Timothy J. O’Shaughnessy
Graham HoldingsAbout Timothy J. O’Shaughnessy
Timothy J. O’Shaughnessy, age 43, is President and Chief Executive Officer of Graham Holdings Company (GHC) and has served as a Director since November 2014; he is a Georgetown University graduate and previously co‑founded and led LivingSocial . Under his tenure, GHC’s pay-versus-performance framework shows five-year cumulative TSR rising from a $100 base to $144.19 in 2024, with net income of $732.6 million and operating income before amortization and impairments of $302.4 million in 2024 . He serves on the Board’s Finance and Executive Committees; GHC separates the Chair and CEO roles and has a Lead Independent Director, which helps mitigate typical dual-role concerns in a controlled company with family ties (he is married to Laura G. O’Shaughnessy, daughter of Chairman Emeritus Donald E. Graham) .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| LivingSocial | Co‑Founder & CEO | Not disclosed | Grew sales to nearly $2 billion |
| AOL | Executive | Not disclosed | Media/technology leadership experience |
| Revolution Health | Executive | Not disclosed | Health tech/operations experience |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Federal City Council | Officer | Not disclosed | Civic and policy engagement in Washington, D.C. |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 900,000 | 900,000 | 1,200,000 |
| Change in Pension Value ($) | 22,908 | 34,382 | 51,487 |
| Other Compensation ($) | 3,050 | 3,300 | — |
Notes: No perquisites or 401(k)/SERP company contributions disclosed for 2024; restricted stock dividends for O’Shaughnessy were not reported (—) .
Performance Compensation
Annual Bonus Structure and 2024 Outcome
| Metric | Weighting | Target | Actual (Adjusted) | Payout vs Target | 2024 Bonus ($) | Vesting |
|---|---|---|---|---|---|---|
| Diluted EPS | 100% | $61.88 | $59.40 | ~90% | 1,079,760 | Cash, paid for FY2024 |
Design details: Threshold at 80% of target pays 50%; maximum at 140% pays 200%. Committee applied standard and discretionary adjustments (e.g., investment impairments, FX, pension variances) to align with operating performance .
Long-Term Incentives – Performance Units (PU)
Award cadence: Two overlapping four-year cash cycles; O’Shaughnessy held 12,000 units per cycle at year-end 2024 .
2021–2024 PU Cycle Component Payouts (per unit):
| Component | Weight | Performance Result | Payout per Unit ($) |
|---|---|---|---|
| Kaplan cumulative operating income (ex. certain items) | Up to 27.5% | $444.2M achieved (adjusted) | 26.91 |
| Graham Media Group (GMG) cash flow margin rank vs peers | Up to 25% | #1 rank; 2% higher vs nearest competitor each year | 50.00 |
| Hoover, Dekko, Joyce, Forney cumulative operating income | Up to 10% | $170.7M achieved (adjusted) | 9.81 |
| Graham Healthcare Group cumulative operating income | Up to 12.5% | $213.2M achieved (adjusted) | 25.00 |
| Framebridge cumulative gross profit | Up to 10% | Target not achieved | 0.00 |
| Automotive, Clyde’s, Code3, Decile, Slate, Foreign Policy, Pinna, CyberVista operating income | Up to 10% | $81.5M achieved (adjusted) | 20.00 |
| Leaf Group operating income | Up to 5% | Target not achieved | 0.00 |
| Total Unit Value | — | — | 132.00 |
O’Shaughnessy 2021–2024 PU payout:
| Units Held | Per‑Unit ($) | Total ($) | Payment Timing |
|---|---|---|---|
| 12,000 | 132.00 | 1,584,000 | Paid March 2025 |
Annual non‑equity incentive totals:
| Year | Non‑Equity Incentive Plan Compensation ($) |
|---|---|
| 2022 | 2,561,506 (bonus + PU) |
| 2023 | 843,574 (bonus) |
| 2024 | 2,663,760 (bonus + PU) |
Equity Ownership & Alignment
Beneficial Ownership
| Security | Shares | % Outstanding | Notes |
|---|---|---|---|
| Class A Common | 51,326 | 5.3% | Includes trust-related beneficial ownership |
| Class B Common | 152,779 | 4.4% | Includes options/right to purchase and Class A convertibles |
| Options – Right to Purchase Class B | 68,033 | — | Included in “sole voting and investment power” |
| Class B – Sole voting & investment power | 89,054 | — | Includes options (68,033) and direct 21,021 shares |
| Class B – Shared voting & investment power | 12,399 | — | Spousal/joint/trust holdings |
Pledging/Hedging:
- No pledging of securities by directors/officers, unless otherwise indicated; table notes none pledged for listed individuals .
- Hedging is prohibited for directors and executive officers under GHC’s insider trading policy; clawback applies to incentive-based pay tied to financial reporting measures (Dodd‑Frank/NYSE) .
Stock Ownership Guidelines:
- Not disclosed for executives; directors may elect to receive up to 50% of fees in Class B stock via the Director Share Purchase Program; employee directors receive no director pay .
Outstanding Equity Awards and Vesting
| Instrument | Quantity | Strike | Expiration | Vesting Details |
|---|---|---|---|---|
| Stock Options (Grant: 9/10/2020) | 71,045 | $426.86 | 9/10/2030 | Vests ratably over 6 years; 45,291 vested, 25,754 unvested at 12/31/2024 |
| Stock Options (Grant: 11/12/2015) | 22,742 | $872.01 | 11/12/2025 | Fully vested by 2021 |
| Restricted Stock/RSUs | — | — | — | No RS/RSU awards disclosed for O’Shaughnessy outstanding at 12/31/2024 |
Year‑end valuation reference: Class B closing price $871.92 on 12/31/2024 for award valuations .
Insider Option Exercise Activity:
| Year | Shares Acquired on Exercise | Value Realized ($) |
|---|---|---|
| 2024 | 77,258 | 7,987,489 |
Vested vs. Unvested at 12/31/2024:
- Vested options: 68,033 total referenced within “sole voting and investment power,” including the 2020 grant’s vested tranches and prior grant .
- Unvested options: 25,754 (2020 grant) .
Insider Selling Pressure Assessment:
- Significant 2024 option exercises indicate realized option value; however, hedging is prohibited and there is no evidence of pledging. Continued unvested tranches and upcoming 2015 grant expiration (11/12/2025) may create timing windows for additional exercises .
Employment Terms
| Term | Detail |
|---|---|
| Agreement | Letter agreement dated October 2014 in connection with becoming President |
| Severance | None; no severance compensation/benefits provided |
| Non‑Compete/Non‑Solicit | One‑year non‑compete, non‑solicitation, and no‑hire restrictions post‑termination; confidentiality obligations survive termination |
| Change‑of‑Control | GHC discloses no change‑in‑control agreements for NEOs |
| Equity Treatment on Termination by Company (not for cause) | Accelerated vesting of the next tranche of options scheduled to vest following termination; as of 12/31/2024, 12,877 options accelerated (value reference based on strike $426.86 and closing price $871.92) subject to irrevocable release |
Board Governance
- Service and Roles: Director since November 2014; serves on Finance and Executive Committees .
- Committee Composition: Finance Committee included O’Shaughnessy; Compensation Committee comprises independent directors (Mulcahy, Allen, Weymouth) .
- Board Structure: Independent Chair (Anne M. Mulcahy) and Lead Independent Director (Christopher C. Davis); non‑management directors met in executive session twice in 2024 .
- Meeting Attendance: Board met five times in 2024; each director attended at least 75% of Board and committee meetings .
- Controlled Company Considerations: The Graham family holds majority of Class A; GHC is a “controlled company.” O’Shaughnessy has family ties (spouse is Laura G. O’Shaughnessy; father‑in‑law is Donald E. Graham), and both relatives serve on the Board—Board nonetheless maintains a majority of “independent” directors .
Director Compensation:
- Employee directors receive no Board compensation; non‑employee director cash retainers and committee fees are disclosed separately .
Compensation Committee & Peer Benchmarking
- Design and Oversight: Compensation Committee (independent) oversees CEO/senior exec pay, plans, risk reviews, and succession planning .
- Peer Group (Revenue-based, conglomerates/education/media): AdaptHealth, Adtalem, AMC Networks, Bright Horizons, E.W. Scripps, Gannett, Gray Television, iHeartMedia, John Wiley & Sons, Laureate Education, News Corp, Nexstar, Pearson, Scholastic, Select Medical, Sinclair Broadcast Group, Strategic Education, Tegna, NYT Co.; no set target percentile .
- Say‑on‑Pay: Class A Shareholders unanimously approved 2023 compensation at the 2024 meeting; annual advisory vote cadence adopted .
Performance & Track Record (Pay vs Performance)
| Year | CEO SCT Total ($) | CEO “Comp Actually Paid” ($) | Avg NEO SCT Total ($) | Avg NEO “Comp Actually Paid” ($) | TSR (GHC, $100 Base) | Peer TSR ($100 Base) | Net Income ($mm) | Op Income before Amort. & Impairments ($mm) |
|---|---|---|---|---|---|---|---|---|
| 2020 | 9,652,756 | 16,264,685 | 2,815,080 | 1,824,204 | 84.68 | 132.43 | 300.0 | 187.4 |
| 2021 | 2,272,461 | 7,665,501 | 2,438,194 | 2,712,613 | 100.99 | 66.93 | 353.3 | 168.2 |
| 2022 | 3,487,464 | 4,277,957 | 2,997,459 | 3,254,318 | 97.93 | 80.53 | 70.4 | 271.7 |
| 2023 | 1,781,256 | 4,259,793 | 2,684,386 | 2,909,823 | 114.15 | 91.38 | 211.7 | 218.5 |
| 2024 | 3,915,247 | 7,648,942 | 3,045,433 | 3,476,494 | 144.19 | 97.93 | 732.6 | 302.4 |
Compensation Structure Analysis
- Cash vs Equity Mix: Heavy use of cash (annual bonuses and cash performance units), limited equity grants to NEOs; O’Shaughnessy had no 2024 stock/option grants and relies on prior option grants and cash-based PUs .
- Performance Calibration: 2024 EPS target was challenging; payout at ~90% of target after adjustments suggests formulaic discipline with selective discretionary normalization of unusual items .
- Clawback/Hedging Controls: Clawback compliant with Dodd‑Frank/NYSE; hedging prohibited—positive governance for alignment .
- No CIC Agreements/Tax Gross‑Ups: No change‑in‑control severance for NEOs; no gross‑ups disclosed—reduces shareholder‑unfriendly provisions .
Related Party Transactions and Interlocks
- Family Employment: Elizabeth G. Weymouth (relative of the Graham family) employed as Editor‑at‑Large; $300,000 compensation in 2024—subject to Audit Committee related‑party policy .
- Compensation Committee Interlocks: None disclosed involving O’Shaughnessy; committee members independent .
Say‑on‑Pay & Shareholder Feedback
- 2024 Meeting: Unanimous approval by Class A Shareholders of 2023 NEO compensation; Board adopted annual advisory vote cadence .
- CEO Pay Ratio: 72:1; median employee pay $54,484; CEO 2024 SCT total $3,915,247 .
Investment Implications
- Alignment: Significant personal exposure via vested/unvested options and direct holdings, no pledging, and hedging prohibitions support long‑term alignment; cash PUs tied to diversified operating metrics across major subsidiaries reinforce multi‑segment execution incentives .
- Retention/Turnover Risk: Absence of severance and CIC protection for the CEO, plus only partial option acceleration on termination (next tranche only), suggests lower guaranteed exit economics—potentially lowering entrenchment but heightening retention sensitivity to market opportunities .
- Trading Signals: 2024 option exercises (77,258 shares; $7.99M value realized) and 2015 grant expiry in November 2025 may influence near‑term exercise/transaction timing; continued PU cycles and EPS‑based bonuses keep payout tied to operating performance and cash generation rather than stock price alone .
- Governance: Controlled company structure with family relationships on the Board introduces independence optics; mitigants include independent Chair, Lead Independent Director, majority independent board, and active executive sessions .