We have been discussing the shareholder revolt in some companies over social and political agendas that are suppressing profits at companies like Disney and BudLight. Recently, Disney admitted that it was driving away consumers with its controversial positions and Disney CEO Bob Iger has indicated that he wants to return to selling products and not social reforms. With Disney films cratering and the company losing its position as the top grossing film company, shareholders are threatening to take action.
The problem for Iger is turning a massive company around after years of reinforcing this role as a corporate culture warrior, including layers of hires over the years reinforcing this culture. It also needs to address damaging public comments from Disney figures.
Last year, Disney had to deal with stars like Rachel Zegler trashing the story behind Snow White and promising a new feminist rewriting of the story. This followed an alleged move to replace the dwarves with “magical people.”
2024 will likely determine if even companies the size of Disney can be drawn back through shareholder actions in reshuffling boards. Iger may have been rescued by two whales recently. Just as shareholders appeared set to challenge Iger, ValueAct Capital and Blackwells Capital moved in to support Iger and to continue his policies.
In the meantime, critics have a new gripe after Kathleen Kennedy, the chief of Lucasfilm, who widely associated with the prior social agenda in films, selected director Sharmeen Obaid-Chinoy as the new director for the Star Wars franchise.
Obaid-Chinoy drew fire in 2015 over her comments that “I like to make men uncomfortable. I enjoy making men uncomfortable.” She recently stated “we’re in 2024 now, and it’s about time that we had a woman come forward to shape a story in a galaxy far, far away.”
The comments are reminiscent of those of Alissa Heinerscheid, vice president of marketing for Bud Light, before the company went into a market dive.
Before the devastating boycott over the Mulvaney promotion, Heinerscheid was lionized by many for pledging to drop Bud Light’s “fratty reputation and embrace inclusivity.” Bud Light lost its top position among beers and, despite many insisting that the opposition would be short-lived, it has continued to suppress sales.
The question is whether the moves on the board this month followed assurances from Iger that he will address the increasingly polarizing view of the company. Reportedly losing a quarter of billion dollars on just two movies, Disney has been suggesting that it is moving away from pushing social and political messaging.
Disney recently seemed to acknowledge that it is facing its own Bud Light moment. In its annual SEC report, Disney acknowledges that “we face risks relating to misalignment with public and consumer tastes and preferences for entertainment, travel and consumer products.” In an implied nod to Smith, the company observes that “the success of our businesses depends on our ability to consistently create compelling content,” and that “Generally, our revenues and profitability are adversely impacted when our entertainment offerings and products, as well as our methods to make our offerings and products available to consumers, do not achieve sufficient consumer acceptance. Further, consumers’ perceptions of our position on matters of public interest, including our efforts to achieve certain of our environmental and social goals, often differ widely and present risks to our reputation and brands.”
