Activision Blizzard CEO Bobby Kotick routinely receives millions in stock bonuses every year based on the company’s performance. Now he is expected to receive even more, with a total payment of almost $ 200 million, according to the CtW Investment Group, a union organization for the defense of pension funds. And all of this thanks to a clause in its contract that was recently triggered by the strong performance of the company’s shares during the pandemic.
While the Call to action Manufacturer CEO Kotick receives bonuses based on helping the company achieve profit targets and other milestones. And because 2020 saw Activision Blizzard’s stock price jump dramatically as millions turned to gaming to distract themselves during the pandemic, it’s on track to collect all the incentive bonuses he lost in the last few years, in addition to the tens of millions that he already earns annually, due to the “incentive to create shareholder value” clause in its contract.
In March 2016, the company’s stock price was around $ 32 each. Last March, it had risen to $ 56 and, in the year the pandemic started, it only rose further, reaching more than $ 100 at one point last month, before dropping back to just under $ 92. Because the stock remained more than double what it was when Kotick’s 2016 employment contract came into force more than 90 days ago, the provision for “incentive to create shareholder value” was triggered earlier this month. “On March 1, 2021, the performance conditions for the four-year performance period from 01/01/17 to 12/31/20 underlying these performance stock unit premiums were achieved at the maximum level,” says Activision Blizzard’s latest SEC file.
“While the increase in Activision’s share price is something to be commended, as we said last year and we continue to say, this achievement alone does not justify a substantial payment result for the CEO,” said CtW Investment Group researcher Michael Varner in a statement. In a call with Kotaku, Varner called the “maximum level” payment equivalent to a six-minute mile c-suite, and said that Activision Blizzard is basically awarding retroactive gold medals to Kotick for his previous performance based on the last stock price .
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The CtW Investment Group has criticized CEO salaries at several companies, including one of the largest in the gaming industry. Demanding wage inequality and significant Kotick bonuses at Activision Blizzard’s annual shareholders’ meeting last year, and has been pressing the company’s board of directors to diminish how rich it has become the company’s decade-long boss. Since Activision Blizzard was boasting record sales last summer, Bloomberg reported that some of its employees have begun to share their personal payment information with each other internally to protest the lack of increases commensurate with the company’s continued success.
Although the pandemic has made Kotick even richer, it has not ended the layoffs at Activision Blizzard. The company fired about 800 people in early 2019, followed by hundreds more in the following months, the closure of his office in France, and just confirmed yesterday that somewhere between 50 and 190 more people would be let go, including its electronic sports division, which struggled last year during the ban on in-person gaming events.
Bloomberg reported that the most recently dismissed employees would receive health benefits throughout the year as part of their severance package. They would also receive $ 200 gift cards for Battle.net, I think so that they could still buy the latest Overwatch skins even when unemployed, and even when your ex-boss is about to earn millions in additional bonuses.
Activision Blizzard did not respond to a request for comment.