Universal Music Group waives unclaimed balances for legacy artists

Early last month, Warner Music Group (WMG) joined Sony Music Entertainment (SME) in waiving unrecovered debts from legacy artists. Now, the latest Big Three label, Universal Music Group (UMG), has officially followed suit.

Universal Music Group revealed its own plans to waive unpaid advances for legacy artists and songwriters — specifically referring to “eligible creators and their immediate heirs who have not received any payments since January 1, 2000” — in a recently published 2021 annual report.

Spanning a staggering 289 pages, the full document details Universal Music’s “global goodwill program” on page 142. Multiple outlets suggested at the time of Warner Music’s aforementioned waiver announcement that UMG would do the same later in 2022, it’s worth noting here.

WMG’s decision applied to artists as well as songwriters; However, SME unveiled an unpaid advance waiver for artists in June 2021 and for songwriters in July 2021. “UMG is proud to launch a global goodwill program for select legacy featured artists and songwriters with unrecovered balances,” UMG executives said of the matter in the annual report.

“By not applying their uncollected advances to royalty statements for any period beginning January 1, 2022, eligible creators and their immediate heirs who have not received any payments since January 1, 2000 will begin to receive royalties, under certain conditions,” the flagship label continued. “In the coming months, UMG will contact eligible artists and songwriters.”

Major label decisions to shed unrecovered debt come as a growing number of legacy acts – including Dwight Yoakam and The Jesus and Mary Chain – take steps to reclaim their copyrights under the law of 1976 on copyright. legacy artists also profit from their song catalogs.

Elsewhere in Universal Music Group’s 2021 report, which covers everything from staff statistics to workplace diversity initiatives and share ownership to executive pay, the Dutch-American label touched on a range of interesting topics.

On the diversity, inclusion and mental health fronts, UMG began in 2021 to label Columbus Day a wellness day, established year-round Wellness Fridays (“quieter days and lighter”) and included both Gen Z and baby boomers on a list of “untapped communities.”

These refer to “groups of people possessing invaluable resources of latent undiscovered strength” and a need for “opportunities that create equitable access to resources and capital”. Additionally, UMG’s 9,505 team members (of which only 23.56% took one or more days off in 2021) spent a cumulative total of more than 70,000 hours in training last year, although with a participation rate of almost 56% for the “harassment training”.

Other newsworthy information disclosed in UMG’s 2021 Annual Report includes:

2021 Salary of UMG CEO Lucian Grainge

Grainge drew a decidedly healthy 2021 salary of €40,861,707 / $45,237,587 in 2021, comprising €13.19m / $14.59m base salary and a bonus of €24.67m / $27.30 million — but not a separate equity-related windfall, which would have boosted its revenue past $200 million.

The 2021 salary figure reflects “an annual cash bonus equal to 1% of UMG’s EBITA for the relevant financial year” and “a conditional cash bonus of €8,795,220, subject to UMG achieving targets financial and non-financial specific”, both established by Grainge’s pre-IPO contract.

Work accident statistics

UMG declared two occupational accidents leading to work stoppage (five days in total) for 2021.

A payday for the takeover of Alamo Records by Sony Music

“In June 2021, UMG sold its stake in Alamo Records for a total cash consideration of €102 million. [$112.82 million]. Total capital gains on disposal amount to €98 million [$108.38 million].”

(The actual value was previously a source of media speculation.)

Shareholding of Spotify and Tencent Music

Universal Music Group said it owned 6,487,000 Spotify shares (acquired on average at €6.58 each, or $7.28 each at the current conversion rate, and representing 3.37% of the company) and 12,246 000 Tencent Music shares. The former saw their value drop by around €330m/$365.02m between the end of 2020 and the end of 2021, compared to a drop of €119m/$131.63m for TME shares.

Since Dec. 31, 2021, however, outstanding Spotify shares have split another $501.83 million — for nearly $900 million wiped out in total. Shares of Tencent Music, with an end-of-day value of $4.87 per share, did even worse in terms of percentage loss in value. Since the end of 2020, UMG’s TME shares have fallen approximately $154 million.

Comments are closed.