SEC Filing: Disney’s Loss from Culture Wars

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The Walt Disney Co. has recently acknowledged in a corporate disclosure that its controversial political and social agenda has cost the company and its shareholders. This comes as the company celebrates the 300th birthday of famed economist Adam Smith, who coined the “invisible hand” metaphor to explain how consumers exercise their choice between products.

According to George Washington University law professor and Fox News contributor Jonathan Turley, the company’s SEC annual report acknowledges that “we face risks relating to misalignment with public and consumer tastes and preferences for entertainment, travel, and consumer products.”

In the report, Disney also recognizes that the success of its businesses depends on its ability to consistently create compelling content and that its revenues and profitability are adversely impacted when its offerings and products do not achieve sufficient consumer acceptance. It further states that consumers’ perceptions of the company’s position on matters of public interest, including its efforts to achieve certain environmental and social goals, often differ widely and present risks to its reputation and brands.

Turley notes that despite consumer backlash and the company’s reported loss of a billion dollars on four recent “woke” movie flops, Disney has continued to roll out underperforming movies. He also points out that corporate executives may put their personal agendas over profits, as it could advance their careers and earn them praise from colleagues.

While there is an element of expression in Disney’s products, Turley highlights the issue of the company’s political and social agenda becoming the focus of its brand. He notes that what was once an unassailable and uniting brand is now negatively associated with activism by a significant number of consumers.

Moreover, Disney’s report shows a decline in licensing revenue for products associated with some of its most iconic and beloved brands, indicating that consumers are becoming increasingly disconnected from the company. CEO Bob Iger has reportedly recognized the negative impact of the company’s involvement in cultural wars and is looking to tone down its political and social activism.

Disney has faced criticism from conservatives for its involvement in issues such as opposition to Florida’s parental rights bill, and its recent films and reboots have drawn mixed reactions from audiences. As the company continues to grapple with the consequences of its political and social agenda, the question remains how long it can sustain falling revenues due to its “misalignment with the public.”

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