In 2018, Disney CEO Bob Iger got a raise–a big raise. His total compensation increased 80% to hit $65.6 million. According to a recent study by Equilar, his compensation was 1,424 times that of the median Disney employee. For Abigail Disney, granddaughter of Disney cofounder Roy Disney, that level of pay is “insane.” Moreover, she says, executive pay at that level has “had a corrosive effect on society.”
Disney, a filmmaker who has become an activist on issues of corporate social responsibility, made the remarks at the first annual Fast Company Impact Council on Thursday, where she joined Columbia University associate professor Howard W. Buffett and Coalition for Inclusive Capitalism founder and CEO Lady Lynn Forester de Rothschild for a discussion about practicing “humane capitalism.”
Disney told attendees that her perspective has been informed by her interactions with Disneyland employees in Anaheim, California. Over time, she said, they have experienced a reduction in benefits, and in many cases are struggling to pay for essential needs like medicine. “I like Bob Iger. Let me be very clear: I think he’s a good man. But I think he’s allowing himself to go down a road that is the road everyone is going down,” she said, citing Wall Street-driven norms. “When he got his bonus last year, I did the math, and I figured out that he could have given personally, out of pocket, a 15% raise to everyone who worked at Disneyland, and still walked away with $10 million. So there’s a point at which there’s just too much going around the top of the system into this class of people who–I’m sorry this is radical–have too much money. There is such a thing.” Disney is a member of the activist organization Patriotic Millionaires, which advocates for higher taxes on the wealthy.
A Disney spokesperson offered Fast Company the following statement in response: “Disney has made historic investments to expand the earning potential and upward mobility of our workers, implementing a starting hourly wage of $15 at Disneyland that’s double the federal minimum wage, and committing up to $150 million for a groundbreaking education initiative that gives our hourly employees the opportunity to obtain a college or vocational degree completely free of charge.” The company also noted that the increase in Iger’s 2018 compensation was tied to performance and a stock grant connected with Disney’s acquisition of 21st Century Fox.
Forester de Rothschild, through her Inclusive Capitalism initiative, has been working with multinational corporations and asset managers to push companies to a take a long-term perspective when making decisions about their employees. Over time, she said, sustainable growth depends on a sustainable workforce and customer base. “God didn’t invent the corporation. The corporation was invented by society . . . and that means that the corporation has an obligation to society.”
Buffett, author of Social Value Investing: A Management Framework for Effective Partnerships, said he is optimistic about capitalism’s potential to become more inclusive, or humane, after seeing younger generations start to hold corporations to account. An annual Deloitte survey of millennials, for example, has found that the majority believe that the primary purpose of business is not to make a profit, but to serve society. “What I’d argue is, their children and their children’s children will probably have those perspectives, but even more magnified,” Buffett said. “Or at least I hope they do.”