Reactions to Times Mirror Company CEO Mark Willes’ scheme last year to integrate the business and editorial functions at the Los Angeles Times were swift, clear and well-publicized. Journalists across the country wrung their hands over the plan, which in any other industry would be viewed as a reorganization but for those in the news business heralded the imminent demise of the Times’ journalistic integrity.
Willes again made waves when he announced that Times Mirror’s 1997 annual report would be authored not by a faceless committee or a hired pen but rather by three highly-respected journalists recruited from the newsrooms of the company’s own papers. The goal was to imbibe ‘a more balanced view.’ And to seal the deal, Willes pledged a hands-off policy: ‘As ‘publisher’ of this annual report, I gave this remarkable journalistic team complete independence,’ he writes in his shareholder letter. ‘Not only did I not tell them what to do or write, but I am not even reading their piece until after it is printed.’
Willes’ work last summer inspired erudite articles extolling the virtues of the church-and-state relationship between the editorial and business functions of the press, and there was a slight flap of press protest when the plan for the annual report was announced, yet its publication has been met with a deafening silence. In fact, a straw poll survey of analysts and investors more than two weeks after Times Mirror’s tome should have landed on their desks revealed that hardly anyone had read it.
Mark Greenberg, a portfolio manager at Invesco, notes that he feels no urgent need to rush to read Times Mirror’s annual because his confidence level is high in the company already. ‘I’m like a father with 80 children,’ he says, referring to the stocks he covers. ‘I’ll get to it in the next month. But to my mind, Times Mirror didn’t have much of a credibility problem to start with.’
The dense, 20-page ‘special section’ sandwiched between the shareholder letter and the MD&A is divvied up into five articles. The first, by LA Times senior economics editor and business columnist James Flanagan, is headlined, as is the cover of the annual report, ‘Becoming a newspaper company again.’ It includes a subsection on the company’s financial results headed ‘By the numbers, a very good year.’ Flanagan authored the second article as well, reporting on ‘Mark Willes takes control at the Times.’
Debbie Price, a general assignment reporter for the Baltimore Sun, picks up part three, while the fourth and fifth sections are by-lined by James Toetdman, Washington bureau chief of Long Island’s Newsday. These last three sections look more closely at the company’s eastern newspapers division and subsidiary businesses in publishing, training and magazines. David Laventhol, former publisher of the Los Angeles Times, served as editor on the project.
Shedding light
What the special section represents, then, is really an operations history, albeit one written by professionals free to use language that has probably never seen the light of day in an annual report. For example, in one of Flanagan’s articles, chairman Willes does not just say something, he ‘muses’ it. ‘Jolted’ is not a word included in the AR-speak dictionary, yet there it is in a caption describing the effect on the Los Angeles Times of the resignations of its publisher and editor after the reorganizations were announced.
But the question remains about the value-add of the so-called journalist’s perspective in these articles. Both Willes and Times Mirror’s VP of corporate communications, Martha Goldstein, make much of the ‘balance’ that this report could claim, with the implication that it is considerably more credible than the average, run-of-the mill one. ‘Our desire is to have less gloss, and more texture and insight,’ writes Willes in his letter. ‘Our intention is to bring to bear a different perspective,’ adds Goldstein, ‘without the corporate spin.’
Their fuss about this bias-free report brings up the question: do investors (or whoever the intended audience is) really care about credibility in an annual report? And isn’t there a difference between an annual report written with CEO oversight and approval and one where he doesn’t take any responsibility for what’s between the pages (in the front half, at least) except for his own letter? Does Willes overestimate the value of objectivity in an annual report?
‘When I interview a CEO for an annual report,’ explains veteran annual report writer Richard Lewis, president of the Conceptual Communications Group, ‘he knows I’m on his team, and he can tell me 100 percent of his problems and his dreams. I really try to get inside his head and tell the story from his perspective, because ultimately it’s his responsibility to explain how the company’s going to grow and survive. A reporter’s goal is to get the story. An annual report writer’s goal is to foster an understanding of where the company has been and where it is headed. Those are two very different things.’
Peer review
While the journalistic community found the notion of using newsroom pros as PR stand-ins distasteful, annual report experts and even a few Times Mirror peers thought the idea was at least provocative. ‘It’s a fascinating experiment,’ says Frank Hawkins Jr, who heads his own consulting firm, Hawk Associates, after 14 years as vice president of corporate relations at Miami-based Knight-Ridder. Still, he cautions that it would be critical to use reporters tuned to the language of Wall Street. ‘There’s a code,’ he says, ‘and it’s useful to know the code.’
Notes annual report consultant and writer Lawrence Tavcar, ‘It makes a lot of sense for a company in the media to involve its own people. This is its product, after all. It’s a way to demonstrate its intellectual capital.’
At Tribune Company, Ruthellen Musil says the idea might be worth exploring as a means of showcasing company talent, but not without polling major shareholders first. Lee Ann Schlatter, director of corporate communications at Knight-Ridder, adds: ‘It sounds dramatic, but I don’t know that it’s any different than approaching a writer on a freelance basis to write an article for the employee newsletter.’
In fact, it is very different. For one thing, Times Mirror did not approach its writers on a freelance basis, but asked them to undertake the assignment as part of their regular workload. They were not paid extra for their work, and indeed one of the reporters was curious, if not surprised, to hear the going rates for annual reports. Moreover, the reporters were under a mandate to write the articles for the annual report as if they were destined for newsprint.
‘It was relatively simple,’ says Price. ‘We were told to approach it as an assignment with clear instructions not to pull punches and to be fair and square. I did a lot of interviews and did what I would normally do, filling up a quarter of a file drawer full of information, just as if I were writing an article.’
But just where, the student of journalism might ask, is this ‘balance’ so antithetical to the notion of corporate ‘spin?’ James Flanagan’s overview, for example, quotes Willes and Los Angeles Times managing editor Michael Parks. Where are the analyst and investor views? What is going on at other media companies? There is a quote in Price’s article from Tom Goldstein, dean of Columbia University’s Graduate School of Journalism, but other journalist opinions are left out of the equation.
Vision of the future
What is going on at Times Mirror’s peers is this: many have clued into the last five years’ trend in annual reports and are laying out a strategic vision of the future for investors who don’t need or want laborious reviews or even analysis of historical events. Chicago media conglomerate EW Scripps Company, for example, titles its annual ‘What’s next?’ and then goes about answering this question by laying out a plan, division-by-division, goal-by-goal, with short explanations of how the company anticipates achieving each goal. The New York Times Company annual report is called Strategies in action, also focusing on future growth. By turning over its annual report to reporters, Times Mirror preordained that it would be a retelling of the past, rather than a look into the future.
When the investment community does finally get around to reading Times Mirror’s annual report they will probably find, as did industry analyst John Morton of Morton Research, that it’s ‘well written.’ He was also impressed by the CEO’s hands-off policy. But does it really give any better perspective than readers might have gained from reading the Los Angeles Times’ intensive three-part series on the newspaper industry that ran at the end of March this year? And for that, readers only had to pay 75 cents – surely a bargain compared to the price of a Times Mirror share.
