Update:
Responding to a request for comment, an Activision spokesperson has given NME this statement:
“We are pleased that, based on exceptional shareholder returns and responsiveness, Activision Blizzard shareholders again approved our say-on-pay proposal and re-elected our Board directors with an average of 96% of votes. The additional time shareholders requested allowed them to thoroughly review the facts about Activision Blizzard’s rigorous pay-for-performance compensation practices as well as changes the Board made to our executive compensation based on extensive feedback from shareholders.”
We’ve also clarified within the main body of the story that CtW does not directly represent Activision Blizzard investors, but is part of a coalition of labour unions.
Original Story:
Activision Blizzard has attracted controversy by approving CEO Bobby Kotick’s £111million ($155million) bonus.
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According to reports, 54 per cent of shareholders approved the vote for Kotick’s compensation plan, despite the efforts of CtW Investment Group, who had requested investors vote down the proposal (thanks to GamesIndustry.biz).
CTW doesn’t
The approval represents a dip from the previous year’s 56.8 per cent approval, which is the lowest that the approval rating has been in recent years. Kotick took a voluntary 50 per cent pay cut earlier in 2021, but the current bonus includes awards for multi-year objectives set in 2016.
Pressure came from CtW in 2020, which made a filing to the US Securities and Exchange Commission, which said: “Despite repeated low approval votes from shareholders, Activision Blizzard maintains multiple, overlapping opportunities for its CEO to earn outsize equity awards, even when performance-related vesting thresholds have not been met”.
CtW does not directly represent Activision Blizzard investors. It is part of a coalition of labour unions.
The filing, signed by Dieter Waizenegger (executive director of CtW) contained a reference to the layoff of 800 Activision Blizzard staff members in 2019.
Waizenegger wrote that the payment proposal was of “special concern” because “Activision Blizzard employees face job insecurity following layoffs of 800 employees in 2019, and typically earn less than 1/3 of 1 per cent of the CEO’s earnings, with some employees, such as Junior Developers, making less than $40,000 a year while living in high-cost areas such as southern California.”
The vote was originally delayed, a measure that was requested by shareholders who said it would give investors “adequate time to review and consider the company’s recent responses to statements that were published and recirculated about the company’s executive compensation practices that the company believes to be misleading.”
The statements referred to are those of CtW Investment Group, above. CtW director of executive compensation Michael Varner responded to GameIndustry.Biz’s request for a comment on the vote passing, as CtW does not consider the matter closed.
“With only 54% of votes cast in favour, the proposal nearly failed to receive majority support — it appears Activision did just enough arm-twisting for the measure to pass,” Varner said.
“Activision will be expected to make even further changes in response to a vote where 46% of shareholders expressed discontent, they will not be able to ‘rest on their laurels’ solely with the changes they made thus far to Mr. Kotick’s pay.”
The GameIndstury.Biz article on the matter fully breaks down the clauses in Kotick’s contract that allowed him to receive the bonus, as well as the measures CtW has taken to protect Activision Blizzard investors.
In other news, Activision Blizzard has planned to triple the size of its franchise development teams by the end of 2021.