Trouble in the 'Magic Kingdom': Governance Problems at Disney

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

Case Details:


Case Code : BECG038 For delivery in electronic format: Rs. 300;
For delivery through courier (within India): Rs. 300 + Rs. 25 for Shipping & Handling Charges


Coporate Governance
Case Length : 12 Pages
Period : 1995 - 2004
Pub. Date : 2004
Teaching Note : Available
Organization : Walt Disney Co.
Industry : Media & Entertainment
Countries : USA


The case discusses the governance problems at Disney. In late 2003, Roy Disney and Stanley Gold, both of whom were directors at the company resigned from the board in protest against the bad governance practices at Disney. They alleged that CEO Michael Eisner ran the company like a 'personal fiefdom' and that the board was only a rubber stamp to his decisions. The case looks into this allegation and studies a few instances which support the fact that Disney did not conform to the principles of good corporate governance. It also discusses the future of Disney in the context of the allegations of bad governance and the bid by Roy and Gold to oust Eisner from the company and install a new board.


Practices at a major media conglomerate

Importance of good governance to maximize shareholder benefit, especially in large companies

Implementation of new governance norms at a large media company and the credibility of these norms


  Page No.
Disney Directors Resign 1
Background Note 2
New Governance Norms 5
Instances of Bad Goverance 5
The Future of the Magic Kingdom 8
Exhibits 10


Governance problems, Disney, 2003, Roy Disney, Stanley Gold, directors, bad, governance practices, CEO, Michael Eisner, personal fiefdom, rubber stamp, conform, future

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