Iger vs. Chapek Part I — The Unlikely Promotion

The whole thing happened less than two years ago, although I understand if it feels like longer.

In November 2022, The Walt Disney Company fulfilled the dreams of its most loyal fans.

Like a fairytale, the conquering hero returned and upended the brutal regime of the oppressive ruler.

And we all lived happily ever after with only a few Disney+ price increases. Eat your heart out, Hans Christian Andersen!

Here’s the three-part story of how Bob Iger brought down Bob Chapek.

Oddly enough, our tale begins with Iger championing Chapek.

I Think I’ve Heard This One

Admittedly, this fairytale isn’t new. Instead, we’ve discussed it several times over the past two years.

The difference now is that The New York Times just ran a story entitled The Palace Coup at the Magic Kingdom.

The article details the events leading up to Chapek’s grand comeuppance at Disney.

This story is a bit different in that the publication’s typical Disney reporter, Brooks Barnes, is assisted by James B. Stewart.

You may not know the name, but he’s the author of DisneyWar, the seminal book about Michael Eisner’s last days at Disney.

As such, this sure feels like the precursor to a longer book about Iger’s return or possibly Disney’s pandemic era.

The article covers about 13,000 words. So, it’s about a quarter of a book in length.

Since we live in a TikTok culture, I’m condensing it into three pieces: the hiring, the Chapek era, and the comeuppance.

The hiring part includes several newsworthy inclusions that weren’t previously discussed anywhere.

So, Stewart and Barnes have nailed a few scoops. One of the most intriguing ones happened nearly a decade ago.

Presuming the reporting is accurate – and I have no reason to question it – Bob Chapek was in contention for Disney CEO earlier than previously known.

The Secret Third Contender

When Bob Iger became CEO of Disney, he joked that he’d never keep the job for a decade.

While Wall Street openly questioned Iger’s competence at the time anyway, the CEO believed that for a different reason.

He’d watched Eisner cling to the job like grim death. From Iger’s perspective, Eisner’s desperation wasn’t for him.

Instead, Iger fully expected to run Disney for a decade and then move along to other life’s ambitions.

During his conversations with his friend, Steve Jobs, Iger heard the disappointment.

The Apple co-founder was dying and wanted to share words of wisdom. He believes that he’d stayed there too long and missed out on life.

Jobs didn’t want Iger to make the same mistake, which informed the latter individual’s thinking in the mid-2010s.

Iger went to Disney’s Board of Directors and embarked on a succession plan.

As we all know by now, Thomas O. Staggs and Jay Rasulo emerged as the leading candidates for the job.

Ultimately, Staggs famously won the bakeoff, only to depart Disney the following year.

Stewart and Barnes confirm longstanding rumors that Staggs lost the job due to Shanghai Disneyland.

That park’s grand opening ran late, while construction on the project ran way over budget.

Both of those things happen frequently with theme park design, which makes the whole thing sound like scapegoating.

The surprise here is that Iger went to a third high-level executive for feedback on Staggs and Rasulo. It was…Bob Chapek.

During an unscheduled visit, Iger appeared in Chapek’s office and pressed him on which candidate was best.

In a moment of honesty, Chapek said, “Neither.” Iger trusted Chapek, and the statement confirmed his belief that Disney needed someone else.

Iger Runs Hot and Cold

After that conversation, Chapek grew confident in his status at Disney. He began to believe that he might eventually run the company.

After Rasulo left Disney in 2016, Chapek considered himself the frontrunner.

Iger enhanced that belief by telling Chapek that the Chairman of Disney’s Parks Division should meet with other division heads.

The idea was for Chapek, who, by his own admission, lacks emotional intelligence, to foster relationships with his peers.

Those plans fell by the wayside for an unexpected reason.

Iger entered advanced negotiations to purchase Fox’s media assets in 2017.

As part of that deal, Ruper Murdoch demanded that Iger extend his Disney contract.

Murdoch sought assurances that Iger, the media exec with the Midas Touch, would handle the former Fox content.

Once Chapek found out Iger was staying for two more years, he canceled those meetings with the other division heads.

Chapek has never been a people person.

Despite this fact, the story paints Iger as an ardent supporter of Chapek’s career, which sounds shocking with the benefit of hindsight.

According to the “scores” of people interviewed, Chapek remained Iger’s top choice as the future CEO at Disney.

During this time, Iger also grew tired of some aspects of his job.

Sure, the CEO loved the glitz and the glamor of running Disney. He’d grown to hate the mundane activities like budget meetings, though.

Iger also felt strongly that he was underpaid. You and I may find that statement absurd, but he had his reasons.

Iger’s Final Straw

Disney’s CEO frequently compared himself to Leslie Moonves, who was running Paramount at the time.

In 2017, Moonves earned $69.3 million while Iger claimed only $36.3 million…and Iger had the better year.

Iger pushed Disney’s Board of Directors for a raise. So, they put the matter to a non-binding vote, which Iger lost.

Disney’s shareholders believed that Iger was earning an amount of money commensurate with his performance.

That was probably the moment when Iger mentally checked out at Disney. Quiet quitting is apparently a thing in C-suites as well.

By the end of 2019, Iger was ready to go, and he believed that Chapek was the person for the job.

I’ll note that their reporting conflicts with what I know of Kevin Mayer’s candidacy.

Also,the authors note that some aspects of their story don’t align, even after discussing Chapek’s sudden ascension with countless sources.

So, some degree of mystery will always remain about what happened. But here’s what we know.

Iger had purchased a license plate holder that stated, “Is there life after Disney?”

Once the CEO learned that his investors didn’t appreciate him to the level he felt he deserved, he pushed hard for Chapek.

Accelerating the Process

The reporters stress that in December 2019, right before the world caught fire, Iger went to Disney’s Board with an idea.

Iger had watched Nike executive Mark Parker pivot from CEO to Executive Chairman there. He viewed that as the blueprint for Disney.

Iger wanted Chapek to succeed him as CEO almost immediately. His exact quote was, “Why don’t we accelerate the process?”

Since Chapek lacked any experience with television, Hollywood, or even Wall Street, the Board didn’t love the rushed approach.

Notably, Disney’s board of directors, led by Oracle executive Safra Catz, resisted the idea

Catz understandably preferred to make Chapek Chief Operating Officer instead. We all wish Disney had taken this approach.  

Frustratingly, the article makes the Board sound like Iger’s puppets, which won’t go over well in some circles.

The Board members agreed to take the holidays to consider Chapek’s candidacy and had warmed to the idea by late 2020.

Disney scheduled the sudden promotion of Chapek to CEO on February 25^th, 2020.

At this point, Chapek STILL hadn’t met with the division heads he’d planned to befriend in 2017.

Meanwhile, Catz wasn’t the only executive who hated the idea. Even Iger’s most trusted advisor, Zenia Mucha, was against it.

Similarly, when Disney CFO Christine McCarthy learned what was about to happen, she rattled off a list of Chapek’s many flaws.

Iger had made up his mind, though, and he always got his way at Disney.

So, on February 25^th, the entire world, save for maybe 20 people, was shocked to learn who had won the succession game.

Bob Chapek was the new CEO of Disney, reporting only to…well, we’ll get to that in Part II.

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