Bob Iger’s time as Disney’s returning CEO is ticking.
Iger has only signed on for a 2-year return to Disney, and a succession planning committee has been created which is tackling the hunt for Iger’s successor. Various names and ideas have been proposed. Could Iger be replaced by TWO CEOs? What about the reported “top contender” Christine McCarthy? There have been lots of names thrown into the ring, but one candidate might be particularly interesting to those at Disney for a big reason.
We’re talking about an “out-of-the-box” candidate — Adam Silver, the current NBA Commissioner. Silver has a long-standing relationship with Iger and Disney (having worked with them on ESPN-related matters) and under Silver’s leadership, the NBA has had increased profitability in ticket sales, merchandising, and networking deals.
As Fox Business points out, there could be many reasons why Silver could be a good choice. But one particular thing that might make Silver stand out when compared to others is that under Silver, “The league has expanded in places like Communist China, which has been controversial but also profitable.”
Disney has a unique relationship with China. It has 2 theme parks in China — one in Hong Kong and one in Shanghai. It also generally releases its movies in China but did hit some issues with films recently. According to Variety, under Chapek relations between Disney and authorities of the Communist Party of China “grew frosty.” But upon Iger’s return, “a thaw appears to be afoot.” Iger was once even considered a candidate to become a United States ambassador, possibly for China.
And for some in the entertainment business, Iger’s generally positive relationship with China is seen as a positive thing because Variety points out that “the entertainment industry has been concerned about its lack of access to China’s enormous market.” Some suggest that it goes beyond that, and that given some more recent financial losses, Iger “cannot afford to turn up his nose at the Chinese market.”
But not all have a positive view of Disney’s relationship with China. Disney received heavy criticism for its live-action remake of Mulan — as parts of it were filmed in Xinjiang, where The New York Times reports “Uighur Muslims have been detained in mass internment camps.” During the 2023 Disney shareholder meeting, a shareholder proposal was also discussed (though ultimately rejected based on initial votes) which would have required Disney to make a report on operations related to China. That shareholder proposal indicated that Disney does business in and relies on raw materials, labor, services, and more from China.
In the proxy statement, Disney indicated that they have a deep respect for human rights and said that their “International Labor Standards (“ILS”) program sets forth labor standards and working conditions requirements for manufacturers of products using our intellectual property.”
Still, some see Iger’s “friendly” relationship might be seen as a good thing and Disney may be seeking a new CEO with a similar standing.
In 2019, Adam Silver issued a statement on the NBA’s relationship with China. In that statement, he said “Over the last three decades, the NBA has developed a great affinity for the people of China. We have seen how basketball can be an important form of people-to-people exchange that deepens ties between the United States and China.”
Silver pointed out that one of the strengths of the NBA is its diversity, and “With that diversity comes the belief that whatever our differences, we respect and value each other; and, what we have in common, including a belief in the power of sports to make a difference, remains our bedrock principle.” He continued, “It is not the role of the NBA to adjudicate those differences. However, the NBA will not put itself in a position of regulating what players, employees and team owners say or will not say on these issues.”
In 2022, Silver once again defended the NBA’s relationship with China. According to The New York Times, Silver said “virtually every major U.S. company” conducts business there. He asked, “So then the question becomes why is the N.B.A. being singled out as the one company that should now boycott China?” Silver said, “It’s very difficult for the league to practice foreign policy.”
According to CNN, Silver pointed out that the league lost hundreds of millions of dollars after an event in 2019 that caused a falling out with China. In 2019, the Houston Rockets’ general manager tweeted in support of pro-democracy supporters in Hong Kong. Initially, the league distanced itself from the Tweet, but Silver later supported the coach’s freedom of expression. China’s state-run TV network stopped airing NBA games due to Silver’s comments. That changed in March 2022 when NBA games were once again broadcast in China.
Silver said that “engagement is positive, particularly through sports,” and that it was a “positive thing” to export “Americana, NBA basketball and the messages that come with it, to China.”
So things haven’t always been smooth sailing, but it seems that Silver, like Iger, has been able to turn around a company’s relationship with China. That alone might make him a worthy CEO contender.
But things could get complicated. According to a notice on Rick Scott’s website, Senator Rick Scott and Congressman Tro Nehls led other members in sending a letter to the National Basketball Association (NBA) Commissioner in 2023 “sharing concerns about Chinese Communist Party (CCP) propaganda being broadcasted and promoted at NBA games.” Apparently a “recorded video message from the People’s Republic of China (PRC) Minister of Foreign Affairs, Qin Gang…was broadcasted to thousands of fans in attendance at Capital One Arena in Washington, D.C.”
They note that although the message may “be perceived as an innocent gesture at face value, it is a blatant exertion of soft power at a venue in the epicenter of our nation’s capital and gives the CCP a platform to disseminate their messaging to a national audience.”
Following this letter, American First Legal petitioned the U.S. Department of Justice to make the NBA and Adam Silver register under the Foreign Agents Registration Act as agents of the Chinese Communist Party (per a post on Rick Scott’s website).
According to Deadline, members of the House Select Committee on the Chinese Communist Party also plan to meet soon with Iger regarding Disney’s relationship with China. The Chairman of the Committee has said that he wants Adam Silver to testify on some business dealings with China. Chairman, Rep. Mike Gallagher, shared, “Gallagher said, “I think we can have a productive conversation with companies that have substantial business interests in China, and we want to make sure that the power of the Chinese economy is not seducing certain companies into betraying American values.”
So will Adam Silver’s seemingly “positive” relationship with China prove to be an asset or perhaps a hindrance moving forward? Could he be seen as “too friendly” by some? Only time will tell.
In March 2023, Iger did note that succession is a top priority for him and the Board. The succession committee at the Board meets regularly and Iger has said he’s “confident that we’ll identify the right successor at the right time.”
Stay tuned for more updates.
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