Unions on both sides of the Atlantic have attacked Reuters for "riding a coach and horses through the trust's principles" by allowing a merger with rival Canadian media giant Thomson.
The deal, worth £8.7bn, was backed by the Reuters Founders Share Company – set in place to safeguard Reuters' editorial independence.
- October 2, 2020
- September 21, 2020
- September 15, 2020
The merger was confirmed on Tuesday, and will allow a Thomson family holding company to own a 53 per cent stake of the newly merged business, even though Reuters limits shareholder stakes to 15 per cent and a Trust Principle bars Reuters from being controlled by "any one interest, group or faction".
Fear of job cuts were rife among Reuters' 17,000 staff after a statement announced: "This transaction would also create enhanced value for shareholders through the delivery of in excess of $500m of annual synergies expected to be achieved within three years."
NUJ newspapers and agencies organiser Barry Fitzpatrick said this statement could spell job cuts and a threat to editorial standards.
He said: "No one is quite clear what that means, but we assume, in the minds of Thomson at least, that's a marker for further cost cutting, and cost cutting inevitably can mean jobs. If it introduces more instability into editorial, it clearly will affect standards.
"What we're now concerned about is that the emphasis seems to be on cost cutting rather than expanding the group and exploiting the merits of the two companies involved."
In a joint letter to Reuters Founders Share Company, the Newspaper Guild-Communications Workers of America, its New York and Canadian locals, the National Union of Journalists and Amicus-GPM have expressed concern over the effect the merger would have on the standards of journalism at Reuters.
"There are deep concerns, despite assurances we have already heard, over whether a reconstituted Reuters would maintain the high standards of journalism and the integrity, independence and freedom from bias that have shaped the company's 156-year-old reputation and are crucial to its future success," the letter said.
Thomson's ability to gain the backing of the trust – made up of 15 independent executives – was essential in the success of the deal, as it has a "Founders Share" it can use to outvote all other shareholders and stop a takeover. The Trust Principles, which date back to 1941, were created largely to maintain Reuters as a reputable, independent global news organisation.
Fitzpatrick said the NUJ was still awaiting answers as to how and why the Trust Principles were apparently breached.
He said: "It appears to us these so-called safeguards are worthless. It's the fact that they've really been prepared to ride a coach and horses through the trust principles – most of those are designed to ensure Reuters maintain a totally independent and unbiased editorial."
Thomson has pledged that the trust's principles will be maintained, including the independent process for appointing trustees.