Sulzberger cuts own compensation
New York Times Co. Chairman Arthur Sulzberger Jr. has sent employees a letter announcing that he and cousin Michael Golden, Vice Chairman, will not be getting any stock-based compensation for 2006 or 2007. Instead, the roughly two million bucks each year will be distributed to employees for "exceptional performance." As the two members of the founding Ochs/Sulzberger family in senior management, Sulzberger and Golden, who is Publisher of the International Herald Tribune, said "it is our turn" to rise to the challenges facing the company as previous generations of their family had done. The new bonus pool will be for employees who do not qualify for the company's annual bonus plan for executives. The stock and options will be distributed across all units of the New York Times Co., based on their relative size, with the recipients to be selected by senior management of each unit. The move comes as The NY Times Co., like many other newspaper groups, is attempting to adapt to a changing media landscape by focusing on expansion in online and other new media areas. The company announced plans this week to sell off its TV group as part of that refocusing (9/13/06 RBR #178).
Read the letter.
September 14, 2006
Dear Colleagues:
As we make our way through the challenging period of transition that we and our industry are in, there are a few things of which we at The New York Times Company can be sure. One is that we're in this together.
The members of the Ochs/Sulzberger family, who for over a century have helped shepherd our institution, are resolutely committed to our mission and to the men and women who put forth such tremendous dedication to this extraordinary enterprise and who have made it the great media company it is.
As the two members of the family in senior management, we have decided to forgo any stock compensation that we would be awarded for 2006 and 2007. Management will use the savings to create a bonus pool to reward exceptional performance by employees who don't participate in the Company's annual bonus plan. We expect that, between us and including both restricted stock units and options, roughly $2 million would be available in the 2006 pool, which would be distributed next February. We expect that a similar amount would be distributed in February 2008.
The money will be distributed across all our media groups, as well as corporate, in accordance with their size. The specific grants will be left to the discretion of the senior management of those units.
Our decision as family members is a purely personal one. Our great-grandfather purchased The Times in 1896 because he recognized its potential for greatness. Since then we've been through many trying times. Previous generations have demonstrated that they had the courage, the drive and the intellectual wherewithal to rise to the challenges they faced. Now it is our turn and we are fully confident that all of us who work for this Company today are more than up to the task ahead.
Every member of senior management is thankful for your countless contributions, your exceptional dedication, and your heartfelt devotion to our mission of providing quality news and information to audiences in this country and around the world. We're proud to be your colleagues.
Sincerely,
Arthur & Michael
RBR observation:
In a time when the directors of public companies are being criticized for awarding ever higher compensation to top executives, regardless of whether their performance is good, mediocre or poor, Sulzberger and Golden deserve credit for putting the good of the company ahead of pumping up their own already sizeable fortunes. No matter how many times we have heard the truism that you can't really achieve growth by cutting payroll and other overhead costs, it seems most companies are trying to do just that. Small wonder, since Wall Street encourages just that sort of short-sighted behavior.
