Disney just gave itself a little more time to find CEO Bob Iger’s heir apparent: It made the expected announcement that it has extended his contract one year to July 2, 2019.
“Given Bob Iger’s outstanding leadership, his record of success in a changing media landscape, and his clear strategic vision for Disney’s future, it is obvious that the Company and its shareholders will be best served by his continued leadership as the Board conducts the robust process of identifying a successor and ensuring a smooth transition,” Independent Lead Director Orin Smith says.
Iger says that he plans to “build on our proven strategy for growth while working with the Board to identify a successor as CEO and ensure a successful transition.”
Iger is one of the nation’s highest paid CEOs; he made $43.9 million in the fiscal year that ended in September.
His new deal will extend the current terms, and give him an additional $5 million bonus if he stays to mid-2019, according to an SEC filing.
In addition, the board changed the standards it will use to determine his bonus. It says that Disney’s stake in Hulu is “projected to continue to have a net adverse impact” on the company’s operating profits — one of the benchmarks to determine Iger’s success.
As a result, the board will “make such adjustments as it deems appropriate” to make sure the losses don’t hurt Iger’s pay.
The CEO agreed to serve as a consultant for three years after the term expires. He’ll be paid $2 million a year for two years, and $1 million for the third year.
Disney will continue his security services, but won’t let him continue to use the corporate jet for personal trips.
If the company decides to end his tenure before the end of the new contract — except for cause — then Iger would still be able to collect the bonus, and begun the consulting term immediately.
