Bloomberg News

Disney Holders Elect Board, Vote CEO Iger as New Chairman

March 13, 2012

Walt Disney Co. (DIS) shareholders, after weighing protests by two proxy advisers and a state treasurer, elected all 10 nominees to the board, including Chairman and Chief Executive Officer Robert Iger.

Shareholders representing at least 73 percent of the votes present backed the nominees, the Burbank, California-based theme park, film and television company said at today’s annual meeting in Kansas City, Missouri, citing preliminary data.

“The stock’s at $43, we’re happy,” Roy Patrick Disney said in an interview at the meeting.

The voting signaled management at Disney, the world’s largest entertainment company, continues to enjoy the support of investors, with a few exceptions. Disney said on March 1 that the stock has at least doubled what comparable companies have returned since October 2005, when Iger took over as CEO.

Stockholders approved the company’s executive pay plan in an advisory vote, with 57 percent of the shares present backing the proposal. Last year’s vote drew 77 percent approval, proxy adviser Glass Lewis & Co. said in a report.

Institutional Shareholder Services Inc. and Connecticut Treasurer Denise L. Nappier opposed four members of the governance and nominating committee. Glass Lewis opposed compensation panel members, citing deficient link between performance and executive pay, and a fifth nominee, Orin Smith, who served on the audit committee of a seized lender.

Board Moves

A third adviser, Egan Jones, backed the board slate in a March 6 report, saying the audit, compensation and governance panels were composed of independent, outside directors.

After the shareholder meeting, Disney’s board formally elected Iger as chairman and designated Smith, a former chief executive officer of Starbucks Corp., to serve as independent lead director, according to a company statement.

Investors should have been consulted when the company acted to recombine the top jobs, ISS said, while Nappier called the move “regressive.” Disney split the jobs in 2004 under pressure from investors who said it would improve governance.

Executive pay is “entirely in line with” peers including CBS Corp. (CBS), Comcast Corp., News Corp., Time Warner Inc. and Viacom Inc., Disney said in a March 1 filing. Combining the two top jobs is part of a succession plan that will “enable a healthy mentoring process,” the company said.

Disney announced in October that Chairman John E. Pepper Jr., a former chairman and CEO of Procter & Gamble Co., would retire at the meeting today and that the company would name a new CEO to succeed Iger in March 2015. His contract as chairman runs until June 2016.

Walt Lived Here

Disney, operator of theme parks in the U.S., Asia and Europe, holds its annual meetings in different cities, typically ones where the company has operations. Founder Walt Disney grew up in Kansas City.

Disney, owner of the ESPN cable network and ABC television, rose 3.9 percent to $44.01 at the close of New York trading. The stock has gained 17 percent this year.

Iger announced plans at the meeting to create jobs for 1,000 returning veterans over the next three years, part of a program to help military personnel and their families adjust to civilian life. Disney also will invest in nonprofit groups that provide training and other support for veterans, he said.

To contact the reporter on this story: Christopher Palmeri in Los Angeles at cpalmeri1@bloomberg.net

To contact the editor responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net


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