Activist investor targets Activision Blizzard CEO’s ‘exorbitant’ pay package
Video game maker shareholder meeting set for June 11
A pro-labor activist investor is calling for shareholders of video game maker Activision Blizzard to reject an “exorbitant” pay package for the company’s CEO.
Activision Blizzard CEO Robert Kotick has received a combined $96.5 million in stock and options during the last four years, CtW Investment Group wrote in a Securities and Exchange Commission filing ahead of Activision’s June 11 annual investors meeting.
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Meanwhile, the Santa Monica, California-based company, which has made titles like “Call of Duty,” “World of Warcraft” and “Candy Crush,” laid off about 750 employees last year. And disclosure around some of Kotick’s pay award objectives has been “severely lacking,” CtW alleged in the SEC letter.
“We note that three of these objectives are clearly related to human capital management and that Kotick’s apparent failure to achieve more than half of the targeted performance strongly suggests that Activision Blizzard’s skewed approach to human capital management -- lavishing multi-million dollar rewards on the CEO as employees face layoffs -- needs to be addressed before it manifests in deeper operational problems,” the filing states.
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An Activision Blizzard spokesperson told FOX Business that Kotick’s pay is more-than-90 percent performance-based.
“During Mr. Kotick’s tenure -- which is the longest of any CEO of a public technology company -- Activision Blizzard’s market capitalization has increased from less than $10 million to over $53 billion,” the spokesperson said.
Robert "Bobby" Kotick, president and chief executive officer of Activision Blizzard Inc.(David Paul Morris/Bloomberg via Getty Images) (Getty)
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CtW also described an incentive tied to increasing the company’s market cap through merger-like transactions as “another problematic provision.”
“Such incentives should be unnecessary: executives are already well compensated in the event of a merger or other strategic transaction without additional incentives because they typically hold large amounts of vested equity,” CtW wrote.
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The Activision Blizzard spokesperson said Kotick’s leadership helped the company’s stock outperform the S&P 500 by more than 11,000 percent over the past 20 years.
“He has delivered exceptional value for Activision Blizzard’s stockholders,” the spokesperson said.