How the Kimmel Fallout Could Cloud Bob Iger’s Legacy at Disney

Jimmy Kimmel is back on ABC, but Bob Iger’s reputation might not get a ratings boost.

Disney’s decision to reinstate Kimmel’s show after benching him over comments he made in the wake of the killing of political activist Charlie Kirk might have quieted some critics, but it didn’t signal the final act for the drama starring Disney’s CEO.

Soon after Disney announced the return of “Jimmy Kimmel Live!,” two top ABC affiliate operators, Sinclair Broadcasting Group and Nexstar Media Group, said they would continue to air alternative programming in place of the show.

While the creative class that Iger has long courted has largely celebrated Kimmel’s reinstatement, how it all will play out is still unclear. And some people who threatened to cancel their subscriptions to protest Kimmel’s suspension said they would continue to boycott the company.

How the saga ends could be pivotal in cementing the legacy that Iger has worked so hard to mold — both during his first 15-year run as head of the company and in a second act that began in 2022, corporate observers and entertainment insiders told Business Insider.

“Whether he’s remembered as a CEO who made billions of dollars for this corporation, or as the one who made the right choices in difficult times, I think people will pay more attention to the difficult choices,” Christopher Myers, the faculty director of the Center for Innovative Leadership at the Johns Hopkins Carey Business School, told Business Insider.

Meanwhile, Iger faces a Cinderella problem: He has about 15 months before the clock strikes, and his contract as CEO is set to end.

“This will be sort of the lasting image — the final taste in people’s mouths — of his legacy,” Myers said, referring to Iger’s actions in the Kimmel saga. Myers said that when people think about leaders, they often over-emphasize initial actions and the most recent things they’ve done.

Disney didn’t respond to a request for comment from Business Insider.

Corporate tug-of-war

When running a company, CEOs inevitably face times when doing what is best for the bottom line and doing what’s popular come into conflict.

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Iger himself has addressed the issue.

“When you’re dealing with right and wrong or when you’re dealing with something that does have profound impact on your business, I just think you have to do what is right and not worry about the potential backlash to it,” he said on CNN in 2022, discussing his predecessor’s botched response to the “Don’t Say Gay” bill.

CEOs have a moral obligation to shareholders, among others, to do right by the company and give investors a reasonable return, said Jeffrey Moriarty, a philosophy professor who directs Bentley University’s Hoffman Center for Business Ethics. He said that Iger could decide that, in this case, shareholders’ concerns trump those about free speech.

Obvious business considerations went into the call to pull Kimmel.

Nexstar and Sinclair’s decisions to stop airing the show could mean fewer ad dollars for Disney. Disney also needs FCC approval for its pending deals with the NFL and Fubo.

“He’s trying to steer a middle course in defense of Disney’s core values,” said Jeffrey Sonnenfeld, senior associate dean for leadership studies at Yale School of Management, referring to Iger. “And Kimmel is a hired hand who has to respect the same objective.”

Sonnenfeld said he doesn’t think Kimmelgate will stain Iger’s legacy. As Sonnenfeld sees it, the CEO was doing what he’s done in the past: staking out a middle ground to appeal to a broad audience while avoiding divisive language, like when he canceled Roseanne Barr’s show or stood up to Florida Gov. Ron DeSantis.

A big difference is that in this case, Trump-appointed FCC chair Brendan Carr was threatening Disney over the show, and yanking Kimmel left the impression in Hollywood that Iger was throwing free speech under the bus. Even some GOP lawmakers said the FCC chair went too far. Disney’s saying it would “indefinitely suspend” Kimmel with no further explanation freaked out people in the creative community, some of whom heard it as Kimmel being canceled for good.

Bentley University’s Moriarty said the speed at which Disney appeared to acquiesce to pressure from Carr and affiliates raised the question of how much the company was willing to fight for its values.

It’s a concern shared by Disney’s Hollywood home base. Creatives — a key engine of Disney — denounced Kimmel’s cancellation, attended rallies, and some high-profile figures vowed never to work with the company again.

“Without the creatives, there is no business,” said Michael Santoro, a professor of management and entrepreneurship at Santa Clara University.

In the days between Kimmel’s suspension and return, the number of X posts that expressed support for a boycott of ABC or Disney was more than two times the number that expressed support for firing Kimmel, social analytics firm PeakMetrics found.

Faced with the uncertainty of boycotts, cancellations, and a growing number of Hollywood stars vowing they’d never work with Disney again, Iger had to bring back Kimmel to protect his legacy — even if the affiliates decide not to carry Kimmel’s show and it costs Disney in ad revenue, one veteran Hollywood PR exec told Business Insider.

“The reputation damage of him leaving outweighs the cost of keeping him,” they said.

A legacy do-over

Iger is no stranger to storytelling. He’s long cultivated a reputation as a staunch supporter of the creator class. His Disney career started at ABC, where he was a studio supervisor. His wife, Willow Bay, is a journalism school dean.

Iger helped build the modern Disney with acquisitions like Pixar, Marvel, and Lucasfilm, and the launch of Disney+. During his first run, the company’s market cap ballooned more than 400%.

After retiring, he returned to the company in 2022 to fix problems left by his first successor, Bob Chapek. Chapek’s run overlapped with the depths of the pandemic and saw a drop in the company’s stock price and fights over Florida’s so-called “Don’t Say Gay” bill.

Iger’s most important remaining task — to help identify his next successor — might now be overshadowed by the Kimmel situation.

Disney has been a culture war focal point

Disney has increasingly become a flash point in the culture wars, threatening its positioning as the squeaky clean entertainment brand with broad appeal. Since Iger’s return to power, conservative critics have ramped up their attacks against Disney, taking aim at its inclusion of LGBTQ+ characters or racially diverse casts. In combating that narrative, Iger has committed to no more “woke” Disney and shown his willingness to give concessions to Trump.

In December, Disney’s ABC agreed to pay $15 million to then-president-elect Trump’s presidential library to settle a defamation suit.

The Kimmel situation has provoked a greater public reaction than the settlement — and there are lingering questions.

What, if any, concessions did both sides make to restore Kimmel? Did Kimmel, who has a history of taking jabs at the president, agree to dial back his Trump jokes? Will his reinstatement quell the boycotts, which historically don’t make much of a dent, and how much damage did they do? What will Trump say? Will he go after Disney and the press all the harder and encourage people to boycott the company?

All of this leaves the head mouse caught between a trap and a hard place.