Carnegie defends role on The Age

January 17, 2008

This Jane Schulze story in The Age appeared after the 1999 John Fairfax AGM in Melbourne.

Sir Rod Carnegie, the only Melbourne-based director of John Fairfax Holdings, owner of The Age, yesterday defended himself against claims he had compromised the paper's editorial independence.

It was alleged at the company's annual meeting that Sir Rod had publicly questioned the editorial stance of the paper under the helm of a former editor, Mr Bruce Guthrie, and that he had strong connections with Mr Lloyd Williams, the former Crown chief, who lobbied to have Mr Guthrie removed.

Asked after the meeting if he had questioned Mr Guthrie at a function, Sir Rod said: "So it's reported ... I'm not about to comment. There was no public meeting," he said.

Mr Guthrie resigned as editor of The Age in August 1997.

Sir Rod said it was very difficult as a board member to see the value of the paper decline.

"The comment was made by the chairman (Mr Brian Powers) that The Age did go through a negative period, and it was obviously uncomfortable for those of us who were on the board ... that despite ... frequent discussions, privately no changes were being made and the value of the masthead was being substantially eroded," he said.

"Then you have a problem as a director about what your responsibilities are and that's very hard."

A former Age journalist and shareholder agitator, Mr Stephen Mayne, had opposed Sir Rod's re-election to the board at the meeting.

He said Sir Rod's questioning of Mr Guthrie was "quite an extraordinary turn of events for a director of the company to publicly stand up and question the editorial standards of its newspaper in town".

Mr Mayne claimed that at the time The Age was facing several writs from the then Liberal Government and one from Mr Williams, which Mr Mayne claimed were forwarded to Fairfax's former chief executive and the current chief of PMP Communication, Mr Bob Muscat.

"Bob Muscat eventually came down and met with Lloyd Williams, and Sir Rod was chairman of HudCon, which was the largest shareholder and manager of Crown," he said.

Mr Mayne also claimed Mr Muscat was shown a video of Mr Guthrie criticising the former Premier, Mr Jeff Kennett.

Responding to the remarks, Fairfax's chairman, Mr Powers, said he was "much more concerned about how someone performs on this board and on that basis we think he (Sir Rod) continues to make a valuable contribution".

"He is one of the most sophisticated business thinkers in Australia ... he is at the forefront of raising and debating corporate governance issues ... he is a strong advocate that quality journalism is what this company needs," he said.

"Whether or not it was appropriate for him to arrange an editor to see someone ... my personal view is that you should always confront your critics; you learn from it."

But Mr Powers acknowledged that with Fairfax's present company structure, "I think you would not do that without speaking with (the chief executive) Mr Hilmer".

However, Mr Powers agreed that Fairfax's nine-member board should have another Melbourne-based director and another female director.

"I think we would benefit substantially from another Melbourne-based director and another woman director and we will try see to that before the next AGM," he said.