The New York Times Co. Why is the newspaper industry so family controlled? What other industries have a lot of family-controlled companies? What attributes might support family control?

Family owned newspaper companies believe that the journalistic integrity of the newspaper demands family control, so called “family values”. The reason the families give is that the ownership of a newspaper is a "public trust" because of the role of the press in a democracy. Therefore, if a person unrelated to the founder (or some long-ago acquirer as in the New York Times case) takes control over the newspaper, they would manage it with the aim of maximizing profits and thus change the company’s value and reliability in providing quality information to its customers.
Family-owned enterprises play a powerful role in the world economy. The auto Industry such as Porsche, Ford Motor Co., Hyundai Motor, and Peugeot Citroen S.A., and retail grocery and consumable business such as Walmart and Carrefour are great examples of family-controlled companies.
In order to be successful as both the company and the family grow, a family business must achieve strong business performance and keep the family committed to and capable of carrying on as the owner. A prime determinant of how long a family dynasty will endure is how well its business is run and how effective its management is. Attributes such as control of ownership (how shares can be traded inside and outside de family), governance (keeping a strong board of directors), long-term view (long term growth and performance to avoid risking the family wealth and control), and most important: family foundation (promoting values as the generations come and go) are crucial to support family control.

How is family control achieved in large publicly-traded companies? Do you agree with the idea that a group of shareholders (the family) should have more votes than others with a similar ownership stake?

One way to achieve control is by issuing Dual-class shares that allow for public ownership while preserving corporate control for the family and management, who have “super” shares. This structure allows families to carry enhanced voting power and the right to elect a majority of board directors. Moreover, these restricted shares, that can’t be sold outside of the family, ensure family control for future generations and allows uncommitted family members to exit without causing an ownership or capital crisis.
I do agree with the idea that a family can have more votes than others with similar ownership. I believe that they have the rights to keep a greater level of control if they want, even knowing that they are the ones responsible for taking the company public. The nature and limitations of the non-super shares are clearly disclosed at the time of their sale, the public is fully aware of what it is buying and the added risk of investing in dual-class securities. Investors are better off for having the option to invest in businesses that would otherwise not be on the market.

Why are the dissenting shareholders (e.g., Morgan Stanley Investment Management) withholding their votes for the board? What else could they do?

Because by withholding their votes, the dissenting shareholders were able to send a strong message of their discontent and use it as a powerful tool for making Sulzberger resign. A 28% withhold, compared to the 1% of withheld votes in the previous year, was unusually high not only for NYT but also by most corporate governance standards. I think that after those results, the dissenting shareholders were able to show their opinion more effectively and without having to identify themselves. They could have voted for the board but, I don’t believe they would have provoked the same outcome because they accounted for a minority of the Class A votes. Sulzberger owned approximately 90% of Class B shares and 19% of Class A shares, for an overall of 20%. Therefore, not voting was for the dissenting shareholders the best way to act as minor investors. Based on precedent cases of other company’s withheld votes, I suppose Sulzberger understood the shareholders’ message.

How should Arthur Sulzberger, Jr. respond to Morgan Stanley's proposal to put the dual share structure to a vote?

I recognize that the dual-class structuring do not favor all the shareholders equally and that, in the NYT particular case, was fostering a lack of accountability to shareholders, due to Sulzberger poor leadership. However, I still think that Arthur should not give up on the dual structure before trying to implement managerial changes and improve governance. New York Times Co. is a company governed by a pretty iron-clad trust, one that is not at all easy to change. A family in which no dissidents have surfaced and a company in which a view of market demands is in their proxy statement: “ free of ulterior influence, unselfishly devoted to the public welfare.” Morgan Stanley’s long-running campaign against the Sulzberger family, through a dual-class structure, is obviously disingenuous. Morgan cannot claim that they bought Times Co. stock without knowing about the highly circumscribed governance rights associated with the shares. The NYT structure has been in place before they went public and the family trustees have given no indication of any desire to change it. Morgan Stanley was aware of the added risk of investing in dual-class securities. If he was unhappy, I believe he had the option to sell its shares.