When Dawn Hudson was named chief executive of the Academy of Motion Picture Arts & Sciences in April, many were surprised the organization had gone outside its ranks to the longtime head of Film Independent. Hudson, 56, soon discovered the kind of microscope that comes with running an 84-year-old group with a powerful 43-member board of governors and revenue of almost $90 million per year. Change has not come easily: Since her hiring, some longtime members of the Academy's 250-person staff have left and the Academy suffered a public embarrassment in November when Oscar producer Brett Ratner resigned after uttering a gay slur and making raunchy, sex-laden remarks in an interview with Howard Stern. Articles in The New York Times and Los Angeles Times have suggested board members are unhappy with Hudson and have discussed buying out her three-year contract. But in an exclusive sit-down interview Feb. 19 with The Hollywood Reporter -- Hudson's first since assuming the top unelected job in July -- she and COO Ric Robertson, 56, said she has the full support of the board.
The charming, Arkansas-born Harvard grad added that she gets along well with Robertson, a 30-year Academy executive with a grown daughter. Together they addressed Hudson's critics, the issue of diversity and the prospect of opening a long-planned museum within five years.
THE HOLLYWOOD REPORTER: Let's talk about some of the criticism you've encountered.
Dawn Hudson: I don't think change is easy, anywhere or at any time.
ric Robertson No one has spent as much time over the last eight months with Dawn as I have, and it takes time. I am still learning things about this organization and I've been here 30 years. [The criticisms are] comments from people who don't know what's happening.
THR: Dawn, there have been complaints you haven't gotten to know the staff, that you brought in expensive PR and management consultants and a speechwriter. True?
Ric Robertson: We brought in a staff writer, a much-needed resource. He writes everything from press releases to speeches.
Hudson: He's not a speechwriter; he's a staff writer.
THR: What about hiring architect Thom Mayne to do a $3 million to $4 million revamp of your offices?
Robertson: On the fourth floor, where we had a gallery for many years, we have badly needed office space. So we've ceased those gallery operations and have to turn that floor into office space. We began to explore the plan. Dawn had worked with Thom Mayne in the past, and recommended him. We were talking to him about that. But it's on hold.
Hudson: He specializes in doing an open office plan. But now I.T. has taken over the whole floor.
THR: What about allegations you've docked employees' overtime?
Robertson: We converted a small number of employees from non-exempt to exempt status. If you're in a management position, that's a very appropriate thing to do. We were contemplating it before Dawn ever arrived.
Hudson: They came to me with a spreadsheet the first week. It's standard business practice.
THR: Two high-level staffers, administrator Mikel Gordon and PR chief Leslie Unger, resigned. Were they pushed out?
Hudson: Absolutely not. We are back to: Change can be difficult for some people. I was very sorry to see Mikel leave, but she didn't see herself fitting in.
THR: There was a closed-door governors meeting Dec. 6 to discuss the future. Do you feel safe moving forward?
Hudson: Do I feel the support of the governors? Absolutely. Yes.
THR: And you've had no conversations with them about buying out your three-year contract?
Hudson: Absolutely none.
THR: Ric, you were passed over when former chief Bruce Davis left and Dawn was brought in. How did you come to terms with that?
Robertson: I was disappointed, but I got over it pretty quickly, in large part because I've loved the process of getting to know Dawn and working with her. I am so amazed by her passion and love for this organization.
THR: How do you divide your responsibilities?
Robertson: That's an evolutionary process. It's going to be different in three years than maybe it is today. With my operational knowledge and my history of the Academy, it's a natural division. Dawn is dealing with board members, various outside contacts and the like. It seems to work without too much effort.
Hudson: It's important to know, this partnership was not forced on either one of us. We both chose to be here. I was offered the job; I was asked if I would like to work with Ric. I met Ric. I could see we'd be a really successful team and could do much more good together than I could singly, no question. An organization of this size and scope --
Robertson: -- and ambition --
Hudson: -- yes, ambition, thank you -- requires a leadership team who are on the same page, who put that mission first, and if you find that team you can accomplish anything. I realized that in our first couple of meetings.
THR: Do you socialize outside work?
Robertson: We haven't -- mainly because we work together 15 hours a day!
THR: Dawn, what has most surprised you about the job?
Hudson: The scrutiny. I had what I thought was a casual meeting [during] my first couple of days, and 20 minutes after they left The L.A. Times called me. Then I thought, "OK, no meeting is off the record." The Academy matters to people around the world. It's such a global mark. And so the flap of the butterfly wing really does create [a worldwide effect].
THR: Speaking of, what came out of the postmortem following last year's Oscars?
Robertson: There were lots of deliberations, many of them confidential, but in terms of actual board recommendations, there weren't very many -- a lot of discussion about the hosts [James Franco and Anne Hathaway] and what had gone wrong there. But as for moving forward, instructions from the board to the producers, there wasn't any significant change. It was the same mandate as usual. You've got two goals you're trying to accomplish: to recognize excellence in these 24 categories, and to make an entertaining television show, and those aren't always mutual.
THR: Dawn, what has been your involvement with the Oscar show since you joined?
Hudson: Traditionally, the president chooses the producers, but Tom [Sherak, the Academy's president] included me in those discussions. We made a list compiled of past producers, people we would like who may be unavailable. It's a really tough gig for them.
Robertson: They are going to give up their life for six months.
THR: Who brought in Brett Ratner?
Robertson: He came in and shared some ideas with Dawn, and Tom and you got very enthusiastic.
Hudson: He just pitched a show; he wasn't pitching himself to produce it necessarily. He came in for a meeting to talk about his ideas; and it turned out to be quite a long list. I'm not telling you all those ideas, but they were good ideas.
THR: He made his anti-gay comment but didn't resign until after appearing on Howard Stern's show. Did you all support him after the initial comment?
Robertson: Yes. He seemed to get very quickly that he had done something very wrong, and he apologized.
Hudson: What was interesting to me was, before the press reported one word about what Brett said -- a terrible anti-gay comment -- Tom had already received calls from people offering to step in to produce. All the options were being considered at that time. It was a very smooth transition to [current producers] Brian Grazer and Don Mischer, not chaos. It was a very orderly and considered process, and then Brett took himself out of the mix.
THR: None of you actually said to Brett, "You've got to go"?
THR: Was there any attempt to retain Eddie Murphy as host?
Hudson: I think we talked to his manager and said, "We're really sorry, we thought he'd be great."
Robertson: Brian probably talked to him, because they worked together on Tower Heist.
Hudson: But you want a host who wants to be there.
THR: How did Billy Crystal get the job?
Hudson: His name was always in it. We love Billy.
Robertson: The bit he did last year was so well received, and we do speaking engagements at colleges and Billy is always remembered as a great host. Brian then reached out to him, after consultation with the president.
THR: Having Murphy would have helped highlight the matter of diversity. The L.A. Times did a study that found Oscar voters are 94 percent white, 74 percent male, with a median age of 62. Is that true?
Robertson: It sounds about right. We have not historically tracked the demographics of our members. We have started applying much more attention to it, but we can do better in that regard. It's about conscious inclusion, raising consciousness, not just waiting for people who think they should be members to apply, but how can we reach out to qualified potential candidates for membership?
THR: Dawn has been active in this effort. What about the rest of the Academy?
Robertson: Oh, sure. That's nothing new. It's customary for [us]to review who has applied.
Hudson: There are so many thresholds people must cross to become a member, but part of the staff's job is to bring people to the Academy's attention. That applies to black, white, all kinds of artists.
THR: What else are you doing to improve diversity?
Robertson: We give away about $1 million in grants, and a number of those go to organizations like Streetlights here, a job program that trains a real diverse youth audience to get them interested in working in the film industry.
THR: How much of a role are you both playing in the Oscar show?
Hudson: I've been to the Oscars, but only as a guest, and that was a while ago and just once.
Robertson: The producers are producing the show and they ask questions -- for instance, they wanted to reverse the traditional alphabetical order of the nominees in a certain category. There's a lot of back and forth like that. We'll look at the script; we want to make sure the Academy is being presented properly. We're very involved in everything else that happens around the show -- from security to the red carpet to the Governors Ball. We approve every ad that runs on the telecast, so we've been looking at lots and lots of ads. We've set up temporary offices in a couple of hotel rooms there [around the Kodak Theatre]. We'll be back and forth throughout the next week.
THR: Will the Oscars leave the Kodak?
Robertson: We are not sure yet. We are talking about extending our deal. We have two more years there. We'll see what happens.
THR: What if they change the name and it becomes, say, the Home Depot Theatre?
Robertson: We have the right to approve the name, if we're still there. We approved Kodak.
THR: Has the Grammys' success added to the pressure?
Robertson: Sure. But we have enough internal pressure.
THR: How many hours each day are you spending on this?
Robertson: A lot. Midnight e-mails.
Hudson: From when you get up to when you go to sleep. I have a 13-year-old. He doesn't love the time I spend on the show.
THR: Among your other activities, where does the Academy museum stand?
Robertson: We've been talking to LACMA about putting together this deal, and in October we finalized a memo of understanding where we gave ourselves 12 months to raise a certain amount of money. And if we do that, then it's hopefully a green light.
Hudson: This particular iteration of the museum, all of us feel this is achievable and this will be magnificent and this will add to our city. Being on the LACMA campus, having a film museum along with a world-class art museum, one plus one will mean a lot more.
THR: You also have a library and restoration program. How substantial are they?
Hudson: I didn't know the depth of what the Academy does to support our film history until I began working here. I didn't know there were 10 million photographs archived there, 80,000 screenplays and 40,000 movie posters.
THR: Finally, on a personal note, what are your own favorite movies?
Robertson: I would say Touch of Evil, because the first time I saw it I was gasping. I've seen it a couple of dozen times.
Hudson: Today, my favorite film is The Lives of Others. But I watched Touch of Evil when I was pregnant with my son -- and I think it's why
ACADEMY REVENUE: 15 YEARS OF MASSIVE GROWTH
When retiring executive director Bruce Davis left the Academy in 2011 after 20 years, he handed Dawn Hudson an organization that had grown very wealthy under his watch. According to tax returns, AMPAS took in $86.8 million in 2010 -- more than triple its 1996 revenue. About 90 percent of that bounty comes from the license fee ABC pays to broadcast the Oscars. Producing the show and throwing the Governors Ball and other awards-related events costs about $30 million, leaving the Academy a hefty profit to spend on film preservation, outreach programs and a proposed movie museum to be housed on the campus of the Los Angeles County Museum of Art. -- Matthew Belloni
ACADEMY PLAYS ROUGH WITH KODAK OWNER: The organization sees an opportunity to find a new venue for the Oscars
The January bankruptcy of the 132-year-old Eastman Kodak Co. could not have come at a better time for the Academy. The organization is threatening to exit its lease via an "out" clause unless CIM Group, owner of the Hollywood & Highland complex that has housed the Oscars since 2002, agrees to a more favorable deal. And now that a bankruptcy court has allowed Kodak to remove its name and stop paying a nearly $4 million per year fee, CIM Group must scramble for another sponsor knowing that its marquee tenant -- the Oscars -- could be on its way to downtown Los Angeles' Nokia Theatre or another venue. The result: big negotiation leverage for the Academy, which also enjoys veto power over the venue's marquee sponsor. "We are not going to turn them down if it is a suitable name," says Academy president Tom Sherak. But any potential sponsor -- whether it's Dell, Coca-Cola or possibly a more downmarket brand -- will want to know the Academy's long-term plans before shelling out $50 million or more for a multi-year naming deal. Worse for CIM, the Academy is in no rush -- exploring its options could take months or longer, leaving CIM unable to commit to interested brands until the Academy makes up its mind. According to John Tronson of commercial real estate brokerage Avison Young, which is not part of the talks, naming rights could be worth $2 million or $3 million a year (down from what Kodak was paying). But if the Academy pulls out, they're worth about "50 cents," Tronson jokes, underscoring the value of the Oscars telecast. In the meantime, CIM, which declined to comment, is expected to strip the Kodak name from the venue, though that process likely won't begin until after the Feb. 26 Oscars. And ABC's telecast is expected to refer to the venue as simply "Hollywood" or the "Hollywood & Highland Center." -- Alex Ben Block and Daniel Miller