Activist company

Prominent Disney anti-ESG investor calls on company to ‘commit to political neutrality’ before it’s ‘expected to take sides that won’t be favorable’

Amid the ongoing public backlash against the company’s recent foray into political activism, prominent Disney anti-ESG investor Vivek Ramaswamy has issued a personal plea to the House of Mouse to s refrain from going any further in this arena – otherwise, he warns, they “will be called upon to take sides that are not favorable to his activity”.

Falcon/Sam Wilson (Anthony Mackie) in THE FALCON AND THE WINTER SOLDIER from Marvel Studios exclusively on Disney+. Photo by Eli Ade. ©Marvel Studios 2021. All rights reserved.

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Founder of the biopharmaceutical company Roivant Sciences and author of Woke, Inc.: Inside America’s Corporate Social Justice ScamRamaswamy – if it wasn’t already apparent in the title of his book – has been a staunch critic of America’s recent corporate obsession with following environmental, social and governance (ESG) principles – which, in short, essentially serve against headings where companies can categorize their commitments to goals such as promoting diversity, fighting climate change, raising social awareness, etc.

Source: Star Wars: Episode VII – The Last Jedi (2017), Disney

On September 19, speaking as a representative of the recently co-founded Strive Asset Management and investors who, through his company, hold some stake in the entertainment company, Ramaswamy sent an official letter to the CEO. of Disney, Bob Chapek, asking him to take corrective action in the face of “a [public approval ratings] collapse following the company’s public endorsement of controversial political positions out of respect for social activists.

Source: Kingdom Hearts coded (2008), Square Enix

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Citing events such as the company’s battle with Florida Governor Ron DeSantis over the state’s recently passed Parental Rights in Education Act, their firing of Gina Carano, and their various attempts to weigh in on anti-abortion legislation, Ramaswamy would lament “There is no evidence to suggest that these positions have benefited Disney shareholders, and a growing body of evidence to suggest that they have harmed Disney shareholders.

Source: The Mandalorian Season 2 Episode 7 “Chapter 15: The Believer” (2020), Disney Lucasfilm

“On the contrary, last week you praised Disney for”[standing] our land,” he said. “We find these comments deeply troubling for the future of Disney.”

To that end, Ramaswamy then took a moment to “remind the Disney Board of Directors that it owes a fiduciary duty only to the beneficial owners of Disney, and not to a minority of its employees, activist organizations, or large corporations. financial institutions that promote one-sided political agendas”.

(L-R): Natalie Portman as Mighty Thor and Chris Hemsworth as Thor in Marvel Studios’ THOR: LOVE AND THUNDER. Photo by Jasin Boland. ©Marvel Studios 2022. All rights reserved.

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“In 2022, the three largest passive asset managers in the world – BlackRock, State Street and Vanguard – were Disney’s top 3 shareholders,” he detailed. “In contrast, the real owners of Disney are not BlackRock, State Street, Vanguard – or, for that matter, Strive. The real owners of Disney are the customers of these institutions: ordinary citizens whose capital is invested in funds passively managed indices.

Source: Kingdom Hearts III (2019), Square Enix

“You owe a fiduciary duty to the beneficial owners of Disney, not to the institutions that claim to represent them,” the investor said. “There are strong reasons to believe that these big asset managers are not acting in the interests of their clients.”

“Like Disney customers and Americans more generally, Disney shareholders are not monolithically progressive,” he continued. “So even if these investors wanted their capital to be used for political purposes — and most don’t — not all of them would agree with the positions Disney has chosen to take.”

Source: Kingdom Hearts III (2019), Square Enix

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That said, Ramaswamy called on Disney to “focus on providing an excellent customer experience without repeating the mistakes of its recent past” and “clarified that it will no longer take political positions on matters unrelated to its business operations. main”.

“The company needs to make it clear that it will stand firm on this promise and not waver, no matter how important a particular social cause is to Disney employees or its Twitter followers,” he said. declared. “While we defer to management on how best to achieve this goal, we believe that such a change will only be possible if Disney formally updates its corporate policy to adopt a position of neutrality ex ante. Such a corporate policy would appropriately immunize Disney from criticism from its liberal or conservative constituents.

Source: Marvel’s Avengers (2020), Square Enix

“Disney must act now,” said the entrepreneur. “If Disney continues to speak out on political issues that don’t affect its business, it will face even greater pressure to act when they do. And the sides Disney will have to take will not be the sides that will be favorable to his business.

Source: Black Panther: Wakanda Forever (2022), Marvel Entertainment

In the end, Ramaswamy issued three demands “on behalf of [Strive’s] customers”, which included:

  • The adoption of “a formal corporate policy that Disney does not take a public position on political controversies that are not related to the company’s primary business activities”,
  • A public commitment to “political non-discrimination among its employees and customers, including human resources policies that clearly state that employees or customers will not be subject to sanctions for expressing political opinions”,
  • And a commitment to “make all decisions solely on the basis of Disney’s long-term profitability, without regard to social, cultural, or political pressure from employees, activist groups, or other stakeholders.”

Source: Heart of Iron 2020 Vol. 1 #1 (2020), Marvel Comics. Cover by Jung-Geun Yoon.

Asked to comment in response to Ramaswamy’s post, a Disney spokesperson told The Wall Street Journal that “we are listening [the shareholders’] perspectives.”

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