It’s a question that plagues many CEOs of Fortune 500 companies: “Who will replace you when you step down?” According to Disney’s former CFO, current boss Bob Iger may be running out of answers.
Iger is a familiar figure in the corner office at the House of Mouse, having his first tenure as CEO between 2005 and 2020 before returning in 2022, and has made promises to step down in a few years.
However, talent looking to step up to the top job at Disney has been disappointed.
Iger, 72, has delayed leaving the company several times in the past: When he was reappointed as CEO in 2022, Iger made it clear he would stay in the job for only two years.
But by July 2023, he confirmed his contract had been extended until 2026.
For the past two decades, only Bob Chapek has had a shot at the head of the table as Iger’s handpicked successor, but he was ousted by the board after only two years in charge.
Such factors have led Gary Wilson, Disney’s former CFO, who spent 21 years on the board and oversaw Iger’s initial promotion, to believe the boss has intentionally or unintentionally stamped out talent aspiring for his role.
“Iger has systematically eliminated any executive who could become a successor,” Wilson told the Wall Street Journal in an interview released yesterday. “To me it’s a real black mark on Iger’s record.”
Iger is rebuffing such criticisms. Onstage at the New York Times’ DealBook Summit in November, the man being paid $27 million a year addressed the issue of succession planning head-on.
“The succession process at Disney is robust right now,” Iger said. “We’re aggressively pursuing succession; there’s no more detail that I want to give.”
Pushed on whether he’s stepping down for good in 2026 Iger joked: “Given the list of things that I have to do? Yeah, I’m definitely going to step down.”
Any insinuation that Iger wanted to stay on back when he relinquished the CEO role in 2020 is “completely inaccurate,” he continued.
“There were plenty of things in the world that I was interested in that I either wanted to do or wanted to learn more about. I had not really had a day off in, I don’t even remember … It wasn’t about being bored. It wasn’t about lack of challenge. It was just the time was ready,” he said.
Iger added that he had tried to “distract himself” during Chapek’s transition and subsequent tenure, but admitted he had been “disappointed in what [he] was seeing.”
Disney did not immediately respond to Fortune’s request for comment.
The battle for power at Disney
Even if Iger is determined to hand over the reins as CEO, one thing’s for sure: He doesn’t want to give any power to activist investor Nelson Peltz.
Peltz is embarking on his second proxy battle, trying to get a seat on Disney’s board having pushed for cost-cutting initiatives.
Almost a year ago Peltz was sent home with his tail between his legs after dropping his initial campaign when Wall Street backed Iger following a raft of measures announced to streamline Disney.
However, a year on, and Peltz is back.
A week ago the investor set out his case to CNBC, promising to “finally complete a successful CEO succession” and achieve “Netflix-like margins” of 15% to 20% by 2027.
Peltz’s bid is backed by former Disney CFO Jay Rasulo, who is also asking for a seat on the board.
In the proxy filing, Rasulo added: “A heavy dose of best-in-class corporate governance is the medicine Disney needs to fix its ailing shareholder returns.”
Disney’s earnings per share (EPS) have taken a hit in recent years.
In 2018 for example EPS hit $8.36, falling to $6.64 in 2019. By the 2020s however things took a turn, sinking further to $1.09 in 2021, $1.72 in 2022 and $1.29 in 2023.
Despite the losses, Iger is categorically unimpressed by Peltz’s bids.
Before Peltz rescinded his proxy bid last year, Iger took aim at his strategy, telling CNBC: “There is not a need. Plus, he has not articulated either a vision or even ideas that are of particular value to us. Now some, he has, but we were already working on those.”
