Bob Iger’s back at Disney. But who comes next?

This is an audio transcript of the FT News Briefing podcast episode: ‘Bob Iger’s back at Disney. But who comes next?’

Marc Filippino
Good morning from the Financial Times. Today is Tuesday, November 22nd, and this is your FT News Briefing.

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European central bankers are meeting in a couple of weeks and they don’t see eye to eye on interest rates. Oil prices were on a wild ride yesterday. We’ll look at why. Plus, Disney’s board just staged a mutiny against their CEO. One of the most amazing things, they did it in total secrecy.

Anna Nicolaou
This was probably the most surprising thing I’ve seen since covering the media for the past five years. It’s almost cinematic how stunning this is.

Marc Filippino
I’m Marc Filippino, and here’s the news you need to start your day.

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We could see a clash of monetary policymakers at the next European Central Bank meeting. Yesterday, Austria’s hawkish central bank chief, Robert Holzmann, told the FT that he wants another rate increase of 75 basis points. Holzmann says that it’s important to convince the public that policymakers are serious about taming inflation. Other central bankers are recommending smaller increases because they see signs of a recession. The ECB’s chief economist yesterday said that 75 basis point increases may not be necessary anymore. And some European politicians have warned the ECB not to raise rates too high. The central bank will make a decision at its next meeting in mid-December.

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Oil prices were unusually volatile yesterday. They fell sharply in the morning after the Wall Street Journal reported that Opec was going to increase supplies. Here’s the FT’s Derek Brower on what happened next.

Derek Brower
And then later in the day, Saudi Arabia issued a statement saying this was not the case, that they weren’t discussing this at all. The United Arab Emirates came along and said the same thing. And actually, every, pretty much every source that we spoke to at the FT when we were trying to follow this story in the Journal, told us the same, that there had been no discussions of this kind. And the plan was still, as they agreed last month, to carry on with this production reduction over the coming weeks and months.

Marc Filippino
And a reduction would theoretically drive prices higher. But, you know, a lot can happen between now and Opec’s next meeting, which is in just under two weeks. Could Opec change its mind by then?

Derek Brower
There’s tons of wriggle room. There always is before these meetings. And what happens to the price will be very important in what Opec decides to do. And bear in mind that even before yesterday’s gyrations in the oil market, the oil price had fallen by about 10 per cent in the past week or so. So that will be one factor. But then the other really, really big thing to bear in mind is that just a day after Opec is due to hold its meeting in Vienna, the EU’s embargo on Russian oil starts and so does the price cap on Russian oil exports that the US Treasury is trying to impose. So there’s this huge almost cliff edge, this building for the oil market. Nobody quite knows how the drastic tightening of sanctions on Russian oil exports by the EU will play out or how the price cap will play out. In fact, yesterday the Russians reiterated again that any countries observing the price cap, they would cut supply to those countries. So it’s very, very complex. There’s so much at stake here because the global economy, as we know, is perilously perched on the edge of this recession that some people think is imminent. And higher oil prices could help push the global economy in that direction. Cheaper oil might give it a bit of a fillip. So there’s a lot at stake when Opec meets on 4th of December in Vienna.

Marc Filippino
Derek Brower is the FT’s US energy editor.

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Hollywood is in a state of shock, stunned by revelations of the boardroom mutiny at Disney. On Sunday, the board of the entertainment conglomerate ousted chief executive Bob Chapek. He’d been at the helm for less than three years, and they replaced him with Bob Iger, the legendary former CEO who’s now back at the helm. With me now to pick up the storyline is our US media correspondent, Anna Nicolaou. Hey Anna.

Anna Nicolaou
Hi.

Marc Filippino
So I’ve got to ask, Anna, did you know that this was in the works? Did anyone who covers the media know that this was in the works?

Anna Nicolaou
I did not know that this is in the works. I mean, people were reporting on the Bob-Bob relationship as recently as, I think, Thursday or Friday. So it’s kind of remarkable from just a journalism standpoint that the board is able to keep this so under wraps. But no, I was, this was Sunday night. It was, like, 10pm. Eastern time. I think I was watching The White Lotus, HBO’s show. And then I saw the email and could not believe it.

Marc Filippino
And what was so stunning about it?

Anna Nicolaou
It’s just, it’s this kind of clash of personalities. Disney is the biggest company in entertainment, at least in the western world. Bob Iger is this kind of larger-than-life executive. Everyone loved him. He delayed retiring at least four times. Then he finally, kind of out of the blue, said he was retiring. He handpicked Bob Chapek as his successor. And then it almost instantly, it seemed, like he regretted it. And you’ve had this kind of bizarre situation for the past few years of Disney under the leadership of this person that no one seems to trust or like. And you had Iger still kind of looming in the background, even though he had left the company. And this was all happening as obviously Disney was going through the pandemic. So it’s just been this very dramatic, I would say, personality-driven drama.

Marc Filippino
OK. So you have all these personality and trust issues, but you got to think that the reason for this mutiny was streaming and the big losses at the streaming unit. Is that right?

Anna Nicolaou
I mean, I think Chapek’s biggest weakness is not necessarily the business strategy itself. It’s Chapek never was able to get either the press or Wall Street behind him from the jump, really. There was a lot of scepticism over who he was, his credentials. He doesn’t come from a creative background. He is kind of this marketing guy from the midwest who’s been around at the company forever. And he kind of had a few different fiascos that people didn’t seem to appreciate how he handled them.

Marc Filippino
What kind of fiascos?

Anna Nicolaou
He announced a kind of restructuring that no one was ever in favour of, really, that kind of took power away from the creative leaders within Disney. And the goal of it was to make it more of a tech company, as, you know, a streaming-first company. But that was very unpopular internally. Then there was that kind of argument, this bizarrely public argument with Scarlett Johansson over payments for the Black Widow movie, which a lot of people seem to think Chapek did not handle that well either. So that was it. The other one, and then the third one was regarding Disney’s operations in Florida, where politicians have been pushing for the, what they call the “Don’t Say Gay” legislation, where, you know, Disney internally, as you know, as a workforce, had a lot of liberal focused employees who were unhappy that Chapek didn’t say anything initially, and then Chapek did say something, but then he was dealing with all this backlash from politicians in Florida. It was another scenario that, you know, not necessarily Chapek’s fault, but people don’t think he was able to kind of handle it in a savvy way, communications-wise. And again, that kind of underscores that it wasn’t even necessarily the business decisions he was making. It was more the brand and the public face of the company and kind of flaws in the way that he was handling things.

Marc Filippino
Now going back to streaming, where does that fit in?

Anna Nicolaou
Iger is the one who came up with this strategy of, you know, we’re going to go all in on streaming and now the market has completely turned on that strategy. So in a way, I mean, Chapek has basically been pushing forward Iger’s strategy. I think the problem is that the world has changed. And Chapek didn’t change that strategy.

Marc Filippino
So Iger has agreed to stay on for two years and help find another successor. But he’s the one who tapped Chapek. I guess what I’m wondering is, can he find someone suitable to take over when he steps aside again?

Anna Nicolaou
Yes. So that’s the problem. That’s, and some people actually I’ve spoken to who are, who know Iger well, were saying the question for everyone right now and the question for Iger is, how is he going to be able to actually find a real successor and set the company on the right path for a future beyond him? Almost one of the biggest weaknesses in his legacy at this point is that he never found a proper successor or at least one that he trusted enough to do this, which is a problem for a massive company, if only one person can manage it successfully. And the challenge for the company is, can Disney actually succeed without Iger?

Marc Filippino
Anna Nicolaou is the FT’s, US media correspondent. Thanks, Anna.

Anna Nicolaou
Thanks for having me.

Marc Filippino
And no surprise, but Disney shareholders are happy to have Iger back. The company’s share price closed up 6 per cent yesterday.

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Before we go, the British appetite for bacon is back. Imports of the meat are now at pre-pandemic levels as office and school canteens have reopened. Plus, rising prices means more consumers are turning to cheaper foods. Rising demand for bacon is a crucial reason why one of Europe’s leading meat companies, Danish Crown, is building a new bacon and gammon processing plant north of Manchester. And fun fact: Brits are the top bacon eaters in Europe.

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You can read more on all of these stories at FT.com. This has been your daily FT News Briefing. Make sure you check back tomorrow for the latest business news.