Being the CEO of a huge, multinational entertainment conglomerate probably isn’t a walk in the theme park.
For Bob Chapek, his tenure as Walt Disney Company CEO was marked with controversy and criticism, ultimately leading to the Board of Directors replacing him with former Disney CEO Bob Iger late Sunday evening. Iger’s tenure is viewed in a much more positive light by Disney fans, so having an old pro at the helm can only mean success from here, right? History says that might not be the case.
Bob Iger is back as the CEO of The Walt Disney Company after the Board of Directors ousted Chapek — and just one day after the announcement Disney stock prices rose by about 9%. It would seem as though Iger’s return is welcome news for many, but now that he’s joined the “boomerang CEO” club, can he return Disney to its former glory?
Disney’s Board has taken something out of an old playbook by bringing Iger back — the now second-time CEO joins Apple’s Steve Jobs, Starbucks’ Howard Schultz, Twitter’s Jack Dorsey, and more as former leaders who have returned to their previous chief positions, according to Fortune. But, just because a leader was successful the first time around doesn’t mean the sophomore slump won’t sneak up on them.
Steve Jobs was forced out as CEO, but returned to Apple in 1997 and ultimately helped to make the nearly-bankrupt company one of the world’s largest companies by market capitalization.
Similarly, Starbucks CEO Howard Schultz returned in 2008 as the company was losing market share — his second run is touted as turning Starbucks around and tripling its share price.
But not all boomerang CEOs are as successful. Twitter CEO Jack Dorsey was pushed out in 2008, returned in 2015, and was criticized for the company’s content moderation policies along with annual losses in all but two years.
In a 2020 study from MIT Sloan Review, it was reported that companies that brought back former CEOs have “significantly lower” stock performance than those who went with someone new.
Disney’s decision to bring Iger back comes after the company reported $1.5 billion in quarterly losses during its most recent earnings call, which didn’t sit well with investors. A few days after that, Chapek said in an internal memo that Disney would cut costs with hiring freezes and layoffs.
Iger’s return is intentional — the Board didn’t want to place a new person in the position due to the current pressures the company is facing, though a few internal candidates were considered as possibilities.
Disney board chair Susan Arnold shared that “Bob Iger is uniquely situated to lead the company through this pivotal period.” And with Disney’s stock performance in the wake of the CEO swap announcement, Iger could join the ranks of Jobs and Schultz as executives who returned to their previous companies just in the nick of time.
Many Disney fans have been taking to social media to welcome Iger back with open arms, including former Disney CEO Michael Eisner and Josh Gad, who voices Olaf in Disney’s Frozen franchise.
Only time will tell how Bob Iger’s second round as CEO will go and if he will be able to fulfill his obligation to “set the strategic direction for renewed growth and to work closely with the Board in developing a successor to lead the Company at the completion of his term.”
For more on this recent change, check out the following posts:
- BREAKING: Bob Chapek Stepping Down As Disney CEO, Bob Iger Returns to Position
- NEWS: Disney Stock Prices Rise After Iger Announced as CEO
- Bob Iger Thinks Choosing Bob Chapek as Next Disney CEO Was a Mistake
- Why Bob Iger Replaced Bob Chapek
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Do you think Disney should have chosen a different replacement for Bob Chapek? Let us know in the comments.