Bob Iger On Succession, Nelson Peltz, Elon Musk & “Woke” Content

Bob Iger took a victory lap this morning, a day after the company fended off activist investor Nelson Peltz in a fierce proxy battle. In an interview on CNBC, he said the fight had one positive, getting the company in closer touch with investors as it lobbied hard for its board slate. Succession is top of mind and a new CEO would requiring a decent transition period, he said, also commented on current (and perhaps former) adversaries from Ike Perlmutter to Elon Musk to Florida Gov. Ron DeSantis.

Peltz didn’t have much strategically to offer Disney but did successfully press on one big misstep, succession. The billionaire activist investor lost his bid for a board seat, but did get the support of 30% of shareholders at the annual meeting yesterday. The voting and tally marked the end of a bitter and expensive months-long fight.

“Clearly shareholders care about [succession], given what the company has been through,” Iger acknowledged. A dedicated board committee led by chair Mark Parker met seven times last year and will meet more frequently in 2024 to identify the next CEO well before Iger’s contract ends in 2026. A transition period is key. “I think it’s really important to name the right person at the right time [and] create a transition process that is healthy.”

He wouldn’t say how long of a transition is under consideration. “But I think it’s really important … This is a big, complicated company. And not only is important to choose the right person, but it’s really important to give that person all the opportunity in the world to be successful in the job. And the board is very focused on who the person is when the decision should be made. And essentially, how the handover will take place … They are treating it with a sense of urgency.”

The last, unsuccessful, handoff of CEO baton “could not have happened at a worst moment for the company and in the world,” he said, noting that COVID hit in full force soon after Bob Chapek was named CEO, shutting down moviegoing, production, theme parks and live sports. “This company was hit very, very hard. And it handed my successor a set of challenges that were enormous in nature. And hopefully that will not be the case the next time around. I don’t think that there’s much more I can add in terms of the process itself or the transition. Obviously, we all learn from the past.” Iger rarely defends Disney’s former handpicked by him CEO, who also took a series of strategic missteps, and who was arguably kneecapped by Iger staying on to oversee creative.

“We’re focused on the future, not the past at this point … Because you can’t do anything about what happened. You just have to make sure it doesn’t happen again,” he said.

Overall, he said, “This whole process [fighting off Peltz] gave the board and some members of management an opportunity to engage with many shareholders on an even deeper level and have a good, honest, candid dialogue, where we had an opportunity to describe the shareholders, what our priorities are, and what our various processes are, including succession. And we had an opportunity to listen to them and hear what was on their minds as well. So I think, if anything came of this, from that it’s positive is that it did in fact, increase the engagement that we’ve had with shareholders in this. And that’s a very good thing.”

Clearly, shareholders are interested in care very much about succession,” he said, “given what the company has been through over the past few years.”

Iger denied that pressure from the activist investor had anything to do with a bump in Disney’s share price or flood of strategic initiatives (many Wall Streeters believe it did have some impact). Petlz didn’t make the board but at a shareholder vote tally at the annual meeting yesterday, he did receive 30% of the votes.

Asked about noisy criticism, from X owner Elon Musk in particular, Iger said, “I ignore it. It has no relevance to Disney or to me … People have been coming after the company and me for years and I don’t get distracted.”

On the woke content controversy, ” he said, “Generally speaking, we need to be an entertainment-first company.”

“I think the noise is sort of quieted down. I’ve been preaching this for a long time at the company [from] before I left, and since I came back, that our number one goal is to entertain, I think the term ‘woke’ is thrown around rather liberally No, no pun intended. I think a lot of people don’t even understand really what it means. The bottom line is that infusing messaging as a sort of a number one priority in our films and TV shows is not what we’re up to. They need to be entertaining. And where the Disney company can have a positive impact on the world, whether it’s, you know, fostering acceptance and understanding of people of all different types great. But, generally speaking, we need to be entertainment for an entertainment first company, and I’ve worked really hard to do that.”

“We’re trying to reach a very, very diverse audience. And, on one hand, in order to do that, the stories you tell have to really reflect the audience that you’re trying to reach … And really, first and foremost, they want to be entertained, and sometimes they can be turned off by certain things. And we just have to be more sensitive to the interest of a broad audience. It’s not easy, you can’t please everybody all the time, right?”