September 19, 2006
Time Revisited? Shareholder Wealth vs. Journalistic Integrity
Posted by Lisa Fairfax

I have been reading with interest the happenings at the LA Times.  Last week, the publisher and editor of the Times refused to make additional staffing cuts in the newsroom as requested by its parent Tribune Co.  Those who oppose the cuts have framed the debate as a decision between enhancing economic interests and advancing other concerns related not just to the paper, but also to the employees of the Times and members of the broader community. 

Thus, the editors opposing the cuts argue that the short term economic savings hoped to be realized by the cuts would have a negative impact on the long-term quality and journalistic integrity of the paper. 

Accounts also discuss the issue in terms of a struggle between the interests of employees and economic concerns.  The impact of staffing cuts on those being fired is obvious, but there also was a story about the more general impact on employee morale, suggesting that the editors’ decision to oppose the cuts bolstered the morale of employees at the Times.  Given that some high ranking editors apparently have left in protest over these kinds of cuts, there also has been a suggestion that the decision to make cuts may have negative repercussions for employees who the Tribune wanted to keep. 

Then too, community leaders have argued that the cuts have an impact on the larger community.  Indeed, 20 civic leaders including former Secretary of State Warren Christopher wrote a letter to the Tribune in support of the actions by the Times’ editors.  The letter evidently urged the Tribune to resist the economic pressure to make cuts at the paper because of the civic role the newspaper played in supporting and providing a voice for the community.  According to such leaders, that role meant that the Tribune should not allow its financial goals to hinder its public responsibility. Although the leaders did acknowledge the Tribune’s obligation to make a “reasonable” profit.

With the focus on the importance of journalistic integrity, the accounts of the editors’ struggle seem reminiscent of the 1989 Time-Warner decision.  Certainly that decision suggests that a company could legitimately focus on preserving that integrity even if it had a negative impact on short-term profits.  Of course the Tribune has argued that its staffing decisions ultimately may make the Times a better paper, and hence the Tribune is seeking to resist the attempts to frame the decision as one that puts financial considerations above these other issues.  Even if the decision does not reflect a “shareholders against others” stance, it is interesting to me how much public perception that it does reflect such a stance has driven the discussion.

Corporate Governance | Bookmark

TrackBacks (0)

TrackBack URL for this entry:

Links to weblogs that reference Time Revisited? Shareholder Wealth vs. Journalistic Integrity:

Recent Comments
Popular Threads
Search The Glom
The Glom on Twitter
Archives by Topic
Archives by Date
January 2019
Sun Mon Tue Wed Thu Fri Sat
    1 2 3 4 5
6 7 8 9 10 11 12
13 14 15 16 17 18 19
20 21 22 23 24 25 26
27 28 29 30 31    
Miscellaneous Links