In June Fairfax CEO David Kirk spoke in Perth and spruiked his company’s creation of “a dynamic program of diversification and growth” that makes it “as well positioned as any heritage publishing company in media worldwide”. Today we see the proof of that smug little pudding, with news that Fairfax will soon begin a program of “business improvement” that involves shedding 5% of the company’s full-time workforce.
It’s as well, as Kirk pointed out in July, that Fairfax has learned from the mistakes made by international media naivs like the staff sloughing New York Times and the struggling Tribune group. As Kirk said:
We are past that here. We know how to do our newspapers well and we know how to do the internet well, and we can put them together to deliver a fantastic 24-hour news product.
Big phew there for Fairfax, if they hadn’t managed that transition with such entrepreneurial brilliance imagine how much more stringent this latest round of cost cuts and job shedding would have had to be. Fairfax staff must truly be grateful.
As must the lush ranks of senior Fairfax executives. Why, if things weren’t so upbeat they might even have to do without the significant bonus payments scheduled to arrive in their accounts through October, a month that will probably coincide with the first of the 550 pink slips that will dot Fairfax newsrooms, sales and corporate offices over the coming financial year. Remember last year’s bonus payments for performance: $143,380 for Kirk on top of his base salary of $1.16million. The Age’s Don Churchill took home $86,667 to top up his salary of $394,912.
As Margaret Simons reported in July:
Between 2006 and 2007 the top executives in the company were rewarded with a stunning 45% increase in bonuses alone. The total in bonuses for the top eight went from $1.5 million to $2.2 million over the period. Add to this another 7.7% total increase in salaries for the top people.
But they’re worth it.
In the light of today’s statements, all included in this Crikey edition, Fairfax staff are entitled to ask: what proportion of the cuts will come from management and in particular head office in Sydney?
And will the Board freeze its own remuneration which recently went up by more than 20%?