Frustrated with nearly five years of declining stock values and increased executive compensation, Morgan Stanley Investment Management, one of the top institutional shareholders of the New York Times is crying foul and demanding major corporate and management changes.
"Over the past several years, the New York Times Co. has consistently underperformed its peers. Its market value has declined 52% since its peak in June 2002," the company said in a statement put out by its managing director, Hassan Elmasry. "Despite significant underperformance, management's total compensation is substantial and has increased considerably over this period."
The asset management company also called for an end to the NYT's long-standing practice of splitting shares into two categories. The dual share policy allows "A" shareholders to elect four of the company's 13 seats on its board of directors. Those owning "B" shares elect the other nine. The Sulzberger family, descendants of the founder of the Times, Adolf Ochs, own 88 percent of the "B" shares.
"It is time for the company's board to combine the Class A and Class B common stock into a single class of common stock that would provide equal rights, voting power and representation for all shareholders," the MSIM statement said. "This will ensure that the company's owners are able to hold the board and management accountable for the company's performance."
Don't expect to see this story reported the next time you see a story about "soaring CEO salaries." The existence of divided shares in NYT Co. is the reason why it remains America's most biased news organization.
