Online Extra: Mark Mays: "An Enormous Amount of Trust"

Clear Channel Communications' president talks about how he, his brother, and his father work together running the radio giant

Clear Channel Communications (CCU ) is the biggest force in U.S. radio and a growing power in billboard advertising and entertainment promotion. It's run by L. Lowry Mays, 68, one of the founders, and his two sons, President Mark P. Mays, 40, and Executive Vice-President Randall T. Mays, 38.

Mark Mays talked with BusinessWeek Chicago Bureau Chief Joseph Weber about how the May family runs the publicly traded San Antonio-based company. Here are edited excerpts of their conversation:

Q: What do you suppose is the value that family adds?

A:

First and foremost, we're totally aligned with shareholder interests.... We tend to do things that shareholders would want us to do. We tend to have maybe a little bit longer-term horizon than a short-term horizon. That's probably why you would see in more family-oriented companies maybe a little bit stricter [adherence] to things like corporate governance, accounting policies, things like that that tend to have no tolerance for games being played.

I would tell you that if you look at organizational structure.... Lowry is the chairman of the company, chairman/CEO. I'm president/COO, and Randall, my brother, is CFO, and if you look at it, there's no conflict of interest between the three of us. There's an enormous amount of trust and just no conflict of interest.

Q: You touched on something that intrigued me, and that's the bond among family members. Is there something about the goals of family members that might explain the different approach they would take to management or vision than unrelated people?

A:

The adherence to professionalism is incredibly strong. We stress honesty and integrity and professional behavior in everything that we do. Does that help us attract better people? I think it does from this standpoint: Most people like to work for people that have those values.

Q: When I'm talking about goals, I'm thinking nonrelated executives oftentimes might imagine I'm going to be in this job three to five years, have stock options. I've got to maximize my value and the company's value in the short term, whereas your goals might be different.

A:

If you look at the very top of organizations, sometime they're very political, from the perspective of people jockeying for who's going to be the next CEO or who's going to be the next president, or who's going to be this or that. And I think therefore there's often political reasons why things are done, as opposed to doing things for the right reasons. And I think with regard to Lowry, Randall, and I, there's just that enormous amount of trust that everybody knows that whatever we're doing, we're doing for the right reasons, not the wrong reasons, or not for political reasons.

Q: Let me ask you about the CEO's role. How is it that you decided who would be chairman, who would be CEO, who would be president, who would be CFO? How do you decide who gets what job?

A:

Well, Lowry being the father, he decided. He has a heckuva lot more shares than I do. He has that vote. But you know we talk about it all the time, and we swap out different aspects of what we do all the time.

Q: Obviously, you do have a long-term orientation. I imagine that conflicts with your competitors -- or some of your competitors that don't have a family presence. Are you managing with the next generation of Mayses in mind, as much as the next quarter?

A:

No. I'm not sure we're managing with the next generation. I'm 40, so the next generation of Mayses is 20 years away. Are we managing for the long-term? Yes. Are we managing for a longer horizon than probably most companies are managed? I would say yes. Are we managing for the next generation? I'd say no.

Q: Why not?

A:

I was brought up in the mindset that I'm not entitled to the top job -- unless I'm capable of the top job. And therefore no one should be entitled to the top job just because their last name is Mays. One of the differences, I guess, if you look at our stock vs. maybe some of the other family stocks is that we don't have a supervoting stock. And the reason we don't is it has always been our opinion that it's a shareholders' company. And you know what? If we're not doing a good job running the company, then they ought to kick our butts right out on the street.

Q: Another factor we found, and it's common at the high-performing companies, is the continuing presence of the founding entrepreneur. It seems to make a very positive difference. How does that play out with you?

A:

Certainly having the founder's presence is such a huge advantage that we have in this company.... [It's] the wisdom you have that goes along with having grown the company to the level it is today. You have an incredible wisdom there that's a guiding factor, whether it's capital deployment or strategic thinking or just day-to-day operations.

Q: There's a common view that performance in some family companies suffers because of nepotism or self-dealing. You and your brother do seem to have very strong credentials, though. Did your dad demand that the two of you prove yourselves academically or professionally before promoting you into the jobs you've got?

A:

You know, it's interesting. He never, ever suggested that we should or should not come back to work for the company. And I think having that flexibility -- there's no pressure whatsoever -- it so happened that both of us had careers outside of the company before we came back. So I would tell you that I'm a believer of that.

Q: Did you learn the business over the dinner table as you were growing up.

A:

[My dad] had the philosophy of: If you were in school, he would help fund you -- he thought education was so important. But the day after school ended, whether that was summer or spring break or whatever, you were cut off. And so we all had to work in the summers and find jobs.... I remember one summer, I think I was 14, and I had to work in construction in the summer -- building a radio station. Man, that's one of those summers where you realize that maybe that's not what you want to do for the rest of your life.

The other thing that was maybe a little different in our situation is when I joined the company in 1989, we only had 16 radio stations, and that was it. So a lot of the growth and development of the company we've done together, which I think has been probably more fulfilling and rewarding for dad than anything else, doing that together.

Q: Do you use outside directors as mediators if there's a difference of opinion among you?

A:

A difference of opinion among the three of us? We tend to iron out our differences ourselves. I can't think of one we didn't. But the board is always a great sounding board. They're always there to run things past, and we treat them as such, as business partners that we can great advice from.

Q: Does your dad have any retirement plans soon?

A:

As he says, as soon as it stops getting fun, he's gonna stop doing it. Right now, it's still a lot of fun. He's in great health and still a tremendous benefit to the company, so we would all be disappointed if he retired any time soon.

Q: This does raise a sensitive subject, but obviously somebody gets to be CEO. Have you and your brother talked about that? Do either of you have a preference?

A:

We talk about it. But I'd leave it at that, rather than air that private conversation publicly.

Q: I ask it only because sometimes one of the things that's a big problem in family companies...

A:

Sibling rivalry?

Q: Yeah.

A:

We don't have that sibling rivalry. We have the utmost respect for each other. And there's no rivalry whatsoever. I would say that's got to be a rarity, though. We're more like best friends than brothers.

Q: But one of you most likely would be CEO. Can the other live with that, whoever that is?

A:

Yes.

    Before it's here, it's on the Bloomberg Terminal.
    LEARN MORE