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Disney caught in controversy over Steve Jobs’ health

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Disney caught in controversy over Steve Jobs' health

Chicago (IL) – Steve
Jobs, Apple’s CEO currently on a six months medical leave, is seeking
re-election as board member to the entertainment conglomerate
Disney. Ahead of meeting scheduled for March 10, Jobs appears to have
already won the support of Disney’s CEO Bob Iger who relies on Jobs’
knowledge of new media platforms and experience in technological
issues. However, Jobs’ re-election bid comes in question this time
around amid broader concerns that have been surrounding his health in
lately and throughout 2008. Jobs’ opponents warn that Jobs can’t come up for re-election at Disney if he recently stepped down from his daily CEO
duties at Apple, citing health issues.


At least that’s what
Charles Elson, professor of corporate governance at the University of
Delaware thinks about Jobs’ re-election. The Financial Times cited
the professor as saying the following: “A directorship is not an
honorary position, If he’s said he can’t
run Apple, how on earth can he [stand for the Disney board again],” he
warned. “Non-executive directors of large public companies need to be
able to
devote at least 250 hours a year to the position.”

Jobs
is up for re-election at Disney’s annual meeting scheduled for
March 10. Although Jobs’ seat on Disney’s board does not come with
executive responsibilities, nor does he gets any compensation for it,
it is his advisory role to the CEO Bob Iger that matters. In fact, many
think that Jobs single-handily helped Disney capitalize on new media
platforms. In fact, nobody in Hollywood questions Steve Jobs’ influence
in the entertainment industry.

Apple’s CEO got a seat on
Disney’s board in 2006 when the entertainment conglomerate acquired
Jobs’ animation studio Pixar. Prior to the acquisition, there were
intense negotiations about extending Pixar’s distribution deal with
Disney in 2004 which was set to expire soon. The dispute between Jobs
and then Disney CEO Michael Eisner practically brought the negotiations
to a halt. Jobs tried to cut a deal with other studios but was rejected
because studios thought his terms were too demanding. Disney and Pixar would
eventually agree, after Eisner stepped down late 2005 and Iger took
over as the CEO, that Disney would acquire Pixar.

Terms
of the agreement ensure that Pixar remains a separate entity within
Disney, with its employment policies and Emeryville, California studio
kept intact, in addition to the Pixar name and branding. The
acquisition earned Jobs 7% stake in Disney worth more than $4 billion
on the ground of his 50.6% ownership in Pixar at the time. Jobs’ share
of Disney exceeds the combined shares of director emeritus Roy Disney
(1%) and ex-CEO Michael Eisner (1.7%).

The fact that
today, Steve Jobs is the largest Disney shareholder has boosted his
influence in the entertainment and media industries which he
successfully leveraged to get content distribution deals for Apple’s
iTunes Store. Disney has been the first studio to make its movie
library available for online rental and purchasing via iTunes Store.
Since that deal, Disney has been selling millions of movies and tens of
millions of TV shows on the iTunes Store.