HSBC and Telegraph: owners cannot afford to ignore paper’s credibilty

In my early days in Fleet Street I witnessed a stand-up row on the editorial floor between the Sun’s then editor, Larry Lamb, and a smart man in a pinstripe suit. Lamb was a towering figure in the newsroom and I had never witnessed anyone daring to speak back to him, let alone shout and swear at him. So who, I asked an older and wiser colleague, could this man be? “That,” said a fellow subeditor, “is our paymaster – the ad director.”

They were engaged in a battle in what I came to recognise as a ceaseless war between the two sides of commercially-run newspapers. Advertising versus editorial. The suits versus the hacks. Bottom lines versus headlines. Even in the 1970s, when advertisers were lining up to buy space, there was tension between the two departments. Now, with advertising in retreat from print as companies seek online audiences, the situation has become more desperate.

Yet print remains the most profitable platform and the commercial departments in newspapers have needed to become infinitely more innovative in order to attract advertising in its various guises. Wraparound newspaper covers are common. Clumsy inside ads often dominate editorial pages. Supplements featuring “advertorial” proliferate. Media buyers are calling the tune as never before.

It is against such a background that the Daily Telegraph wishes people to view the series of allegations made by its former chief political commentator, Peter Oborne, about editorial decisions having been compromised by the need to keep advertisers sweet. But Oborne’s detailed indictment, stemming from its failure to cover the HSBC tax evasion story, does not excuse what appears to have been a breach in the boundary between the editor’s freedom to report and the management’s wish to placate advertisers.

Related: Telegraph owners' £250m HSBC loan raises fresh questions over coverage

The paper’s editorial on Friday, an illogical mix of bluster and obfuscation, appeared to accept that the breach had occurred. It said: “We are drawing up guidelines that will define clearly and openly how our editorial and commercial staff will co-operate in an increasingly competitive media industry.” Rival publishers could have been forgiven for laughing out loud. No national newspaper owner has previously thought it necessary to codify one of the key planks that maintains a newspaper’s credibility. Despite threats from advertisers, editors revel in the opportunity to show they cannot be bought.

When Distillers pulled its advertising from the Sunday Times during its 1960s campaign on behalf of thalidomide victims, the editor, Harold Evans, was supported by his advertising chief. Years later, when the Sunday Times had passed into Rupert Murdoch’s hands, Mohamed al-Fayed threatened to remove £3m of Harrods advertising from the paper because he didn’t like an article about his renovation of a house in Paris. Its then editor, Andrew Neil, turned the tables on him by telling him he was banning him from advertising, a move enthusiastically endorsed by Murdoch.

It has been second nature for owners and editors to refuse to allow advertisers to hold sway. If one gets away with it, then others would soon follow suit. And once readers discovered the truth, trust would fly out the window. That’s not to deny that it may have happened in secret. The former investigative journalist, John Dale, told me that he wrote an article in 1984 about allegedly shady dealings by British Telecom, as it was then known. He offered it first to the Mail on Sunday and was told it would be the splash. Days later, it was spiked. So he went to the Sunday Express and its editor liked it too. But it was never published. At the time, British Telecom was spending many thousands of pounds at both papers as it prepared to privatise. The papers’ decisions, said Dale, were “connected with the advertising”. Both editors are now dead, so it’s impossible to ask them.

I know of no similar case. In my experience, editors – and owners – have always resisted such threats, although undoubtedly some newspapers have made uncomfortable accommodations with businesses, over fashion and travel in particular. Partnerships between publishers and advertisers, along with sponsorships, raise few eyebrows nowadays.

While these are confined to feature pages, they could prove compromising if the companies involved were to be scrutinised by a paper’s news journalists. At that moment, editors and publishers must prove the freedom to report outweighs commerce.

It is all very well to talk of “financial realities” and to support – to quote that Telegraph leading article – “wealth-creating businesses”, but there is another reality no editor can afford to ignore: a newspaper’s credibility. A series of full-page ads provides short-term revenue. Should those ads be secured by restraining journalists from going about their work by holding businesses to account for their activities, then the long-term damage could be terminal. The Telegraph’s owners, Sir David and Sir Frederick Barclay, need to take that “financial reality” on board.

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