UPDATE: 'WSJ' Stands By Negroponte Despite Murdoch Link

By: E&P Staff Dow Jones may not have known that one of the people assigned to help monitor the Wall Street Journal's editorial independance runs a charity that received $2.5 million in funding from Rupert Murdoch's global media conglomerate. Reuters reported this first on Thursday and it was confirmed by an article in the Journal on Friday.

As part of the deal to sell Dow Jones to Murdoch, Massachusetts Institute of Technology Professor Nicholas Negroponte was selected to sit on the five-member special committee that will oversee the editorial independence of Dow Jones's news operations.

"We have confidence that Nicholas Negroponte can be an effective and valuable member of the Special Committee on editorial independence,' said Journal Managing Editor Marcus Brauchli and Editorial Page Editor Paul Gigot in a statement. "We did not envision that members of the committee, News Corp. and Dow Jones would have no associations among or with each other, only that they would be people of integrity who are committed to ensuring our editorial independence."

In an interview with Reuters conducted over e-mail in May, Negroponte described Murdoch as a personal friend and a key backer of the One Laptop per Child (OLPC) foundation that makes inexpensive laptop computers for poor children. Negroponte is former chairman of the MIT Media Lab and a founder of Wired magazine. He is the brother of John Negroponte, the Bush administration's former intelligence chief.

It was not immediately clear if the Bancroft family, which approved the sale to Murdoch, was aware of the payment.

It sounds like a conflict of interest, Louis Ureneck, chairman of the journalism department at Boston University, told Reuters. ?Is a person truly independent if a decision he makes puts at risk a significant grant to his foundation? It strikes me that there is a conflict,? said Ureneck.

The New York Times reported today that sources that revealed that four members of the new board were selected by Dow Jones "while Mr. Negroponte was proposed by the News Corporation."

The Wall Street Journal reports on Friday: "A Dow Jones spokesman referred to language in the merger document that defined independent people as those 'who, in the sole judgment of the Special Committee, are able to consider and evaluate objectively any issue that comes before the Special Committee and whose judgment is not impaired by any interest in or relationship with the company [News Corp.], Dow Jones, the Murdoch family, the Bancroft family or their respective affiliates. Employees, directors and consultants of the company, Dow Jones or their respective affiliates shall be deemed not to be independent.'

"A News Corp. spokesman said, 'Dow Jones thinks [Mr. Negroponte] is independent, we think he is independent.'

"It isn't clear whether Dow Jones was aware of News Corp.'s ties to Mr. Negroponte's group, although it hasn't been a secret and was reported by the Journal in November 2005."

Another member of the board, Jennifer Dunn, is a former conservative Republican member of Congress with no apparent editorial background. Another conservative on the panel, Thomas Bray, has served as a columnist.