March 9th means one thing for Disney fans: It’s the 2022 Disney Investor Day!
As was the case the last two years, the Disney Annual Meeting of Shareholders is a virtual webcast rather than an in-person affair.
Several moments of note occurred during this conversation between CEO Bob Chapek, Chairperson of the Board Susan Arnold, and shareholders.
Here are the highlights from yesterday’s event.
Disney starts with its usual game about how everything is great. If you’re new to investor meetings, that’s how they all start. Otherwise, people sell their stock.
At this point, Belinda Massafra of Shareholder Services confirms that Disney currently floats nearly 1.8 billion in shares.
So, if you hold one share of DIS – and I know that many of you do – your vote counts once out of 1.8 billion! Ain’t democracy grand?
Disney notes that more than half of its 1.8 billion shares are present, guaranteeing a quorum. How does the company know that?
I presume it’s because most of the largest shareholders are present, and they hold a LOT of the stock.
Arguments begin for some of the proposals on the ballot. You can read the complete list here. It’s on Page Four.
Disney allows the people responsible for each proposal to make five-minute arguments for their ideas.
The various participants honor these guidelines, although at least one of them comes across as a bit of a nutter. But, again, that’s democracy.
After one individual makes their pitch, the shareholders vote. Later, Disney posts the full results.
Perhaps the most amusing of them is a request for Disney to lower the percentage of votes required to hold a shareholder meeting.
I can assure you that one will not pass. Few executives or shareholders ever want more meetings. You probably worked from home during the pandemic and know what I mean.
About the votes
Disney got its way on virtually all the votes. Let’s quickly evaluate each one so that you can better understand what transpired.
Proposal One matters the most to people who dislike Bob Chapek. The current CEO has endured a tone of criticism over the past year for his policies.
Chapek was also up for a vote as a member of the Board of Directors yesterday. So, this proposal functions as a referendum on him…and he aced it.
Every proposed board member receives at least 94 percent of the vote. So, no matter what you or I think of Chapek, the shareholders like him well enough.
Proposal 2 is the one nobody cares about, as it involves Disney’s accounting firm of choice.
Everyone quickly confirms Price-Waterhouse. So, don’t be surprised if La La Land winds up on the Board of Directors over Moonlight.
The voting on Proposals 3 and 5 goes about as expected. One calls for an advisor to evaluate Disney executive compensation. It passes with 84 percent of the vote.
People want to keep Disney executive salaries in check. However, I have questions about how much authority the new advisor will have in this role.
Meanwhile, 39 percent of people DO want more shareholder meetings, which is about double what I would have guessed. Still, the proposal fails.
Another proposal for a human rights evaluation across all Disney operations falls short with a 34 percent vote.
That’s 17 times as well as a weird non-discrimination proposal does.
The person who argued in favor of this did themselves no favors by invoking Godwin’s Law. Shareholders went against him 98-2.
Finally, the surprise event is the passage of a pay equity proposal. This vote went against Disney’s wishes. People want it by a 59-41 margin.
Here’s a Politico quick take:
News: 59% of Disney shareholders approved a proposal calling on management to create a pay equity report.
The other shareholder resolutions, including one calling for more lobbying disclosures, failed to gain a majority of support. pic.twitter.com/T8ivW3kCpP
— Corbin Hiar (@CorbinHiar) March 9, 2022
Other Investor Day highlights
Yes, the Obi-Wan Kenobi trailer has arrived. And yes, fans are ecstatic about it. Take a look:
Disney also announces its new slogan for 2023, “100 Years of Wonder.”
You should expect to hear that a LOT over the next two years as the company celebrates its 100th birthday.
During this part of the presentation, CEO Bob Chapek trumpets all the many things that are going great at Disney. There’s also an extended love letter to Encanto.
Chapek then prepares to take questions from shareholders. But, before he does so, the CEO takes a stand on the Don’t Say Gay bill in Florida.
Chapek confirms that Disney officials worked behind the scenes to stop the bill.
When that failed, he and a team of LGBTQ+ Disney executives asked to meet with Florida’s Governor. That meeting will occur this week, although the bill might be signed by then.
Chapek also announced a Disney pledge of $5 million to the Human Rights Campaign. Disney also signed that group’s denouncement of the bill.
So, despite the CEO’s aversion to politics, he came out hard against the bill.
Chapek also pointed out that Disney has donated to many of the most vigorous opponents of this legislation.
In other words, the company is paying both sides of the political arena. In fact, the CEO later states that Disney likely contributes to both sides of any legislation.
This comment causes me to wonder how Disney benefits from its donations if it’s paying off everybody.
At the moment, Chapek and Disney’s strategy appears to be a blatant attempt to have their cake and eat it too.
However, several shareholder questions may have demonstrated that this philosophy is impractical.
Overall, Susan Arnold’s first Investor Day went quite smoothly. As for Chapek, he probably feels like he had a win here as well.
The vote showed that Chapek has the full support of most investors.
Also, his aggressive stance on the Don’t Say Gay legislation should win back cast member support.
As for Disney fans, the forced transparency with the pay equity proposal will provide long-term benefits.
Disney may not have wanted to do it. Still, the company’s upcoming documentation should prove beneficial for society as a whole.
Feature Image: Matt Stroshane/Courtesy Disney Parks