Trian Fund Management has nominated Nelson Peltz and James Rasulo to The Walt Disney Company Board of Directors. Peltz is Trian’s founder, while Rasulo is Disney’s former Senior Executive VP and CFO.
James “Jay” Rasulo joined Disney in 1986. He was EVP, then President, then Chairman of Disneyland Paris from 1998 – 2000. He became President of Walt Disney Parks and Resorts in 2002 and then CFO in 2010. He stepped down in 2015 and was replaced by Christine McCarthy.
“The root cause of Disney’s underperformance, in our view, is a Board that is too closely connected to a long-tenured CEO and too disconnected from shareholders’ interests,” Trian wrote in a letter (via Seeking Alpha). “The Board, we believe, lacks objectivity as well as focus, alignment, and accountability.”
Peltz first tried to secure a board seat in January of 2023, with Trian issuing a statement highlighting Disney’s “self-inflicted” problems. Peltz halted the proxy battle in February after Disney announced a major reorganizing and cost-cutting plan. But in October, Peltz and Trian began pushing for seats again, this time with support from former Marvel Entertainment chairman Ike Perlmutter. In November, Disney turned down Trian’s request for two seats and then altered their bylaws to require more from stockholder nominations.
At the same time, Disney also appointed two new directors: James P. Gorman, Chairman and Chief Executive Officer of Morgan Stanley, and Sir Jeremy Darroch, a veteran media executive and former Group Chief Executive of Sky. Their appointments will be effective in early 2024.
Trian continued in their Thursday letter, “Although the recent appointment of two new directors to the Disney Board is a step toward greater Board objectivity (and a belated acknowledgement by the Company of the need for change), this reactive Board self-refreshment on the eve of a proxy contest is insufficient in our opinion both because the new directors were chosen without shareholder input and because they seemingly do not own meaningful amounts of stock.”
Another activist investor, Ancora, agrees that Peltz should be added to the Disney board. Ancora’s Frederick D. DiSanto and James Chadwick wrote in another letter, “We believe Disney is saying the right things about restructuring and transforming the enterprise. Nonetheless, the addition of a shareholder representative or investor-designated directors to the Board can help ensure that these efforts are carried out in the most effective way. In an effort to avert an election contest following a year of distractions and disappointing performance, we hope you join us in encouraging the Board to pursue a viable compromise with Trian Fund Management, L.P. and Nelson Peltz.”
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