In a recent filing with the United States Securities and Exchange Commission, an investment group representing some Activision Blizzard shareholders argued that the video game company “finds multiple ways to unnecessarily enrich” chief executive officer Bobby Kotick. More directly, this translates to “Why the fuck is this one dude making so much money?”
CtW Investment Group writes in its mission statement that it functions to hold “directors accountable for irresponsible and unethical corporate behavior and excessive executive pay.” Since, as it says in the filing, several of the union-sponsored pension funds it works with own “substantial” shares in Activision Blizzard, this goal put the group on an obvious collision course with Bobby Kotick, who rakes in tens of millions of dollars a year while regularly laying off employees.
In the filing, CtW Investment Group executive director Dieter Waizenegger writes that, thanks to “multiple, overlapping award provisions” in Kotick’s employment agreement with Activision Blizzard, the CEO is allowed “multiple bites at the apple.” Kotick has received over $20 million in stock options every year for the last four years in addition to his base salary, a bonus that eclipses the total pay for many of his fellow CEOs throughout the games industry. The cumulative total of Kotick’s stock awards alone in the last four years is $96.5 million—which, again, doesn’t include his salary. The filing adds that Kotick’s bonuses are “antithetical to pay for performance.”
Waizenegger continues, writing: “While equity grants that exceed the total pay of peer companies would be objectionable in most circumstances, it is of special concern in this case because Activision Blizzard employees face job insecurity following layoffs of 800 employees in 2019, and typically earn less than 1/3 of 1% 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.”
Activision defended Kotick’s bonuses in a statement to GameSpot, citing increases in the company’s “market capitalization” and share price performance during his tenure as the impetus behind his hefty compensation. “He has delivered exceptional value for Activision Blizzard’s stockholders,” the rep said.
CtW Investment Group has asked Activision shareholders to vote against an upcoming proposal that would approve Kotick’s compensation for the next fiscal year. The next investors meeting is scheduled for June 11.