From top: Ian Drennan, Director of the Office of the Director of Corporate Enforcement (ODCE); Chief Executive Michael Doorly and Chairman Murdoch Mac Lennan at the Annual General Meeting of Independent News and Media (INM) last month
Independent News and Media has lost its challenge to a decision by the State’s corporate watchdog to apply to have inspectors appointed to the company.
INM had argued that it should have been given an opportunity to respond to the Director of Corporate Enforcement’s concerns before he made the decision.
This morning Mr Justice Seamus Noonan dismissed the judicial review.
He said the argument that INM should have to be consulted first is “novel and without precedent“.
Editor-in-chief of Independent News and Media Stephen Rae
Small violin to hand?
When asked to confirm Mr Rae’s departure, INM declined to comment.
It is the latest development in a period of tumult at the media company, which has recently undergone a major change to its board membership and is fighting efforts by the Office of the Director of Corporate Enforcement (ODCE) to have inspectors appointed to the business.
INM has lost both a chief executive and a chairman in the past year.
“Since 2013 I have had the privilege and honour to lead the editorial department at INM.
“Now having completed by five-year term as group editor and following a transformation of the group into a digital focused newsroom and content hub, I am to leave the publishing business in a strong position and hand it over to a team of strong and dynamic editors.
“I leave the business at a time when all print titles are market leaders, in addition our online platform independent.ie has become the nation’s go-to news source.
“During my 25 years in INM I feel greatly fortunate to have worked with many extremely bright and exceptional people and to have guided the coverage on some of the biggest news stories our country has seen.”
“I am now looking forward to taking on new digital projects which will focus on my core interests of developing new revenue models for journalism along with the hugely important editorial fight against fake news.”
Independent News & Media CEO Michael Doorly (above left) and Chairman Murdoch MacLennan (right) at the company’s AGM.
Of the data breach allegedly ordered by previous chairman Leslie Buckley, Mr MacLennan said:
“The board believes that any person who facilitated or exploited such access should be required to account fully as to how and why they obtained access to such data, for what purpose and what use was actually made of such data.”
MacLennan said the appointment of an inspector would have a “damaging impact” on the company and its stakeholders, including its shareholders, employees, readers and customers.
Readers may recall how one of these controversies concerned an Irish Daily Mail front page story in 2012 about how the then Environment Minister had written to some of his constituents in Kilkenny, telling them a Traveller family – Patrick and Brigid Carthy and their seven children – would not be moved to a house near them.
During his address to the Seanad, Mr Hogan spoke about “fake news” and praised the Group Editor-in-Chief of Independent News and Media Stephen Rae who was recently appointed to the European Commission High Level Expert Group on Fake News.
Mr Hogan was speaking about Brexit when he praised Mr Rae.
“The EU institutions have been shaken from their slumber. It is noticeable that there is a new energy and a new desire to get things done. In a world of rising nationalism and retrenchment, the EU is occupying the space that has been vacated by others to lead from the front across multiple policy areas.
“The EU is now the unquestioned global leader in promoting open and fair trade that is based on rules. As the Cathaoirleach mentioned, in the past two years we have signed important new deals with Canada, Japan and Singapore. Earlier this week, I was delighted to announce an agreement with Mexico.
“Many of these deals are immensely positive for our agrifood producers and our pharmaceuticals and financial services sectors. This is very good news for Ireland. Size matters in trade. As the world’s leading trading bloc, the EU is in a position of strength to build mutually beneficial agreements with our global partners.
“We are driving the global agenda on climate and sustainability, which remains the single greatest challenge of our time. This country urgently needs to step up its contribution to meeting this challenge. We are trying to relight the flame of Europe’s enlightenment values by making truth and reason relevant again in a world of mistruths and fake news.
“Again, Brexit is important in this context. EU membership was a successful policy in the UK and was accepted as such by the majority of politicians and commentators. That did not stop a majority of people voting to scrap it. That is strange because one thing the Brexit story has shown is that the UK does not – by a long shot – have an alternative policy to EU membership.
“Even Brexiteers are happy to keep one foot in the EU, for example by continuing to participate in security and transport agreements and certain EU agencies. The fact remains that people in the UK voted to leave. As politicians, we might think successful policies always commend themselves, but that is not always the case.
“Successful policies need to be defended, articulated and communicated. Brexit has taught us all a sharp lesson in this regard. We need to understand this and incorporate it into our political lives as part of our stocktaking. We cannot take it for granted that people will vote for the EU, or like the EU, just because it happens to work.
“As I mentioned earlier, this has been a wake-up call for the European institutions. We have to look at how we can do things better in this regard. That is what we are discussing with member states and, through them, public representatives and people. Perhaps we can go a stage further by asking how everyone failed to spot that a disconnect was arising between citizens and their representatives.
“This disconnect dominates so much of our politics today. How did we allow our public discourse to be dominated by fake news and half-truths? How can we begin to remedy things and stop it happening here? Here again, Brexit should be a lesson, because another thing the Brexit story has shown us is a brand of politics in which concern for people’s real well-being has gone out the window, the soundbite has become more important than the truth and people can groom a majority to act against its own welfare. In short, we now have a brand of politics and commentary that, all too frequently, misleads rather than leads.
“It is remarkable that a successful UK economy is determined to be divergent rather than convergent with its neighbouring countries in Europe. If we look a little more widely, we see it is not only Brexit. Our political arguments are becoming coarsened and are having knock-on effects on our behaviour. One sign is the trigger-finger readiness of so many people to play the immigration card, even the race card.
“Much of this is the result of fake news and the way in which what we used to call tall stories and gossip no longer goes from mouth to mouth but from one set of fingers to a million sets of eyes, with a tap on the keyboard.
“Brexit shows us how vulnerable we are in that regard. That is why the Commission is alerting member states to the dangers and advising them to set up an infrastructure that can counter what is happening.
“The respected Irish Independent editor-in-chief, Mr [Stephen] Rea, is making a sterling contribution to this work, having been appointed to the European Commission’s high level expert group examining the issue of fake news. Next year’s elections to the European Parliament gives this added significance and urgency. We must be on our guard.
“My final thought on this issue is to underline the difference between bad publicity, contrary opinion and fake news. As politicians we all know about bad publicity and contrary opinion. It comes with the turf and we deal with it, but we do it in the world of truth. We have been slow to recognise that fake news is something else. It is not bad publicity, it is not contrary opinion, it is not in the world of truth. It is a fiction – a harmful fantasy.
“It is urgent that we find the way to reveal it for what it is, namely, political mischief and a wrecking ball.”
From top: Minister for Communications Denis Naughten and Fianna Fáil TD Timmy Dooley and Sinn Féin TD Brian Stanley
In the Dáil.
Minister for Communications Denis Naughten was asked again about his contact with lobbyist for Independent News and Media Eoghan O’Neachtain in November 2016, in relation to INM’s proposed takeover of the regional newspaper group Celtic Media.
At the time, the minister told Mr O’Neachtain that he planned to refer the proposed takeover to the Broadcasting Authority of Ireland.
This discussion was then relayed to Denis O’Brien in an email of November 12, 2016.
This was two months before the minister’s plans were made public.
In addition, on December 6, 2016, Minister Naughten told Social Democrats TD Catherine Murphy and Sinn Féin TD Brian Stanley he had not yet decided if he was going to refer the proposed takeover to the BAI.
Minister Naughten never took a note of his mobile phone call with Mr Ó Neachtáin, hedidn’t tell his officials and Mr Ó Neachtáin didn’t register the approach with the Lobbying Register.
Further to this…
In the Dáil this morning:
Brian Stanley: “Are there two types of meetings with your department? And two types of contacts? Both official and unofficial? And how many of these do occur?”
Denis Naughten: “We do comply with all of the standards and the legislation, as set out, as I’ve said. I’ve discussed this with my secretary general and he is reviewing the situation to consider if there are further changes. I, for one, won’t be taking any phone calls from lobbyists in the future, I can tell you that for nothing. But the reality is that we do comply with it, and as you know, if you look at the register I think, there are, I think 951 occasions in which my own name is mentioned in relation to various interest groups that have lobbied me since I was appointed minister. I think that’s an average of about 50 a month, covering a wide range – right from the environmental sector, right through to communications, energy, broadcasting media, right across the spectrum. So it is a very busy department, a very complex department – many aspects that are very technical and, as I said, I have discussed this with my secretary general.”
Timmy Dooley: “Look, if we could try and bring this thing to a conclusion, rather than having it, dragging it on, it doesn’t suit any of us. But I think we all have a responsibility to this House to try and get it tidied up. So, for me, there’s a couple of straight questions that you need to answer.
“And if you first accept that you provided confidential information, in other words, an insight into what you were, what you were ultimate intentions might be or your future intentions, and let’s not dance around the head of a pin and that, three weeks later, you came in here and misled the Dáil, albeit inadvertently, I would suspect, but nonetheless, you mislead the Dáil. There’s potential for all of us to do it. It’s just a matter of addressing it and getting beyond it. And that your actions amounted to wrongdoing.
“I don’t bear you any ill will whatsoever. I have considerable sympathy for you, to be honest in this instance. The way you wandered into such a firestorm, but nonetheless minister, you’re responsible to the House. So there’s three things I think you need to do.
“You need to accept that there was confidential information, because you did give insight into where you were, where you might ultimately go, you can put the caveat on it. The issue of misleading the Dáil and accepting it was wrongdoing.
“It doesn’t require you to resign, minister. Nobody has been really demanding that. But it requires you to be answerable to the House. And then I think, you know, this issue gets off your desk and gets off everybody’s desks.”
Naughten: “No, I did not give confidential information and I’m quite categoric in relation to that. The conversation that I had, and I sincerely regret that conversation, and I acknowledge that it was a political mistake to have that conversation and I’ve learned form my experience and I apologise for that. And I sincerely apologise for that.
“But I did not give confidential information, because I did not have any information available to me at that stage. The information that I had was the information that everyone else in this House had or was available on Google and yes, I do regret giving my opinion in relation to it at that point and the reality was that three weeks later, when I was here in the House, I had an active file in front of me at that stage, and it was a very different situation at that point.
“And I’ve been at pains to try and point out that. And I do sincerely regret it.”
Stanley: “Minister, just in relation to your reply. The problem arises that I asked you in October of 2016 about this and I asked you again on the 6th [of December] in a Priority Question here, in this seat, and you sitting over there in relation to what was your intentions regarding that merger and what you intended to do and you told me, and the transcript is there from that debate in the Dáil between you and I, that you had absolutely no idea, I remember you, I think you shook your head, as to what you were going to do with it. And you can say that in relation to, that you didn’t have the file in front of you at that point, that you hadn’t entered the process, and I know how that works, I’ve looked at all of that in detail.
“And I was following that very carefully at that time because we had huge concerns about that and I was raising it with you for months before that. But the problem, that’s where the problem arises.
“I accept the fact that you have apologised, what we wish to do now is to make sure that we tighten up all of this area…Would you agree that unofficial contacts with lobbyists, for ministers, has to stop?”
Naughten: “Look. Deputy Stanley, in my initial reply to you, to your supplementary, I said, look, I won’t be taking calls for lobbyists. I’ve said to you that I have discussed it with my secretary general and he will be reviewing the situation to see if there are other changes that, in procedures. But procedures are set out very clearly in relation to this and as I say, look, I have apologised for it. I do sincerely regret it. And look, I just want to get on, focus on the job and work that’s in front of me, the very demanding job, it’s a very demanding department and I know that all of you here want to do the same thing. And look, there’s nothing more that I can say in relation to this.”
Dooley: “I want to let you on with your job, I want to get on with mine. But I’m still at a loss as to understand, why you regret taking the call? Why you’ve apologised for taking the call? Why you’ve asserted that you’ll never take a call again – if you did nothing wrong in the first instance?”
“The facts remain, minister, that you fail to understand, by providing an insight into your thinking, a personal opinion, whatever it might be, that was confidential information. It’s the confidence of your own personal information that’s at play here – not access to some information in relation to your officials.
“Because you had a hunch as to where this thing was going. And you gave that information to the lobbyist and he passed it on. Which is now the result, or is now forming part of evidence which the Director of Corporate Enforcement is using as part of his campaign to appoint investigators [into INM]. So it was confidential information, minister. That’s what you need to accept. That’s what you’ve identified as being regrettable for taking the call, that’s what you’ve apologised for. You need to start at the beginning and just accept that you provided confidential information, that it was wrong, it was on a relatively low scale and it can be addressed within this House.
“Will you just please, just bring this to a conclusion, minister?”
Naughten: “One, I did not give any confidential information. Two, I made it crystal clear that I would be guided by whatever advice that I got from my officials and the file shows clearly that’s exactly what I did. And the reason that I regret and apologise is this is the fourth day in a row, in this House, that we’ve been discussing this issue here regarding a 30-second conversation that I had giving an opinion that I sincerely regret giving and that’s why I’m apologising to this House and to the public out there. That his House has been preoccupied about this for four days in a row.”
At the time, the minister told Mr O’Neachtain that he planned to refer the proposed takeover to the Broadcasting Authority of Ireland.
This discussion was then relayed to Denis O’Brien in the aforementioned email of November 12, 2016.
This was reportedly two months before the minister’s plans were made public.
In addition, on December 6, 2016, Minister Naughten told Social Democrats TD Catherine Murphy he had not yet decided if he was going to refer the proposed takeover to the BAI.
Further to this.
Mr Martin claimed the Dáil was mislead and said Minister Naughten should apologise to the Dáil, and correct the record of the House.
M Martin also added:
“His [Minister Naughten’s] officials in the department must have warned him in advance of this issue, given their experience in relation to the Moriarty Tribunal and the awarding of the State’s second mobile phone licence to Esat Digifone. We know that experience traumatised the officials considerably and obviously left a mark within the department.”
In his response, Mr Varadkar said:
“Minister Naughten didn’t do any favours for anyone. He didn’t do any favours for Independent News and Media. He didn’t do any favours for Denis O’Brien. In fact, his action was to delay the merger, delay the proposed merger between INM and Celtic Media by referring it to the Broadcasting Authority…”
Which breaks down into eight non-executives directors, who would more commonly be known as NEDS (which means they are not employees of the Company) and one executive director.
The latter joined late last year, INM CEO Michael Doorley, and is one of six members who have just joined the Board, with the remaining five commencing in March of this year.
So from a Board composition of nine, these six already form a healthy quorum and yet have all only arrived in the last seven months.
To recognise the real weight of this information, consider this; five directors who form a majority, and this includes the chair who has an additional vote in the event of a tie, were not in situ at the Year End that is about to go before the shareholders for their AGM.
Surely it is fair to say without causing any angst amongst serial litigants and industrial trolls, that there is a majority who do not know, or actually, are not supposed to know of the matters at board that led to the protective disclosure to corporate enforcement.
Therefore, I must ask the question; and I will admit first that I am disappointed no one else has already; why are INM objecting to Inspectors coming into the organisation?
It is my opinion that it is of huge importance that any breeches, matters of concern and weaknesses within the organisation should be identified for this new Board.
Furthermore, and in my opinion and in my experience, this level of investigation will allow those charged with the governance of the organisation not only to address and rectify breaches, but to ensure that such behaviour is not repeated.
Rather than have them inherit risks and doubt, why not get a full root and branch investigation? It is the only way to eliminate the doubt and uncertainty about this Company’s future; and the future is what governance is all about. Ensuring the Company is a solid going concern and all its activities are in the best interests of all the Shareholders, regardless of percentage held.
Which presents another question; why haven’t the Irish Stock Exchange supported the ODCE’s application to appoint inspectors?
Other responsibilities of the board include Risk Management and protecting the assets of the Company. How can they be certain they, as directors, are satisfied they have identified all the risks the Company is exposed to by historical behaviour.
I most definitely would not be comfortable taking any assurance from any internal reporting, or indeed any external reporting from parties engaged by this Company; I want to know for sure all the breeches and risks have been identified, remedied, costed and provided for, and that policies and procedures are in place so that they are avoided in the future.
As former Chair Lesley Buckley stepped down (in March) John Bateson stepped in. The former was the nominee of the largest shareholder in the Company, while the latter is no stranger to a known associate of that Shareholder, and who also happens to be a significant shareholder in the Company….. As Bodger might say,: ‘join the dots‘.
You might also be interested in knowing that another director, Triona Mullane, one of the 2012 inductees, is a founder of a company that received investment from a gentleman that has been referred to as the largest shareholder.
I am not, not for a second, doubting Ms Mullane’s or anyone’s credentials, competence, experience, or ability to perform at board level in a PLC.
However, the most important asset I have as a someone who works in professional practice is my independence which includes the perception of that independence.
As a director you are responsible for the welfare of the company, followed by the shareholders, and you must make decisions in the best interests of the company, at all times, and you must never allow that be questioned or mistrusted.
So I will ask again; Why are INM objecting to the appointment of inspectors?
Vanessa Foran is a principal at Recovery Partners. Follow Vanessa on Twitter: @vef_pip /a>. Vanessa will be on Broadsheet on the Telly tonight at 10pm.
Minister for Communications Denis Naughten speaking to RTE One’s Martina Fitzgerald.
It follows a report in The Irish Times yesterday based on an affidavit sent to the High Court by the Office of the Director of Corporate Enforcement, in which it has asked the court to appoint inspectors to examine matters at Independent News and Media (INM).
The report stated, and Minister Naughten confirmed yesterday, that he spoke to Heneghan PR official Eoghan Ó Neachtain, who was representing INM at the time, on either November 10 or 11, 2016, about the proposed takeover of the Celtic Media Group by INM to the Broadcasting Authority of Ireland.
Minister Naughten has told the Dail that he told Mr Ó Neachtain that he would likely send the matter to the BAI.
However, according to an email sent from Nigel Heneghan, founder of Heneghan PR, to Leslie Buckley, former chairman of INM, on November 12, 2016, Mr Heneghan wrote:
“The information, following Eoghan’s call with the minister which happened yesterday afternoon, is based on advice from his officials, he will pass it to the Broadcasting Commision [sic] of Ireland for review, because of the overall ownership of print and broadcast titled by DOB [Denis O’Brien].”
The decision to send the matter to the BAI wasn’t publicly known until January 2017.
In addition, he told Social Democrat TD Catherine Murphy in the Dáil, on December 6, 2016, that he hadn’t made a decision yet.
Minister for Communications Denis Naughten gave a statement to the Dáil following a report in The Irish Times this morning.
The report was based an affidavit to the High Court by the Office of the Director of Corporate Enforcement (ODCE) – in which the ODCE has requested that two inspectors investigate certain matters an Independent News and Media.
It stated that, on November 11, 2016, Mr Naughten informed Eoghan Ó Neachtáin, of Heneghan PR which represented INM, that he planned to refer INM’s proposed takeover of Celtic Media Group to the Broadcasting Authority of Ireland (BAI).
[Mr Ó Neachtáin was previously the press secretary to three Governments and three Taoisigh.]
This decision wasn’t made public until January 2017.
On December 6, 2017, Mr Naughten was asked questions about the proposed merger by both Social Democrats TD Catherine Murphy and Sinn Féin’s Brian Stanley.
In response to Mr Stanley asking him about the proposed takeover and raising concerns about media plurality, Mr Naughten said:
“I have not made my views known and I am not going to.I have a decision to make and I will make it in line with the legislation.”
Mr Naughten has also told the Dáil he met former INM chairman Leslie Buckley at a DataSec summit in Dublin’s RDS organised by INM – at which Mr Naughten spoke – on May 3, 2017, where they shared “small talk”.
He said he can’t recall fully but he doesn’t believe Mr Buckley raised the matter of the proposed takeover.
Mr Naughten has also told the Dáil: “I didn’t wilfully, or any other way, mislead the Dáil.”
Mr Naughten said:
“I wish to confirm that I received a phonecall from Eoghan Ó Neachtáin, former press secretary to a number of governments, on either the 10th or the 11th of November, 2016, informing me that the Competition and Consumer Protection Commission was after approving the Independent News and Media acquisition of the Celtic News and Media Group.
“This was in advance of the Competition and Consumer Protection Commission communicating the decision to me.
“It was common knowledge that this was a very significant acquisition with a significant geographical impact. I expressed a purely personal view that the likely course of action would be a referral to a phase two assessment in accordance with the guidelines in light of the diversity and media plurality assessments required and in light of the scale of the proposed acquisition, its geographical concentration and the extent of the ownership of regional media by Independent News and Media at that point.
“According to the advice from the Office of the Attorney General, in the context of there being a decision by the Competition and Consumer Protection Commission, the legislation about such referrals to the BAI is clear, that referral is an option to me as minister when there is a planned media merger.
” If so, there is nothing wrong or inappropriate with me, as minister, saying to anyone, to the public, anyone or to the public if the plan for a media merger continues, I would take advice on sending it to the BAI.
“This is not inside information, but simply a reflection of the legislation itself.
“I had no inside information to give.
“It may have been preferable if the conversation had not taken place but it was by no means expressing a definitive view nor could I do so at that time.
“Nor did I state that the view expressed was a confidential one as the article (in The Irish Times) seems to assert. In fact, I clearly stated that I had made all pervious decisions, solely based on the advice provided to me by my officials and I reiterated that I would adhere to that approach in this case as well.
“There seems to be a misunderstanding about the nature of the media merger process. This is not a secret process.”