Disney Announces New Chairman & CEO Succession Planning for After Iger
The Walt Disney Company Board of Directors announced that it has elected independent director Mark G. Parker as Chairman of the Board, effective following the Annual Meeting of Shareholders. This post shares the official announcement plus our commentary and context about how this fits into the bigger picture of the Battle of the Bobs and Iger’s succession planning.
Mark Parker is a seven-year member of the Walt Disney Company’s Board and the Executive Chairman of Nike. Parker will succeed Susan E. Arnold, who is ineligible for re-election pursuant to the 15-year term limit under Disney’s Board Tenure Policy. Rather than filling the empty seat, the size of Disney’s Board of Directors will contract to 11 members.
“Mark Parker is an incredibly well-respected leader who over seven years as a Disney director has helped the Company effectively navigate through a time of unprecedented change,” Ms. Arnold said. “During his four decades at Nike, Mark has led one of the world’s most recognized consumer brands through various market evolutions and a successful CEO transition, and he is uniquely positioned to chair the Disney Board during this period of transformation.”
“Mark Parker’s vision, incredible depth of experience and wise counsel have been invaluable to Disney, and I look forward to continuing working with him in his new role, along with our other directors, as we chart the future course for this amazing company,” said Robert A. Iger, Chief Executive Officer, The Walt Disney Company. “On behalf of my fellow Board members and the entire Disney management team, I also want to thank Susan for her superb leadership as Chairman and for her tireless work over the past 15 years as an exemplary steward of the Disney brand.”
Said Mr. Parker: “I am honored to have the opportunity to serve as Disney’s Chairman, and I look forward to working closely with Bob and his management team on a strategy of growth that balances investment with profitability, while preserving Disney’s core mission of creative excellence, to deliver shareholder value. At the same time, it is the top priority of mine and the Board’s to identify and prepare a successful CEO successor, and that process has already begun.”
The Walt Disney Company Board has continued to evolve to ensure it has the right combination of backgrounds, skill sets and perspectives to guide the Company into the future. Today, Disney’s directors bring experience across a relevant range of disciplines, including brand, marketing and retail, direct-to-consumer expertise, and technology and innovation.
The Board is nominating for re-election at the Company’s Annual Meeting incumbent directors Mary T. Barra, Safra A. Catz, Amy L. Chang, Francis A. deSouza, Carolyn Everson, Michael B.G. Froman, Robert A. Iger, Maria Elena Lagomasino, Calvin R. McDonald, Mark G. Parker and Derica W. Rice.
In the same press release, Disney also made the wholly unsurprising announcement that it opposes activist investor Nelson Peltz’s attempt to join the board. Late last year, Peltz’s Trian Group took an $800 million stake in Disney and began pushing for a board seat. Trian is seeking operational improvements and cost-cutting, while also opposing Bob Iger’s return as Disney’s CEO. On that basis alone, it was pretty obvious that Disney was going to rebuff Trian’s attempts to gain influence on the company.
“The Walt Disney Company remains open to constructive engagement and ideas that help drive shareholder value. While senior leadership of The Walt Disney Company and its Board of Directors have engaged with Mr. Peltz numerous times over the last few months, the Board does not endorse the Trian Group nominee, and recommends that shareholders not support its nominee, and instead vote FOR all the Company’s nominees,” Disney stated in its press release.
This further ups the ante in what’s likely to be a big and messy power struggle. We almost certainly have not heard the last of this, and it may become a topic of contention as soon as the earnings call next month. However, this is a fan blog and not Bloomberg, so we’ll table that topic for now.
More notably to the future of the company, incoming Chairman of the Board Mark Parker will also head the newly created Succession Planning Committee of the Board. This will advise the Board of Directors on CEO succession planning, including review of internal and external candidates. Mr. Parker served as Nike’s Chairman and CEO until 2020, when he became Executive Chairman.
This is a big deal. In the original announcement that Bob Iger was returning, the Walt Disney Company stated that it was “with a mandate from the Board to set the strategic direction for renewed growth and to work closely with the Board in developing a successor to lead the Company at the completion of his term.” This was undoubtedly a conscious inclusion, as Iger had infamously avoided proper succession planning, arguably pushing aside multiple worthy heir-apparents and extending his own reign as a result.
Even if you’re not a Nike fan, you might recognize the name Mark Parker. That’s because he came up during the whole Battle of the Bobs palace intrigue back in November. There were leaks then that some members of Disney’s Board wanted to replace Chapek and appoint Nike chairman Mark Parker as a stopgap CEO during the search process.
However, sources indicate that Parker declined the role multiple times. General Motors executive Mary Barra also advocated replacing Chapek at the June meeting of the board.
However, not every member of the board was on board with replacing Chapek over the summer. Most notably, departing Board Chairman Susan Arnold advocated for Chapek. According to reports, she sided with Chapek from the beginning, even before Iger left. At every turn, she reinforced her belief that Chapek should be given a chance to run the company.
In the aftermath of Rice’s firing, Arnold released a supposedly unanimous statement of board “confidence and support” for Chapek. At that time, industry chatter noted that the statement was hollow without a contract renewal for Chapek, which was the true show of confidence. “You let the CEO get within a year of his contract being up,” one industry power player said at the time. “That by itself is a statement of non-support. A vote of confidence is nonsense.”
When the board discussed Chapek’s contract last June, some wanted to extend it for only two years. Arnold argued that would undercut Chapek, so a compromise was reached: Chapek’s contract was extended for three years but backdated. That left slightly more than 2 years remaining on his deal with Disney. Of course, we all know how that ended.
Arnold’s allegiances to Chapek make me wonder if she would’ve been out as Chairman of the Board even were she not ineligible pursuant to the 15-year term limit under Disney’s Board Tenure Policy. Iger seems like one to value loyalty, and not take kindly to perceived slights. It’s also likely that he’ll want to consolidate power and have allies on the Succession Planning Committee of the Board.
Since his return, there has been endless speculation about potential successors to Iger. Internal CEO candidates have already been identified who might be able to take the job over time by Disney’s Board. That actually happened while considering how to replace Chapek, but the Board didn’t want to put someone new in that position given all various pressures on the company.
There are senior executives at Disney who could be groomed into chief executive material, including Dana Walden, Disney’s television chief, and Josh D’Amaro, Disney’s theme park chairman. But the Board doesn’t think either is quite ready.
None of this should come as a huge surprise to those who have been following this saga. In Experts Predict Big Changes for Disney in 2023, Hollywood insiders shared their expectations for the company this year, and although they were all over the place, the general vibe was one of tumult. The industry is expecting executive leadership shake-ups, mergers, and more in 2023 for the Walt Disney Company. It would seem that has begun, only 11 days in!
In 5 Businesses Disney Should Buy or Sell, we suggested that Disney should acquire Candle Media primarily as a talent acquisition play for Mayer and Staggs. That duo serving as co-heads of Disney with an Eisner-Wells dynamic is a dreamlike scenario. It’s a great prediction from a ‘things that should happen’ perspective, but I’m far less certain of it from a ‘things that will happen’ perspective. Definitely a long shot, but Iger does take big swings.
Some insiders have speculated that McCarthy’s intimate relationship with the board could lead to Iger choosing her as his successor for CEO. In Disney CFO Rumored to Succeed Bob Iger as CEO, we essentially pleaded with Disney not to make the same mistake twice. Disney needs a charismatic storyteller in its top spot, not a numbers person. That doesn’t mean McCarthy is a bad CFO. To the contrary, what she did to navigate Disney through the rough waters of 2020 was masterful.
Ultimately, the creation of the Succession Planning Committee of the Board is a good move by the Walt Disney Company. The biggest blemish on Bob Iger’s legacy is his failure to do this in the past, which resulted in Bob Chapek’s Reign of Terror. As much as we’re happy to have Iger back at the helm, we also do not trust him to finally get succession planning right on his own. He’d probably just keep extending his tenure again and again if left to his own devices.
When it came out back in November that Susan Arnold had backed Chapek behind the scenes, I figured she wouldn’t be around much longer. (Granted, I had no clue she was approaching her 15-year term limit.) That was also when Mark Parker’s name came onto my radar as he was floated as an interim CEO, so I did a bit of reading about him. (Here’s a great profile on Mark Parker from Fast Company.)
Based on that and other profiles, I’ve gotta say that Mark Parker being Chairman and heading up the Succession Planning Committee is really good news. In his time at Nike, Parker became synonymous with the company’s rapid growth, technology growth, and product innovation. He was first hired as a footwear designer in 1979, worked on a variety of hugely influential products, and continued top-shelf designs for HTM, a collaboration between he and two other renowned designers.
Parker became Nike CEO in 2006 and remained heavily involved in product, design, marketing, talent deals, and the company’s Innovation Kitchen. (Not a kitchen for food–more like Imagineering’s R&D lab.) Even though they are dramatically different companies, it sure sounds like Parker obtained the well-rounded skillset at Nike that it would take to achieve success at Disney. He also sounds exactly like the type of obsessive creative leader that would be a perfect fit for the Walt Disney Company and its rich legacy. Perhaps it’s unfortunate that he didn’t take the interim role, but at least he’ll head the search and selection of Disney’s next CEO.
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What do you think about Mark Parker being named Chairman of Disney’s Board? Thoughts on the Succession Planning Committee or anything else discussed here? Optimistic that Iger will finally get choosing a successor right? Are you bullish or bearish about the company’s future as the Walt Disney Company enters its 100th year? Think things will improve or get worse throughout 2023? Do you agree or disagree with our assessment? Any questions we can help you answer? Hearing your feedback–even when you disagree with us–is both interesting to us and helpful to other readers, so please share your thoughts below in the comments!
Nike….now that’s a laugh, if it weren’t so damaging. Forget the political stuff, they’re the epitome of corporate greed over product quality (think more unjustified price hikes and less fun and entertainment elements.) We have our family vacay next week at WDW and will be staying at the Yacht Club. I’m excited that real park hopping has partially returned and going anywhere we want after 2pm without a park reservation has returned. That is great for vacationers staying on site, within walking distance of the parks. But Parker would only diminish the experience further while raising prices so I worry our vacay next week might be the last time we get to have real fun there. The Nike product is evidence of that. I like Peltz’s theme, #restorethemagic because isn’t that what all of us super fans have been begging Iger and Chapek to do for the last 8 years while they pivoted the opposite direction every time? Personally I think Peltz’s cute slogan is a ploy to get us to lobby for him then he’ll turn on us and be Harrison-Foote style, where he further guts, pumps and dumps Disney. Just don’t do it!
I will say that the Board Chair is traditionally not the #2 position at Disney (or many companies), though it may be a secondary title for a CEO, President or COO. As Tom said, his impact as an independent Chair will be to choose the next CEO; that being said, it’s clever to have someone with an engineering background to bridge the Walt creatives vs Roy financials gap most of us think of for Disney management.
(On a personal note, I love that Tom Staggs came from a financial background but became known as a creative through his sheer enthusiasm. I’ll always wonder if there’s a reason that he didn’t become CEO last time other than Iger wasn’t ready to leave.)
Thanks for a great article, Tom. Mark Parker sounds like an interesting choice. No question he’s accomplished at corporate governance, but I would be interested in finding out if someone who’s that big a fan of creepy doll art (that photo of him above is quite something) is someone who can understand and promote the magic of Walt Disney.
I hate creepy doll art as much as anyone (the biggest strike against Gideon’s at Disney Springs), but I respect that others like it for…reasons beyond me.
With that said, there are a bunch of better photos of Parker in cooler settings, and with athlete art (e.g. Kobe, Jordan, Woods, etc). I just felt this one was more appropriate for a Disney post. Perhaps I misjudged!
I certainly hope he brings back the Magic. I hate the feeling that visiting WDW has become such a stressful experience, I remember fondly the times with FastPass!!!
Tom, thank God for your updated information that helps us so much!
I hope you and Sara have a great 2023!!
Maybe it’s just me but his office decor is creepy.
Not surprised Disney rejecting Nelson Peltz given his right leaning politics. But maybe they need a different perspective to balance things out. Disney needs to rein in the left a bit and stay out of politics if it wants to hold onto the majority of their fans and maintain the wholesome family oriented image Walt envisioned.
Couldn’t agree more
Granted, I’m not intimately familiar with Nelson Peltz, but after reading a couple of articles about his politics, he strikes me as centrist to right-leaning. He’s definitely fiscally conservative, but that probably describes the overwhelming majority of billionaires–and most current Board members. I doubt that’s why or how he would be at-odds with Disney.
This endless quest to see everything through a political prism is exhausting and counterfactual. Can we please give it a rest?
It’s disappointing that Disney being inclusive to people and family of all types is viewed as an attack on the “wholesome family oriented image.” And even more so that similar comments get crammed into so many posts whether it has any relevance or not.
What is this “wholesome family oriented image” you’re referring to and what specifically is Disney doing to wreck it?
I’m honestly not sure that Peltz’s support of continuing Chapek’s cost cutting and price raising has anything to do with his politics, but I think it’s a bad idea regardless.
Need to cutback on politics companyhaslostfocuson it’s cutommerbase
Nike took a very political turn in recent years and turned off a lot of consumers. Disney is experiencing some of the same issues. Going back to the well with these same types of people isn’t going to make things any better with middle America.
Great read! One thing that is almost always overlooked is that when Disney the company began it was run by two people, not one. Walt’s dreams could have only happened if his brother Roy was able to find a way to pay for them. It’s probably no coincidence then that the Disney Renaissance in animation occurred when Michael Eisner and Frank Wells worked as a team.
It is possible to entrust the Empire to single Jedi as a steady hand, but in the end that stability is all you really get.
The “good news” for Disney at least is that there is never a shortage of potential suitors who would love the chance to follow in Walt’s footsteps.
I worked at Nike for 18 years, including all the years in which Mark Parker served as Nike’s CEO. And I echo your opinion that he will be an excellent Chairman for Disney. Of his many great qualities there are three in particular that I think makes him an excellent fit for helping to get Disney back on the right track. 1. He knows how to lead and guide creative people; he inspires them to do their best by providing thought through guidance, and then showing the utmost respect to the creative teams as they work through their creative ideas. 2. He knows how to build respect and understanding of the customer to deliver products, services and ideas that maintains the highest level of consumer confidence and loyalty toward the company. 3. His management style, which has always been Nike’s management style, is to foster mutual respect by all employees towards each other so as to achieve the best results as a team (they do take this approach seriously, it’s not just corporate lip service). All three of these qualities, I believe, have been inherent at Disney beginning with Walt’s original leadership.
Thank you for sharing this insight through personal experience. This is the kind of informed comment that is helpful to read. How a person interacts with employees, the work culture they create and foster, is what matters and helps us outsiders have more accurate expectations.
Thanks for sharing this–very insightful!