Fairfax Media will not be offering its largest shareholder, Gina Rinehart, any seats on its board after a breakdown in talks seeking mutually acceptable terms.
“I regret that agreement has not been reached for Mrs Rinehart to join the Fairfax Media board of directors,” Fairfax chairman Roger Corbett said in a statement. “I hope that this might be possible in the future. However key elements yet to be agreed include acceptance of the charter of editorial independence as it stands and the Fairfax board governance principles as agreed by all existing directors.
“In coming to this view the board has gauged the opinion of other shareholders and noted some of their recent public comments on these matters, noting in particular they share the company’s view on maintaining editorial independence and their desire that board members act in the interests of all shareholders."
The mining magnate, who owns 18.7% of Fairfax, was seeking three seats on the Fairfax board including the deputy chairmanship. One of the seats was tipped to go to her fellow Ten Network Holdings director, Hungry Jack's founder Jack Cowin.
Fairfax has refused Rinehart board representation despite threats yesterday she would consider selling her stake if not offered seats. Rinehart “had hoped” she would be seen as “a necessary 'white knight' with a mutual interest in a sustainable Fairfax” according to written responses her company Hancock Prospecting sent to ABC-TV's Four Corners on her behalf.
Without the director positions, Rinehart's company “may hence sell its interest” in Fairfax, although it “may consider repurchasing at some other time.”
Rinehart's alleged demands to have a say in editorial content and the hiring and firing of editors have raised significant concerns with journalists and politicians alike. Members of the Labor caucus have called on Federal ministers to legislate new media controls, a news watchdog and media ownership laws.
The Greens announced the party is introducing a private member's bill to the Senate this week with the aim of implementing a public interest test when changes in control of major media companies occurs.
Fairfax journalists including David Marr, Kate McClymont, Peter Hartcher and Nick McKenzie have made a video and started a petition alongside the journalists' union to encourage Rinehart to commit to the Charter.
Earlier this afternoon, The Sydney Morning Herald reported a statement from Hancock Prospecting lambasted the media company for its 'abysmal' track record. The statement also emphasised two board positions would not be adequate for Rinehart and her cohort to effectively influence the board and the company's operations.
Corbett added: “The company has received tens of thousands of emails and other correspondence from shareholders, our readers and others making it clear that they support Fairfax’s long-standing position on editorial independence.”
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