Walt Disney Co
For the period ended Mar 20, 2025. Filed Jan 23, 2025.
View on SEC.govAbout this filing
What shareholders are asked to vote on at a company's meeting. It is where to find what directors and top executives are paid, and who owns the most shares.
Mar 20, 2025 · Filed Jan 23, 2025
Contents
Executive Compensation Program Overview
We design our executive compensation program to drive the creation of long-term shareholder value. We do this by linking compensation payouts to the achievement of preset performance goals that promote the creation of sustainable shareholder value and by designing compensation to attract and retain distinguished executives in a competitive market for talent. We provide compensation opportunities that consider peer compensation levels and practices and individual circumstances of our company and executives.
Total direct compensation comprises a mix of variable and fixed compensation that is heavily weighted toward variable performance-based compensation. Our performance-based compensation includes a short-term annual performance-based bonus and longer-term equity awards that deliver value based on financial and stock price performance. Our equity awards include PBUs that are eligible to vest after three years and only upon meeting preset performance targets. The following table sets forth the elements of total direct compensation in fiscal 2024 and the objectives and key features of each element. When we refer to NEOs on the following pages, unless explicitly noted, we exclude Mr. Lansberry. Mr. Lansberry’s fiscal 2024 compensation decisions are described further under the section below titled “— Fiscal 2024 Compensation Decisions — Interim CFO - Kevin A. Lansberry.”
| 38 | The Walt Disney Company | Notice of 2025 Annual Meeting and Proxy Statement |
| Proxy Summary | Corporate Governance and Board Matters | Director Compensation | Executive Compensation | Audit-Related Matters | Items to Be Voted On | Information About Voting | Certain Relationships and Related Person Transactions | Other Information |
|---|
| OBJECTIVES AND KEY FEATURES | |
| BASE SALARYObjectives:The Compensation Committee sets salaries to reflect job responsibilities and to provide competitive fixed pay.Key Features:•Minimum salaries set in NEO employment agreements•Committee discretion to adjust annually based on changes in experience, nature and responsibility of the position, competitive considerations and CEO recommendation (except in the case of the CEO) | |
| ANNUAL PERFORMANCE-BASED BONUSObjectives:The Compensation Committee structures the bonus program to incentivize performance at the high end of the financial performance measure ranges that it establishes early in the applicable fiscal year. The Committee believes that incentivizing performance against key annual metrics will lead to long-term, sustainable gains in shareholder value.Key Features:•Target bonus for each NEO set by the Committee early in the fiscal year in light of employment agreement provisions, competitive considerations, CEO recommendation (except targets for the CEO) and other factors the Committee deems appropriate•Unless otherwise adjusted downward by the Committee, payout on 70% of target is formulaic and determined by performance against financial performance ranges developed by the Committee early in the fiscal year•Unless otherwise determined by the Committee, payout on 30% of target determined by Company-wide Other Performance Factors (“OPFs”) and the Committee’s assessment of individual performance based both on other performance objectives and on CEO recommendation (except the payouts for the CEO) | |
| ANNUAL EQUITY AWARDSObjectives:The Compensation Committee structures equity awards to link rewards to long-term shareholder value. Annual grants are made in the beginning of each fiscal year at or about the same time as financial performance measures are established for the annual performance-based bonus. Equity awards carry vesting terms that extend for three years and include PBUs whose value depends on Company financial performance, including total shareholder return performance relative to the S&P 500. These awards provide incentives to create and sustain long-term growth in shareholder value.Key Features:•Combined value of options, PBUs and RSUs determined by the Committee in light of employment agreement provisions, competitive market conditions, evaluation of executive’s performance and CEO recommendation (except awards for the CEO)•Allocation of annual awards for CEO: 60% PBUs; 40% stock options•Allocation of annual awards for other NEOs in fiscal 2024 (based on award value): 50% PBUs; 25% RSUs; 25% stock options | |
| PERFORMANCE-BASED RESTRICTED STOCK UNITSKey Features:•PBUs reward executives only if preset performance targets are met•PBUs vest subject to the level of achievement under multi-year performance tests. Payout ranges from 0% if performance is under threshold, to 50% if performance is at threshold and up to 200% if performance is at or above maximum•50% of each PBU grant vests based on three-year cumulative TSR relative to the S&P 500; the other 50% vests based on three-year ROIC performance. Awards as described in the section titled “Executive Compensation — Compensation Tables — Fiscal 2024 Grants of Plan-Based Awards Table” | |
| STOCK OPTIONSKey Features:•Exercise price equal to average of the high and low trading prices on day of award•Option re-pricing without shareholder approval is prohibited•Ten-year term•Vest one-third per year over three years | |
|---|---|
| TIME-BASED RESTRICTED STOCK UNITSKey Features:•Vest one-third per year over three years•Mr. Iger's equity mix does not include RSUs | |
| The Walt Disney Company | Notice of 2025 Annual Meeting and Proxy Statement | 39 |
|---|
| Proxy Summary | Corporate Governance and Board Matters | Director Compensation | Executive Compensation | Audit-Related Matters | Items to Be Voted On | Information About Voting | Certain Relationships and Related Person Transactions | Other Information |
|---|
COMPENSATION AT RISK
The Compensation Committee believes that most of the compensation for NEOs should be at risk and tied to a combination of long-term and short-term Company performance.
In establishing a mix of fixed-to-variable compensation, the Committee seeks to maintain its goal of making compensation overwhelmingly tied to performance, while also providing compensation opportunities that are competitive with employment opportunities available to the executive. In particular, the Committee expects that performance at the high-end of ranges will result in overall compensation that is sufficiently attractive relative to compensation available at successful competitors and that performance at the low-end of ranges will result in overall compensation that is less than that available from competitors with more successful performance.
The following charts show the percentage of the target total direct annual compensation for first, Mr. Iger, and second, all other NEOs, that is variable or at risk versus being fixed with respect to fiscal 2024. At risk compensation includes both the target performance-based cash bonus and equity awards while the only fixed component of pay is base salary.
| CEO – MR. IGER | Non-CEO NEOs |
|---|
| CEO – MR. IGER | Non-CEO NEOs |
|---|
| 40 | The Walt Disney Company | Notice of 2025 Annual Meeting and Proxy Statement |
| Proxy Summary | Corporate Governance and Board Matters | Director Compensation | Executive Compensation | Audit-Related Matters | Items to Be Voted On | Information About Voting | Certain Relationships and Related Person Transactions | Other Information |
|---|
PERFORMANCE PLAN PAYOUT HISTORY
For fiscal 2024, the CEO continued receiving 60% of his annual long-term incentive grant in the form of PBUs. For NEOs other than the CEO, their PBU weighting also remained the same, at 50%. Beginning in fiscal 2022, in direct response to shareholder feedback and to meaningfully increase performance-based compensation, the Compensation Committee determined to increase PBUs from 30% to 50% of the overall long-term incentive grant value for the NEOs other than the CEO, who already had 50% in the form of PBUs (and who has had 60% in the form of PBUs since fiscal 2023). Due to below-threshold TSR performance relative to the S&P 500, our executives have received below-target payouts of PBUs in each of the last five years. The below table reflects the vesting of the annual PBU grants vesting over the last five years, all of which resulted in below-target payouts due to below-threshold TSR performance relative to the S&P 500:
1 Excludes Mr. Iger’s November 2022 PBU grant, which paid out at 49%. The value of a $100 PBU grant as of vest date would have been $60.99.
2 Assumes stock purchase was made at the closing price on the grant date and sold on the third anniversary of the grant date (or the nearest trading date if third anniversary falls on a non-trading day) and then adjusted for the actual % payout. Awards vested in 2020 were granted on December 19, 2017; awards vested in 2021 were granted on December 19, 2018; awards vested in 2022 were granted on December 17, 2019; awards vested in 2023 were granted on December 17, 2020; and awards vested in 2024 were granted on December 14, 2021.
See the section below titled “— Fiscal 2024 Compensation Decisions — Equity Incentive Grants — Recent PBU Payout Detail” for further discussion of the most recent PBU payout calculations.
| The Walt Disney Company | Notice of 2025 Annual Meeting and Proxy Statement | 41 |
|---|
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.