On Wednesday night Michael Eisner finally did what many corporate governance campaigners and former members of his own board have urged -- quit fifty percent of his double act as chairman and chief executive of the ailing Walt Disney Company.
The chair has now passed to former US senator and non-executive board director George Mitchell, while Eisner remains as chief executive. The latter did not go gentle into that good night: it took 43% of the company's shareholders to vote against his re-election at Wednesday's annual meeting in Philadelphia.
Mitchell, a faithful Eisner ally, continues to serve in a non-executive capacity, even though he is now warming the corporate chair. His appointment has already raised questions as to whether the reshuffle actually alters the balance of power or is merely cosmetic.
Eisner last night told the Nightline TV program (on Disney's ABC Network) that he intends to remain ceo until 2006 when his current contract expires. He defended the company's (and by extension his own) performance but said, "I do not belittle a large 'withhold' vote."
As to his relinquishing the Disney chair: "We heard our shareholders, who seemed to be interested in that, so we went ahead and did it," Eisner said. And in a Damascene flash of self-realization, he added: "There are obviously certain people that are not happy with me, personally, I guess."
Two who fall in that category are former directors Roy E Disney and Stanley Gold, both of whom received a warm round of applause from the meeting.
Speaking to shareholders, Disney (nephew of the eponymous Walt) opined: "It is no longer sufficient to separate the roles of chairman and chief executive. That is not what this is about. While we the shareholders have watched the value of our equity decline, Michael Eisner has never had a bad year."
The company had lost its creative heart, Disney said. "In recent times, there's been a tendency to refer to us as 'the Disney brand' ... branding is something you do to cows ... branding is what you do when there's nothing original about your product."
A formal statement from Disney's board expressed "unanimous" support for Eisner and the rest of management while acknowledging shareholders' concerns at Eisner's dual-role incumbency.
But there was more than a hint of defiance in its rider: "That is not to say that we view the vote as limited to governance issues alone. We are aware that some voted for an immediate change in management and in the board."
• Separately, on Wednesday night Microsoft chairman Bill Gates categorically denied rumors the software titan could be involved in any potential acquisition of Disney.
Responding to a question from Channel Thirteen's Charlie Rose as to whether Microsoft could become involved in Comcast Corporation's hostile bid for Disney -- either as a partner or even a separate bidder -- Gates firmly zapped the speculation: "We're not going to be involved in it, because we're very focused on software. We're not part of the bid or anything," he insisted.
Data sourced from: The Wall Street Journal Online and The Washington Post Online; additional content by WARC staff
