This is the fourth installment in a five-part series on Australian business journalism. Read part three here.

A common argument is that business journalists are failing, at least in part, because the diminishing resources of media outlets and increasing pace and complexity of financial markets leaves them ill-equipped to scrutinise companies and the powerful people who run them.

Academic Gillian Doyle interviewed more than a dozen business journalists from the Financial Times, Sunday Times, Telegraph, Investors Chronicle and CNN for a 2006 article published in Journalism: Theory, Practice and Criticism. She found skills generally had to be learned on the job and “surprisingly little commitment to training is available to support journalists working on the business sections of many mainstream newspapers in the UK”.  Financial irregularities buried in the accounts of fraudulent companies like Enron could easily go undetected.

A lack of expertise can lead to a possibly unhealthy reliance on financial experts such as broking analysts. In his 2010 article “What are financial journalists for?“, Damian Tambini from the London School of Economics’ media policy project interviewed journalists and editors, and was told, “The people that are really skilled go and make loads of money working in the financial sector. Not writing about it”.

Not so, say the half-dozen accomplished Australian business journalists Crikey interviewed for this series (see part one for a list of interviewees). Only two of them, Adele Ferguson and Ian Verrender, had directly relevant qualifications: both hold economics degrees and Ferguson also completed a graduate diploma in applied finance. While both thought their studies had been helpful — Ferguson says training gives the journalist “more confidence to ask questions” — neither believed financial qualifications were necessary to being an effective business journalist, and could cite plenty of names to prove it. Most important were the fundamental attributes of any journalist: curiosity, fact-checking, and the determination to keep digging to get to the bottom of a story. Trevor Sykes, who had a leaving certificate in English honours, told Crikey that studying accountancy and law could be useful but “journalism after all is really an unqualified profession; anyone who can write something that people want to read can get a job”. Sykes, who started as a cadet at the Adelaide Advertiser in 1952, continued:

“… as soon as I got into newspapers it was just what I wanted to do. I was good at English, which qualified me to make tea for subeditors for 13 months as a copy boy. I never wanted to do anything else, you were always somewhere that was either interesting or important, because if it wasn’t interesting or important, you shouldn’t be there! [After a year on the state politics round] I thought if I can get into finance I’ll spend my life working out what fellas are doing who are a lot smarter than I am and the bastards have never let me down, they’ve always been a jump or two ahead, it’s a never-ending game.”

Indeed one writer, Ben Hills, thought financial training could be a handicap:

“… In some ways it can make you a worse business journalist because you come into close contact with a lot of people who are going to be accountants and company secretaries and so on, and you start to think like them, you start to think it’s OK to rip the public off, I think it gives you a mindset that can be really damaging, if you’re going to do your proper function as a business journalist … you’re going to say to me ‘well how are you going to read a balance sheet if you’ve never studied accounting?’ Well I’ve never studied accounting. You’ve never studied accounting. We can both find our way around a fucking balance sheet. It is not that hard. And if you come across a bit that is hard — thinking of Michael West trying to analyse how much tax corporations have paid, which is deliberately made into a spider’s web of complexity just to defeat the regulators who are trying to get them to pay their share — then you can always call up an expert to help you through it. That’s what journalism’s all about, it’s not about knowing everything yourself, it’s about knowing where you can go to find out.”

Much the same could be said of firsthand experience working in the financial markets: it might be helpful for some journalists — or not, as the case may be — but it is certainly not essential.

Interestingly, almost all interviewees describe falling into business journalism — in a few cases, as a second preference or even what Gideon Haigh thought of at first as a “hardship post”. But all describe falling in love with the field. With her economics background Ferguson, for example, started in business almost by default and originally hoped to get into political reporting. Later she would knock back a tempting offer from then-editor-in-chief of The Australian Paul Kelly to join the Canberra press gallery, choosing instead to go to BRW: “At first I thought, how boring is business journalism? Who cares if the All Ords goes up or down a few points? But after a while I thought, this is where the power is. It’s got everything — politics, power, money, everything.”

What is undoubtedly important for a business journalist is experience — especially covering bull and bear markets, in an echo of the great Warren Buffet quote about exposure to reinsurance risk in the wake of the September 11 attacks: “you only find out who is swimming naked when the tide goes out”. Busts could be the making of the journalist. In Sykes case, it was the Poseidon nickel boom in the ’70s, which led to his first book The Money Miners. For Haigh and Ian Verrender, it was the ’80s crash. For West, the tech wreck:

“When I first started as a columnist at the Oz I used to lunch everyday. I had the perspective of a market participant. I got a lot of scoops. I moved share prices. But after the dotcom boom, I realised I’d been manipulated too. I became more concerned with matters of public interest, and understood my role was to be critical and to pursue stories in the public interest, rather than in the interest of a few investors who might own the stock.”

But to gain such long experience, finance writers need to specialise and this is a sticking point for some of the journalists we interviewed, leading to capture or (just as bad) stagnation.

“Finance reporters have to work through a boom-bust cycle or two to learn the necessary scepticism …”

Gideon Haigh, also a celebrated cricket writer, is scathing about the quality of business writing, telling Crikey that there are few memorable wordsmiths. “I like peppery Michael West and shrewd Adele Ferguson, but I wouldn’t go to the business section for the promise of scintillating prose”. For example, said Haigh, “it’s really pretty scandalous how poor the writing is about BHP … that’s a bit of a reflection on the quality of business journalism, the fact that our biggest corporation tends to get written about as though it descended from the sky five minutes ago”. Haigh fears business reporting here has fallen into a narrow rut, becoming “safe as milk” and failing to do justice to stories that are every bit as exciting as those in sport or politics or the arts. A loss of experienced hands on finance desks is partly to blame for the dull copy, according to Haigh:

“… when I worked at The Age one of the important influences on my writing was the fact that the business section had its own dedicated subs desk. They were excellent subs and they sat right next to you — a pool of desks in the middle of the business section. And if they had a problem with anything you wrote, they called you over and they taxed you about it — exactly the kind of relationship that young journalists don’t have with subs any more. Ingrained in my memory is this lovely, fruity English sub called Stephen Hall, looking around the business section and saying ‘where’s Haigh, where’s Haigh?’. I think I was looking in a drawer in one of the filing cabinets, so he couldn’t see me. Anyway, he said as loudly as he could to everyone on the subs desk, ‘if there’s a piece of jargon lying around, Haigh goes to it like a fly to shit’. Fair dinkum, I never forgot it. From that day forward, if I ever had an opportunity to avoid using a piece of jargon I took it. He picked me up on a stylistic tick that I’d fallen into and he rightly remonstrated with me about it. And I think maybe if business journalists had people who are reading them on a daily basis and challenging them about their style they’d probably be better off.”

The general reader has to come first again. Tell it like it is — and context, depth, history, colour, humour and imagination wouldn’t go astray. Michael West says satire can be hugely effective:

“Until a few years ago the story of mine with the most impact by far was ‘Casey Williams’ … the HIH Royal Commission was on and hearing about Ray Williams’ penchant for business travel. He was Qantas’ number one customer, and used to book seat 1A and seat 1B to put his briefcase on, because he didn’t want to sit next to anybody. I’d come in after a long lunch at 5.30 with an hour and a half to file by 7 and we’d been talking about HIH at lunch and I concocted this [satirical] bit of transcript to the royal commission, cross-examining Williams, the whole spiel was deadpan, under whose name did you book seat 1B? Casey Williams! The internet had just got going. The next day I had all these people who’d clicked on the story and sent in messages. It was huge, [even] mentioned in the summing up of [presiding judge] Neville Owen!

“One of the big problems is that business journalists regard themselves as business journalists, rather than journalists, and they hold themselves to a lesser standard and write all these boring business yarns for business, rather than for the public.”

Finance reporters have to work through a boom-bust cycle or two to learn the necessary scepticism, so the wave of senior redundancies from newspapers — which dominate business journalism — looms as a real threat to corporate accountability. As Hills observes:

“Unfortunately we don’t have enough journalists with enough skills with enough talent with enough motivation let alone enough time to do their job properly … because there are fewer journalists because they get less time to do their job the proportion of genuine news in newspapers has just collapsed. An Australian Centre for Independent Journalism survey [conducted jointly with Crikey in 2010] found 55% of all content came directly or indirectly from a press release. My own guess is it’s now closer to 75%. You just can’t do the same job in a newsroom that’s got 150 people in it and most of those are young kids. I mean the people who walked were the older hands who wanted to get their $200k, $300k, $400k superannuation, and they’ve been replaced by kids who are wet behind ears who, even if they were given the time and resources, wouldn’t know where to start on an investigative story.”

Higher turnover of increasingly junior finance reporters is exacerbated by the constant lure of more highly paid jobs in business, particularly the ever-expanding public relations industry, itself a major and well-recognised threat to journalism. The big bank media units are awash with ex-finance journos. Tongues wagged last year when well-regarded Australian Financial Review journalist Andrew Cleary, who had written an award-winning (and flattering) profile of Qantas boss Alan Joyce for BRW in the wake of the airline’s controversial grounding, was hired soon after to a plum job running the company’s investor relations. He followed in the footsteps of a line of ex-AFR journos to go from the round to the company, including Tansy Harcourt and Jane Boyle.

Just as there is for government ministers, Hills thinks there should be a three-year cooling off period before journalists can go and work for a company they’ve been writing about. “It casts a grey brown stink across the whole bloody profession when journalists do that.” One way to do it would be to write it into the Media Entertainment and Arts Alliance Code of Ethics. “I know a lot of people no longer belong to the MEAA, and I know that it would be impossible to force compliance, but it would signal the profession’s disapproval and it would indicate to the wider public that this was an unethical practice.”

Read the fifth and final installment of Watchdog or Lapdog? tomorrow.