The #MeToo movement is long overdue in Hollywood, said ex-powerhouse agent Michael Ovitz, whose talent agency effectively controlled Hollywood for much of the 1980s and 1990s.

"What's happening today is absolutely critically important to the entertainment business, to all businesses. I think that the brave women who have stood up to this — and they are brave because it's a system that does not forgive — are going to start a movement to change that's going to be really healthy for everybody," Orvitz said Tuesday during an exclusive with CNBC's Scott Wapner.

Once known as the most powerful man in Hollywood, Ovitz co-founded Creative Artists Agency (CAA) with partner Ron Meyer. The agency recruited and managed such star-studded talent as Steven Spielberg, Martin Scorsese, Meryl Streep, Arnold Schwarzenegger, Morgan Freeman and Robert DeNiro, among many others. After decades as a power broker, he became president of Disney, but was fired shortly after amid tension with former Disney CEO Michael Eisner. Since his departure from Disney in the late '90s, Ovitz has dabbled as a private investor in Silicon Valley.

Ovitz said the culture of sexual misconduct, exemplified by producer Harvey Weinstein, who has been charged with sex crimes, has long been a problem in Hollywood. Weinstein has pleaded not guilty to the charges.

"Hollywood has been in a problem since its inception. The term 'casting couch' wasn't invented yesterday. This whole concept has been around forever and it's always been swept under the rug," Ovitz said.

He said that at CAA, there wasn't quite as severe a problem with sexual misconduct since "40 percent of our staff were women."

"I have to say we didn't have as much of it at CAA as what you're experiencing now," Ovitz said on CNBC's "Halftime Report." "I loved women agents. I thought frankly, I shouldn't say this, but they were better than men. They had just a much greater ability to handle the clients."

Ovitz readily admits he and others at the agency didn't do as much as they should have, to address rumors of misconduct.

"We would hear things, we would follow up what we could, probably not as much as we should have," he said.

One of the #MeToo movement's most recent targets, former CBS President and CEO Les Moonves, was once a client of Ovitz. The two worked together with Michael Crichton and Steven Spielberg to put long-running NBC drama series "ER" on the air.

Ovitz described Moonves as "the most terrific guy," and said he "feels horrible for him" over his forced resignation from CBS. But, ultimately, Ovitz reserved judgement.

"Still I'm not sure I quite understand it all," he said.

Numerous women have accused Moonves of sexual assault, misconduct and abuse of power in alleged incidents ranging from the 1980s to early 2000s. Moonves stepped down as CBS chairman, president and chief executive officer in early September. He denies the allegations.

Ovitz is now promoting a new memoir, "Who is Michael Ovitz?" which details "a story of three valleys" — his childhood home, the San Fernando Valley, Silicon Valley and "a Valley I'd dug for myself," according to The New York Times.

Les Moonves did not immediately respond to CNBC's request for comment.

Disclosure: NBC and CNBC are divisions of NBCUniversal.



