As a semi-professional Disney historian, the stories of what goes on in the boardrooms fascinate me. Every few years, a battle brews for the soul of the company, and after years of stagnation or bad direction, the leadership of the company changes.
James M. Stewart's excellent book "DisneyWar" chronicles two of those leadership shake-ups: the one that brought in Michael Eisner as CEO after over a decade of creative ennui and the coup that ousted Eisner and ushered in the Bob Iger era.
In the leadership changes that bookend "DisneyWar," Disney hurt itself with bad creative decisions. Before Eisner, the company's film offerings were uninspiring and bland, while at the end of Eisner's tenure, he made some boneheaded decisions like greenlighting Michael Moore's propaganda piece "Fahrenheit 9/11," passing on "Survivor," and programming hour after hour of "Who Wants to Be a Millionaire" until viewers tired of Regis Philbin.
These days, Disney faces a different sort of crisis. So much of its content is more concerned with agenda than entertainment, the company made the regrettable decision to stick its nose in the state of Florida's business, and Disney's theme parks have become less enjoyable due to out-of-control prices and burdensome "planning tools."
So is Disney due for another leadership shake-up? There may be a battle on the horizon, and one of the parties is bringing in a name from Disney's recent past. My friend and colleague Steve Green has written on a couple of recent occasions about the efforts of activist investor Nelson Peltz to gain some control over the Disney board.
Peltz calls himself a centrist, but he also has a reputation as a solid Republican donor who has supported Donald Trump and Gov. Ron DeSantis (R-Fla.) in the past. We're not really sure what Peltz hopes to accomplish, although his company Trian Partners has made statements decrying Disney's woeful financial performance in recent years.
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This week, Trian nominated two candidates for Disney's board. Peltz is one of those candidates, of course, but the second one is a name that should intrigue students of recent Disney history: Jay Rasulo.
Rasulo spent nearly 30 years with Disney, including stints as chairman of Disney Parks and Resorts and senior executive vice president and CFO. Solid leadership and strong decision-making characterized his tenure. I don't know anything about Rasulo's politics, but it's clear that he loves Disney and wants to see it do better.
“The Disney I know and love has lost its way,” Rasulo said in a statement. “As independent voices in the boardroom, Nelson and I are confident that the combination of my decades of experience at Disney, Nelson’s significant boardroom skills and history of driving positive strategic change, and our combined consumer brands expertise and financial acumen, will be additive to the Disney Board.”
Trian released its own statement about nominating Peltz and Rasulo, saying, “The root cause of Disney’s underperformance, in our view, is a Board that is too closely connected to a long-tenured CEO and too disconnected from shareholders’ interests."
“To resolve the malaise and crisis of confidence among Disney shareholders, the Board needs fresh perspectives from truly independent directors selected by the shareholders themselves,” Peltz said in a personal statement. “Jay and I have the strategic, operating, financial, and governance expertise to help Disney and are committed to working with the other members of the Board and management team to address the fundamental issues underlying the Company’s continued poor performance. There is much that can be done to revive Disney and restore the confidence of Disney shareholders, and Trian looks forward to discussing these opportunities with our fellow shareholders over the coming months.”
Disney also released a statement in response to the Trian nominations, in which the company said, "Disney has an experienced, diverse, and highly qualified Board that is focused on the long-term performance of the Company, strategic growth initiatives including the ongoing transformation of its businesses, the succession planning process, and increasing shareholder value. The Governance and Nominating Committee, which evaluates director nominations, will review the proposed Trian nominees and provide a recommendation to the Board as part of its governance process.”
Any political concerns aside, Disney should be tripping all over itself to make sure Rasulo has a spot on the board. His experience and leadership skills alone would be priceless. Will Trian's gambit work? It may take some time, but we can hope that Peltz and Rasulo can provide positive and sensible guidance to Disney.
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