Eisner Tells 'Nightline' He's Staying On

March 4, 2004 — -- Disney boss Michael Eisner talked with Nightline's Ted Koppel after 43 percent of the company's shareholders withheld their support for him.

TED KOPPEL: It has been a very long and trying day for Michael Eisner. When this day began he was Chairman of the Board, and CEO of the Disney Company. By this evening, you've given up one of the titles I gather. That happened when, Michael?

MICHAEL EISNER: We decided, the board decided, that this movement in America to separate the non-executive chairman and the CEO was something we had been considering, and getting our company into contemporary governance and we did it today, we heard our shareholders who seemed to be interested in that, so we went ahead and did it.

KOPPEL: There is an inclination to suggest to you that it may be too little too late. What do you think?

EISNER: Well I think our performance is fantastic. Our stock went up 60 percent in the last year. We just had a 33 cent quarter, after a five cent quarter the year before in the same period. We're looking at 30 percent growth this year, double-digit growth over the next three or four years. Performance is not an issue at the Walt Disney Company, so I don't think it has anything to do with that.

KOPPEL: I guess my question is do you think this will be enough to keep your critics at bay, and judging by the number of shareholders who voted against you today, you got a few critics out there.

EISNER: Well, American corporations have critics, and certainly we had critics because we didn't have a separation of the chairman and the CEO duties. We've had some historic critics that we didn't deliver on corporate governance fast enough. Certainly there must have been people out there that were dissatisfied with our performance post 9/11 and the wars in Iraq, and our tourism dropped during that period. The messages that we're getting from that kind of vote are multiple, and they're about corporate America, they're about messages to other corporations, and there obviously certain people that are not happy with me, personally, I guess.

KOPPEL: And I'm back once again with the CEO of Disney company Michael Eisner. Michael, you heard what a couple of I can only describe them as your adversaries and they seem quite adamant. They are not willing to be satisfied by what you and the board have done this evening. Are you going to be able to resist whatever kind of pressure they bring to bear?

EISNER: You know they have been on this kick, saying these things, these conclusions which are completely false and fabricated. And they bring up different arguments to try to draw the same conclusion.

I don't want to try and argue them point by point. Obviously our board disagrees. We have great management all of our operations are running well. The growth is there. The shareholder withhold vote that you are talking about is not unprecedented in today's world and corporate governance. For companies that have not split CEO and chairman, or for companies that still have poison pills, or for companies that don't destagger their board. Many, many of these company average 40 percent withhold.

That is not to say that the two gentlemen you talked to didn't create a groundswell with their rhetoric. Their rhetoric doesn't equate with my agreement or the agreement of the board. Their suggestions have been rejected continually by the board. They have heard them. They were on the board as board members. For years they agreed with everything, they voted for everything that we did . After 9/11 things happened, they became dissatisfied, they left the board. And they have made this kind of a mission, everything they have said to you I have heard before much of it is false. And there is no point in going through it point by point.

KOPPEL: Let me just ask you this. You are currently, your term as CEO runs through sometime in 2006 is that right?

EISNER: I believe that is correct.

KOPPEL: Is it your intention to serve that term out to its completion?

EISNER: My intention is definitely to serve that term out to its completion. We had a board meeting today. I think the board has made it very clear that behind the management, behind me, behind Bob Iger, behind David Westin for instance at ABCNEWS, Dick Cook. Dick Cook had the biggest year in our motion picture group in the history of the business. The fact of the matter is although the critics, there are always things, and reasonable things to criticize, and I do not belittle a large withhold vote.

But the fact of the matter is our returns, our growth, our performance, our performance in movies in theme parks. ESPN is blazing, yes ABC primetime television network is not the number one network that we would like it to be. We are number one in daytime I think we are the number on news organization by the way. Good Morning America is blazing. Jimmy Kimmel coming on after you is really strong. Our soap operas are obviously fantastic The Disney Channel has never been better. Anyone who has children or teenagers know that.

So our shareholders are happy with our performance They're happy with the quality of our theme parks, with our cruise ships. Some of them are not happy with our corporate governance. Others of them have bought this kind of massive campaign that you heard earlier in your show, which the fact that it is said does not mean that it is true.

KOPPEL: Let me ask you one last question. And this has been a very very long day for you so I am going to let you go right after this. Comcast issued a statement today suggesting that the independent directors on the board meet with them yet again to consider their proposal. Do you think that is going to happen?

EISNER: Well, no, it's not going to happen because their proposal is the exact same proposal they already offered us which our board rejected. If they want to make a new proposal that has specific information in it our board certainly will consider it.

TED KOPPEL: Michael Eisner I suspect you have had better days I thank you for ending it with us. It was good of you to come on.