Activist Investor Nelson Peltz to Disney's New Board Chair: No Thanks; Entertainment company's appointment of Nike's Mark Parker to Disney chairman puts a Bob Iger loyalist in control of succession

Activist investor Nelson Peltz doesn't think the Walt Disney Co.'s board leadership change will shift the direction of the company, saying the new chairman is little more than a rubber stamp for newly returned CEO Bob Iger, according to people familiar with the matter.

On Thursday, Mr. Peltz and his hedge fund Trian Fund Management LP turned up the heat in their proxy battle, despite board changes the Walt Disney Co. made Wednesday in an effort to counter his push. Disney on Wednesday replaced its board chair Susan Arnold with Nike Inc. chairman Mark Parker, and assured investors that he would lead the search for the company's next chief executive.

Mr. Peltz thinks Mr. Parker and the newly-returned Mr. Iger are too friendly for Mr. Parker to be truly objective, according to people familiar with Mr. Peltz's thinking. Mr. Peltz also thinks Mr. Parker has too many demands on his time and attention, given that he still serves as Nike's executive chairman, these people said.

Wednesday night, the activist and his fund made their criticisms of Disney's performance public in an online presentation titled "Restore the Magic" followed by a proxy filing Thursday that detailed their assessment of a company in crisis due to what they describe as a series of self-inflicted wounds.

They argued Disney has been hobbled by poor succession planning, "over the top" compensation, mismanagement of costs and flawed strategy. They criticized Disney for using its theme-parks revenue to subsidize its streaming losses and said Disney's acquisition of the 21st Century Fox Inc. assets put Disney in an unhealthy financial state. Fox's corporate sibling, News Corp, owns The Wall Street Journal.

Disney's failure to persuade Mr. Peltz that the company is on the right track means that Mr. Iger faces a rockier road ahead in his first year back atop Disney , which already includes challenges such as a potential recession, a prolonged stock price slump, rising costs for content, potential layoffs and stiff competition in the streaming video business.

It also highlights ongoing concerns among shareholders about Disney's leadership, strategy and succession plans. Six months ago, Disney fended off a challenge from another activist, Dan Loeb, who agreed to back off after the company appointed a director that Mr. Loeb had approved.

Disney opposes placing Mr. Peltz on its board because the company thinks, in part, that the activist investor lacks experience in the media-and-entertainment space, according to people familiar with the company's thinking. The board also thinks that adding Mr. Peltz to its board would bring more disruption amid an already turbulent time for the company, as it navigates a new period with Mr. Iger back at the helm, people familiar with the matter said. Some shareholders voiced concerns about Disney's succession planning after Mr. Iger returned, the people said.

Ms. Arnold retiring as chairwoman had been in the works with her 15-year term limit nearly up and wasn't meant to be a reaction to Mr. Peltz's campaign, the people said. Disney's bylaws limit nonmanagement directors to 15 total years on the board, after which they aren't permitted to stand for re-election.

Mr. Iger reclaimed the CEO spot at Disney in November, when the company's board fired Bob Chapek. The ouster came as Mr. Peltz was amassing Disney shares, and communicating with Mr. Chapek about his stake, according to Trian's proxy materials.

Mr. Peltz's fund has now amassed a more than $900 million stake, which will likely grow larger, according to people familiar with the matter. He said in the online presentation he doesn't want to replace Mr. Iger, but is seeking a board seat and wants a CEO named within two years.

Disney said Wednesday that while members of its senior leadership team have engaged with Mr. Peltz numerous times over the past few months, the board is asking shareholders to vote against him at the coming annual meeting. Disney also asked shareholders to reinstate the current board of directors of the company—minus Ms. Arnold. In the presentation on Trian's website, Mr. Peltz's fund highlighted what it described as mistakes made by the board, and compared Disney's shareholder returns to the broader market during the tenure of each director. Mr. Parker's seven years on the board have seen Disney's performance trail the S&P 500 by 128 percentage points, a wider margin than for any other director, the presentation said. "There are still several current directors and members of management who oversaw and approved some of Disney's worst corporate governance and strategic failures," Trian wrote.

Mr. Iger has long admired Mr. Parker as an executive and has felt that Nike and Disney have similar leadership needs, according to people familiar with the matter. The two men have a close professional relationship, they said. Mr. Iger has told associates that he considers Mr. Parker, who in 1983 designed the Nike Pegasus running shoe, a "creative executive" and praised his steering of Nike's business toward a more digital-focused e-commerce model. The path tracks Disney's own pivot to streaming video and recent emphasis on smartphone apps and data-driven sales practices . The two men have also bonded over being fitness buffs, people familiar with the matter said.

There are five other people who serve as board chairs at two companies simultaneously, according to governance research firm Equilar, Inc. "This is going to take an awful lot of work," said Charles Elson, founding director at the Weinberg Center for Corporate Governance at the University of Delaware.

Mr. Peltz's campaign is rooted in his belief that Disney's board and senior management have made a series of high-profile missteps over the last year. Mr. Iger has also criticized several of the Disney board's moves, according to people familiar with the matter. Last year, some Disney directors began to discuss whether Mr. Chapek could recover after a war of words with Republican Florida Gov. Ron DeSantis over an education bill, according to people familiar with the matter. Some board members discussed appointing Mr. Parker as interim CEO, the people said. In early June, after Mr. Chapek fired a top deputy, Ms. Arnold released a statement saying that Mr. Chapek had the full support of the board. Later that month, the board renewed Mr. Chapek's contract through the end of 2024, over the objections of at least two directors who needed to be persuaded Mr. Chapek was still the right man for the job, The Wall Street Journal previously reported. Mr. Iger told friends at the time that he couldn't understand why Ms. Arnold was so unwavering in her support for Mr. Chapek, despite what he viewed as clear signs that Mr. Chapek wasn't leading Disney successfully, according to people familiar with the matter.

Last summer, as the company veered into crisis, Mr. Peltz and his wife dined with Mr. Chapek and his wife at Disneyland Paris, where the activist investor told the then-CEO that he was interested in joining the board and offering a fresh perspective, according to Trian's proxy materials.

Mr. Peltz also told two other Disney directors, Oracle Corp. CEO Safra Catz and Procter & Gamble Co. board member Amy Chang, that he wanted to join the board "to help turn around the Company and drive long-term shareholder value," according to Trian's proxy materials. Those discussions didn't go anywhere until early November, when Disney's share price plummeted following a weaker-than-expected quarterly earnings report, according to Trian's proxy materials. Mr. Peltz pounced, quickly accumulating more than $800 million worth of Disney stock. A few days later, he contacted Mr. Chapek to initiate a formal dialogue. Over the last week, Disney and Mr. Peltz have met to try to reach an agreement that would avoid a proxy fight, to no avail. Ms. Arnold called Mr. Peltz on Wednesday to offer him a view into the board, but not a seat on the board, and Mr. Peltz declined, according to Trian's proxy materials.