Vice Chair Exits Disney Board, Demands Eisner Follows Suit

01 December 2003

Walt Disney Company vice chairman Roy E Disney (73) on Sunday suddenly quit the group's board, accompanying his resignation with an acrimonious demand that chairman/ceo Michael Eisner (61) should also quit.

But Eisner -- unlikely to heed such a call whatever its source or circumstances -- will be even less prone to do so when it emanates from his most bitter inhouse foe.

With the resignation of the last of the founding Disney family still on the company's board, Eisner's power is now more firmly ensconced than at any time since joining the company in 1984.

Roy Disney, angry and concerned at the continued diminution of the value of his major stockholding in the group, has been at odds with the ceo for the past eighteen months, their relationship deteriorating in direct proportion to the tail-off in the company's performance.

Those close to Roy say he believes he is "unmuzzled" by resigning. He now plans to speak out publicly against Eisner and his leadership -- an act that previously would have contravened the group's confidentiality policy for board members. This allows only Eisner, presiding director George Mitchell or their nominee to speak publicly about matters discussed during board meetings.

Roy had been 'asked' to leave the board under corporate-governance guidelines adopted last year that call for all directors to retire at age 72, unless they are former Disney chief executives, in which case their service can be extended until age 75.

But Roy did not go gentle into that good night. In his letter of resignation, he slams Eisner for losing too many talented executives, for refusing "to establish a clear succession plan" and for the absence of strong relationships with creative partners such as Pixar Animation Studios, whose films Disney co-finances and releases.

Eisner had, Roy charged, "driven a wedge between me and those I work with even to the extent of requiring some of my associates to report my conversations and activities back to you."

He signed off: "It is my sincere belief that it is you who should be leaving and not me. Accordingly, I once again call for your resignation or retirement. The Walt Disney Company deserves fresh, energetic leadership at this challenging time in its history just as it did in 1984, when I headed a restructuring which resulted in your recruitment."

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