By: Lucia Moses
Many top executives at newspaper companies, in line with the industry’s abysmal revenue performance, did without bonuses and raises in 2001 — and some even took pay cuts.
But now bonuses are back. “Pay tends to follow performance, so when things get better, the pay tends to turn up,” said Allen Jackson, a Towers Perrin compensation consultant based in Valhalla, N.Y. Thus Belo lifted a yearlong wage freeze in October and will hand out some bonuses for last year, a year that “exceeded our expectations,” Chairman, CEO, and President Robert W. Decherd has said.
Even at Dow Jones & Co. Inc., where The Wall Street Journal is still suffering an advertising-revenue decline, some executives will pocket small bonuses, although Chairman and CEO Peter R. Kann wrote in a staff memo that he won’t be one of them. Dow Jones also froze salaries for nonunion employees for this year, the second year without increases for the highest-paid executives, and the company expects to negotiate a similar sacrifice by union employees this year.
While publicly traded newspaper companies generally aren’t accused of executive pay excesses, some, in step with Corporate America, are taking a fresh look at their compensation programs.
Belo, for one, said in December it would issue fewer stock options for last year, and compensation consultant Robert J. Greene expects to see a shift away from stock options and long-term cash awards. “I think you’re going to see a lot of examination of the use of options and the use of equity,” said Greene, CEO of Reward Systems Inc. in Glenview, Ill. The economic downdraft notwithstanding, Greene sees no end to the shift toward performance-based pay.
Even so, Media General Inc. plans this year to add qualitative components to financial measures used to determine executive compensation. As Marshall N. Morton, vice chairman and chief financial officer, said recently, “We need to be thinking about things other than numbers.”