Disney Board Tightens Director’s Nomination Rules Amidst Brewing Proxy Battle

On Nov. 30, Disney’s board “amended and restated” the company’s bylaws, which became effective as of Thursday, the company said in an SEC filing Thursday. The Board’s move is seen as a response to activist investor Nelson Peltz’s announcement of launching a proxy campaign to get seats on the company’s board.

A day after Disney announced that James Gorman, the CEO of Morgan Stanley, and Jeremy Darroch, the former CEO of Sky, would be joining the board as new members with terms beginning in early 2024, Peltz’s Trian Fund Management said that it would begin a proxy battle to get its Directors on the board.

In a separate attempt to win back shareholders’ confidence, the company announced its first cash dividend post-covid of $0.30 per share.

The statement from Disney stated that the changes, among other things, “enhance the procedural mechanics and disclosure requirements relating to business proposals submitted and Director nominations made by stockholders.” This entails the need for “any notice of Director nomination to be accompanied by all written questionnaires required of the company’s Directors, completed and signed by any proposed Director nominees,” as well as “certain additional background information, disclosures, and representations regarding any proposing stockholders, any proposed Director nominees and business, and any other persons related to a stockholder’s solicitation of proxies.”