March 4, 2004
FARQUAARD SHRINKS:
Disney's Eisner Loses Chairman Role (Peter Henderson, Mar 3, 2004, Reuters)
Embattled Walt Disney Co. Chief Executive Michael Eisner on Wednesday was stripped of his role as chairman, but kept his position as chief executive even after 43 percent of shareholders voted against him in an unprecedented protest.Convening in Philadelphia after a stormy annual meeting, Disney's board said it had elected former U.S. Senator George Mitchell as the company's chairman. [...]
Analysts had expected Disney would strip the chairmanship from Eisner, but many doubted that step would be enough to placate investors now.
"No, no, no. That to me would be just a cosmetic or technical response. This in my mind goes much deeper," said Charles Elson, director of the Weinberg Center for Corporate Governance at the University of Delaware. "It's got to be a management change one way or the other."
Alan Hevesi, the New York State Comptroller who had called for Eisner to leave, said in a statement that the vote marked a "wake-up call" for Disney management.
Pat McGurn, spokesman for Institutional Shareholder Services, the influential adviser which stoked opposition to Eisner, said splitting the CEO and chairman roles at Disney would only mark a first step toward reform.
"If they think that is going to be the end, they are kidding themselves," he said.
If you're an entertainment company trying to recapture lost magic, you naturally think...George Mitchell? Posted by Orrin Judd at March 4, 2004 12:19 AM
Considering the bulk of Disney's profits from its radio station division come from airing shows like Rush Limbaugh and Sean Hannity on their 50,000 watt AM stations across the country, I eagerly await the first visit by the new chairman to some of his major broadcast properties...
Posted by: John at March 4, 2004 12:46 AMThe heck? George Mitchell as chairman of Disney? What experience does he have in the entertainment business? (Wiseacres need not point to his Senate career.)
Posted by: Joe at March 4, 2004 5:37 AMGeorge Mitchell's last major gig was mediating the Northern Ireland conflict. Maybe the PTB think he can mediate peace between the Eisner faction and the R.Disney faction?
George Mitchell? I could be wrong but he seems to have a history of brokering deals that fall apart 2 years later.
Disney has lost its way since the ABC merger. They need to focus on what they do best and get rid of the rest.
Are you guys aware that Mitchell was already on the Disney board? It makes the decision less "surprising" (and decidedly less ambitious).
Posted by: MG at March 4, 2004 7:49 AMOne of the first things on the to-do list is to sell Miramax to the highest bidder. And, that means, now.
Disney's reason for being is family entertainment. When one of your biggest money-makers is alienating families big-time, then it's time to dump it.
Old-time board member Mitchell will want to keep Miramax. First Eisner, then Mitchell.
Posted by: John J. Coupal at March 4, 2004 9:09 AMI must have missed the Mickey Mouse doll which came equipped with a samurai sword and yellow tracksuit.
Honestly what difference does it make whether Disney owns Miramax or some other media conglomerate?
There's little to no cross-promotion between the family brands and what Miramax offers and you may as well be offended about Time Warner owning Bugs Bunny as well as showing adult drama on HBO.
Posted by: M Ali Choudhury at March 4, 2004 9:41 AMMr. Choudhury:
Disney is - at the core - about family. It brings in money, secondarily, with theme parks, and family movies. Under Eisner, Miramax is its sex, violence, and anti-religion motion picture unit.
True, the current Disney board doesn't cross-promote Miramax. It would be insane to cross-promote. The current board is at least not insane when it comes to dollars.
Time Warner - at the core - is about money.
Posted by: John J. Coupal at March 4, 2004 10:04 AMI eagerly await the latest Disney animated special: "Under the Texas Moon - Conspiracy in the Firelight". Narrated by Ted Kennedy, with solemnity by George Mitchell.
Posted by: jim hamlen at March 4, 2004 10:09 AMTime Warner - at the core - is about money.
That is true of all corporations. Not just Time Warner.
Posted by: Brandon at March 4, 2004 10:52 AMBrandon, very true.
And, smart corporations do not alienate their customers/employees (or, shareholders).
Think Enron, Global Crossing, WorldCom, and the present Disney as stupidly-run corporations.
Posted by: John J. Coupal at March 4, 2004 11:58 AMAh, John J., one of those companies is not like the others.
Regardless of how poorly you think it's been run, of late.
Posted by: Michael Herdegen at March 5, 2004 5:05 AMMichael, check out what Disney shareholders did last Wednesday in Philly.
Their actions indicate that getting rid of Eisner is not going to solve Disney's current problems, not by a long shot.
The curent board, (Mitchell, Estrin, etc.) have been rearranging the deck chairs on the Titanic for years. Shareholders and customers are now demanding accountability for corporate actions.
Just ask Martha Stewart.
Posted by: John J. Coupal at March 7, 2004 1:38 AM