Heiress Abigail Disney on how to bring magic back to capitalism

Abigail Disney, a great-niece of Walt Disney and a shareholder in the media giant, went viral in 2019 when she slammed former CEO Bob Iger’s $66 million compensation package. Since then, the Disney heiress — who is a documentary maker and social activist — has used her connection to the company to advocate for broader change in American business around pay equity and to redefine success in the corporate context.

“How can you call a company successful when people are suffering?” Disney recently said CNBC’s Julia Boorstin at the virtual ESG Impact Summit. “Part of the problem is how we define the notion of what a successful company is, and if we put human interest at the center of our calculations about a company’s well-being, we would think very differently about Disney as a successful company.” .”

Disney, which recently released the documentary The American Dream and Other Fairy Tales, said it views ESG as one aspect of a much larger set of principles that govern how a company operates and what it can and cannot do.

“It’s also about helping companies do the right thing,” Disney said.

Indeed, employee issues are the #1 ESG issue according to surveys of the American public. The survey found that paying a fair and living wage is the number one issue for Americans when asked what they expect from companies.

Disney doesn’t believe in the argument that the market dictates wages. “The market is a bit of a benchmark, but it doesn’t really dictate anything,” she said. “These are boards that are filled with people who are CEOs or who want to be CEOs one day and are loyal to the class … they identify with the CEO,” she said.

A Disney spokesperson said in an emailed statement to CNBC, “Our amazing cast, storytellers and employees are the heart and soul of Disney, and their well-being is our top priority.” The Disney spokesperson called “competitive.” Compensation and leading entry-level wages, affordable medical care, access to tuition-free higher education, and subsidized childcare for eligible employees.

Just Capital, the nonprofit ESG research organization that conducts surveys of the American public on important business issues, ranks Disney the #1 media company in its annual ranking of the top 100 companies overall, but the lowest score in the category is workers, where Disney ranks 10 under 15 media companies.

In March, Disney shareholders voted on a proposal for more transparency in payroll data, including data on race and gender, a rare loss for Disney management in a proxy fight supported by 60% of shareholders. According to a June article in entertainment magazine The Wrap, Abigail Disney is preparing for another shareholder fight next year over the salary of current Disney CEO Bob Chapek, whose compensation doubled to $32.5 million last year.

Disney, who told the FT in 2019 that she had a net worth of $120 million and described herself as a “traitor” to her class, doesn’t think the idea of ​​wealth redistribution is necessary.

“I don’t think we need to redistribute. But I think we need to think more carefully about pre-allocation, and maybe companies need to take less ownership and see workers as their true partners who deserve to share in the profits just as deeply,” she said. “Capitalism is the invisible hand that adds some sort of magical value when it’s working properly, and it can still do that without being this predatory entity it’s become,” she added.

Watch the ESG Impact video below to learn more about the Disney heiress and shareholder’s views on CEO compensation and employee compensation.