1. Headline: Governance or How to make a media business by watching markets closer than anyone else GCGF-IFC PEP SE Media Corporate Governance Workshop Belgrade 11-13 May 2006 Dr. Stephen Davis

2. Why Should Media Care About Governance? First, public policy trends build market demand. 1. Lots more ordinary people are investing in, and depending on, the market—so there is growing popular interest in how companies behave 2. As the state recedes, local and foreign companies inherit power to affect jobs, pay, pensions, working conditions and the environment 3. Regulators and stock exchanges are focusing on it 4. Foreign funds have vast new influence but are little known—and sometimes feared as ‘locusts’

3. Media Feast Second, to be frank, there are some traditional media reasons. Everything an editor dreams of in a great story can be found in corporate governance Scandal and corruption. Blatant greed. Riveting political power grabs. Even sex (a Google search for sex and corporate governance yields 573,000 entries). Scandal and corruption. Blatant greed. Riveting political power grabs. Even sex (a Google search for sex and corporate governance yields 573,000 entries).

4. So Governance Coverage Can Be Good Business Examples around the world include Crikey.com.au (Australia) Crikey.com.au (Australia) Webb-site.com (Hong Kong) Webb-site.com (Hong Kong) Dow Jones and ISS’s Governance Weekly (US) Dow Jones and ISS’s Governance Weekly (US) Governance (UK) Governance (UK) Global Proxy Watch Global Proxy Watch

5. Start Up Questions Need to answer key questions in planning a corporate governance publication: What form should it take: Online? Paper? Stand alone or supplement? Frequency? What form should it take: Online? Paper? Stand alone or supplement? Frequency? Who is its audience: Corporate executives? Investors? Auditors? Regulators? Who is its audience: Corporate executives? Investors? Auditors? Regulators? What is its voice: Champion? Impartial? What is its voice: Champion? Impartial?

6. How do you gather information? How do you gather information? What is the business plan for revenue: Advertising? Paid subscriptions? What is the business plan for revenue: Advertising? Paid subscriptions? What staff resources are needed—for marketing, sales and production What staff resources are needed—for marketing, sales and production

7. Case Study: Global Proxy Watch Started January 1997 as adjunct to consulting business Started January 1997 as adjunct to consulting business Launch followed months of format modeling with a publishing expert, consultation with potential readers, and a beta test Launch followed months of format modeling with a publishing expert, consultation with potential readers, and a beta test Began as fax distribution to core consulting clients Began as fax distribution to core consulting clients Weekly frequency, two page length Weekly frequency, two page length

8. GPW: Strategic Profile Identified core readers as investors worldwide Identified core readers as investors worldwide Set a voice: champion of rights; source of specialized market intelligence; punchy tone; unrooted to any single market from content to spelling; avoid gossip for trend watching Set a voice: champion of rights; source of specialized market intelligence; punchy tone; unrooted to any single market from content to spelling; avoid gossip for trend watching Set short length for articles: earns surprisingly frequent praise Set short length for articles: earns surprisingly frequent praise Revenue from subscriber fees only Revenue from subscriber fees only

9. GPW: Content Created original, must-have material available nowhere else Global governance calendar Global governance calendar Spotlights on who’s who in the field Spotlights on who’s who in the field Independent governance industry coverage Independent governance industry coverage Frequent hot links to source documents Frequent hot links to source documents

10. GPW: Getting the Story Contacts through development of field expertise, consulting business and professional work—capacity to trade information Contacts through development of field expertise, consulting business and professional work—capacity to trade information Liberal use of off-record sourcing Liberal use of off-record sourcing Weekly routine includes web searches, Nexis, master idea list, ‘what’s new’ phone calls Weekly routine includes web searches, Nexis, master idea list, ‘what’s new’ phone calls News now comes to GPW through tip offs and press releases discarded by mainstream outlets News now comes to GPW through tip offs and press releases discarded by mainstream outlets Others sources: public filings, employees Others sources: public filings, employees

11. The Nexus of Media and Governance Why should any man be allowed to buy a printing press and disseminate pernicious opinions calculated to embarrass the government? Vladimir Ilich Lenin, Moscow 1920. Some CEOs today feel the same protectiveness about business. BUT… Why should any man be allowed to buy a printing press and disseminate pernicious opinions calculated to embarrass the government? Vladimir Ilich Lenin, Moscow 1920. Some CEOs today feel the same protectiveness about business. BUT… “It is very simple. People will not invest in a company if they think the boss is going to steal their money.” James Wolfensohn, president, World Bank, Moscow 2004. “It is very simple. People will not invest in a company if they think the boss is going to steal their money.” James Wolfensohn, president, World Bank, Moscow 2004. The challenge: If media can find ways to prosper by keeping governance honest, an accountable economy can thrive

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