Disney’s Proxy Fight with Nelson Peltz Ends But Scrutiny Will Persist

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In the end, Bob Iger didn’t have to break a sweat to fend off Nelson Peltz.

No question, Disney did have to spend tens of millions of dollars to fight the proxy battle with the activist investor, which came to a head on Wednesday with the Mouse House’s annual shareholders meeting. From the start, it was an extreme long shot that a majority of shareholders (or a majority of those who opted to cast a virtual vote) would turn against Iger and install Trian Partners founder Peltz and former Disney executive Jay Rasulo as board members, in opposition to Disney’s preferred slate of 12 incumbent directors.

On Wednesday, Iger was in prime form as Disney’s avuncular statesman, addressing the meeting in a pre-taped video filmed — where else? — at the happiest place on earth, aka Disneyland Resort in Anaheim, Calif. Disney’s shareholder meeting was entirely virtual this year, in contrast to the company’s past tradition of hosting it in a city with significance to something happening at the company. In the past, Disney has made the meeting available as a audio-only webcast. But this time around, the company incorporated videos from Disney board chairman Mark Parker and Iger.

Presenting Iger at Disney’s ground zero was a form of circling the wagons and putting the boss on a pedestal. As Iger narrated a video describing the company’s core operations and future plans, the message was crystal clear: Who else at this fraught moment for media is equipped to run the Walt Disney Co.? The company’s far-flung operations demand a leader who is equally conversant in guiding the production of cutting-edge film and TV to figuring out how to use AI to help sell T-shirts and turkey legs and whatnot at the company’s theme parks.

“There is perhaps no place that better embodies this company’s extraordinary past or its limitless future,” Iger said, beaming from a sunny outdoor spot where Disneyland visitors could be seen moving around in the distance.

Iger has leaned heavily on the 33-month gap in his tenure as Disney CEO to make the case for how he has righted the ship since he reclaimed the reins in November 2022. But as Peltz and others have noted, the truly existential issues that Disney and other media giants face have been brewing for years, since before Iger handed the baton, briefly, in February 2020 to former Disney executive Bob Chapek.

As Iger reminded investors in the video, “At last year’s annual meeting, we had just embarked on an important transformation to restore creativity to the center of our businesses and returned Disney to a period of sustained growth,” he said. “As we gather today we stand on a far more solid foundation, which has been fortified by our ambitious course of action over this past year. We are once again building our businesses for growth. As we demonstrated during our most recent earnings report, we have turned the corner and entered a new positive era for the Walt Disney Company.”

In other words, Iger sought to convey to shareholders that the storm is over despite some lingering clouds. The campaign waged by Peltz, and to a lesser degree activists affiliated with Blackwells Capital, has certainly brought scrutiny to Disney’s recent financial performance. But the biggest challenge that has been magnified by the activist campaigns is the company’s struggle to find an Iger successor who will stick as CEO. The drama of the past few months likely eliminates any chance of Iger changing his mind about stepping down at the end of 2026.

The cast of internal contenders to move in to Iger’s office is well known: Disney Entertainment co-chairs Dana Walden and Alan Bergman, ESPN chief Jimmy Pitaro and parks and experiences boss Josh D’Amaro. Those four will operate in a fishbowl in the coming months as pressure undoubtedly grows on Iger to give a signal for who will get the tap on the shoulder, in time for that person to have plenty of sorcerer’s apprentice time working alongside Iger.

There is, of course, always a chance of an outside candidate swooping in to bowl over the board. But the results of Wednesday’s shareholder vote, coupled with the way Disney insiders rallied around Iger in his hour of need, suggests that the next CEO hold that job will already know the route to the Rotunda executive dining room on day one.

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