Swinton's casting as the character, who was originally Tibetan in the comic books, drew flack from a lot of Asian actors and visibility groups ahead of the release of the Benedict Cumberbatch-led 2016 superhero movie.
At the time, Marvel Studios defended the casting citing "creative freedom", but Feige now believes the company could have handled the situation better.
"We thought we were being so smart and so cutting-edge. We’re not going to do the cliche of the wizened, old, wise Asian man," he told Men’s Health for a cover story on the upcoming Asian-led Marvel film "Shang-Chi and the Legend of the Ten Rings" .
"But it was a wake up call to say, ‘Well, wait a minute, is there any other way to figure it out? Is there any other way to both not fall into the cliche and cast an Asian actor?’ And the answer to that, of course, is yes," Feige added.
"Shang-Chi" will be the first Marvel film to feature a predominantly Asian cast, with the lead role being played by Simu Liu.
The film will hit the theatres in the US on September 3.