Disney CEO Bob Chapek announced the salary reductions in an internal email obtained by the Los Angeles Times on Monday. Chapek, who replaced Iger as CEO in February, will take a 50 percent salary cut, while the company’s other high-level executives will take varying pay cuts. Disney’s vice president will have their salaries cut by 20 percent, while senior vice presidents and executive vice presidents will see salary reductions of 25 and 30 percent, respectively, according to the Los Angeles Times. The reductions will go into effect April 5.
“While I am confident we will get through this challenging period together and emerge even stronger, we must take necessary steps to manage the short- and long-term financial impact on our company,” Chapek said in an email to staff obtained by the Los Angeles Times. “In light of this, we are going to be implementing a variety of necessary measures designed to better position us to weather these extraordinary challenges. Among them, we will be asking our senior executives to help shoulder the burden by taking a reduction in pay.”
Disney spokespersons did not return a request for comment.
The Los Angeles Times noted that Iger, whose base salary was $3 million during the company’s latest fiscal year, is one of the entertainment industry’s highest-paid individuals. That said, much of Iger’s wealth comes from cash bonuses: His $47.5 million pay package in fiscal 2019 included cash bonuses and stock awards totaling more than $40 million.
Iger’s lucrative compensation has been a source of controversy. Abigail Disney, granddaughter of company co-founder Roy Disney, spoke out against Iger’s “insane” salary, given the company’s comparatively low salaries for its rank-and-file employees.
Like all other entertainment companies, the House of Mouse’s operations have been broadly disrupted by the coronavirus pandemic. IndieWire recently spoke to several entertainment industry analysts about the financially destabilizing nature of the virus. One expert told IndieWire that Disney would likely be hit especially hard by the coronavirus pandemic due to its significant investments in theme parks and cruise lines. Disney announced last week that Disneyland and Walt Disney World would be indefinitely closed due to the outbreak.
Current events have also forced Disney to halt production on a variety of projects, including “The Falcon and the Winter Soldier” and the rest of its Disney+ series, and the company has also postponed the theatrical releases of “Mulan” and “Black Widow,” among other films.
Still, Disney+ has enjoyed a surge in popularity as more consumers hole up indoors. A recent report from streaming analytics firm Antenna noted that Disney+, which recently began streaming “Frozen 2” ahead of schedule, had seen its rate of signups triple earlier in March. The streaming service also made its long-awaited debut in Europe and the United Kingdom last week.