Disney Defends Its CEO and Board Members After Negative Report
International Shareholder Services advises against the reelection of certain board members and says Bob Iger is paid too much money.
Disney on Thursday blasted a suggestion from Institutional Shareholder Services that some board candidates not be elected, and it defended CEO Bob Iger's compensation.
The ISS is basing its opinion on information that is "deeply flawed," Disney said in an SEC filing. The company said the advice from ISS is "out of touch with shareholder interests."
ISS on Wednesday criticized Disney's decision to make Iger its board chairman, claiming that it would give the CEO too much unchecked power.
ISS also said that Iger's pay package will rise to $30 million from $26 million when he becomes chairman, which is too high cnsidering "lackluster shareholder returns" over the past five years.
ISS has advised shareholders to vote against the candidacies of Judith Estrin, Sheryl Sandberg, Aylwin Lewis and Robert Matschullat, the members of the Governance and Nominating Committee who allowed for changes that represent "an about face" from reforms made during the tail end of Michael Eisner's reign as CEO and chairman.
Disney said in October that after John Pepper steps down this month, Iger would add the role of chairman and remain CEO through March 2015.
ISS pointed out that a $100 investment in Disney stock five years ago was worth only $105 at the end of fiscal 2011.
Disney, though, is mindful of its relatively stagnant stock and has taken steps recently to boost it, including last year's 50 percent hike in the dividend that it pays its shareholders.
In its filing, Disney said that "its total shareholder return is more than four times greater than that of the S&P 500 during Mr. Iger's more than six years of leadership."