Heiress Abigail Disney on how to bring magic back to capitalism

Abigail Disney, a grandniece of Walt Disney and shareholder in the media giant, went viral back in 2019 when she criticized former CEO Bob Iger’s $66 million compensation package. Ever since, the Disney heiress — who is a documentary filmmaker and social activist — has used her connection with the company to make the case for broader changes in corporate America related to the pay fairness issue, and to redefine success in a corporate context.

“How can you call a company successful when people are suffering?” Disney recently told CNBC’s Julia Boorstin at the ESG Impact virtual summit. “Part of the problem of this is in how we define the idea of what a successful company is, and if we pushed human interest to the center of our set of calculations about the well-being of a company, we would feel very differently about Disney as a successful company.” 

Disney, who recently released the documentary, “The American Dream and Other Fairy Tales,” said she thinks of ESG as one aspect of a much larger set of principles that determine how a company operates and determine what it can and cannot do.  

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

Worker issues are, in fact, the No. 1 ESG theme, according to polling of the American public. The polling finds that paying a fair and living wage is the single-most important issue for Americans when asked what they want to see companies do.

Disney doesn’t buy the argument that the market dictates wages. “The market is a bit of a yardstick, but it’s not really dictating anything,” she said. “These are boards of directors that are populated by people who are CEOs or would like some day to be CEOs and are loyal to the class … they identify with the CEO,” she said.

A Disney spokesman said in an emailed statement to CNBC, “Our amazing Cast Members, storytellers, and employees are the heart and soul of Disney, and their wellbeing is our top priority.” The Disney spokesman cited “competitive pay and leading entry wages,” affordable medical coverage, access to tuition-free higher education, and subsidized child care for eligible employees.

Just Capital, the ESG research nonprofit that produces the polling of the American public on corporate issues of importance, ranks Disney No. 1 among media companies overall in its annual ranking of the top 100 companies, but its lowest category score is workers, where Disney ranks 10th among 15 media companies.

In March, Disney shareholders voted in favor of a proposal for greater transparency on pay data, including data related to race and gender, a rare loss for Disney management in a proxy battle which garnered support from 60% of stockholders. According to a June article from entertainment publication The Wrap, Abigail Disney is gearing up for another shareholder fight next year against the pay of current Disney CEO Bob Chapek, whose compensation doubled last year to $32.5 million.

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

“I don’t think we need to do redistribution. But I think we need to think more carefully about pre-distribution, and maybe businesses need to be taking less as owners and seeing the workers as their true partners who deserve to participate in profits just as deeply,” she said. “Capitalism is the invisible hand that creates a kind of magical surplus when it’s worked right. And it can still do that, without being this, you know, predatory entity that it has become,” she added.  

Watch the ESG Impact video below for more of the Disney heiress and shareholder’s views on CEO compensation and worker pay.