I am still traveling, visiting friends and family for Thanksgiving, so today’s post will be short.
Media companies are public corporations.
They are accountable to their Board of Directors.
They respond to possible negative action on their revenue streams and profitability and to activist shareholders.
The New York Times has some clear leverage points that can be used to promote a return to broad, unbiased political coverage due to editorial decisions on what content is most likely to increase revenue.
Here is the logic chain:
The corporate board of the New York Times1 is headed by A. G. Sulzberger, who was publisher on January 1, 2018, and became chairman on January 1, 2021, succeeding his father Arthur Ochs Sulzberger Jr in both positions.2
The NYTimes is a publicly traded corporation with a dual-class share structure. It went public in 1969. After this, the family continued to exert control through its ownership of the vast majority of Class B voting shares. Class A shareholders are permitted restrictive voting rights, while Class B shareholders are allowed open voting rights. Class A shareholders are permitted restrictive voting rights, while Class B shareholders are allowed open voting rights that determine management structure. The Ochs-Sulzberger family trust controls roughly 88 % of the company's class B shares. Any alteration to the dual-class structure must be ratified by six of the eight directors who sit on the board of the Ochs-Sulzberger family trust. The trust board members are Daniel H. Cohen, James M. Cohen, Lynn G. Dolnick, Susan W. Dryfoos, Michael Golden, Eric M. A. Lax, Arthur O. Sulzberger Jr., and Cathy J. Sulzberger.3
Starting in 2003, the position of public editor was established to "investigate matters of journalistic integrity"; each public editor was to serve a two-year term. The position "was established to receive reader complaints and question Times journalists on how they make decisions." In 2017, the Times eliminated the position of public editor.4
NYT revised its revenue model around 2018, when A. G. Sulzberger became publisher, from advertiser-dominant to subscriber-dominant.5
The activist investor group ValueAct has taken a significant position in NYT and is now one of its largest Class A shareholders because it felt that profits could be increased by packaging its paywall subscription offerings.6 According to the article, “ValueAct has a track record of investing in companies over a long period and working with management behind the scenes. Often, it seeks out companies, like Adobe and Microsoft, that are in the middle of changing their business models…Activist investors have been increasingly willing to take stakes in companies with dual-class structures like The Times… The Times has dealt with activist investors before. In 2008, the hedge funds Harbinger Capital Partners and Firebrand Partners told the company they intended to nominate four independent directors to the publisher’s board. The Times ultimately struck a deal with the investment firms, offering up two board seats.”
ValueAt subsequently upped its stake to 12,808,340 shares of New York Times Co (NYT). This represents 7.8% of the company, and you can see other major investors in the Times here.7ValueAct reduced its stake in NYT by 5,859,746 shares in August 2023, or approximately by half.8 The total publically traded float of class A shares is 159.77M.9 Given the latest available information, ValueAct still owns 6,948,594 shares, or 4.3% of NYT.
The Columbia Journalism Review critique of the bias in editorial decisions at the New York Times provides quantification of the problems in choices of coverage, depth of coverage, and allocation of resources.10
This is an ideal set-up for maximum leverage by subscribers and shareholders of the New York Times to again make it the paper of record and return it to the intent of its motto, "All the News That's Fit to Print”. We all have perceived the lack of coverage of President Biden’s accomplishments.
If you have $45.46 today, buy a share of NYT so you can participate in the annual shareholder meeting and increase your clout. I would argue that you are investing in ensuring the future of a free, unbiased press, which is the cornerstone of democracy in America. Shareholder activism is where leverage over corporations lies.
If you can say you are a New York Times shareholder, you can write with more authority to G. Mason Morfit, the Chief Executive Officer and Chief Investment Officer of ValueAct Capital, at info@valueact.com, and copy to A. G. Sulzberger Arthur.Sulzberger@nytimes.com and the members New York Times Corporate Board.11
If you aren’t into letter writing, but have some time to help in this effort, you can call Value Act and the companies of the members of the NYT Corporate Board and try to get direct email addresses for them and add them as replies to this post.
Daniel Victor, New York Times Will Offer Employee Buyouts and Eliminate Public Editor Role Archived May 3, 2021, at the Wayback Machine, The New York Times (May 31, 2017).
A great link to commentary from Ferm McBride https://open.substack.com/pub/heathercoxrichardson/p/november-26-2023?r=dvhmb&utm_campaign=comment-list-share-cta&utm_medium=web&comments=true&commentId=44324561
Brilliant idea! You should share with Robert Reich’s post today. Very relevant.