Bob Iger’s Invincible Era Is Over

If Bob Iger were a Marvel superhero, his power would be persuasion. The Disney CEO has long leaned on his ability to convince others of his plans. From film and TV writers, directors and stars, to Disney shareholders, to the company’s own board members, Iger’s track record has been impeccable.

Consider possibly the most important deal he ever led: Disney’s $4 billion acquisition of Marvel Entertainment in 2009. While Marvel’s success since then is not in dispute, at the time the idea of ​​Disney chasing young men via the comic book brand was seen as a real risk. In his 2019 memoir The Ride of a LifetimeIger recalls how he pitched a skeptical Steve Jobs on the deal.

Jobs, who had sold Pixar to Disney just a couple of years earlier, was Disney’s largest shareholder and a member of the board. He also told Iger that he had never read a comic book in his life, “so I brought an encyclopedia of Marvel characters with me to explain the universe to him and show him what we would be buying,” Iger recalled. Jobs ultimately bought into the idea and called Marvel chairman Ike Perlmutter to vouch for Iger, helping to seal the deal.

Fifteen years later and Disney finds itself at a crossroads, facing a bitter proxy fight with Nelson Peltz and his Trian Partners, who are backed by billions of dollars in Disney stock owned by Perlmutter, all set to come to a head April 3 at Disney’s annual meeting.

The former Marvel chairman, who was let go last year in a round of corporate cost-cutting, plays a shadow role in Peltz’s push, with the Trian chief telling Financial Times in an interview, “Why do I have to have a Marvel that’s all women? Not that I have anything against women, but why do I have to do that? Why can’t I have Marvels that are both? Why do I need an all-Black cast?” — comments that mirror critiques of Iger’s strategy by Perlmutter. And Peltz said of Marvel chief Kevin Feige, “I question his record,” again mirroring comments from Perlmutter, and sparking a rebuke from Disney, which noted that with $30 billion at the box office, Feige is the top-grossing producer of all time .

Iger has been pulling out all the stops to convince Disney shareholders (given its long history and high profile, Disney has a higher percentage of retail shareholders than most companies) that the company is in the middle of a turnaround, and that Peltz is a “ distraction” that will ultimately hurt the company rather than help it. “This campaign is, in a way, designed to distract us, to take our eyes off all those balls,” Iger said at a Morgan Stanley conference March 5.

But the endgame (to lean on a Marvel reference) remains uncertain. Iger and the Disney board have lined up a murderers’ row of public supporters, securing letters of support from not only Laurene Powell Jobs, former Disney CEO Michael Eisner and JPMorgan CEO Jamie Dimon, but also Star Wars George Lucas, who disagrees with Iger about the right approach for future films in the sci-fi universe. And Disney secured letters of support from the families of Walt Disney and Roy Disney, including Abigail Disney, who has long criticized Iger over his pay packages and the company’s treatment of its employees.

But the surprise recommendation from Institutional Shareholder Services on March 21 to vote for Peltz over current Disney board member Maria Elena Lagomasino placed a level of uncertainty over the vote, giving Peltz’s campaign oxygen at a moment when it was on the verge of being snuffed out. And so, as the vote heads into the final stretch, Iger’s persuasion skills have been in full effect.

The company’s last earnings call saw Iger unleash a barrage of announcements: A surprise release of Moana 2hitting theaters this year, an investment and partnership with Epic Games, Taylor Swift’s Era’s Tour movies hitting Disney+, etc.

Iger has frequently cited earnings calls as a time and place where he can set the stage for Wall Street, and make announcements to shore up the company’s stock price.

Bank of America’s Jessica Reif Ehrlich, for example, reacted to the report with a note titled “Bundles of Joy,” writing that “in a little over a year since returning to the company as CEO, Bob Iger’s actions are already having an impact. Moreover, the company has undertaken bold, decisive steps to address the evolving landscape…”

And on March 25, CFRA’s Kenneth Leon wrote that “we believe [Disney] has a rigorous plan to drive future growth and enterprise value leading to the April 3 shareholder meeting,” specifically calling out the company’s parks and sports business lines.

Other analysts have been more circumspect, noting the changes that still need to come: “We think mgmt attention remains on creative,” Wells Fargo’s Steven Cahall wrote Feb. 9. “The last thing investors want to see to solidify support is content hits.

And S&P Global’s Naveen Sarma wrote of Disney’s upcoming sports streaming service that while it could provide valuable data, it could also “put a cap on the potential price for Disney’s future ESPN flagship DTC service, limiting its profitability.”

But as powerful as Iger is, even he has recognized the risks of his own influence.

“Being atop a company that is so well known, the power of my voice is so much greater than it ever was and sometimes than I ever expected it to be,” Iger said in a 2019 interview at the University of Pennsylvania’s Wharton School. “I’m much more careful with how I use it, either when I say something or what I say or how I say it.”

It’s something Iger recalled himself in a dispute with David Lynch over when to reveal a key plot point in his series Twin Peaksback when Iger was running ABC.

“Deep down, I felt David was frustrating the audience, but it might well be that my demands for an answer to the question of who killed Laura Palmer threw the show into another kind of narrative disarray,” Iger recalled. “David might have been right all along.”

Yet most significantly for Iger, his reputation for making the right call at the right time has been punctured in Disney’s ever-evolving succession process. Indeed, the question was at the heart of the ISS recommendation. The ill-fated decision to name Bob Chapek CEO of The Walt Disney Co. in early 2020 was, it seems, as abrupt as it appeared publicly. ISS wrote in its blistering report that “Chapek’s sudden appointment at the onset of the pandemic was not a result of a rigorous process, by the board’s own admission during engagement with ISS.

“It appears that there was no structured board-mandated interview process, and that the board primarily relied on Iger’s judgment in making this decision,” the report continues, adding that the board said it encouraged Chapek to build a relationship with Disney’s creative executives after naming him CEO: “Which begs the question of why somebody who was being considered as a contender to succeed Iger hadn’t been working on those relationships well before the transition.”

For all of Iger’s ability to persuade, the succession issue has been the Achilles’ heel, which is why Peltz has pushed it so aggressively. But it is also an issue that Disney’s board seems acutely aware of, and while Iger may have had a little pushback in his previous succession calls, the board seems poised to make its own decision this time. (Iger’s CEO contract runs through 2026, but Disney is expected to unveil succession plans well before then.)

The Disney board’s succession committee, consisting of Mark Parker, James Gorman, Mary Barra and Calvin McDonald, sent a letter to institutional shareholders March 22 seeking to address “inaccurate assertions” in the ISS report. The committee writes that they are meeting frequently and reviewing internal and external candidates with the help of a search firm. “Each internal candidate is going through a rigorous preparation process,” the letter continues. “This includes mentorship from Bob Iger and external coaching, engagement with all Board directors, and comprehensive review of each candidate.”

The letter didn’t name the internal candidates, but ISS noted that the Disney board highlighted the work of several Disney leaders by name in their talks: Disney entertainment co-chiefs Dana Walden and Alan Bergman, parks chief Josh D’Amaro, ESPN chief Jimmy Pitaro, and Disney chief brand officer Asad Ayaz. And Iger himself told journalist Andrew Ross Sorkin last November that “I’ve tried hard to conduct my own postmortem just so that we as a company don’t do it again” when it comes to succession.

As the final votes roll in from retail investors, institutional investors and major stockholders like Jobs, Lucas and Perlmutter, that question — What will Disney look like post-Iger? — seems to be the one hanging in the balance. And the results on April 3 could be a pivot point in that process.

A version of this story first appeared in the March 27 issue of The Hollywood Reporter magazine. Click here to subscribe.