How Bob Iger vanquished a corporate raider in Disney’s most consequential boardroom battle in decades

Analysis by Oliver Darcy, CNN

New York (CNN) — Editor’s Note: A version of this article first appeared in the “Reliable Sources” newsletter. Sign up for the daily digest chronicling the evolving media landscape here.

Bob Iger handed Nelson Peltz a bruising defeat on Wednesday — and he did it, in part, by shoring up perceived weaknesses within Disney that the billionaire corporate raider had sought to exploit.

While it was never quite clear what changes Peltz wanted Disney to implement, the 81-year-old had complained loudly about a few issues: corporate succession, “woke” entertainment, streaming strategy and profits, and a need to set up ESPN for a direct-to-streaming future.

But over the last several months, the Disney chief made significant moves that took the wind out of those sails. Whether the action was taken intentionally to quell the rebellion that Peltz was leading, or whether Iger would have made the moves irrespective of the proxy battle, remains a secret tucked deep within the Magic Kingdom. Regardless, the course of action taken by Iger had the same effect, pouring cold water on Peltz’s public grievances.

On the “woke” agenda: Iger repeatedly stressed that entertaining audiences must be the company’s top priority. “Our primary mission needs to be to entertain and then through our entertainment to continue to have a positive impact on the world,” Iger said on an earnings call last year, adding, “It should not be agenda-driven.” Then, in a stunning move last week, Disney settled a major lawsuit and years-long feud the company had been engaged in with Florida Gov. Ron DeSantis over the state’s so-called “Don’t Say Gay” law that had made the company the target of right-wing culture warriors.

On streaming strategy: Iger moved to take full control of Hulu in a major deal with Comcast. Last week, Disney merged the service into Disney+, putting both libraries into a single app in a move once considered unthinkable. Meanwhile, Iger oversaw the shedding of 7,000 staffers last year as he worked to cut costs and improve profits. During the most recent earnings call in February, Iger credited a surge in profits to the cost-cutting and reiterated his aim of “building streaming into a profitable growth business.”

On ESPN’s future: Iger has stressed he is “focused on fortifying ESPN for the future.” He announced in February that the sports network’s direct-to-consumer streaming service will be available by fall 2025, finally giving shareholders a firm timeline for the service, which he touted as a “one-stop shop” for sports fans. On Wednesday, Iger said that its standalone ESPN service would also be integrated into Disney+ next year.

On the succession question: Iger has stressed that he wants to get succession right when his contract expires in 2026, after flubbing it the last time around with Bob Chapek. The board has a special planning committee who is conducting a “diligent and thorough succession planning process.” That crew now includes the recently added board member and former Morgan Stanley boss James Gorman, who has plenty of experience in the area. Reports have also started to emerge about the succession planning, including in CNBC and THR.

Under Iger’s control, Disney also launched an expensive advertising campaign to ensure its wide constellation of “mom and pop” investors were hearing his message. Disney treated the campaign like a political one, launching a campaign website, taking out Google search ads, and advertising on popular podcasts like “The Town” and “Smartless.” It even leaned on some of its best-known animated characters.

In other words, by the time shareholders had gathered for their annual meeting on Wednesday afternoon, Peltz had little, if anything, to stand his campaign on — and shareholders agreed. Peltz received less than one-third of the vote, or roughly 31%, a person familiar with the matter told CNN. Retail investors also voted overwhelmingly for Disney’s candidates, with three-quarters backing the Disney slate. Investors also rejected Jay Rasulo by a five-to-one margin.

“We are proud of the impact we have had in refocusing this Company on value creation and good governance,” Trian said. “Since we re-engaged with the Company in late 2023, Disney has announced a host of new operating initiatives and capital improvement plans. The Board has been refreshed with two new directors. Over the last six months, Disney’s stock is up approximately 50% and is the Dow Jones Industrial Average’s best performer year-to-date.”

Iger, for his part, thanked shareholders for putting their “trust and confidence” in his leadership, the board, and the “ambitious strategy” the company is “implementing across our businesses to build for the future.” How much of that strategy was a result of Peltz’s proxy war will forever be unclear.

It’s certainly likely that Iger and the board had independently identified many of these issues and sought to plan remedies to fix them. After all, it does not take a media savant to realize ESPN needs a direct-to-consumer home. Or that finding a worthy successor to Iger must be a top priority for the company. Those issues have been plainly obvious for all to see.

That said, it does stretch credulity to believe that Peltz’s ruthless proxy war carried with it zero influence in the decisions Disney has taken over the last several months. If nothing else, it served as an added catalyst for change. After all, sometimes the best tactic to defeat a corporate opponent is simply to address their concerns, thereby clipping their wings and robbing them of their stated disagreements.

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