News International's chief executive Rebekah Brooks knew that the company's lone "rogue reporter" defence against phone hacking was "shaky" a year and a half before it changed its public position, the Old Bailey heard today.

Appearing in the witness box for the eighth day to answer charges of plotting to hack phones and pervert the course of justice, Mrs Brooks was asked about the publication of evidence in July 2009 that challenged its claim that the News of the World staff member who had intercepted voicemails was royal editor Clive Goodman.

As well as publishing a front-page revealing NI's confidential legal settlement with a hacking victim, football union boss Gordon Taylor, the Guardian released to MPs an internal News of the World transcript of his messages.

The email had been sent by one NoW reporter, Ross Hindley, to another - chief reporter Neville Thurlbeck, raising the possibility of wider involvement by the paper in the illegal practice.

Asked what she thought of the "For Neville" email, Mrs Brooks told her QC Jonathan Laidlaw: "I certainly saw just by glancing over it, without having any other information, that the emphaticness of the company's position that nobody else knew what [NoW external hacker] Glenn Mulcaire was doing was looking shaky, because this was an email for someone to the News of the World allegedly for someone else at the News of the World."

Mrs Brooks said that she and other NI bosses opposed a legal move in early 2010 by publicist Max Clifford to force Mulcaire to name who commissioned him to hack because they were worried of the damage he could do."

We were opposing that order in the context of the civil courts on the basis that he was an unreliable witness, naming names - and reputationally and financially we didn't want that to happen," she said.

She added: "The fear was that he could say anyone or anything."

At a meeting at Mr Clifford's office on 2 February 2010, Mrs Brooks negotiated a £200,000-a-year deal with the hacking victim for him to start supplying stories again to the NoW and the Sun.

After that deal, Mr Clifford dropped his claim for breach of privacy - and Mulcaire was not ordered to name names.

Asked whether she had been concerned about her own position as a former News of the World editor, Mrs Brooks replied: "No."

She said she was merely continuing the company line.

She told the jury: "Our decision at News International was to settle [civil hacking cases] as confidentially as possible to prevent further damage reputationally and financially. That was the policy I inherited and continued."

The company only substantially changed its position on phone hacking in January 2011, when it announced a "zero tolerance" policy and disclosed it had dismissed a senior journalist at the News of the World.

Mrs Brooks, chief executive of News International between 2009 and 2011, and the other six defendants deny all charges. The case continues.