Why co-CEOs might be a bad idea

As 2025 enters its final months, Disney is closing in on the announcement the entire entertainment industry has been waiting for — who will take over as the company’s next CEO, succeeding Bob Iger.

Disney She has publicly stated that she will appoint Iger’s successor in early 2026. Two internal candidates stand out as the most likely contenders: Disney Entertainment Co-Chairman Dana Walden and Disney Experiences Chairman Josh D’Amaro. Walden brings decades of Hollywood experience. D’Amaro worked in consumer products before being promoted through the theme parks division to running the unit when its former leader, Bob Chapek, was named Disney CEO in 2020.

Given Walden and D’Amaro’s complementary skill sets — and given the recent momentum behind co-CEO appointments in both media and outside of media — Disney’s board could jointly select both to replace Iger.

It is a strategic competitor Netflix It has been used similarly — and effectively — since 2020, when Reed Hastings appointed Ted Sarandos as its co-CEO. Three years later, Hastings stepped down from that position and moved to become CEO of the company, promoting Greg Peters to his position as co-CEO.

Last year, Iger called Sarandos and asked him about the Netflix co-CEO model, CNBC has confirmed, based on interviews with people familiar with the matter. This call was first reported on Wall Street.

Netflix’s success has contributed to its recent wave of co-CEOs. last month, Spotify Alex Norstrom and Gustav Soderstrom have been named co-CEOs, replacing founder Daniel Ek; oracle Clay McGuirk and Mike Cecilia have been appointed to jointly lead the company; and Comcast Chairman Mike Kavanagh is set to join long-time CEO Brian Roberts in the key role.

But while a dueling CEO structure may make sense on the surface for Disney, company insiders and corporate governance experts warn that there are Mouse House-specific considerations that would make such a dynamic unwise.

Netflix has a specific set of circumstances that make a co-CEO structure viable.

For starters, Sarandos and co-CEO Peters have different passion areas, according to people familiar with Netflix’s leadership styles, who asked to remain anonymous because the details are private. This allowed the two leaders to make decisions without stepping on each other’s toes.

If Sarandos and Peters disagree on something, they work it out by going back to the leader who’s most passionate about the answer. This usually means that Sarandos wins if the decision is content or creative, and Peters wins if the decision is more product or technology based. A Netflix spokesperson declined to comment.

If there’s a gray area, the co-CEOs can always turn to Hastings, the company’s co-founder and CEO of 25 years. Peters and Sarandos worked together under Hastings for many years. This comfort level — and Netflix’s famously non-hierarchical company culture — has helped maintain a dual CEO structure without turf wars while simultaneously serving shareholders, Sarandos told Iger, according to the people familiar with the matter.

Since Peters took over as co-CEO in January 2023, Netflix shares have risen about 275%.

At first glance, Walden and D’Amaro present a similar dynamic to Sarandos and Peters. Walden’s expertise is Hollywood, and D’Amaro’s is theme parks and consumer products. Iger could theoretically advance to the CEO role, keeping him around in a similar way to Hastings.

The selection of both Walden and D’Amaro as Iger’s long-awaited successor may allow Disney to keep both leaders at the company. If the board chooses one over the other, Disney risks losing a top executive who might want a chance to be CEO elsewhere. This happened to Disney in 2020, when streaming chief Kevin Mayer left the company to become CEO of TikTok after he was passed over in favor of Chapek.

But Disney’s co-CEO arrangements also come with a number of red flags that don’t exist at other companies.

First, if Iger remains on the board, some employees — and outside partners — may still view him as a CEO. This could undermine the power-sharing structure between two executives, especially given Iger’s reputation for wanting to remain the company’s top leader.

While Hastings has turned his attention to hobbies like skiing since stepping down as CEO, Iger has gained a reputation for wanting to stay on as Disney’s chairman. He has been pushed into retirement five times to remain at the helm, returning to replace Chapek in 2022 after being named as his replacement.

Second, during Chapek’s tenure, Iger did not completely relinquish his operational responsibilities immediately, choosing to direct the company’s “creative endeavors” for more than a year. This created an ugly power-sharing situation between Iger and Chapek, as CNBC explained in 2023. Even if Walden and D’Amaro have different strengths in the space, choosing the co-CEO model after suffering through a recent time period where lines of control were blurred may be a case of failing to learn from one’s mistakes.

Third, Walden and D’Amaro have not worked together for as long as Peters and Sarandos (or other co-leader arrangements that have had long-term success, such as the CAA co-leader arrangement with Brian Lord, Richard Lovett, and Kevin Hovan). Walden served in a co-president arrangement with Gary Newman at Fox for many years running Fox TV, proving that she can succeed in such an arrangement, but it is unclear whether she would relish the opportunity to return to the pairing.

Fourth, Disney’s culture is political. The company has seen several torturous successions with Iger and former Disney CEO Michael Eisner. While Netflix has been largely unaffected by mergers and acquisitions, Disney is a combination of several acquisitions and spinoffs over the years, including ABC, ESPN, Fox, Pixar, Marvel, and Lucasfilm. This has brought employees from many different cultures together, rather than generating a unified mindset for the company since its founding.

“It’s not going to work out with Disney,” a senior media official told CNBC privately. “There’s going to be a lot of backbiting. That’s how it’s always been.”

A Disney spokesman declined to comment.

On top of all this, traditional corporate governance experts have widely dismissed the appointment of a co-CEO as suboptimal.

About 1.2% of companies in the Russell 3000 have employed a co-CEO structure at any given time in recent years, the Wall Street Journal reported last month, citing data from Equilar.

“When you create two sources of authority in an organization, that’s never a good thing,” Charles Elson, founding director of the Weinberg Center for Corporate Governance at the University of Delaware, said in an interview. “Two are responsible means no one is responsible.”

However, Elson said there are mitigating factors that could make co-CEO arrangements more palatable. Having Hastings as CEO is likely to be important for Netflix because he could serve as a de facto tie-breaker in the co-CEO pecking order.

Likewise, a co-CEO structure can work if it is clearly implemented for longer succession planning, such as Comcast’s decision to promote Kavanagh to co-CEO alongside Roberts, Elson said.

When it’s time to act, Hastings and Roberts can call the shots on the biggest decisions, Elson said. Roberts is the controlling shareholder of Comcast. Oracle likewise has a controlling shareholder in co-founder Larry Ellison.

While Iger could play a crucial role at Disney as CEO, he is not a founder of the company and owns less than 1% of the outstanding shares. Elson noted that this gives him less of a stake in the game for Disney’s future than someone like Roberts or Ellison.

Choosing just one CEO may be a leap of faith for Disney’s board, but it is better than creating instability, Elson said.

“It is inevitable that one CEO will dominate and the other will leave,” he said. “This is the nature of humanity.”

Disclosure: Comcast is the parent company of NBCUniversal, which owns CNBC. Versant will become the new parent company of CNBC based on Comcast’s planned spin-off of Versant.