Disney recently responded to a report by ISS recommending shareholders to vote activist investor Nelson Peltz to the board and withhold votes for company board nominee Maria Elena Lagomasino. In a statement, Mark Parker, chairman of the board, stated that Disney strongly believes ISS reached the wrong conclusion regarding the addition of Nelson Peltz to the board.
Glass Lewis, another influential proxy advisory firm, came out in favor of all Disney nominees last week. Disney emphasized that its 12 Board nominees are best qualified to provide oversight of management and create sustainable shareholder value. The company argued that Nelson Peltz lacks the additive skills required for the board and does not have a meaningful plan to deliver superior shareholder value.
Disney pointed out that Trian’s “silent partner,” former Disney employee Ike Perlmutter, owns almost 79% of Trian’s Disney shares. The company highlighted ISS’s own report which called Perlmutter’s involvement “an unfortunate distraction.” It was mentioned that Perlmutter has a history and personal agenda against Disney’s CEO, Robert A. Iger, which could pose a threat to the company’s continued success.
Despite the concerns raised by Disney, ISS still found Nelson Peltz to be a valuable addition to the board. ISS cited critically flawed succession planning at Disney as a reason for their decision. Disney, on the other hand, defended Maria Elena Lagomasino as a seasoned financial leader with expertise in corporate governance and fiduciary responsibility.
Disney’s response to ISS’s report reflects the company’s commitment to maintaining the current board structure and emphasizing the qualifications of their nominees. The debate over Nelson Peltz’s potential role on the board continues, with ISS and Disney holding contrasting views on the matter. It remains to be seen how shareholders will ultimately decide in this ongoing dispute.
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