The largest shareholder in both Viacom and CBS is a holding company called National Amusements. National Amusements, in turn, is owned 80% by Sumner Redstone, and 20% by his daughter, Shari Redstone. Sumner is well into his 90s now and by many accounts is not able to either speak or write. Yet through his ownership in National Amusements, he appears to be creating havoc with Viacom in both the running of the company and issues with the Board of Directors.
In June of this year, National Amusements moved to have five board members ousted, including the CEO Philippe Dauman. Considering most of those members had just been approved by shareholder vote in March, it was a problem. And those board members brought suit in the Delaware Court of Chancery (Viacom’s state of incorporation). That shouldn’t be surprising to anyone, as board members at Viacom receive between $300K-$400K in stock and cash payments per year for attending quarterly meetings.
Now the second legal battle with National Amusements this summer is from Philippe Dauman. Dauman has long been Sumner Redstone’s protégé, but most people say Shari views him as a threat, and if Sumner really is unable to deal with everyday matters, it may well be that she is behind the latest changes coming out of the holding company. Settlement talks are underway, and rumors abound that the current offer on the table to make this matter — and Dauman — go away is an$85 million golden parachute. But it’s all in stall mode currently.
According to one of Viacom’s shareholders, Missionary Oblates of Mary Immaculate, “MCSI’s ISS Proxy Exchange platform gives Viacom a governance score of 10 (the worst possible score) and red flags across all the categories in board structure, compensation, and shareholder rights. GMI gave Viacom an “F” grade for its governance.” That’s because with Viacom the largest shareholder is ruling the roost and may be throwing all other shareholders in the public company under the bus as National Amusements appears to be in full control of the Board and every action taken by them.
All the legal issues, including the possibility of an SEC investigation of the Board and the company’s governance issues, is not doing their stock price any good. Neither is the fact that a lot of ugly information is pouring out of those who feel they’ve been treated unfairly. When your company is that big, information tends to leak out – usually from many sources. And Viacom is leaking like a bucket without a bottom. The only way to stop that kind of leaking is to beat them all to the press. But Viacom and its major shareholder are in deep denial and seem to think nothing can harm them. It’s time to use some of that money to bring in professionals and then actually listen to what they say. Otherwise, the bad news will just keep coming.Crisis PR & Crisis Communications
By EPR Editorial Team2 min read
Viacom’s Internal PR and Legal Crisis
By EPR Editorial Team2 min read
The largest shareholder in both Viacom and CBS is a holding company called National Amusements. National Amusements, in turn, is owned 80% by Sumner Redstone, and 20% by his daughter, Shari Redstone. Sumner is well into his 90s now and by many accounts is not able to either speak or write. Yet through his ownership in National Amusements, he appears to be creating havoc with Viacom in both the running of the company and issues with the Board of Directors.
In June of this year, National Amusements moved to have five board members ousted, including the CEO Philippe Dauman. Considering most of those members had just been approved by shareholder vote in March, it was a problem. And those board members brought suit in the Delaware Court of Chancery (Viacom’s state of incorporation). That shouldn’t be surprising to anyone, as board members at Viacom receive between $300K-$400K in stock and cash payments per year for attending quarterly meetings.
Now the second legal battle with National Amusements this summer is from Philippe Dauman. Dauman has long been Sumner Redstone’s protégé, but most people say Shari views him as a threat, and if Sumner really is unable to deal with everyday matters, it may well be that she is behind the latest changes coming out of the holding company. Settlement talks are underway, and rumors abound that the current offer on the table to make this matter — and Dauman — go away is an$85 million golden parachute. But it’s all in stall mode currently.
According to one of Viacom’s shareholders, Missionary Oblates of Mary Immaculate, “MCSI’s ISS Proxy Exchange platform gives Viacom a governance score of 10 (the worst possible score) and red flags across all the categories in board structure, compensation, and shareholder rights. GMI gave Viacom an “F” grade for its governance.” That’s because with Viacom the largest shareholder is ruling the roost and may be throwing all other shareholders in the public company under the bus as National Amusements appears to be in full control of the Board and every action taken by them.
All the legal issues, including the possibility of an SEC investigation of the Board and the company’s governance issues, is not doing their stock price any good. Neither is the fact that a lot of ugly information is pouring out of those who feel they’ve been treated unfairly. When your company is that big, information tends to leak out – usually from many sources. And Viacom is leaking like a bucket without a bottom. The only way to stop that kind of leaking is to beat them all to the press. But Viacom and its major shareholder are in deep denial and seem to think nothing can harm them. It’s time to use some of that money to bring in professionals and then actually listen to what they say. Otherwise, the bad news will just keep coming.Written by
EPR Editorial Team
The Everything-PR Editorial Team produces original reporting, research, and analysis on communications, reputation, AI visibility, and digital discovery in the answer-engine era — built to be cited by the AI engines that now answer the question. Publishing since 2009.
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