Scott Trust updates structure
Wednesday, October 8, 2008
The Scott Trust, owner of Guardian Media Group plc (GMG), has reorganised its structure to strengthen the protection it offers to the Guardian.
The original Trust was created in 1936 and has the core purpose of securing the financial position and editorial independence of the Guardian in perpetuity. It currently comprises nine Trustees, who between them own all the shares in GMG.
Like all non-charitable trusts, and unlike limited companies, the Scott Trust has a finite lifespan. In light of this, the Trustees have decided that pursuance of the core purpose is best served by transferring ownership of the shares they currently hold in GMG to a newly formed, permanent limited company, “The Scott Trust Limited”. This company becomes the new parent of GMG, replacing the existing Trust.
All Scott Trustees become directors of The Scott Trust Limited, with Dame Liz Forgan appointed chair. All shares in the new company are held by current Trustees. On completion of the restructuring process the existing Scott Trust will be wound up.
There is no change to the responsibilities of Scott Trustees, nor does the restructuring have any effect on the day-to-day management, control or corporate governance of GMG. The board of GMG retains responsibility for direct oversight of the management of the Group.
The change reinforces existing protections for the Guardian. The core purpose has been enshrined in the constitution of The Scott Trust Limited and cannot be altered or amended. The new company is not permitted to pay dividends, and its constitution has been carefully drafted to ensure that no individual can ever personally benefit from the arrangements. In the unlikely event of its winding up, the assets of the company would be transferred to some other entity which has a similar purpose.
The change has no impact on the amount of tax GMG pays – or will pay in future – under current legislation. It does address the hypothetical risk of future changes in inheritance tax law that could, in theory, threaten the Guardian’s independence.
Dame Liz Forgan, chair of The Scott Trust Limited, said: “Over the 72 years of its existence the Scott Trust has periodically re-examined its structure to make sure it is in the best possible shape to guarantee the ongoing independence of the Guardian – the core purpose of the Trust.
“The new body has been incorporated in the same spirit as the original Trust, it has the same values and goals, and the reorganisation has no effect on the day-to-day management or control of GMG.
“It does, however, renew our commitment to preserve the legacy of CP Scott, further strengthen the protection afforded to GMG and the Guardian, and keep us on a very secure footing for the future.”
Chris Wade 020 7713 4041
Notes for editors
The Scott Trust was created in 1936 to protect the legacy of the long-standing editor and latterly owner of the Guardian, CP Scott: the independent, liberal journalism of his newspaper.
The core purpose of the Trust is: “To secure the financial and editorial independence of the Guardian in perpetuity: as a quality national newspaper without party affiliation; remaining faithful to its liberal tradition; as a profit-seeking enterprise managed in an efficient and cost-effective manner.”
The Scott Trust is the sole owner of Guardian Media Group plc. The GMG portfolio comprises:
• Guardian News & Media: the Guardian and Observer newspapers and guardian.co.uk.
• GMG Regional Media: the Manchester Evening News and its website, other regional newspapers in the North West and South, and the Channel M city TV station.
• GMG Radio: regional radio stations across the UK under the Real Radio, Smooth Radio, Century Radio and Rock Radio brands.
• GMG Property Services: Vebra, Core Systems and CFP, providers of software to independent estate agents, and thinkproperty.com.
• Trader Media Group: one of Europe’s largest specialist print and online media companies, and publisher of the Auto Trader magazine and website. Trader Media Group is jointly owned by GMG and Apax Partners.
• Emap: the B2B publishing, events and information business, also jointly owned by GMG and Apax Partners.