Bloomberg News has an unusual practice of paying some of its reporters explicitly for publishing “market-moving” stories.
This is one of many metrics that is factored into reporters’ annual bonuses.
This practice is not widespread in the financial news industry, and journalists we spoke to from other outlets were not aware that it is used at Bloomberg. We also canvassed traders, bankers and public relations professionals. None of them had heard this before, either.
Most of the people we spoke to, especially traders, were startled to hear about this practice, worrying that it might create an incentive for Bloomberg reporters to “push” or stretch stories with the specific aim of moving markets. Traders react instantly to headlines and news stories, and the decisions they make often make or lose significant amounts of money.
We asked Bloomberg about the practice. A company spokesperson acknowledged it.
“It isn’t news unless it’s true. At Bloomberg News, the most important news is actionable. That means we strive to be first to report surprises in markets that change behavior and we put a premium on reporting that reveals the biggest changes in relative value across all assets.”
The tidbit about Bloomberg’s compensation practice was buried in a New York Times article by Stephanie Clifford from 2010 and mentioned in a 2011 article by Jodi Enda in American Journalism Review. It was also recently mentioned again in a New York Times article this summer by Amy Chozick.