Credibility is the stock-in trade of U.S. newspapers, so their corporate-governance policies should be beyond reproach
It's the middle of the annual-meeting season, and at most publicly held newspaper companies this year the top executives are staging an intricate two-ring circus for shareholders. When they're explaining away disappointing financial comparables, they tell stockholders that everything's changing in the media business. But when these same executives are forced to discuss their corporate-governance policies, they insist that nothing should change.
This stubborn stand never made much business sense, but right now it threatens to erode the most important asset any newspaper company has: its credibility. Newspapers in recent months have filled their business pages -- and, increasingly, their front pages -- with stories about high-powered executives and companies brought to ruin by corruption, fraud, and self-dealing. The public is disgusted with those who enrich themselves at the expense of employees and investors, even as newspaper groups retain policies that allowed corporate abuses to fester elsewhere.
A few newspaper companies are finally getting it. Last month, Dow Jones & Co. Inc. directors ended six years of resistance and recommended requiring board members to stand for election every year, a practice long urged by good-governance advocates. Shareholders overwhelmingly approved the move. The Washington Post Co. and Lee Enterprises Inc. didn't wait to be pushed: Both now treat stock options as expenses, another welcome reform. …