UPDATE: It pays to be promoted at Disney. With his elevation today to COO, Thomas Staggs is entitled to a $2 million annual salary, and a performance-based bonus targeted at 250% of that amount, the company disclosed in an SEC filing. The board can give him much more if it wants, which it usually does. Disney adds that Staggs will receive $2.4 million in options and restricted stock to bring his 2015 equity “into alignment” with his new deal. Added to awards he received earlier in the fiscal year, the stock and options come to “four times his annual base salary.”
The $2 million base salary puts him behind CEO Bob Iger, who made $2.5 million last year as part of a total compensation package of $46.5 million. But Staggs is ahead of CFO Jay Rasulo, who had a salary of $1.8 million in his $16.2 million package. The SEC requires companies to list compensation for their five top executives and Staggs, as head of theme parks, was not listed in the latest proxy.
The filing adds that Disney extended General Counsel Alan Braverman’s contract by two years to the end of March 2018, with a minimum salary of $1.5 million.
PREVIOUS, 9:18 AM: This is the strongest indication yet that the head of the company’s theme parks is the top contender to replace CEO Bob Iger when his contract expires in 2018. In his new role as COO, Thomas Staggs will continue to oversee the parks until a successor is named. Business segment leaders will now report to him, except for CFO Jay Rasulo — also considered a potential successor to Iger — General Counsel Alan Braverman, Chief Communications Officer Zenia Mucha, and Chief Human Resources Officer Jayne Parker.
Iger says that the 25-year Disney vet, who was previously the CFO, has a “proven ability to lead a business.” Staggs says he’s “humbled and honored by the opportunity.”
The company release credits the new COO for “delivering record revenue, profit and attendance levels” at the parks, while expanding into new territories and upgrading existing venues. It adds that he “played a critical role” in the acquisitions of Capital Cities/ABC, Pixar, and Marvel. In his 12 years as CFO “he spearheaded the realignment of Disney’s performance goals toward the combination of profit growth and strong long-term capital returns and free cash flow.” Before joining Disney in 1990, the Stanford MBA graduate was an investment banker at Morgan Stanley.
Staggs’ star rose at Disney in 2009 when he swapped jobs with Rasulo, giving him a chance to run one of the company’s most important operations. But some company watchers expected him to be named COO years ago, leading them to wonder whether he was, indeed, the heir apparent. There’s no doubt that Wall Street would applaud his rise; he’s well liked by the financial community.
Still, some wonder whether it would make more sense for the company to be led by someone with more experience in its core business — television. It accounted for 44% of revenues and 42% of operating income in the last three months of 2014.
Rasulo’s contract expired at the end of January according to the company proxy filed at the SEC last month.