The financial compensation for Bobby Kotick is again under fire, as the CEO of Activision Blizzard will earn a payout of up to $ 200 million.
The CtW Investment Group claims that Activision’s success over the past year has caused the shareholder value Creative Incentive clause of Kotick’s service agreement, reports Kotaku.
CtW is an investor group that states that its mission is to hold companies accountable for ‘irresponsible and unethical corporate conduct and excessive management remuneration.’
Due to the pandemic and a banner year for Call of Duty, Activision had a record year.
Over the past 12 months, the share price has jumped from $ 56 per share to $ 92, where it currently sits. In February, it reached more than $ 100 per share.
As the stock spent more than 90 days at double the value when Kotick’s service agreement went into effect in 2016 – with a share price of $ 32 in March of that year – the shareholder value Creative Incentive was apparently boosted.
This allegedly gives Kotick the right to all the bonuses he missed in previous years, even if it was because he could not achieve the performance goals. According to CtW’s calculations, this could amount to $ 200 million.
CtW criticized the payout and questioned whether Kotick should be rewarded for the company’s success which can be attributed at least in part to circumstances beyond its control.
“While the increase in Activision’s share price is somewhat commendable, as we said last year and still claim, this performance does not justify such a significant outcome for the CEO,” said Michael Varner, director of the executive compensation group. said in a statement shared by GameSpot.
“There are many factors that could contribute to a rise in the company’s share price, which may not be directly attributable to Robert Kotick’s leadership. Using video games as one of the few entertainment options available amid the COVID-19 ‘pandemic available, for example, has been a boon for many companies in the gambling industry, regardless of executive talent or strategic decisions.’
The news follows yesterday’s report that Activision Blizzard has laid off 50 employees, mainly from its live events and sports businesses, with the publisher citing the impact of the pandemic on such events.
CtW Investment Group had earlier criticized Activision Blizzard for continuing to award “excessive equity awards” to Kotick, although it did not meet performance-oriented targets.
The group even urged shareholders to vote against the Management Say on Pay proposal, which makes the reward possible.
CtW has also launched a shareholders’ campaign against Electronic Arts, claiming that the publisher has shown an “excessive share issue” in the way of mass redundancies.