On first announcing the plan – which was subject to shareholder approval, Disney noted that the decision was no reflection on auditor Pricewaterhouse Coopers – to which it paid $9 million in auditing fees, and $32 million in other fees – but an acknowledgement that such arrangements could constitute a conflict of interest, the WSJ reports.
Disney originally opposed such a proposal – originally put forward by the investment arm of the union pension fund United Association, but reversed its position.
The United Association is pursuing such shareholder proposals at about 30 companies – Disney was the first to bring the matter to a vote. But despite the company’s support of the proposal, it was rejected by about 54% of the voting shareholders.
After the proposal’s defeat was announced, Disney
Chairman and Chief Executive Michael Eisner said the
company would “proceed as if it had been” passed. A formal
plan spelling out how Disney will separate the functions is
expected later, according to the report.