“The current crisis in global banking, markets and economies has reminded us all of the importance of financial and business journalism. It has also raised a set of profound questions as to the quality of that form of reporting. Why didn’t we know this was coming? Did the journalists fail to put the financial system under proper scrutiny? Are they equipped to deal with the continuing complex story? Is this representative of a wider problem with the news media?”—From “What Is Financial Journalism For?” a study published in November by POLIS, a joint public policy research project of the London School of Economics and the London College of Communication.
Those are good questions. The financial press doesn’t get much study from academic types, but if it ever was going to, now would be the time.
Two years ago, Damian Tambini, a senior lecturer on media and communications at the LSE, launched a project to examine financial journalism’s role in the wake of new challenges: technological changes, increasing complexity of the subjects it covers, a British media/insider-trading scandal, eroding media finances, and the rising clout of financial public-relations operations.
Then the financial crisis hit, making a systematic study of the financial media, if anything, more urgent than ever. The result is a useful 33-page paper that looks at the financial media’s place in the financial system and calls, at least implicitly, for higher standards.
The title of the paper asks one of those big, “dumb” questions that I find so valuable:
What Is Financial Journalism For?
Those kinds of questions don’t get asked much on this side of the pond. That’s too bad. Even the subject of business media’s performance in advance of the current crisis seems to be something of a taboo. The scant attention the subject has received has been either the once-over-lightly treatment, a la Howard Kurtz (1), and or an “all-clear” for the business press from our cousins over at the American Journalism Review.
We take a different view here on the press’s pre-crash performance and have done so on many occasions, and believe, like Polis, that some reexamination of the business press’s role and priorities is in order.
We note also that 68 percent of top business journalists recently surveyed agree with us that the financial press, to use a sports metaphor, didn’t leave it all on the field in the run-up to the crisis.
We’ll have a lot more on the subject coming up this spring. Stay tuned.
I recommend the Tambini paper as a starting point for discussion, not (solely!) because I was one of the interviewees, but because among its merits it sees financial journalism as not separate from, but as part of, a system designed to oversee financial markets and corporate actors. The tone is dry, sober and serious—entirely unAudit-like, and all the better for that.
“It is time for a much more serious analysis of the effects of new market systems, of new media and the state of financial journalism,” writes Charlie Beckett, Polis’s director, who wrote the preface.
The paper is written for the British context, so at first glance a lot of it may sound a bit off-key to American ears. It argues for instance, for reexamining financial journalists’ “rights” and “duties,” for strict definitions of who’s a journalist and who’s not, and for creating or refining codes to regulate journalist conduct. All this may sound very Euro—more formal, regulation-oriented, and even more organized than we’re used to. It might sound indeed a bit fussy and, yes, academic to define journalists’ dos and don’ts regarding panics, bubbles, market rumors, and the like. And one would think it should go without saying that business journalists shouldn’t trade in the stocks they’re reporting about.
But I wouldn’t dismiss these issues so fast. Even beyond the rare conflict-of-interest cases we’ve encountered among media practitioners (e.g. Maria Bartiromo CNBC’s on-air disclosure before a 2003 interview with a Citigroup executive that she owned $45,000 in Citigroup shares) we now have money managers routinely offering widely read, often highly literate, commentary on financial issues in which they may or may not have a stake, which they may or may not disclose. I’m thinking here of a recent, well-done Op-Ed by journalist Michael Lewis and hedge-fund manager and author David Einhorn, but it could apply to many other commentators as well. That poses a more complex set of issues, and some believe, problems.