Ousted Disney chief executive Bob Chapek is set to receive a hefty paycheck following his exit.
The Walt Disney Company said the former CEO, who took over in February 2020 after longtime CEO Bob Iger retired, is eligible to take home a severance pay package worth roughly $20 million, according to a regulatory filing Tuesday. That’s in addition to the $24 million he made last year — his $2.5 million base salary plus millions in stock options and awards. That’s down from the $32.5 million he made in 2021.
Chapek abruptly exited the company in November after a hectic two-year stint marked by Covid-19 shutdowns, a PR debacle related to Florida’s “Don’t Say Gay” bill and a significant slowdown in demand for streaming services. He was replaced by his predecessor, Iger.
The proxy filing said that the board determined that Chapek “was no longer the right person to serve in the CEO role,” even though it had voted to extend Chapek’s tenure for three years in June 2022.
“The significant developments and change in the broader macroeconomic environment over this period informed how the board viewed the appropriate leader in light of the rapidly evolving industry and market dynamics,” the filing said.
Disney shares, which were trading at about $170 in January 2022, have fallen to about $100 a share.
Iger has returned to Disney at a tumultuous time. Its streaming business lost $1.5 billion in the fourth quarter, and Disney’s media networks are struggling as cord-cutting accelerates and once-lucrative outlets like ESPN lose household reach.
Dan Loeb, the activist investor and Third Point CEO, made headlines in August when he suggested “a strong case can be made that the ESPN business should be spun off to shareholders with an appropriate debt load.”
A Wells Fargo analyst also called on Disney to ditch ESPN in December.
(DIS) previously revealed that Iger earned a $1 million base salary. However, that compensation comes with an annual bonus of up to $1 million, as well as an annual incentive-based award with a target value of $25 million. That means that Iger has the potential of pulling in around $27 million.
Last week, Disney named Nike executive chairman Mark Parker as its new board chair, replacing longtime director Susan Arnold, whose term limit is expiring.