The governance of public broadcasters

Most of the time, I look at public service broadcasters (PSBs) as exquisitely political creatures.

Most of the time, I think that's the right perspective.

Recently, however, I've been looking at PSBs as corporations, with all the associated paraphernalia of corporate governance. The results have been interesting.

PSBs can be divided into two types: dual board, or single-board.

German PSBs have dual boards: a massive, supervisory board (aufsichtsrat), composed of upwards of twenty members representing civil society, and a much smaller executive board, led by a generalintendant. Something like France Télévisions, by contrast, has a single board of five members, with a President/CEO.

Until now, I've viewed the institutional choice between single- or dual-board structures as a political one: where politicians choose a dual-board structure, they do so because they believe this structure provides a buffer against political pressure, and because they want to insulate the PSB from such pressure.

What if these choices aren't made with conscious objectives in mind? What if, instead, politicians just follow examples drawn from other fields?

In corporate governance generally, we can draw a line between three groups (Hopt, Klaus J., "The German Two-Tier Board", in Hopt, et al, Comparative Corporate Governance (Oxford, OUP):

• single board countries: UK, USA, Ireland, former British colonies, Spain, Italy, Portugal and Greece
• dual-board countries: Germany, Switzerland, Austria, the Netherlands, Scandinavia;
• mixed countries: Eastern Europe, France, Belgium

If the corporate governance of PSBs reflects national practice rather than political views about the desirability of independence, then we should expect single-board countries to have single-board PSBs, dual-board countries to have dual-board PSBs, and mixed countries to plump for either. What's the evidence like? Of the twenty-nine PSBs for which I have access to the legislation, here's the breakdown:

• single board PSBs (11): USA, Australia, Canada, New Zealand, South Africa, Chile, Spain [post-reform], Portugal, Greece(?), France, Bulgaria
• dual-board PSBs (18): Austria, Croatia, Denmark, Estonia, Finland, Hungary, Israel, Japan, Latvia, Lithuania, Norway, Poland, Romania, Slovakia, Slovenia, Spain [pre-reform], Italy, UK, Ireland,

The fit is not bad. Three dual-board countries don't fit: Italy, UK and Ireland; no single-board countries don't fit. There are some countries whose systems of corporate governance I don't know enough about to decide whether their placement is accurate (Israel, Japan, Chile).

Some tentative conclusions:

• PSB governance may be strongly influenced by more general corporate practice;
  
• those countries which could have opted for either system chose dual boards;
• the choice of governance for the BBC and RTÉ was contrary to corporate practice;
• It nevertheless seems to have been a good choice, with both broadcasters enjoying a better reputation than TVNZ, ABC, or (especially) the CPB in the USA, at least in this author's judgement;

Therefore, the dual-board model may be preferable for public broadcasters, squaring the circle of accountability and independence.

Rai round-up

On Saturday, Tommaso Padoa-Schioppa, Finance Minister, writes to Rai saying that he no longer has confidence in Angelo Maria Petroni, the Finance Ministry's representative on the Rai board. Petroni was nominated by Padoa-Schioppa's right-wing predecessor. Petroni claims that the move is purely political, and has no legal foundation. Petroni is partly right: the move has no basis in the Gasparri law, which currently governs the broadcaster. However, according to Repubblica,

"il ministro dell'Economia può revocare la fiducia ad un proprio rappresentante rifacendosi al principio più generale del "contrarius actus". Ovvero, così come autonomamente il fiduciario è stato nominato, altrettanto autonomamente può essere revocato se non esiste una normativa specifica".

The decision will be referred to a shareholders' meeting in June.

Yesterday, Mediaset, along with other European partners, buys a majority stake in Dutch production company Endemol. Mediaset will, through Endemol, now supply programmes to its competitor, Rai, in prime-time. An overwhelming majority (93%) of respondents in a Repubblica insta-poll believe that Mediaset will use their control to screw Rai over.

Today, the centre-right members of the Rai board, upset about Petroni, threaten to vote no-confidence in the director-general Claudio Cappon. As far as I can see, this procedure is not found in the legislation or statuto sociale of Rai.

Conclusion? In both cases, the centre-left and centre-right are making up the law as they go along.

RTÉ responds to government's proposed media reform

In response to the previously announced government consultation exercise, RTÉ has responded to the government's draft broadcasting bill with a fair amount of red ink. Politically relevant concerns are the following:

1. In order to fall under companies legislation, RTÉ is to be constituted as a single-shareholder company with one shareholder, a cabinet minister. RTÉ argues that this would mark the change from public broadcasting to state broadcasting, in that RTÉ has not, since the passage of the 1960 Broadcasting Act, been part of the state apparatus.
2. the general scope for intervention - whether by ministers or by the new Broadcasting Authority Ireland (BAI)
3. The chief executive of the BAI should be appointed by the minister after public consultation.
4. a new right-of-reply is far more generous than existing rights guaranteed by the Broadcasting Act 1990;
5. the provision for RTÉ's independence is couched with the qualification, "subject to the qualifications of the act", which, on RTÉ's reading, mean that RTÉ is not independent in many areas of its management;
6. The requirement that the director ensure "gathering and presentation [of news] which is accurate and impartial according to the recognised standards of objective journalism" - a phrase which I hadn't noticed before - is impossible vague.