Disney Shareholders Uphold Pay to ‘Dead’ CEO10 Mar, 2009 By: Erik Gruenwedel
Shareholders of The Walt Disney Co. think so highly of CEO Bob Iger that they voted to keep paying him should he die while on the job.
Meeting March 10 in Oakland, Calif., Disney’s owners shot down a proposition (61% to 39%) that would have called for greater shareholder scrutiny of executive compensation.
All 12 members of Disney board were reaffirmed, including Apple CEO Steve Jobs, who was not present and controls 7.4% of Disney’s stock.
Known in corporate circles as a “golden coffin,” shareholders voted 73% to 27% to sustain a program for select senior executives that entitle them to be paid even after their deaths.
For example, Iger’s estate would receive his annual salary for three years upon his death, in addition to a $4.5 million lump sum payment.
Disney said the “golden coffin” had been phased out and did not apply to newly hired executives. But that didn’t stop analysts from criticizing the perk during an economic downturn that has seen Disney stock drop nearly 50% from the same time a year ago.
“Pay is supposed to be for performance,” Cornish Hitchcock, a lawyer with Amalgamated Bank LongView Funds, told MSN Money. “If an executive is dead, you are not getting performance.”
Iger told shareholders Disney was well positioned to weather the recession. He said the company had improved its bottom line through assorted online initiatives coupled with “great branding and marketing tools.”