Network Ten’s chairman Brian Long has sought to defend the company’s decision to employ staff from interim CEO Lachlan Murdoch’s firm Illyria to carry out a strategic review of the network.
Addressing today’s annual general meeting, Long defended the move that could be seen as a potential conflict of interest for the interim CEO, who is also the chairman and sole director of Illyria.
“As none of the departed executives [after the restructure] had been replaced, we authorised Lachlan to put together a team from his private company, Illyria, to assist him to carry out the other two key projects and run the business until the CEO-designate became available in early 2012,” Long said.
The chairman claimed that under Murdoch’s (pictured) guidance and with Illyria’s assistance the strategic review and resultant cost cuts had been “successfully delivered in the kind of timeframe that we had hoped for.”
“The choice to use the Illyria team, rather than hiring temporary contractors or a major professional services firm, was made because his team were as capable as any that an outside provider would offer.”
Long said it was important for shareholders to be fully appraised of the context around the board’s decision to employ staff from Murdoch’s company and stressed that the payments made to them were in line with the salary cost that Illyria incurs on them.
“The payments for the Illyria executives reflect the direct salary cost that Illyria pays them. There was, and is, no profit element for Illyria.”
The comments were made during the meeting in which Long also warned of continued tough trading conditions ahead in the near term.