Disney succession: Inside the search for a CEO to replace Bob Iger

The Walt Disney Co. tin sick spend different succession implosion.

The past clip Chief Executive Bob Iger handed implicit the reins, the program backfired, executives revolted, his replacement got bounced and Iger returned to pb the storied amusement elephantine for different 4 years.

Iger volition adjacent retired his two-decade tenure astatine Disney astatine the extremity of this twelvemonth erstwhile his declaration expires. The committee is preparing to marque a pivotal enactment determination astatine a perilous clip for the industry.

This time, Disney has entrusted a take-charge outsider to oversee its CEO transition, which is expected to unfold successful the coming weeks.

James P. Gorman, erstwhile caput of Morgan Stanley, became Disney’s president a twelvemonth agone with succession astatine the apical of his to-do list. The 67-year-old Australia autochthonal comes with beardown opinions and sterling credentials: He helped stabilize, past revitalize the Wall Street slope during his 14 years successful the C-suite, retiring successful December 2024 aft orchestrating a seamless baton pass.

“I don’t cognize that there’s anyone who could person navigated these kinds of enactment transitions amended than James,” Wharton School Dean Erika H. James said successful an interview. “He’s not acrophobic to bash the hard things.”

Disney has kept a lid connected its deliberations. The institution declined to marque Gorman disposable for this story.

Disney Chief Executive Bob Iger is expected to measurement down astatine the extremity of this year.

(Jay L. Clendenin/Los Angeles Times)

Four interior candidates person been vying for the occupation and galore judge the parks boss, Josh D’Amaro, is the apt successor. Wall Street is rooting for the charismatic 27-year Disney seasoned and backmost of the company’s ambitious five-year, $60-billion parks and cruise enactment expansion.

Hollywood insiders, however, aren’t counting retired apical tv and streaming enforcement Dana Walden, who could go the archetypal pistillate to pb the 102-year-old company. Movie workplace caput Alan Bergman and ESPN president Jimmy Pitaro circular retired the field.

Unlike the past go-round, Disney’s committee tightened up the process by establishing a succession committee. The radical — comprising Gorman, General Motors CEO Mary Barra, Lululemon Athletica CEO Calvin McDonald and Sir Jeremy Darroch, the erstwhile caput of Sky broadcasting successful Britain — person been evaluating the smarts, stamina and nationalist entreaty of each candidate. They besides indispensable see the intangibles needed to steer Disney done its steep concern challenges.

And those challenges are galore — including the erosion of accepted TV channels, the displacement to streaming, the enlargement of artificial intelligence, the uncertain U.S. system and a caustic governmental environment.

“There’s truthful overmuch volatility — economic, geopolitical and taste volatility,” James said. “People person a batch of anxiety, [which] makes it truthful hard for leaders to summation a coagulated footing. Every day, you tin beryllium confronted with thing that’s deemed a crisis.”

Picking a caller person for a institution that is adored by millions and employs 230,000 radical is simply a high-wire act. Elevating 1 interior campaigner besides could spark an exodus by the others, putting unit connected the committee to devise ways to clasp Disney’s accomplished runners-up.

Josh D’Amaro, president of Disney parks, experiences and products, speaks astatine the Avengers Campus dedication ceremonial astatine Disney’s California Adventure Park successful 2021.

(Chris Pizzello/Chris Pizzello/Invision/AP)

Gorman earned the heavy respect of Wall Street during his tenure astatine Morgan Stanley, which included deftly steering the concern steadfast retired of the Great Recession and bolstering its businesses and workplace culture.

A autochthonal of Melbourne, Gorman earned a instrumentality grade but didn’t similar being a lawyer so, successful the mid-1980s, helium moved to the U.S. and obtained an MBA astatine Columbia University. He has joked that helium had to enactment successful the U.S. to gain capable wealth to wage his pupil loan, which carried a 24% involvement rate.

When helium retired, Gorman was approached to articulation galore firm boards.

“He chose Disney due to the fact that it was the astir challenging,” said James, who serves connected Morgan Stanley’s board. “He felt helium could beryllium that alteration cause successful work to Disney ... fixed each that was going connected with the company.”

Disney was enmeshed successful turmoil, including fending disconnected a proxy situation from 2 billionaire shareholders, who had aimed their wrath astatine Iger and Disney’s stalled banal price. Iger had exited the Burbank elephantine astatine the extremity of 2021 aft astir 2 years arsenic enforcement chairman. He returned 11 months aboriginal erstwhile Disney’s committee dumped his successor, Bob Chapek.

Chapek had been promoted to CEO successful February 2020 conscionable weeks earlier the satellite recognized the magnitude of the COVID-19 pandemic. Theme parks, theaters and sporting events — Disney’s concern pillars — went dark.

At the time, the committee envisioned a power-sharing statement betwixt the 2 Bobs, but it yet fueled bitterness.

By aboriginal 2022, Iger had exited and upheaval astatine the institution intensified. Disney became a punching container for Florida’s Republican Gov. Ron DeSantis and Chapek’s stutter-step effect to Florida’s alleged “Don’t Say Gay” acquisition measure gave DeSantis ammunition. He labeled Disney arsenic “woke,” past yanked the company’s improvement authorization astir Disney World — a stroke to the company’s immense Central Florida empire.

Senior executives carped astir Chapek to Disney committee members. Streaming losses mounted, alarming Wall Street. Disney’s committee gave Chapek a caller declaration and, 5 months later, shoved him retired the door.

“There person been each of these starts and stops with succession,” David F. Larcker, manager of the Stanford Graduate School of Business Corporate Governance Research Initiative, said. “It’s been a spot embarrassing for specified a large company.”

Larcker noted that, years ago, Disney announced that Iger would discontinue successful 2015, which Larcker called “odd” due to the fact that Iger past was successful his aboriginal 60s, producing stellar results and was not acceptable to leave. (Iger present is 74 and has been actively mentoring the candidates successful mentation for the handoff, radical adjacent to the institution said.)

CEO succession has agelong been Disney’s Achilles’ heel. Michael Eisner famously held onto powerfulness until tensions with shareholders and Pixar Animation’s co-founder, the precocious Steve Jobs, mounted into a boardroom crisis. Iger was appointed successful 2005, and rapidly made savvy moves to enactment up the company’s originative engines, including buying Pixar Animation, Marvel Entertainment and Lucasfilm, the workplace down “Star Wars.”

In 2015, Disney installed Tom Staggs arsenic main operating serviceman to yet instrumentality implicit for Iger. Staggs near successful vexation the pursuing twelvemonth with Iger inactive firmly successful control.

“They’ve enactment radical successful a presumption wherever they are benignant of doomed and Iger keeps coming backmost for different 2 years, different 5 years,” Larcker said. “That’s not the mode it’s expected to work.”

By the clip Iger returned to Disney successful November 2022, the satellite had changed.

Wall Street nary longer was cheering connected Disney oregon different amusement firms to walk large to pull streaming subscribers to vie with Netflix. Investors began demanding profits astatine a clip erstwhile Disney and different accepted amusement companies were bleeding billions connected their streaming ventures.

Disney banal had climbed to astir $200 a stock successful March 2021. Shares closed past week astatine $111.20.

“Disney is astatine a unsocial infinitesimal successful time,” said Robert Fishman, a media expert with MoffettNathanson Research, said.

“They indispensable beryllium to investors that the worth of their premium contented and taxable parks is meaningful,” Fishman said. “Investors request assurance that their streaming pivot, which is good underway, volition person a large payoff — much than what investors tin admit today.”

Dana Walden astatine the Disney 2025 Upfront Red Carpet held astatine North Javits Center connected May 13 successful New York.

(Kristina Bumphrey/Variety via Getty Images)

Disney’s adjacent CEO indispensable navigate an uncertain aboriginal and fortify Disney+ arsenic a starring streaming service. The institution indispensable fortify the movie workplace and its blockbuster franchises, Marvel, Pixar and “Star Wars,” portion simultaneously refreshing taxable parks and overseeing operation of a caller Abu Dhabi resort. The CEO and their squad indispensable equilibrium advances successful artificial quality without allowing it to destruct the worth of specified beloved characters arsenic Moana and Winnie the Pooh.

Each of the 4 contenders is liable for a large Disney concern unit, heightening fears that 1 oregon much of the unsuccessful candidates volition depart — leaving a large void. When Chapek was named CEO six years ago, Disney’s streaming strategy chief, Kevin Mayer, exited.

“Successions are multi-person events,” Larcker said. “It’s not conscionable astir the CEO.”

At Morgan Stanley, Gorman led a multi-year process with a disciplined “framework successful mind,” said committee subordinate Erika James.

The Morgan Stanley candidates spent sizeable clip with committee members, which has besides been the lawsuit astatine Disney.

Gorman “led the succession by remembering these are existent radical who are astatine stake,” James said. “Shareholders are existent people, the employees who volition get a caller person are existent radical and the contenders for this relation are existent people.”

Gorman, successful a Morgan Stanley interview, said he’s been asked for the concealed of that firm’s creaseless succession.

“It starts with a precise basal principle: Do you, arsenic the boss, privation to permission the job?” Gorman said. “And I did. ... What that does is frees you up truthful that your successor has each accidental to succeed.”

In October 2023, Morgan Stanley named Ted Pick to win Gorman arsenic CEO. The 2 different candidates were fixed sizable portfolios and elevated to co-president. Each received a one-time bonus of astir $20 cardinal to enactment put.

Speculation is rampant that Gorman and the committee volition marque akin chess moves astatine Disney.

While D’Amaro knows each nook of Disney’s parks and oversees the company’s video crippled portion and vaunted Imagineers, helium does not person Hollywood acquisition processing movies oregon tv — 2 areas that are captious to Disney’s success.

Walden, who joined Disney successful 2019 from Fox, has spent her vocation successful tv and much precocious streaming — acold from the park’s nett centers successful Anaheim and Orlando. Among her specialties is endowment relations, moving intimately with agents, producers and writers.

Hollywood insiders wonderment however Disney volition onslaught its enactment equilibrium and whether it volition name co-presidents reporting to the caller CEO.

“The Board is committed to not lone uncovering the close leader, but besides focused connected .... positioning the caller CEO for semipermanent success,” Disney’s committee told investors successful 2024. That includes “surrounding the caller CEO with a squad of elder executives who tin enactment unneurotic to pb the institution into the future.”

Disney is expected to sanction Iger’s successor adjacent month.

“Organizations turn due to the fact that you person change,” Gorman told Bloomberg successful 2023. “You’re not going to turn by doing the aforesaid thing, again and again.”