Disney has announced a slew of executive pay cuts in order to mitigate the economic fallout from the coronavirus. According to reporting in Variety , Bob Iger, who stepped down from the CEO role at the company last month, will give up the entirety of his salary for the year in response to the virus.
His successor, Bob Chapek, has announced that he will take a 50 percent reduction in his salary over the coming year, and the company also announced a larger group of cuts for all of its senior executives. According to a memo sent out on Monday, VPs will see their pay cut by 20 percent, Senior VPs will see a 25 percent pay cut, and executive VPs and above will experience a 30 percent cut.
The news of the pay cuts comes in large part because Disney is in the middle of an enormous economic shock as many of its revenue streams are halted. Disney parks and resorts around the world have been forced to close in order to enforce social distancing, and it’s unclear when those parks in the U.S. will reopen. Disney has committed to paying its employees at the parks through at least April 18.
In the memo, Chapek also outlined the fact that the virus had had a drastic impact on the company’s economic outlook in just a few weeks.
“In a matter of weeks, we’ve experienced widespread disruption across our company, with our domestic parks and hotels closed indefinitely, our cruise line suspended, our film and TV production halted and theatrical distribution delayed both domestically and internationally, and our retail stores shut down,” Chapek wrote in the memo.
The CEO continued by saying that he was confident that the company would weather these challenging times, but said that cutbacks were necessary to keep the company afloat.
In February, Iger announced that he would be transitioning out of the CEO role at the company and said that he would be taking a job as executive chairman at the company. Chapek, who had previously been the head of the company’s parks division, then took the company’s top job.
At the time, Iger explained that he was proud of having launched Disney Plus, and wanted it to be his last major achievement with the company.
Iger’s salary in 2019 totaled $48 million, largely as a result of stock and bonuses tied to the company’s strong performance over the course of the year. Chapek stood to earn a base salary of $2.5 million with bonuses of as much as $22.5 million this year.
