Corporate Governance Turned On Head As BSkyB CEO Backs Chairman

The BBC’s Robert Peston makes an interesting point today in his blog about BSkyB’s corporate governance.

Traditionally, the CEO runs the company and the chairman evaluates the CEO’s performance. In an interview this morning, however, BSkyB’s CEO Jeremy Darroch turned the relationship on its head by offering his support to embattled chairman James Murdoch. Darroch said that, in his experience, James has always acted with ‘the highest degree of integrity’.

Peston writes: ‘By way of an aside, Mr Darroch’s Today interview may represent a first in British corporate governance: I can remember plenty of occasions where the chairman of a public company has backed a chief executive (because it is the primary responsibility of a chairman to back or sack the chief executive) but I can’t remember any occasions where a chief executive has publicly endorsed a chairman.

‘Corporate governance purists will seize on Mr Darroch’s support for Mr Murdoch to say it shows the two men aren’t sufficiently arms-length from each other.’

Murdoch and Darroch will hope shareholders are more interested by this.

[Article by Tim Human, Inside Investor Relations]

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