Disney Boss Faces Directors’ Dismay at Dire Performance

03 June 2002

Faced with a plummeting share price and a slump in ratings at TV network ABC, Walt Disney Company chairman/ceo Michael Eisner is reportedly under pressure from certain board members to improve performance.

Eisner has traditionally been given free rein by the Disney board, but in the wake of recent failings and the corporate governance concerns raised by the Enron debacle, a group of influential directors is beginning to play a more central role.

Leading the dissenters is Stanley P Gold, president/ceo of Shamrock Holdings, the investment vehicle of Disney vice chairman Roy E Disney.

However, the disgruntled faction is not seeking Eisner’s head. Rather, they want to work with him to plough more effort into improving ABC, to strengthen the group’s management following a string of departures and to introduce more formal succession procedures.

Eisner insists he has invited the board’s greater participation. “I anticipated there was going to be more pressure on the board post-Enron than there was pre-Enron,” he said, adding that he subsequently began “demanding conversations with board members.”

The directors’ desire for greater involvement follows recent moves to introduce new corporate governance practice at the group, designed to secure the independence of the board [WAMN: 01-May-02].

Data sourced from: The Wall Street Journal Online; additional content by WARC staff