Olswang has been instructed by News International to draw up a new code of practice for the company amid new revelations in the News of the World (NoW) phone-hacking scandal.

The NoW is facing renewed scrutiny this week amid allegations that Glenn Mulcaire, a private investigator working for the paper, hacked into the mobile phone of murdered schoolgirl Milly Dowler in 2002. The Guardian has claimed that messages were subsequently deleted from the phone.

Olswang senior partner Mark Devereux and head of judicial review and public law Dan Tench have been appointed to lead the NoW review, which will see the UK top 40 firm recommend new policies, practices and systems in an effort to help the news group to prevent a repeat of recent events.

Devereux said "I can confirm that we have been instructed by News International to help them conduct a thorough review of their practices and systems. Exact details of our terms of reference and all further communications around them will be provided by News International in due course.

"We are delighted to have been selected to help with such an important project and we expect to come up with some recommendations of best practice which may also have some value for the news industry as a whole."

Dowler's parents are now reportedly pursuing a claim for damages against the NoW, according to the family's lawyer, Mark Lewis of London firm Taylor Hampton.

In an internal statement, News International chief executive and former NoW editor Rebekah Brooks said: "As chief executive I am determined that News International is led in a way that deals with these matters properly. I want both external and internal acknowledgement that we have done the right thing – by facing up to our responsibilities where things have gone wrong and having done our utmost to correct them.

"In April, we admitted liability in a number of civil cases – an important step that has been well received generally and led to litigation becoming more manageable. Last month we announced that the former High Court judge Sir Charles Gray had agreed to act as adjudicator in our Compensation Scheme. This should speed up many civil claims in an efficient and fair way, removing the need for prolonged and unnecessarily costly court action for all parties concerned.

"But our proactive approach to civil litigation is just part of how we engage with these matters. For some time now these issues have been managed within a different structure, which can now be formalised.

"We have also been working for some time with leading law firm Olswang to examine in great detail what we can learn from the past. As a result of that on going examination, Olswang will recommend a series of policies, practices and systems to create a more robust governance, compliance and legal structure for our titles. We hope that, over time, this structure will become a standard for our industry.

"We are committed to publishing both Olswang's terms of reference and their final recommendations in full. Those recommendations will then be implemented, with our CFO, Susan Panuccio, playing a key role in this process."

It is understood that police are set to meet with senior executives from News International this morning (5 July), with Brooks' role in the newspaper's practices attracting much media attention.

The NoW has been accused of phone-hacking by a number of celebrities in recent months, with the newspaper instructed to pay a settlement of £100,000 to actress Sienna Miller in May this year after admitting liability for hacking her phone. In 2007 Mulcaire and NoW royal editor Clive Goodman were briefly jailed for hacking into the mobile phones of royal aides.

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