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Disney has named board member Mark Parker, Nike’s executive chairman, as its new chairman of the board, succeeding Susan Arnold, the company announced Wednesday.

Parker’s appointment is effective following Disney’s upcoming annual meeting of shareholders, which usually takes place in March, with Arnold unable to stand for re-election in her position due to the board’s 15-year limit. As a result, the board will be reduced to 11 members upon Arnold’s exit.

Additionally, the board has responded to a letter from activist investor group Trian Partners recommending that Disney shareholders vote for all of its recommended board nominees rather than Trian’s Nelson Peltz, who is out the outset of a proxy fight with Disney in his effort to join the board.

Two months ago, Trian began seeking a board seat after taking approximately an $800 million stake in Disney. In a letter sent to the Disney board last week, Trian confirmed its plan to field Peltz as a board nominee at the annual meeting.

“We strongly prefer to address the company’s challenges together in the boardroom, starting immediately. If we are not welcomed, we believe that a proxy contest is an opportunity to have a very important conversation publicly that brings shareholders into the debate on the best path forward for Disney,” Trian wrote. “Regardless of how the process unfolds, win or lose, our commitment to you and your management team is to be transparent in sharing our perspectives, to maintain open lines of communication, to listen and consider any and all ideas from the company and to treat everyone involved with respect.”

In announcing Parker’s appointment, Disney gave Trian a polite brush off.

“The Walt Disney Company remains open to constructive engagement and ideas that help drive shareholder value,” Disney said in a statement. “While senior leadership of The Walt Disney Company and its Board of Directors have engaged with Mr. Peltz numerous times over the last few months, the Board does not endorse the Trian Group nominee, and recommends that shareholders not support its nominee, and instead vote FOR all the Company’s nominees.”

Those nominated for re-election to the board include incumbent directors Iger, Mary T. Barra, Safra A. Catz, Amy L. Chang, Francis A. deSouza, Carolyn Everson, Michael B.G. Froman, Maria Elena Lagomasino, Calvin R. McDonald, Mark G. Parker and Derica W. Rice.

Representatives for Trian did not immediately respond to Variety‘s request for comment. But Trian outlined its arguments in detail in a presentation posted Wednesday on the RestoretheMagic.com website, which Trian previously established to help make the public case for changes at Disney.

The presentation asserts that Disney has given itself “self-inflicted” problems that include runaway spending on content for new streaming platforms and a lack of discipline on costs in general. The presentation hammers the current board and management regime for the sharp decline in Disney shares over the past few years. The presentation also flatly asserts that Disney “materially” overpaid in 2019 with its $71 billion acquisition of 21st Century Fox assets.

By Trian’s measure, Disney’s operating profit from the studio side is down by $6 billion since the Fox deal while its debt load naturally increased. “This begs the question, is there a large Fox write-down on the horizon,” the presentation states. Trian also questions the rationale behind Disney’s recent CEO shuffle and is critical of the succession planning process that led to Bob Chapek succeeding Iger in February 2020.

“The initial decision itself appears flawed given Bob Chapek’s lack of experience on the media side
of the business, which led to Bob Iger being appointed as Executive Chairman and head of
‘creative endeavors,’ preventing Bob Chapek from establishing himself as the clear leader of the
organization,” Trian writes. “Appointing Bob Iger as Executive Chairman for 2 years as an outgoing CEO in our view was a very risky corporate governance decision as it set up his successor to fail with the prior
CEO constantly watching over their shoulders – this is exactly what transpired.”

Disney’s elevation of Parker to the non-executive chairman role is a signal to Wall Street that Disney is strengthening its oversight with a seasoned CEO from outside the entertainment industry.

Per Disney, as part of the appointment of Parker, a seven-year member of Disney’s board, he will also be leading a new succession planning committee, “which will advise the board on CEO succession planning, including review of internal and external candidates.”

“Mark Parker is an incredibly well-respected leader who over seven years as a Disney director has helped the Company effectively navigate through a time of unprecedented change,” Arnold said in a statement. “During his four decades at Nike, Mark has led one of the world’s most recognized consumer brands through various market evolutions and a successful CEO transition, and he is uniquely positioned to chair the Disney Board during this period of transformation.” 

Iger added: “Mark Parker’s vision, incredible depth of experience and wise counsel have been invaluable to Disney, and I look forward to continuing working with him in his new role, along with our other directors, as we chart the future course for this amazing company. On behalf of my fellow Board members and the entire Disney management team, I also want to thank Susan for her superb leadership as Chairman and for her tireless work over the past 15 years as an exemplary steward of the Disney brand.”

(Cynthia Littleton contributed to this report.)