Just minutes after influential proxy advisory board Institutional Shareholder Services recommended adding activist investor Nelson Peltz to the Disney board, the chairman struck back with a blunt dismissal. Rolling out the really heavy artillery, that first response was soon followed by a strong shutdown of the Peltz uprising by the widow of Apple kingpin Steve Jobs.“While we’re heartened to see support for Michael Froman and ISS’ recommendation to withhold on dissident directors Jay Rasulo and the Blackwells’ nominees, we strongly believe that ISS reached the wrong conclusion in its recent report when it comes to adding Nelson Peltz to the board,” Disney board boss Mark Parker said Thursday as an increasingly bitter April 3 vote by shareholders looms.“In contrast to Glass Lewis, ISS fails to acknowledge the breadth of perspective and expertise Ms. Lagomasino adds to the Board,” Parker added. Glass Lewis is another influential proxy advisory firm that came out in last week in favor of all Disney nominees “The strong recent performance and results overseen by the Disney Board demonstrate our focus on long-term shareholder value creation and succession planning an our commitment to good governance practices”As Disney’s succession plans once again became the core of the board dispute, one of the largest and most influential single shareholders in Disney added her voice to the proxy dust-up today, clearly in a move to shut ISS down.Pivotal to the rise of past and present Disney CEO Iger to the Mouse House top spot in 2005, ISS today put its weight behind the Ike Perlmutter-backed Peltz for “his considerable experience on other boards and fiduciary duties owed to a large shareholding group, appears best positioned to bring a shareholder perspective to the board.”Booted off his corporate perch permanently by Iger back in 2023, former Marvel chief Perlmutter has delivered his not inconsiderable voting shares to Trian’s Peltz and their handpicked board candidates of ex-Disney CFO Rasulo, who left the company in a succession huff in 2015, and others. Last week, the Peltz co-founded Trian Fund Management said that the rancor between Iger and Perlmutter was “irrelevant” to the long proxy battle. In a bit of irony, the firm added that it was “disappointed that Disney is running a scorched-earth campaign” in the war for board power.Today, Disney also noted that Trian’s “silent partner, former Disney employee Ike Perlmutter, owns almost 79% of Trian’s Disney shares” and that the ISS itself report called Perlmutter’s involvement “an unfortunate distraction.” The company went on to say, “this dynamic is relevant to assessing the Trian Group’s nominees, as Mr. Perlmutter has a fraught history and longstanding personal agenda against Disney’s CEO, Robert A. Iger, which would likely inhibit Nelson Peltz from working constructively with Disney’s Board, threatening the company’s continued turnaround.”Further decrying Peltz’s participation on the Disney board, the company said that the investor “does not bring additive skills to the board, nor does he have a meaningful plan to deliver superior shareholder value in an evolving and increasingly complex global landscape, in stark contrast to the director Trian seeks to replace – Maria Elena Lagomasino.”Disney also defended Lagomasino “as a seasoned financial leader with an extensive capital markets career that has been centered on fiduciary responsibility, honing an investor perspective, and deep expertise in corporate governance,” noting her role a a founder of the Institute for the Fiduciary Standard, a think tank that promoted the vital importance of the fiduciary standard in investment and financial advice.Even with that long held perspective by Disney, ISS Thursday still decided that Peltz would still be useful on the board despite the connection, citing in particular what it called critically flawed succession planning at Disney.That succession planning is what saw Iger return to the CEO gig in late 2022 after a series of stumbles by his hand-picked and short-lived successor Bob Chapek. Initially back for just two years to right the ship and put a new generation in charge, Iger’s contract was given another two years by the board in July 2023. Right now, the 72-year old CEO is set to hand over the reins and exit at the end of 2026.Earlier this year, former Morgan Stanley CEO and chairman James Gorman joined the Disney board in what many saw as a clear indication that succession was on everyone’s mind – with Gorman as a seasoned hand to guide the process. In February, just after an earnings report was released, Iger told CNBC “the succession committee meets regularly and finding the next CEO is probably the board’s number one priority.”
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