Activision Blizzard - CEO's Bonus Sparks Controversy
Activision Blizzard shareholders made an appeal in connection with the proposal of another bonus for Bobby Kotik. Their case is that the CEO's bonus is much too high for his achievements and in the context of mass layoffs in 2019.
When more than a year ago As You Sow presented the list of the 100 most overpaid CEOs, Bobby Kotick from Activision was rated quite high on it. Although he didn't make it into the top ten, his 45th place didn't give him a good testimony in the eyes of players. Apparently also some of the investors have changed their mind, criticizing Activision for the size of Kotick's paycheck. They turned to the CtW Investment Group (which deals with holding CEOs accountable for irresponsible and unethical corporate behavior) and obtained the support of its executive director, Dieter Waiznegger. As a result a letter was written calling for a vote against the granting of another bonus to Kotick at the shareholders' meeting scheduled for June 11.
Dissatisfied investors have a few comments about granting further bonuses Activision's CEO. As we read in Waiznegger's document, Bobby Kotick receives more than $20 million in share capital or other options each year. In the last four years alone, this has contributed to USD 96.5 million in bonuses alone. Thus, Kotick earns more on them than amounts to a total annual salary (i.e. base salary, bonuses and capital payments) of other CEOs in similar companies.
The shareholders also have a problem with unclear definition of the tasks that would justify rewarding Kotick. Those provided by Activision are even below last year's results and plans of the company. Nevertheless, Kotick's proposed bonus has not been reduced. The company itself declares that thanks to the director, Activision's market capitalization has increased from less than $10 billion to $53 billion over the last 20 years. (via GameSpot). However, the group supported by Waiznagger believes that this does not justify such generosity towards a CEO, especially since it is in clear contrast to the situation of the company's employees. Most of them do not even receive 0.33% of Kotick's salary. Some earn less than $40,000 a year, despite living in expensive locations like Southern California. The CtW document also recalls last year's layoff of 800 people, which echoed in the industry and should in itself cancel out any additional bonuses for Kotick.
