Disney’s Horrible Board of Directors

By Douglas A. McIntyre Published Nov 21, 7:25AM EST

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Disney’s Horrible Board of Directors — © Kimberly White / Getty Images

Disney’s board finally sacked incompetent CEO Bob Chapek and brought back superhero CEO Bob Iger, who ran Disney successfully for more than a decade. Iger wanted a rest after he was paid hundreds of millions of dollars for running one of the world’s most famous companies. However, the chance to rescue Disney must have been too tempting to keep him on the beach. At the heart of this story is the bungling Disney board, which elevated Chapek and recently gave him a three-year contract extension in June.

Iger was impossible to replace. He was one of the great CEOs of the last quarter century. He built up Disney, in part through M&A, adding the animation studio Pixar, and the Marvel and Star Wars franchises to its stable. In addition to Disney’s traditional business, this portfolio made it America’s entertainment company powerhouse.

Chapek was a disaster early on, but he saved his worst sins in recent decisions. He spent too much on Disney’s streaming business, which had grown to rival Netflix and Amazon Prime. However, as the streaming business slowed, Disney’s expenses did not. Chapek underpriced the service and spent too much on production.

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Chapek’s decisions had consequences. Disney’s poor financial results, particularly recently, decreased the stock price by almost 50% in the last year.

Who is at fault more than anyone else? The Walt Disney Company (NYSE: DIS | DIS Price Prediction) board of directors.

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Susan Arnold, Disney’s chairman, captains the board. Most of her business experience was at Procter & Gamble. Selling soap is not much like marketing movies and running theme parks.

Some members should have known better than to put Chapek into the top job. First among them is John Mark Parker. He has been on the board since 2016. He currently leads Nike. Mary Barra, CEO of GM, also should have known better.

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Iger can be blamed for one thing; he was instrumental in the selection of Chapek. At least, when Chapek stumbled, Iger agreed to return.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.