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Economist

Corporate governance: Shareholders at the gates

March 20, 2013

SO MUCH for gratitude. In the past financial year, Walt Disney delivered everything you might expect from the owner of a Magic Kingdom. Bumper profits, a well received acquisition of Lucasfilm, prospects that everyone agrees are better than ever. No wonder that shares in the entertainment conglomerate are at an all-time high. In almost any other year, Bob Iger, Disney?s boss, could have looked forward to unstinting gratitude from shareholders at the firm?s annual meeting on March 6th. Instead, shareholder activists, grumbling that Disney is in danger of becoming a ?tragic kingdom?, made a determined though unsuccessful attempt to strip him of one of his titles by voting to split the roles of chairman and chief executive.Shareholders used to mount such campaigns only at firms that were performing horribly, as happened towards the end of the reign of Michael Eisner, Mr Iger?s predecessor. (This led Disney to split the roles of chairman and chief executive, only to reverse this later, to the fury of some shareholders.) Even then, shareholder activism was rare; most investors simply did the ?Wall Street walk?, selling their shares if they were unhappy. But since the...

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