3:47 p.m. | Updated The News Corporation, already grappling with the fallout from a phone-hacking scandal in Britain, has suffered another blow to its operations in Europe. The top European executive at Dow Jones Company, a unit of the News Corporation, resigned Tuesday after an internal inquiry revealed an agreement between The Wall Street Journal Europe’s circulation department and a Netherlands-based company that was featured in articles in the paper.
In an e-mail to his staff Andrew Langhoff, managing director of Dow Jones Company’s European, African and Middle East operations, and publisher of The Wall Street Journal Europe, said he would leave his post immediately. The announcement comes after revelations that two articles in The Wall Street Journal Europe’s Special Reports section were the result of a deal struck between the circulation department and the consulting firm Executive Learning Partnership, or ELP.
“Because the agreement could leave the impression that news coverage can be influenced by commercial relationships, as publisher with executive oversight, I believe that my resignation is now the most honorable course,” Mr. Langhoff said. In a separate statement Dow Jones said the publisher “has the ultimate responsibility for this matter.”
A clarification published on Wednesday explained to readers that a “now-expired agreement between the Circulation Department of The Wall Street Journal Europe and Executive Learning Partnership” prompted the two articles in the Special Reports section on Oct. 14, 2010, and March 14, 2011. The “reporting and writing were solely the responsibility of the News Department,” the clarification said. “However, any action that creates an impression that news coverage can be influenced by commercial interests is a breach of the ethical standards of Dow Jones Co.”
The Guardian reported Wednesday that Dow Jones’s European unit had struck additional deals with corporate sponsors in order to raise The Journal’s circulation figures in the European Union, Russia and Africa. Through Journal-sponsored seminars the company offered companies cheap subscriptions in bulk to distribute to students, according to the British newspaper.
In a statement on Wednesday, a Dow Jones spokesman said: “Dow Jones initiated the original investigation into the deals in question and the employees involved in late 2010. The circulation programs and the copies associated with ELP were legitimate and appropriate, and the agreement was shared with ABC UK [Audit Board of Circulation] before the deal was signed.”
“At this point, we no longer have relationships with the employees or third parties directly involved in these agreements, and we continue to believe that these deals were valid.”
Mr. Langhoff’s resignation came the same day that British lawmakers confirmed that Les Hinton, the former chief executive of Dow Jones Company and The Wall Street Journal’s publisher, would testify in a continuing investigation into allegations of phone-hacking at the company’s now shuttered British tabloid The News of the World.
A close friend and trusted aid of the chairman and chief executive, Rupert Murdoch, with nearly 50 years of experience at the News Corporation, Mr. Hinton resigned from his post in July. Before running Dow Jones Mr. Hinton oversaw the News Corporation’s British newspaper arm, News International, during the time that the hacking was said to have taken place. The scandal has led to the resignation and arrest of several top News Corporation executives.
Mr. Hinton previously testified before a British parliamentary committee in 2007 and 2009. At that time, he told the committee that hacking at The News of the World had not spread beyond one reporter. He will deliver his testimony via video conference on Oct. 24. Mr. Murdoch, his son James Murdoch and the former head of News International, Rebekah Brooks, have already testified.
In the last several years the News Corporation has invested heavily in the London-based Wall Street Journal Europe in a bid to displace its main competitor, The Financial Times. However, the European version of the paper has had a hard time gaining traction. It currently has a circulation of about 73,250.
Dow Jones said it was searching for a replacement. In the interim, Kelly Leach, senior vice president and head of strategy for Dow Jones, will oversee the region, the company said Wednesday.
Executive Learning Partnership could not be reached for comment.
Article source: http://mediadecoder.blogs.nytimes.com/2011/10/12/dow-jones-european-executive-resigns/?partner=rss&emc=rss
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