Outgoing global CEO of Pearson (parent company to Penguin and The Financial Times) Dame Marjorie Scardino reckons that 50 years from now, her company is unlikely produce any more printed products – quite a statement considering many in the industry believe ebooks will never replace the printed book entirely.
Scardino has been a bit of a hero of mine ever since she was appointed to the role 16 years ago. It was 1997, and I’d just joined the The Sydney Morning Herald as a web producer and started studying for the Macquarie Uni Postgrad Diploma in Editing and Publishing.
Here was this former US journalist, a woman, and a mother of three, running Penguin from their glamorous offices on the Strand in London. Suddenly, anything seemed possible to twentysomething me.
As Britain’s Sunday Telegraph reported this week, together with her husband, Scardino had previously bought The Georgia Gazette, thrown all her energy into it, celebrated when they won a Pulitzer, sold it for a dollar and watched as the new owners “broke it up and threw it away”.
The Telegraph also notes that Scardino admits she had a lot to learn about running a public company when she took the helm of Pearson. “I had analysts in on the first day and I could feel them thinking, ‘Who is this person’ and I started wondering, ‘Who is this person?’”
Scardino scuttled away at one point to check the difference between buy side and sell side (in simple terms, investors versus bankers). “I thought, God, what have I got myself into?” she told the Telegraph.
Reading this admission made me wonder how many male CEOs would admit to moments of doubt and surreptitious urgent business education like these. It’s refreshing honesty from one so senior in business – though perhaps it’s easy to be honest about such matters after 16 successful years.
On Scardino’s watch, Pearson has been comparatively successful in navigating the shift to digital. The Telegraph story says digital formats now account for about a third of Pearson’s revenues, which have tripled during her time at the top. The company’s share price has risen nearly 90 per cent since 1997, to £A5.9 billion. Last year’s operating profit was a record £942 million. Which makes me wonder whether recent redundancies at Penguin in Australia were necessary, but that’s another story.
While we’re speaking of Australian publishers, it’s pleasing to note there are plenty of strong women role models here too. To name a few, Penguin Australia’s highly regarded CEO is Gabrielle Coyne. The energetic and approachable Lou Johnston runs the local arm of Simon & Schuster (her global CEO is also a woman, the digitally savvy Carolyn Reidy). Random House’s Australian managing director, Margie Seale, is stepping down next month to concentrate on non-executive directorships but has successfully steered the business through the difficult transition to digital.
All of this seniority makes sense when you consider most book buyers and readers are women.
But back to Scardino. I was intrigued that the American, a former rodeo rider, was a Dame. According to Encyclopedia Britannica online, she was named Dame Commander of the Order of the British Empire in February 2002, a month after she adopted British citizenship. Scardino was the first woman to head a FTSE 100 company, and Forbes named her the 17th most powerful woman in the world in 2007.
Perhaps her biggest battle, to ensure Penguin can control its own pricing in the face of loss-leading discounting from Amazon, will continue on after her departure from Pearson.
Penguin was one of six publishers the US Department of Justice and European regulators accused of colluding with Apple to force Amazon to up its prices earlier this year.
The six had struck a deal with Apple to set their own prices and guarantee they would not lower them for other retailers.
The other five publishers backed down in the face of the cartel accusations to avoid expensive legal bills, but Penguin, led by former lawyer Scardino, stood its ground.
Good on them, I say. If ever there was an argument for government intervention to prevent damaging business practices, this is one of them. Amazon’s price cutting is devaluing the work of authors, editors, photographers, illustrators, designers and publishers, and bringing plenty of beloved bookstores down with it. This time, by in effect supporting Amazon, the authorities got it wrong, and what a shame that only Penguin has stood its ground.
At 66, Dame Marjorie Scardino says she’s not ready to retire just yet. I can’t wait to see what she does next.
[October 29 update: We didn’t have to wait long to find out what Marjorie would do next:
Pearson and Bertelsmann agree consumer publishing partnership: Penguin and Random House to combine, creating the world’s leading trade publisher]