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Case 11: Corporate Governance at Martha Stewart Living Omnimedia: Not “A Good Thing” C-131


that paid her for corporate use of her image and homes
in promotions and demos. Stewart expensed many
other parts of her life, too, including a weekend driver
and a personal trainer. She said all the spending was
necessary to maintain the quality for which her brand
was known.


There was no question that Stewart and the brand
were synonymous. The question on the minds of investors
and consumers alike was: Was Stewart creating a powerful
brand that would outlive her, like Coco Chanel, or was she
more like Laura Ashley, the British fabric designer whose
1985 death thrust her company into a crisis?

Exhibit 2 Martha Stewart Living Omnimedia Selected Key Executive Compensation ($)


2012 2011 2010 2009 2008 2007 2006 2005
Martha Stewart
Founding Chairman and CEO

5,460,406a 5,501,800 5,907,387 9,784,505b 7,018,336 2,061,854 2,096,176 2,226,365c

Susan Lyne
President and CEO

1,671,633 3,934,693 4,405,782 1,333,622

Charles Koppelman
Executive Chairman, Prin
Exec Off

3,785,542 2,268,225 2,122,062 8,016,257

Lisa Gersh
President and COO

1,511,625d 3,759,903

Robin Marino
President and CEO,
Merchandising

1,711,311 1,418,510 2,498,228e 1,709,492 1,461,028 2,032,539

Wenda Harris Millard
President, Media

734,095 2,325,020e 2,718,631

Notes:
aFounder, Chief Creative Officer
bChief Editorial, Media and Content Officer
cFounder
dAdditional title of Chief Executive Officer
eCo-Chief Executive Officer
Source: MSO Proxy Statements.


27 mil

2012 Executive Compensation Compensation vs. Performance (1-Year % Change)

Total Executive Compensation MSO

18 mil

9 mil

23.66 mil

Total Compenstation
$8,540,439 –52.01 %

2008
Stock Price

2009 2010 2011 2012

16.30 mil
11.99 mil

17.80 mil

8.54 mil

10.00
5.00
0.00
Note: currency in USD.

1-Year % Change CEO Compensation Stock Return Revenue Return on Equity Net Income
–59.80% –44.32% –10.86% ––

Source: Morningstar.

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