Disney's fight with Nelson Peltz is about to come to a head. Here's where things stand.

• Disney shareholders will vote for the company's board at its annual meeting on Wednesday.
• The vote will bring to an end a long proxy fight between CEO Bob Iger and Trian's Nelson Peltz.

The battle between Disney CEO Bob Iger and activist investor Nelson Peltz's Trian Partners will come to a head on Wednesday when House of Mouse shareholders finally have a chance to weigh in on the proxy fight that's been going on for more than a year.

The shareholders' decisions at the annual meeting will serve as a referendum on the future of Disney.

A vote for the Disney's slate of board members will show support for Iger's performance as CEO since he returned to lead the company in November 2022.

A vote for self-described "bully billionaire" Peltz and former Disney CFO Jay Rasulo — and for removing Disney directors Maria Elena Lagomasino and Michael Froman from the board — will be seen as a rebuke of management's strategy.

It's the culmination of months of tussling between Disney and Peltz, who has been waging war against Disney's board since January last year. Trian's argument centers on Disney's share price — down about 40% from a March 2021 peak of about $202, debt following its $71 billion acquisition of 21st Century Fox, losses in its streaming division, and its botched succession plan.

Disney, in turn, has forged ahead with its strategy under Iger, announcing results that beat Wall Street's expectations in February alongside a $1.5 billion investment in Epic Games, the company behind "Fortnite," to cater to younger generations like Gen Z and Gen Alpha.

Choosing to back "Peltz's slate of directors would be a vote for shaking things up," Jason Schloetzer, a professor at Georgetown University's McDonough School of Business, told Business Insider. "It's saying that the strategy is either OK or needs to be tweaked, and that acceleration and implementation need to speed up."

But ahead of the shareholder meeting, it looks like Disney's current board will pull through, though the final decision could hinge on how Vanguard, the company's largest shareholder with about 8% of the company, votes.

On Monday, The Wall Street Journal reported that BlackRock and T. Rowe Price, the former of which is Disney's second-largest investor with about 4.2% of shares, were throwing their votes behind Iger. Other prominent shareholders, including investment firm ValueAct Capital, Walt and Roy Disney's heirs, Laurene Powell Jobs, and Star Wars creator George Lucas, have also come out in support of the company's management.

"Creating magic is not for amateurs," Lucas said in a statement last month. "When I sold Lucasfilm just over a decade ago, I was delighted to become a Disney shareholder because of my long-time admiration for its iconic brand and Bob Iger's leadership."

Still, the battle has been closer than Disney would like, as evidenced by the $40 million it has reportedly spent appealing for votes — particularly those of retail investors, who hold about 40% of Disney's shares, according to the New York Times.

Disney has run extensive ad campaigns featuring characters like Pinocchio and Donald Duck's uncle, Ludwig Von Drake. Iger and other executives have spent weeks meeting with and calling major shareholders.

"If Disney wasn't concerned about losing one or two board seats here, they wouldn't be as aggressive and public about pushing back," Schloetzer said.

Trian, too, has spent eight figures on its campaign, publishing white papers and taking to social media with satirical animations of Disney's cast of characters.

That's been paying off. On Monday, institutional investors Neuberger Berman and the California Public Employees' Retirement System threw their support behind Trian, which controls about 1.8% of Disney shares, most of them belonging to disgruntled former Marvel chairman Ike Perlmutter. And proxy advisory firm Institutional Shareholder Service recommended shareholders vote for Peltz, though not Rasulo.

Peltz first waged war against Disney's board in January 2023, though he halted his bid for a seat a month later when the company agreed to cut costs and lay off 7,000 employees.

"We wish the very best to Bob, this management team, and the board," Peltz said on CNBC at the time. "We will be watching. We will be rooting."

By November, he'd reversed course, launching a sequel to his original bid for seats and continuing to fight even after Disney's stock jumped in February.

"It's déjà vu all over again. We saw this movie last year and we didn't like the ending," Peltz said at the time.

If Peltz and Rasulo do get board seats, it's not entirely clear how much sway they will have. Trian has said its main priorities are to improve streaming margins to match those of Netflix and devise a CEO succession plan. Some have suggested he may carve up Disney's assets — ABC, ESPN, the theme parks — and Peltz has said he wants to make changes to its movie strategy.

"Why do I have to have a Marvel that's all women?" he said in a Financial Times interview last month. "Not that I have anything against women, but why do I have to do that? Why can't I have Marvels that are both? Why do I need an all-Black cast?"

In the face of all of this, Iger has remained outwardly confident — particularly after strong first-quarter earnings seemed to restore his signature swagger.

"The last thing that we need right now is to be distracted in terms of our time, our energy, by an activist or activists that, frankly, have a completely different agenda and don't understand our company, its assets, even the essence of the Disney brand," he told CNBC at the time.

But if Peltz does pull an upset, Schloetzer said, "that's when it gets interesting."