At The Walt Disney Company shareholders meeting on March 8th, investors voted 52% to 48% against compensation packages for Disney CEO Bob Iger and other executives. The resolution was non-binding, but shareholders hoped it sent a signal to the Board that Iger’s pay may need to be “tweaked.”
Recently, Reuters spoke with several asset management firms that control large numbers of shares about the vote.
Markus Hansen, a senior analyst for Vontobel Asset Management, who have 2.4 million shares, said that he was pleased with Iger’s performance, but that the four-year compensation package was too easy to collect.
The contract extension that was put in place connected to the acquisition of the assets of Twenty-First Century Fox gives Iger $100 million in stock awards, even if Disney’s returns are in the “middle-of-the-pack” versus other companies.
Hansen added that “maybe a reduction in the amount and an increase in the performance targets” is needed.
The Florida State Board of Administration, with their 2.2 million shares, voice similar concerns, but Jacob Williams, the corporate governance manager for pension, said that the lack of a succession plan is also a big concern. He did say, however, that the reorganization plan announced this week may have helped ease their mind about succession.
Iger earned $36.3 million during the fiscal year that ended September 30th. Based on an analysis of the new compensation package commissioned by Reuters, if Iger hit all of his goals, he could receive $423 million over the course of the four year agreement.
Gerber Kawasaki Wealth and Investment Management voted their 150,000 FOR the compensation plan. CEO Ross Gerber said that most media companies pay well and that the package looked “smart.”
Gerber added, “If he succeeds, then you pay the guy.”
When Reuters asked Disney for comment, they referred to the statement made by the Board’s Compensation Chairman Alwin B. Lewis during the shareholder meeting. Lewis said that the board would “take it under advisement.”