Disney CEO Iger's 2008 compensation: $51.1M

Peerless83 · Post by **Peerless83** » Mar Thu 19, 2009 8:51 pm

No Jacca..but I am a business man..who sees a 50% increase in a fortune 150 company's stock price..and I say..nice work CEO!

Jacca5660 · Post by **Jacca5660** » Mar Fri 20, 2009 10:44 am

Peerless83 wrote:No Jacca..but I am a business man..who sees a 50% increase in a fortune 150 company's stock price..and I say..nice work CEO!

Would like me to put you in contact with some friends I have that are 15 plus year Disney employees? I believe they have a different point of view on this.

PS I'm a grad of the old Tampa Tech.

Peerless83 · Post by **Peerless83** » Mar Fri 20, 2009 11:21 am

Sure..I would love to talk to them..because there could be a number of reasons why they feel differently. But what it comes down to is that there is a reason why Bob Iger runs Disney..and your friends...or any of the other 160,000 cast members do not. A lot of people who are not in high level management positions have this belief that running a company doesnt take much skill...or that anyone can do it. Unfortunately, not just anyone can run a business let alone a 36 billion dollar mulitnational giant conglomerate such as Disney.

The funny thing about anyone "hating" on Bob Iger's compensation is that the details of the compensation are always left out of the conversation. Iger's base salary is only like 1 million dollars a year. yes, its 1 million dollars...but for a CEO of a fortune 500 company..that is on the low end. The majority of Iger's compensation is made up of worthless stock options (out of the money stock options). They are worthless because the options guarantee Iger to purchase Disney stock at like $29 dollars a share. Well, the stock is currently $17. So if you want to be technical, his options are returning an unrealized loss. Only when Disney's stock goes above $29 a share will they really be worth anything. So, sure, his compensation package is worth $51 million dollars...but that doesnt mean that Bob Iger made $51 million dollars last year.

As for the other "luxaries" that are tied into his compensation, part of it considers corporate jet access..which is a necessity if you are going to be flying around the world on very short notices. So, I dont have a problem with that.

The only part that I think is a little dumb is that the company pays for his health club access. Get rid of that...and everything else is fine in my opinion.

Jacca5660 · Post by **Jacca5660** » Mar Fri 20, 2009 11:30 am

I understand what your saying and find it to be (for the most part) true. I know right now Disney is going through some major lay offs and the rank and file are taking it on the nose. I think if Iger (a problem a lot of CM's have with him is he was hand picked by Eisner) would give a little back and lets face it, he can afford it, he could generate some good will. Some of the people on the low end are having a very hard time making it right now. Even though you point is valid for the most part, the numbers are hard to swallow when people are losing their jobs or getting their hours cut.

With this conversation we could go into the whole Groucho Chico Marks whole lot half a lot skit from Coconuts.

Peerless83 · Post by **Peerless83** » Mar Fri 20, 2009 12:00 pm

And please dont get me wrong..I completely understand that people are getting the ax..at disney...and in almost every large business across the globe. And yes, unfortunately, it is the lower end employees that are the first to go...but take my word for it..if Iger doesnt show Disney shareholders a return on their investment given the level of risk they are taking investing in Disney..the shareholders will do one of two things:

1. They will sell their shares and go elsewhere
2. They will kick him out of office (Disney shareholders have a reputation of getting rid of unpopular CEOs)

You see (and Im not lecturing here..im sure anyone who reads this knows all of this stuff)...but for a publically traded company...its shareholders are the life blood. without them..there would not be any new investment in rides, hotels, cruiseships, movies, etc. etc. So (and here is the problem that most CEOs face) they have to make sure that no matter what kind of environment the company is operating in...the shareholders need to be happy...I mean, hey, they are the true owners afterall. So, in a bad economy...cost cutting is the easiest way of maintaining profit margins...and the first thing to go in a cost cutting initiative..is human capital. As much as I hate to see the average Joe Six Pack being let go..because I could literally be let go any day at my job (just like most of us)..but the cold hard facts show that it is much easier to get rid of a jungle boat skipper than fire the CEO of a company. No, it doesnt make it any better..but thats just the world we live in...and love it or hate it...we live under the best system out there.

Again also, these numbers reflect Disney's 2008 figures....their 2009 figures are probably not going to be anything special...so if we are having this same conversation this time next year...then I may agree with you a little more

If there are any positives that can come out of this..is that it will motivate employees to work extra hard..which will in turn generate more value for the company and the people who buy their products and services.

Jacca5660 · Post by **Jacca5660** » Mar Fri 20, 2009 1:37 pm

For the most part I'd agree, but after what Eisner got away with, I'm not sure how much water that holds. Disney stock was stagnant (or worse) for most of the 90's and early 2000's. Nothing was done about it for a long time. It seemed like one bad move after another. It almost took a revolution to get rid of him and then they had to pay him millions of unwarranted compensation for him to leave.

Peerless83 · Post by **Peerless83** » Mar Fri 20, 2009 4:21 pm

Eisner got away with it because it was not only CEO, but he was chairman as well. He hand picked his board members. They were puppets. Now John Pepper is chairman, limiting Iger's power. Like I said..if we are having the same conversation this time next year..then I may agree more