The Walt Disney Company is currently facing some behind-the-scenes drama. The entertainment giant has recently made some bold decisions to gain the upper hand with its board laws.
Disney Board Rules
Disney has notably navigated issues involving an activist investor named Nelson Peltz this year. He’s pushing to have a say in Disney’s decision-making by trying to get seats on the company’s board of directors. In response to this, Disney is making some strategic moves to ensure things stay in their control.
According to Variety, one major announcement from Disney is the return of cash dividends. Imagine it as a little bonus for shareholders. Disney hasn’t handed out these dividends for over three years, mainly due to the challenges brought on by the COVID-19 pandemic.
Each share will receive $0.30 this time around, and it’s set to be paid on January 10, 2024. Shareholders who officially own Disney shares by December 11, 2023, get to enjoy this bonus.
To strengthen its position, Disney’s board didn’t stop at dividends. They decided to tweak some of the rules, known as bylaws, on how the company is run.
Effective immediately, these changes are designed to ensure everything runs smoothly when it comes to decisions about who sits on the board. It’s like Disney is updating its playbook for the game.
These new rules also consider a set of regulations known as Rule 14a-19. Think of it as an extra layer of guidelines for situations where there’s a contest over who gets to be a director.
Disney Changes Laws
Disney wants to ensure that everyone gets the full picture when it comes to voting for directors. Shareholders should see all the candidates presented by the company’s management and other shareholders. The updated rules also ensure everyone follows standards for how these contests are carried out.
There’s even a visual aspect to these changes. Disney’s new bylaws say that anyone trying to convince shareholders to vote in a certain way, known as soliciting proxies, has to use a proxy card that’s a color other than white. It might seem like a small detail, but in the world of corporate decisions, even colors can have a strategy.
Mark Parker, Disney’s Chairman, shared his thoughts on all these moves. He sees it as a positive step in a year filled with progress and changes for Disney. He mentions how the company has restructured some things to focus on long-term growth.
In the midst of these changes, Parker is happy to declare a dividend for shareholders, believing it aligns with Disney’s goal of investing in the company’s future while creating meaningful value.
In a nutshell, Disney is taking steps to handle a bit of corporate drama behind the scenes. They’re ensuring shareholders get a bonus, updating their rulebook, and ensuring everyone plays fair in the election-like process of choosing board members.
The company has dealt with some major shakeups this year, and these Disney board rules are just another challenge it has navigated as it assured fans everything is under control.