Last spring, the co-chairs of The Washington-Baltimore Newspaper Guild wrote an open letter to The Washington Post Company’s (WPO) publisher, Katharine Weymouth, expressing their disappointment that Weymouth – a granddaughter of the Post’s legendary Katharine Graham – had accepted a bonus of nearly $500,000 and a 10 percent raise “…at a time when the sacrifices made by so many people who work here — or used to work here — are still fresh.” They were referring, of course, to the countless layoffs and buyouts that have occurred at The Post during the past few years.
We don’t like to be the bearers of bad news, but Guild members need to brace themselves for even more disappointment this year.
In the proxy that The Post filed yesterday, the company disclosed that:
“In 2010, Ms. Weymouth was paid $537,000 in base salary and received a bonus of $483,750 based on the achievement of pre-established 2010 performance goals. In addition, Ms. Weymouth received $1,053,441 based on achieving pre-established goals under the WP Media Three-Year Long-Term Incentive Plan and a payment of $72,000 for her 2,400 vested Performance Units in the 2007-2010 Award Cycle….”
On top of that, Weymouth is getting a raise of nearly 16.5 percent this year, effective April 1, which means that her 2011 base salary will be $625,000. And besides the performance units referenced above, Weymouth gets equity awards in the form of restricted stock and stock options that vest over a number of years.
Companies craft their own formulae to define good performance, but – from the outside – The Post’s performance isn’t impressive. The Post’s stock declined 1.38% in 2010, trailing the S&P 500 by 10 percentage points. Taking dividends into account, it returned just 2%, trailing the S&P 500 by 13 points. It’s not doing much better so far in 2011, considering a decline of 0.47%.
The proxy also notes that Weymouth has been nominated to serve on the board of directors this year, but that she is ineligible for additional compensation if elected because she is an employee of the company.
Besides Weymouth and her uncle, Chairman/CEO Donald Graham, (who once again declined both a raise and a bonus), the proxy indicates that there are a couple of other family members who are helping out at either The Post or one of its subsidiaries. Katharine Weymouth’s mom, veteran journalist Elizabeth “Lally” Weymouth, left Newsweek after The Post sold the magazine last fall and is now an Editor-at-Large at The Post, earning a base salary of $300,000 per year. And Donald Graham’s daughter, Laura O—Shaughnessy, is working as the CEO and president of a Post subsidiary, Social Code LLC. According to the proxy, she got a $40,000 bonus for her work last year and will earn a base salary in 2011 of $150,000.
Katharine Graham’s legacy was that she ran The Post with a firm but steady hand. Sadly, she’s not around to steer the company anymore, which leaves it to shareholders to ask the tough questions at the May 12 annual meeting.
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