Deadline; Disney’s Potential Proxy Battle No Issue For Incoming Board Member James Gorman: “That Doesn’t Bother Me One Little Bit”

Story from Deadline:

James Gorman, CEO of Morgan Stanley and soon to be a member of Disney‘s board of directors, is not fazed by the possibility of the media giant going through a proxy fight.

During a lengthy sit-down with CNBC, the exec acknowledged that a battle is brewing with activist investor Nelson Peltz, whose investment firm nominated him along with ex-Disney CFO James Rasulo for board seats. The duo are co-ordinating their efforts with Ike Perlmutter, the former head of Marvel.

Disney said a board committee will consider those applications ahead of the annual shareholder meeting, but it has been critical of Perlmutter for having a “longstanding personal agenda” against the company due to his dismissal by CEO Bob Iger. Shareholders will elect board members in early 2024 at the meeting, whose date has not yet been announced.

“That’s all right,” Gorman shrugged about the skirmish between Disney and the activist investors. “You know, we have had a lot of battles in my life. That doesn’t bother me one little bit. I think the, you know, the challenge is to set up the conditions where the board has choices with talented candidates who are properly vetted for all the stresses these jobs have.”

Gorman also confirmed he will join the succession committee of the Disney board, which has been convened to pick CEO Bob Iger’s successor. The process has gone awry several times at Disney over the past two decades, giving the otherwise esteemed blue-chip company a notable blemish in the eyes of investors. Iger recently re-upped through the end of 2026 and has insisted the succession process is a top priority. The CEO also said last month that he would leave at the end of his contract, contrary to speculation that he would again re-up.

Overseeing a CEO transition at Morgan Stanley, which will see Gorman pass the baton in early 2024, has helped prepare him for the Disney effort. “I’m all about a complete handoff” at Morgan Stanley, Gorman said, as opposed to a scenario in which he would stay as chairman or in some other active role, a route taken by many CEOs and boards. Iger remained as executive chair at Disney for nearly two years after stepping down in February 2020, ostensibly to focus on overseeing creative activities. After growing increasingly frustrated with the direction of the company under successor Bob Chapek, Iger accepted the board’s invitation to return as CEO in November 2022.

“I had my last operating committee meeting this morning,” Gorman said. “I had my last risk committee meeting, my last management committee. And I told them, I will never appear in one of these meetings again, ever. It’s not my job anymore.”

Asked about Disney’s struggles with executing transitions at the top, Gorman replied, “The sorts of things I’ve done in this job is strategic transformation. Obviously dealt with shareholders at many levels, including activists. Succession talent building. So, some of the challenges that I have, I hope, you know, I can lend some of my experience on it. I don’t want to prejudge, you know, the succession process. That wouldn’t be fair to the team. I haven’t, I don’t start as a director until February.”

Iger, whose first run as CEO began in 2005, signaled his intention to leave the top job multiple times only to backtrack, finally handing the reins to Chapek just as Covid began sweeping across the planet. Iger’s predecessor, Michael Eisner, also did not proactively manage the succession process. As a result of a shareholder revolt capped by a tumultuous shareholder meeting in 2004, he was stripped of his chairman title. Eisner departed the company the following year, ending a 21-year run in the corner office.