Financial compensation for Bobby Kotick is once again under pressure, as Activision Blizzard’s CEO is expected to receive a payment of up to $ 200 million.
The CtW Investment Group claims that Activision’s success last year triggered the shareholder value incentive clause in Kotick’s employment contract, reports Kotaku.
The CtW is a group of investors that says its mission is to hold companies accountable for “irresponsible and unethical corporate behavior and overpaying executives”.
Due in large part to the pandemic and an exceptional year for Call of Duty, Activision had a record financial year.
Over the past 12 months, its stock price has jumped from $ 56 to $ 92, where it currently stands. In February, it reached more than $ 100 per share.
As the shares spent more than 90 days at twice the value of when Kotick’s employment contract went into effect in 2016 – with a share price of $ 32 in March of that year – the creative incentive for shareholder value was triggered.
This is said to give Kotick the right to all bonuses he lost in previous years, even if this is due to failure to meet performance targets. According to CtW calculations, this could reach $ 200 million.
CtW criticized the payment, questioning whether Kotick should be rewarded for the success of the entire company that can at least be partially attributed to circumstances beyond its control.
“While the increase in Activision’s share price is somewhat commendable, as we said last year and we continue to say, this achievement alone does not justify a substantial payment result for the CEO,” said Michael Varner, research director for executive compensation of the group in a statement shared by GameSpot.
“There are many factors that can contribute to an increase in the stock price of this particular company that may not be directly attributable to Robert Kotick’s leadership. The use of video games as one of the few entertainment options available in the midst of the COVID-19 pandemic , for example, has been a blessing to many companies in the gaming industry, regardless of executive talent or strategic decisions. “
The news follows yesterday’s report that Activision Blizzard laid off 50 employees, mainly from its live events and electronic businesses, with the publisher citing the pandemic’s impact on such events.
The CtW Investment Group had already criticized Activision Blizzard last year for continuing to grant Kotick “disproportionate share premiums”, despite failing to meet performance-related targets.
The group even urged shareholders to vote against the Say on Pay management proposal, which would make these rewards possible.
CtW also launched a shareholder campaign against Electronic Arts, claiming that the publisher had demonstrated an “excessive capital lending problem” in the form of mass layoffs.