Top Disney executives go without bonuses because of the pandemic

Walt Disney Co.’s top executives — including Chief Executive Bob Chapek and Executive Chairman Bob Iger — went without cash bonuses for the company’s most recent fiscal year because of the financial havoc caused by the COVID-19 pandemic, according to a regulatory filing released Tuesday.

The result was significant reductions in overall compensation for Disney’s highest level of executive leadership, whose pay is weighted toward performance-based rewards rather than base salaries.

Chapek, in his first year as CEO of the Burbank entertainment giant, still had a total compensation package worth $14.2 million, including his salary and stock awards, according to Disney’s annual proxy report. He became CEO in February after running the company’s parks, products and experiences division.

A nearly three-decade veteran of the company, Chapek took a salary of $1.81 million, plus stock and options worth $6.13 million and $3.37 million, respectively.

Iger, who transitioned from CEO to executive chairman when Chapek took over, had a total compensation package worth $21 million in fiscal 2020. That represents a 56% decline from the prior year, when Iger received $47.5 million in pay. Iger, who is frequently among the highest-paid executives in the industry, made $65.6 million in 2018.

Last year, Iger pulled in a salary of $1.57 million, down from $3 million in 2019. His zeroed-out bonus in 2020 compared with a $21.8-million cash incentive for the prior year. He also took in $6.96 million in stock awards and $9.59 million in options in the most recent year.

Disney’s executive compensation has often come under criticism from activists, a charge that resurfaced during the pandemic when many employees were out of work. Sen. Elizabeth Warren (D-Mass.) in October blasted Disney for a wave of layoffs, a critique the company called “misinformed.”

The decline in C-suite executive pay reflects a brutal year for Disney’s finances, which were hobbled by theme park closures and movie theater shutdowns. The company posted a net loss of $2.8 billion for the 2020 fiscal year, plummeting from a profit of $10.4 billion a year earlier, Disney said in November. Disney also furloughed and laid off tens of thousands of employees, with big hits coming from its parks business.

Other high-level executives went without bonuses, according to Disney’s proxy report: general counsel Alan Braverman, chief financial officer Christine McCarthy, chief communications officer Zenia Mucha and chief human resources office Jayne Parker.

Early in the pandemic, executives temporarily took salary cuts to slow the bleeding. Iger in March agreed to forgo his salary, while Chapek took a 50% cut. Other executives’ salaries were cut by as much as 30%.

But while Disney’s bottom line took a hit, the company made strides transforming itself for the digital streaming age. Buoyed by the success of Disney+, launched in November 2019, Disney reorganized to supercharge its streaming business by separating production decisions from distribution.

Disney+ in December reached 86.8 million subscribers globally, making it
one of the closest competitors to Netflix in the streaming race.