Reuters

Overview

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Notes

Reuters recently "waived" its rule, in effect since the day it went public in 1984, against allowing any shareholder to own more than 15%; the rule was put into place in order to preserve Reuters's reputation for objectivity in news reporting, and survived even a large incidental stock acquisition by Rupert Murdoch's News Corporation. (News Corp already owned about 15% of Reuters when it bought an Australian news company which also had a large holding.) The waiver was made in order to allow Reuters to merge with The Thomson Corporation; Pehr Gyllenhammar, chairman of the Reuters Founders Share Company, justified the waiver by explaining that "The future of Reuters takes precedence over the principles. If Reuters were not strong enough to continue on its own, the principles would have no meaning."

speculation

It is not clear why it was felt that Reuters's survival was so greatly imperiled that they should either violate their well-established ownership rule or risk seeming less objective. Is it possible that in the Bush era, too much objectivity is now a threat, and Reuters was somehow forced or arm-twisted into taking this step? How much of a part did Murdoch's influence play?

Links

Reference

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