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Did disgruntled bus drivers & baggage handlers force Disney to opt out of Orlando & hold its 2007 shareholders meeting in New Orleans?

Did disgruntled bus drivers & baggage handlers force Disney to opt out of Orlando & hold its 2007 shareholders meeting in New Orleans?

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The introductory letter for the Walt Disney Company's 2007 Proxy starts off like this:

January 12, 2007

Dear Fellow Shareholder,

I am pleased to invite you to our 2007 Annual Meeting of shareholders, which will be held on Thursday, March 8, 2007, at 10 a.m. at the Ernest N. Morial Convention Center in New Orleans, Louisiana. We hope you will join us in supporting the revitalization of New Orleans following the devastating effects of Hurricane Katrina.

Which caught an awful lot of Disney insiders by surprise. Given that Bob Iger was supposed to be the anti-Eisner. Meaning that Disney's new CEO was supposed to be the sort of guy who wouldn't avoid confrontation & controversy by holding the company's shareholders meeting in some far-flung location.

By that I mean: how many of you remember that eight year span where -- after a particularly raucous meeting at Anaheim's Arrowhead Pond back in February of 1997, where angry shareholders took Michael Eisner to task for Mike Ovitz's $90 million golden parachute -- Disney's old CEO literally took Mickey's show on the road. Holding the Mouse House's annual meetings in cities like Chicago, Denver, Fort Worth, Hartford, Kansas City, Philadelphia, Minneapolis and Seattle.

Of course, Disney's PR flaks insisted that the reason Mickey wasn't holding his annual meetings in Orlando or Anaheim anymore (as had been the tradition for over 20 years) was because the Mouse wanted to give more of its shareholders the chance to attend one of these corporate shindigs. But company insiders would admit (off the record, of course) that one of the added benefits of holding these gatherings in states like Minnesota & Connecticut was ... Well, this practice then made it rather difficult for the company's low-paid employees and/or minority shareholders to show up & ask Eisner embarassing questions.

But once Michael exited the Magic Kingdom in September of 2005, that meant that Disney's corporate roadshow had finally come to an end. Or so said one senior Disney exec that I spoke with last year. When I commended the company for once again holding its shareholders meeting in Anaheim, this executive replied:


Photo courtesy of Google Images

"That's all Iger's doing. From here on in, he wants to hold these meetings in places that the bulk of the company's shareholders & fans can actually get to. Which is why next year, we're going back to Orlando. And then -- after that -- these meetings will alternate between Anaheim & Orlando."

And based on what I've heard from dozens of Mouse House employees since March of last year, that was originally the plan. That the Walt Disney Company would hold its 2007 Meeting of shareholders at either the convention center at WDW's Contemporary Resort Hotel or at the Coronado Springs.

But then -- late last year -- this plan changed. Reportedly after it was revealed that Walt Disney World would be handing over 167 of that resort's bell, valet and baggage service positions to an outside contractor in early 2007. Given how upset the union was over this decision by WDW upper management, there was immediately talk of protests & picketing.

And the idea that some disgruntled former WDW bellman might make his way to the mike during the Q & A portion of this year's annual meeting and then potentially embarass Bob Iger reportedly really concerned several senior Disney officials. Then -- when you factor in the lingering bad feeling associated with Disney's Magical Express Service (Which has caused hundreds of people who used to work in transportation-related businesses in the Orlando area to lose their jobs) ... It was then supposedly decided that 2007 might not be the best year for the Walt Disney Company to hold its annual shareholders meeting on WDW property.


Photo courtesy of Google Images

So a search was then allegedly begun for an alternate meeting site. Then someone in PR reportedly came up with the idea of holding Disney's Annual Meeting of shareholders in New Orleans. Which was immediately embraced, given that it serviced both of the corporation's needs beautifully. In that Mickey was sure to get tons of positive publicity for offering to hold its annual meeting in this still-struggling-to-recover municipality. While -- at the same time -- given the news that's been coming out of New Orleans lately ... It seemed quite likely that a lot of Disney shareholders would opt out of attending an annual meeting that was being held in the Big Easy. Prefering to wait 'til the Mouse House held its next corporate gathering in a much more hospitable spot. Like -- say -- Anaheim or Orlando.

Speaking of which, I made a call yesterday to the same senior Disney exec that I spoke with last year. And he said:

"After all of the bad feelings associated with this new outsider contractor & Magical Express have faded away, then the annual meeting will come back to Orlando. That may be 2008. More likely 2009."

So there you have it, folks. Disney's heading to New Orleans in March only partially because this corporation wants to help that city with its recovery effort. Truth be told, the main reason that the Mouse will be holding its meeting at the Ernest N. Morial Convention Center is because Bob Iger is hoping to find a more easy-going crowd in the Big Easy.

A Brief History of the Walt Disney Company's Annual Meetings

Up until 1969, these annual gatherings of shareholders were held right on the Disney lot in Burbank. With hundreds of chairs being set up inside one of the studio's massive soundstages.

Starting in 1970, these Annual Meetings of shareholders were held off the lot. With Disney's first off-site corporate gathering being presented at Hollywood's Pantages Theater. For the five years after that, the company's annual meetings were held at the Dorothy Chandler Pavilion at the Los Angeles Music Center. Starting in 1977, Walt Disney Productions -- with just three exceptions* -- would hold its annual meetings in either Anaheim, the Orlando area and/or on WDW property for the next 21 years.

Year Annual Meeting was Held
Location
1970
Hollywood
1971
Los Angeles
1972
Los Angeles
1973
Los Angeles
1974
Los Angeles
1975
Los Angeles
1976
Los Angeles
1977
Anaheim
1978
Anaheim
1979
Lakeland, FL
1980
Anaheim
1981
Anaheim
1982
Anaheim
1983
Walt Disney World
1984
Walt Disney World
1985
Anaheim
1986
Boca Raton, FL
1987
Anaheim
1988
Kansas City
1989
Walt Disney World
1990
Anaheim
1991
Anaheim
1992
Walt Disney World
1993
Anaheim
1994
Walt Disney World
1995
Walt Disney World
1996
New York City
1997
Anaheim
1998
Kansas City
1999
Seattle
2000
Chicago
2001
Fort Worth
2002
Hartford
2003
Denver
2004
Philadelphia
2005
Minneapolis
2006
Anaheim
2007
New Orleans

* In 1986, Disney's annual meeting was held in Boca Raton, FL to help promote one of Arvida's signature properties, the Boca Raton Resort & Club. In 1988, this corporate gathering was held in Kansas City to celebrate Walt Disney's ties to that burg. In 1996, in recognition of the Walt Disney Company's recent acquisition of Capital Cities / ABC, Inc., that year's annual meeting was held in New York City.

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  • Nice article :) I think Disney should have just stayed with the original plan, to switch each year between Orlando and Anaheim. Or just find a spot in Burbank, why go through all this trouble if there are good facilities in your hometown.

    And I get why Iger wouldn't want that flurry of questions in an annual meeting, but he shouldn't be scared for that. I hope there is a good answer why they are outsourcing, so why not just answer that , aka "the good answer" (I don't know what it is, but Iger must know), at the moment the questions are asked?

  • “Supposed to be the anti-Eisner”??   Excuse me, but Iger was anointed-er appointed-er crowned by Eisner and rubber stamped approved by Eisner’s hand picked board.  BTW: Roy Disney sued, calling Disney’s  so-called selection process of Iger a “sham”.  Maybe Eisner or at least his legacy and policies is still running the Walt Disney Company.

    A few more logical reasons:

    Could it be that the LA Times reported that Iger’s pay in 2006 is worth about 25 million dollars?

    Or that they are “way over the norm” paying Mr. Pepper a yearly sum of  five hundred thousand dollars ($ 500,000.) ?

    Or that about ten of Disney’s companies have been professionally served in September 2006 of the Pirates of the Caribbean lawsuit (Royce Mathew vs. Disney), yet it was nowhere to be found in Disney’s recently filed 10-K, as Disney chose not to disclose the details surrounding this lawsuit in their required 2005-2006 fiscal year 10-K disclosure ending September 30, 2006 that is filed with the United States Securities Exchange Commission and is signed off by Bob Iger and Thomas Staggs dated November 22, 2006?

  • Iger shouldn't be afraid of questions, you're right, empoor.  I think that it makes sense to have a Disney meeting (no matter what kind) in a Disney area.  It just makes sense.  Maybe some people from New Orleans who are shareholders were planning on coming to the meeting, regardless of where it would be, and now they're extra happy.  But the majority of shareholders don't live in New Orleans.  Disney has businesses in NYC- they could even have it there.  Heck, even have it in Marceline, Missouri- that makes more sense than New Orleans.  Not that I'm knocking New Orleans.  

    It seems that Disney's hiding something...just based on what I've read here.

    And, on a side note, do only the top-shareholders get to go?  My husband and I own Disney stock, but only a few shares...so we probably wouldn't be allowed to go, right?  

  • blackcauldron85 said:

    "And, on a side note, do only the top-shareholders get to go?  My husband and I own Disney stock, but only a few shares...so we probably wouldn't be allowed to go, right?"

    Nope ... any number of shares is sufficient. I own a single share I bought framed (from OneShare.com) and even that is enough to gain me entree to the meeting (I went to the tumultuous Philly meeting).

    My personal opinion is this ... If CEO's are "tough" enough to make these "hard" decisions behind closed doors, why aren't they tough enough to stand up in front of the people their decisions affected and justify their actions?

    I'm sorry ... I've been a die-hard capitalist since birth, but I'm rapidly tiring of the growing divide between corporate America and the average worker bee.

    Stand up and be a man, Bob. If you can't take the heat, then don't make the decisions in the first place. You can't hide in your ivory tower forever ... show a ball, for God's sake.

  • Uhh, who really cares?  So what if they don't hold it in Orlando or Aneheim.  Truly, what does it matter?  

    And, also, what organization doesn't try their darndest to avoid negative press?  It's not like Disney is the first company to make a decision based upon avoiding problems with disgruntled people.  

    Much ado about nothing.

  • Come on now, is it really necessary to spin this in a negative way?  Sure, the labor problems probably do have some small influence on this decision, but can't Iger get some benefit of the doubt for scheduling the shareholder meeting in a city that could actually really benefit from it?  This city needs the businesses back, and I think  this is a great move on his part, mainly for the positive PR that the company will receive for hosting it in New Orleans.  I am a New Orleanian, and am totally thrilled that the shareholder meeting is here in town.  I think you guys need to lay off Iger on this one.  He made a great decision by having it down here.  It doesn't need to be in either Orlando or Anaheim every year, although I do think it should be in these places every few years.   He made a good decision which will help a city in need, you guys need to lay off him.  So he's avoiding possible angry mobs, at least it's not shareholders that he's avoiding, and aren't they some of the most important?

  • A true leader is going to make hard decisions.  A true business leader is going to make decisions that will cost people their jobs.  It is how well the person in charge announces and carries out the downsizing/firings/cutbacks to both the departing workers and the workers still employed that determine how good of a leader he/she is.    Issuing a memo followed by hiding doesn't sound all that great.    Last I heard WDW was having a difficult time hiring and retaining employees, but they can blindly get rid of a few thousand??

    Executive pay needs to top out at $2 million/year - unless the executive founded the company. If you come up with the idea and build the company from the ground up - great - you're allowed whatever profits roll in. But if you're a caretaker for a company that's already rolling - not that difficult. There's no seat-of-the-pants ideas that any corporate CEO comes up with - every decision is based on research, focus groups, spreadsheets. The CEO only approves what they've got plenty of back-up projections for, because if it fails, they have to point blame somewhere else - R&D, marketing, etc. It is a series of - do you want to put the company's money into this project or that project - questions. Questions that have been well researched before ever hitting the CEO's desk.

    So am I saying anybody can successfully do the CEO's job? From the general population - no. From the company itself - probably 60-75% of the people employed could, whether it's an oil company, food company, entertainment company. What a CEO has done that most employees haven't done is put in the hours playing politics, schmoozing, pulling the rug out from under potential competitors within the company, taken credit for other's ideas, and ranked moving up in the company ahead of anything else in their lives. Most people aren't willing to do that.  But we shouldn't be shocked when someone with those characteristics finally makes it up the slippery slope to the boardroom, wants to take as much money home as possible, and isn't all that concerned about other people - unless tax credits are involved.

  • You're kinda being a little unfair about what a CEO actually does within his functions.. According to you a CEO is always just a puppet who relies on the work of others - and that's so not true.

  • You're incredibly naive about the way a multi-million dollar company, such as disney, works, if you dont agree with curmudgeon.

    Maybe back in the 50's a CEO really did something for the company, but these days its a lot of ass-kissing, sleeping with the boss, and for-going your family life for a shot at a top position. Dont believe me? Why are there so. many. movies. made. about men (and some women) who cant seem to balance a home-life and that career they so desperatly want. The Devil Wears Prada being a recent example, followed by Click.

    Anyway, Its no surprise to me that Disney doesnt want to hear the bad news. Its not like its some secret that they dont pay their park employees much, and expect The World out of them. And its unfortunate when it does, but lay-offs happen. If Disney didnt have a budget, theyd go bankrupt financing every idea that walks through the door. Which is why there is research and charts and graphs and focus groups, and why ultimately one man makes a decision.

    I dont agree with his paycheck, but its the way a system in this country works. Its the politics of the workforce. Dont like it? Freelance, start your own business, or get to work on how to inhabit another planet. Because while im sure a bunch of us could cause a stir to change current procedures, its just the way it is. And eventually it will all bottom out.

  • Executive compensation has simply grown out of control -- It was ridiculous how much Michel Eisner was pulling OUT the company ... and still is with that massive golden handshake. Unfortunately, it's not much better under Bob Iger.

    Disney isn't the number 1 firm in the U.S. -- is it even in the top 25? Why does Disney reward its CEO with the No. 1 compensation package (least this was true under Eisner despite numerous missteps and miscalculations).

    Walt Disney and his brother Roy both lived modestly (yes, it was a smaller entertainment company and not this mega multimedia monster under their guidance), but I'm sure there wasn't a 10,000 to 1 ratio between what they were paid and their average full-time employee.

    I read a half-dozen years ago that the ratio of the average CEO salary vs. average full-time employee was 17,000 to 1. The rich get richer and the middle-class shrinks. Wake up!

    One has to wonder when visiting Disneyland or WDW how much better things would be in regards to employee retention and morale had they taken all the money Disney paid out in the Michael Ovitz disaster to improve pay and benefits for the FRONT-LINE employees -- those REALLY responsible for creating or destroying the magic in their interactions with the public.  

    The prestiege of working at the park and making dreams come true don't pay the bills. Too many high-paid managers and EXECUTIVES and understaffed restaurants, stores and theme parks.

    Yes, Bob Iger (someone I genuinely want to do well) should face the shareholders and have his feet held to the fire. I think that if he really followed Walt's example of caring about quality first and putting on a good show, if he listened to lower level managers like Dick Cook and Matt (we miss you) Quimett -- known for being approachable and considerate of their guests (and shareholders), he'd know that most of us can be polite even in our criticism. Bob Iger should be able to answer questions and face shareholders in Orlando, Anaheim and the instutional holders in New York. There should be live satellite feeds from ALL those cities as well as questions from shareholders from all those sites for a minimum of 60-90 minutes.

    Bob, be bold and courageous ... don't be Chicken Little. Besides, I can understand why Michael Eisner might need a security patrol and bodyguards ... but why do you? Has Dick Cook or John Lasseter ever really found themselves in a precarious and unsafe situation with some angry mob?

  • Seeing as how The Walt Disney Company weathered the worst of its problems in the past couple years, this hopping from one random city to the next isn't really neccesary anymore, is it?

    By the way, does anybody else find it surprising that the annual shareholders' meeting was held in Walt Disney World in 1984?  I ask, because that was the same year that the studio was almost bought out and seperated by TWO firms!

  • I wouldn't say New Orleans is such a random choice for the Disney company. It's been an influence on Disneyland, it hosted the premiere of Hunchback, and now it's rumored to be the setting for a 4th POTC film. For all I know, POTC4 could be announced there. What makes the better headline: Disney Stockholder Meeting in and upcoming blockbuster to be filmed in New Orleans... or Disney appeases anonymous internet posters by relocating stockholder meeting to Anaheim?

  • blackcauldron85 asks:

    "And, on a side note, do only the top-shareholders get to go?  My husband and I own Disney stock, but only a few shares...so we probably wouldn't be allowed to go, right?"

    If you own one share of stock, you have a right to attend. The proxy and annual report should be mailed to you, or you should get info by email if you opted out of snail mail. Only one share is your ticket in. I've only been to one Disney shareholder meeting, the one in Philadelphia. If I only ever get to go to one in my entire life, I was lucky and glad it was that one!

  • New Orleans! Great for me - for once the shareholders meeting will be close for me to actually make it. I live in Florida, and New Orleans is closer to me than Orlando. Plus I like the idea of having the meetings around the country at various locations. And like k-man said "if I only ever get to go to one in my entire life, I was lucky and glad it was that one!" well this will be mine, in New Orleans.

    My two cents.

  • CEO compensation doesn't irk me at all.

    Considering how much harder it is to be a CEO these days with the internet following every move (harder personally, not professionally) and how much more liable they are for things which may be entirely out of their control, after Sarbanes-Oxley, I feel good CEOs deserve the reward. If the company performs.

    I also feel they should be quick to get the boot when it doesn't. Without the major parachute you still find. Or the book deals making a former HP CEO very wealthy, even after she ran the company into the ground.

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