of which have something to do with integrity.": “When Shell tried to dump an oil rig in the North Sea, it met a storm of protest.” (ShellNews.net 17 Jan 05

Our agenda-setting edition last week revealed deep unease about the quality of British journalism. Here, the former FT editor Richard Lambert joins the debate with a powerful call for media accountability

Monday January 17, 2005

The Sun's front page on July 4 2003 was dominated by a big picture of a large white bird, along with a screaming headline: "Swan Bake - asylum seekers steal the Queen's birds for barbecues". The story below was just as startling. "Callous asylum seekers are barbecuing the Queen's swans," it began. "East European poachers lure the protected royal birds into baited traps, an official Metropolitan Police report says."

That day's editorial read: "This sickening behaviour is an insult to our nation's civilised traditions. If people want to come here from other nations, then let them respect our way of life. If they want to behave like savages, let them get back where they came from."

It was a truly wonderful Sun exclusive, except for one thing: the paper had no hard evidence whatever to support its claims. Subsequent inquiries by other journalists found that the police had no knowledge of such an incident. No one had been arrested or charged on such a grave charge. The Queen's swans paddled serenely on.

And what this story made me think was this. When Shell tried to dump an oil rig in the North Sea, it met a storm of protest. When Unilever launched a detergent that turned out to eat underpants, the result was the same. In both cases, the media led the charge: and quite right too. Businesses these days are expected to take responsibility for the way that they behave and for the products that they sell.

But what responsibility does the news media take for the stuff that it distributes? It sells content, not detergent. But the product can be equally corrosive.

Corporate social responsibility can be defined in lots of different ways, most of which have something to do with integrity.

Definitions might include such qualities as: decent behaviour towards workers, customers, local communities and other interested parties; ethical and open business practices; an awareness of what economists call "negative externalities". This is the notion that companies can impose costs on society without factoring them into their business calculations - by allowing their factories to pollute rivers, or by selling snazzy alcohol mixes aimed at teenagers.

What, I asked myself, were the negative externalities of the swan story: the creation of an urban myth that could in a marginal way make life even tougher than it already is for immigrants in the UK?

Of course the question can't be answered. But if, as is increasingly the case, we expect a polluter to pay for fouling the atmosphere, why shouldn't a news organisation have some kind of price to pay for fouling the public discourse?

The qualities which are associated with corporate responsibility for companies in general are precisely those we should want to be attached to our media: integrity, decency, ethical behaviour, trust.

It's not just the British tabloids which can fall short in this respect. In the past couple of years, three of the most respected news organisations in the world - the New York Times, Le Monde and the BBC - have found themselves caught in the spotlight, having to answer questions which go to the heart of their corporate ethic.

Opinion polls across the US and Europe suggest that journalism is everywhere regarded as among the least trusted of trades, alongside politicians and real estate agents.

If this were any other business, especially one with as strong a consumer interface as the news media, we would be talking about a crisis of trust and demanding different behaviours on the part of the protagonists. Consumers would be boycotting the products to demonstrate their feelings.

Nike no longer has its trainers made in sweatshops in Asia: its brand - and, through that, its sales - would be too damaged by this connection. McDonald's has introduced salads to its menus: it doesn't like being the poster child for obesity. Companies everywhere are taking corporate social responsibility to the heart of the enterprise, at least partly because they fear that if they don't their brand - and thus their future - could be damaged in some serious way.

Everywhere, that is apart from the media. And, unlike Nike or McDonald's, the media companies don't get punished for their behaviour.

The result is that although most media groups are happy to make high-minded statements about their commitment to their viewers and readers, only a very few take their corporate responsibilities seriously enough to spell them out in detail, and to disclose the standards against which their editorial decisions should be judged.

Even fewer then report back on how well they have met their key performance indicators. The oil and the chemical industries have not been able to get away with behaviour like this. Why should the media be different?

The structure of the British press is more competitive than that of any in the western world. As John Lloyd has pointed out, a score of daily and Sunday newspapers are squeezed into one city, London, from which they are distributed around the country every morning. In no other capital of a rich nation is this the case. Nearly all these UK national papers depend heavily on newsstand sales. So their front pages are much more important as attention-getters than is the case in countries where the main papers are one-city monopolies, or are delivered to readers' homes on subscription.

The British media is the way it is because of this hyper-competitive structure. A baked swan on your front page is much more likely to pique the public's curiosity than a story about Tony Blair's latest trip to Washington that everyone's already seen on TV. And if you are not going to get punished for stretching the truth, why wouldn't you do just that?

As a capitalist red in tooth and claw, which is what I am, you might expect me to believe that all this competition is the best possible way of meeting the public interest.

But I don't. The reason is that I believe a series of market failures runs through the process - meaning that this is a case where competition and quality products do not go hand-in-hand. The result is a media that in some extreme cases is more of a threat to our democracy than its guarantor.

Who are the stakeholders in the British print media, and where do the market failures apply?

First come the readers. They don't trust their newspapers, and - maybe not coincidentally - their frequency of reading is in gentle decline. But in the UK they almost never punish their newspapers for egregious behaviour.

Generally speaking, national newspapers in Britain don't have to worry about strong local sensitivities. Whereas the editor of the Baltimore Sun might get punched on the nose if he attacked his own community, the editors of UK national newspapers, secure in their high-rise buildings in London's Docklands, generally don't have to worry about such threats. And of course asylum seekers have no economic and social clout whatever. You can say what you like about them.

Although readers can choose between many different national titles, this does not give them that much choice in the marketplace for ideas. This is because ownership is heavily concentrated. Rupert Murdoch owns more than a third of Britain's newspaper circulation, and controls Sky News. Alongside Associated News and the Telegraph group, he controls the most powerful newspapers in the country.

Among other things, all three groups are opposed to the idea that the UK should become more closely engaged within the European Union. Sometime within the next 18 months, Britain will hold a referendum on whether to sign the new European constitution. With a damaged prime minister on one side of the argument and these three groups on the other, it is hard right now to imagine that the British public will be given both sides of the argument in the coming debate. It's harder still to imagine, at least right now, that the case for the constitution can be won.

John Milton championed the publication of arguments regardless of their truth or falsity in order that the truth may be tested and discovered. In his words: "Let (Truth) and Falsehood grapple: who ever knew Truth put to the worse, in a free and open encounter?"

But rather than seeking a free and open encounter of ideas, readers are more likely to choose their newspapers in order to have their prejudices confirmed than to have them challenged. If you approve of the war in Iraq, you buy the Sun or the Daily Telegraph, confident that the news and commentary will be angled to suit your worldview. If you disapprove, you buy the Mirror or the Independent and get exactly the opposite set of impressions.

The same applies to television in a multichannel world. Fox News Channel, Murdoch's US news network, does not exist to provide a free and open encounter between truth and falsehood. It's there instead to confirm the prejudices of its particular group of viewers.

The old business model - where mass news publishers were supported by mass advertisers - has gone forever. Instead, today's advertisers are seeking niche audiences - people most likely to respond to their particular message with a minimum degree of wasted advertising dollars. And niche audiences have no peripheral vision. They are not interested in the struggle for truth. They want to hear what they want to hear.

Readers say they distrust journalists and disapprove of sensational coverage of footballers' wives, royalty and the like. But only in extreme cases - the Hillsborough football disaster, for instance - do they punish the press for sticking this stuff on their front pages. And a juicy royal story, true or not, adds rather than detracts from daily sales. In that sense, the market doesn't work.

The second set of stakeholders is made up of managers and owners. These can be divided into two categories: those who wish to maximise profits, and those who wish to maximise influence. Rupert Murdoch epitomises the first group.

A prime aim of his Sky News channel in the UK is to underpin the role of Sky as a multichannel news broadcaster in the eyes of the regulators and of Westminster: it is not itself a profit earner. The channel is balanced and straight and in most respects compares favourably with the BBC's 24-hour news channel. It doesn't have a political agenda.

In other words, it's very unlike his US news channel. Fox's tone and presentation is unashamedly right of centre, with liberals and the entire French nation held in an equal degree of contempt. For the Murdoch empire, it serves a different purpose. The tone is shaped to suit the marketplace.

Proprietors who are more interested in influence than profit are less common than they were, and with Conrad Black heading we know not where, they may be becoming an endangered species. There is no doubt that Black's Daily Telegraph played a crucial part in the unravelling of the Tory party over the past 10 years. Its championing of the anti-European wing of the party, its ruthless exposure of the shortcomings of a series of Tory leaders since the days of his hero Lady Thatcher - all this has had a huge impact on the large army of its readers across the shires and, through them, on the character and personality of the party, which is now just about unelectable.

One paper above all others manages to combine enormous market and financial success with consistent political influence. The Daily Mail speaks to and for Middle England, confirming and stoking its readers' fears and prejudices, viciously attacking those of whom it disapproves. It invests hugely in its editorial department. Its editor-in-chief, Paul Dacre, is regarded as a figure with enormous political power, and is just about invisible outside the paper.

Newspaper owners have an obvious interest in defending their freedom of action - and in a country with no First Amendment, limited freedom of information, and a distrusted media, they do have something to worry about.

To keep hostile politicians off their backs, all the British newspapers subscribe to what is described as a self-regulatory structure, in the shape of the grandly named Press Complaints Commission. This is paid for by the press, and presided over by the former British ambassador to Washington. It publishes admirable codes of conduct, and is overseen by a committee of lay as well as editorial people.

It's had some modest successes: for example, the newspapers steer away from stories about the children of the royal family and of politicians (although they are regarded as fair game once they complete their education). But the code of conduct is otherwise largely ignored, and the commission itself is toothless.

Five months after the swan story appeared, the Sun carried 79 words in the back of the newspaper under the heading "Missing Swans". The article ended: "We accept that it is not, therefore, possible, to conclude yet whether or not the suspects were indeed asylum seekers."

The market failure here is again that although there are a large number of national daily titles in the UK, their ownership and their location is too concentrated. Half a dozen powerful characters shape the personality of the British print media, and the regional press carries little clout. As a result no politician from any of the parties is willing to take the press barons head on. Rather the opposite.

The third set of stakeholders in the media is the journalists themselves. Their culture is set by the environment in which they operate, and is shaped by the institutions for which they work. So if a market failure applies to ownership, it is probably also going to apply to editorial. There is very little peer-group pressure in the British print media. We have no equivalent of the Pulitzer prizes. The main press awards are judged by newspaper editors who all shamelessly champion their own staff: I've done it myself. A good royal scandal is much more likely to be acclaimed as a prize- winner than, say, a thorough investigation of the problems of the National Health Service. Years ago, journalists from different titles used to socialise after work in pubs around Fleet Street. Now they sit on the 20th floor of a building in Docklands, and don't have to defend their excesses against their rivals.

The absence of a strong political opposition in the UK has, I think, encouraged some journalists in the view that they should exert power in the land. I am reminded almost every day of the great Walter Lippmann quote: he wrote back in 1940 that "more newspapermen have been ruined by self-importance than by liquor".

The problem with exerting power is that it requires a degree of accountability. And this in turn takes us back to the arguments about corporate responsibility. A brilliant piece by Adam Gopnik in a recent New Yorker about the problems at Le Monde captures this dilemma perfectly.

Alain Minc, the intellectual and very French chairman of the paper's board, is quoted at length. "What" asks Minc rhetorically, "do the three crises - at the BBC, the New York Times and Le Monde - have in common? It is, I think, a perception of arrogance and the populist response ... Throughout Europe and America, each institution of authority has been placed in question - the royal family, the political class, the presidency of America, the presidency of France, Vivendi and Enron - and each has had to bow down before the authority of popular opinion."

Minc goes on: "The lesson is that if the press is perceived as a power - not a counter-power, but a power in itself - it will get the same scrutiny as the rest of the institutions of power. And since it has no obvious accountability, some rough accountability will be invented, even if it has some of the character of a lynching."

That's certainly what happened to the BBC's Greg Dyke and the late editor of the New York Times. They were effectively lynched. This seems to me to be the critical question about corporate responsibility and the media. What does accountability mean in this space? And can it be reconciled with our notions of a free press? Is it possible to hold editors to account without threatening our democratic discourse?

The most interesting arguments I have heard on this subject come from the Cambridge philosopher, Onora O'Neill, who developed her ideas in the BBC Reith lectures of 2002. In these talks, she discussed issues of trust in public institutions - and suggested it was rather odd that the main champions of ideas about transparency and accountability - the media - were themselves the least transparent and accountable groups in our democracy.

Since then, she has taken her ideas further, in particular by challenging the Enlightenment view that freedom of the press had to be preserved at all costs. How well, she asks, do the classical justifications hold up in the world we now inhabit? After all, they were devised in and for a world of printing presses owned by small enterprises, at daily risk of censorship and harassment by church and state.

Are they adequate for a world in which global media conglomerates publish and broadcast across frontiers, using a battery of new communications technologies, and in which states have limited powers to influence what citizens read, hear or see? Will the measures that have protected free speech against state power also protect it against the giant media conglomerates? Or do we need to review and revise classical accounts and justifications of free speech?

This is bold stuff. Like Milton, John Stuart Mill believed that extensive freedom of speech was a sovereign means to truth. But O'Neill suggests that powerful institutions that secure unlimited rights to self-expression may dominate and distort communications and the agenda for public debate. They may shape and limit individuals' opportunities for free discussion. In the end, they may actually constrain freedom of expression.

Rethinking press freedom does not, she argues, imply either censorship or state ownership of the media. What it does point to, though, is an attempt to control the concentration of media ownership, thereby limiting media power and ensuring a plurality of voices. More controversially, it also implies an attempt to regulate media process.

For example, the media could institute more exacting standards for editors and journalists, and require them routinely to disclose their interests. They could put an end to chequebook journalism, and develop indepen dently administered rights of reply. They could develop procedures for challenging unattributed quotes so as deter the use of non-existent sources.

And if necessary, O'Neil argues, these disciplines and others could have statutory backing. None of them, after all, would seem exceptional if they were applied to public, commercial or professional life. Why should the media be different? And she goes on: "If press freedom is best justified by the adequacy with which it safeguards and promotes diverse, intelligible, honest and assessable communication that supports democracy and citizenship, measures taken to ensure that the media actually serve these purposes are entirely justifiable."

Thoughts like these are, of course, anathema to the media in the UK, or just about anywhere else. John Lloyd has been viciously attacked in the British press for even suggesting that there is a problem that needs addressing here. And there is no likelihood that the politicians of any party will have the power, the courage, or the inclination to address either the question of media concentration or media process any time soon. So are we doomed to meet the fate threatened a hundred years ago by Joseph Pulitzer? "Our republic and its press will rise or fall together," he thundered. "A cynical, mercenary demagogic press will produce in time a people as base as itself."

Let me make a modest proposal, drawn from the approach to corporate responsibility and governance that is common practice everywhere apart from the media sector.

A study last year by WWF-UK and SustainAbility concluded that media companies were often quite ready to report on the direct effect of their operations: how much newsprint they recycled, or how much energy they consumed. But they were much less willing to discuss the indirect impact of their content and programming on the community: the sort of stories they told, and the way that they told them. Questions to be addressed by media companies under this heading might include:

· Do we have an up to date set of ethical business principles?

· What are the significant indirect impacts of our content in terms of the full range of corporate responsibility issues?

· What is our policy on errors and corrections, and how is our performance shaping up in this respect?

· What is our approach to rights of reply, and again how have we performed over the past year?

They could report on these and other value-related issues in their annual accounts each year. And to show that they were serious, they could set up a committee of the main board who would sign off this statement of corporate performance. It's hard to see how this would be an affront to editorial independence, since the editors would have to agree to the ethical standards in the first place.

Independent directors usually have a reputation to protect. The idea is that they would be subjected to public ridicule and contempt if they signed off a statement saying that the organisation had met agreed performance indicators if it manifestly had not.

Directors of a news organisation today have very little interest in, or influence over, the integrity of its output - because this is delegated to editorial. Unless there is a crisis - as there was, for example, at the Mirror last year - they keep well away from questions about content. But shouldn't they be required to take an interest in such a vital area? After all, the directors of any other type of business have to be desperately concerned about challenges to their company's ethical reputation.

Corporate boards these days routinely have committees for auditing the financial integrity of the business. Why not have a committee to audit its ethical integrity, as well? It would have to work against a set of absolutely objective benchmarks. The last thing you would want would be for the independent directors to be commenting on, for example, editorial judgments in an election campaign, or on aggressive reporting on the business pages.

Instead, they could simply be asked to report on how the business had come out against an agreed and objective set of performance indicators.

Audit committees, after all, are expected to make objective rather than subjective judgments on the financial figures. Why couldn't an ethics committee do the same?

Is this a good idea? I don't know - I haven't tried it out on anyone else. So you can tell me. How would it work?

If it turned out that the idea had merit, you could probably persuade news organisations such as the Washington Post, the New York Times, or Pearson, to take it up. But how would you influence Express Newspapers, which is now owned outright by a man who made his fortune out of soft pornography? You'd have to develop some quite forceful peer group pressure to win him round.

And what would happen with a group like News Corp, which has dozens of news outlets around the world? Would one statement cover all the publications, or would you have to break it down in some way?

There are some obvious challenges.

But growing pressure for responsible corporate behaviour has forced other types of business to address challenges which in their different ways are just as complicated as these, and to resolve them. My question, once again, is: why not apply the same criteria for corporate responsibility to the media that just about all other businesses today have been obliged to recognise?

Why should the media be different?

This is an edited version of a lecture given by Richard Lambert, editor of the Financial Times from 1991 to 2001, at the University of Nottingham on December 1 2004

http://media.guardian.co.uk/mediaguardian/story/0,,1391738,00.html