After CtW Investment Group said that Bobby Kotick, the CEO of Activision Blizzard, is getting paid too much, they say the same thing about Electronic Arts’ executives…

We previously discussed the Kotick situation, so we’re not repeating ourselves here. However, there is news on the CtW front. In a letter, they say that Electronic Arts is paying multi-million dollar bonuses to executives. They named two people: Blake Jorgensen (the chief financial officer) and Kenneth Moss (the chief technical officer), while EA’s shares are underperforming, and employees are being laid off.

The letter points out that in June 2017, Jorgensen and Moss were given „special equity awards” on top of their standard compensation. In Jorgensen’s case, he received a 10-million dollar special equity grant on top of his standard 6.5 million annual grant. Moss got a 7 million grant on top of his 5.5 million annual grant. (Now, equity compensation is a form of non-cash payment. It’s usually in the form of shares or stock options. The companies use this solution to encourage executives to stay with them and not work elsewhere.) However, in November 2019, Jorgensen received another 7.5 million on top of his annual 7.5 million grant (so he got it increased by 36% in two years – we’d appreciate such a pay raise, too), and Moss received an extra 5.5 million grant.

CtW noted that these equity awards were granted before the performance period for the previous special awards had finished. Thus, the company believes it is suspicious, as Electronic Arts might be using them to make up for the lost income elsewhere, and that „undermines the spirit of pay-for-performance.”

„Electronic Arts has loaded up its top executives, including two executives with two special awards each, while its workers faced massive layoffs last year. This is an undue focus on the short term that cannot be good for the long-term success of EA. The notion that executives need to be incentivized with pay above-and-beyond the ordinary course program is a complete fallacy. EA’s executives have more than enough retention and performance incentive through their annual equity grant amounts, which the company already admits are set above the median of peers in its peer group,” CtW Investment Group executive director Dieter Waizenegger said in a statement.

„The Investment Group pays particular attention to major corporate transactions and contests for control because of the magnitude of shareholder value at stake and the fact that many past deals have destroyed such value. The CtW Investment Group believes active engagement by shareholders with company directors and executives at these critical junctures can help to prevent, or change the terms of, otherwise questionable transactions,” its website states.

They urge the shareholders to vote against the Say on Pay proposal in August when Electronic Arts’ shareholders meet.

The group is urging shareholders to vote against the Say on Pay proposal at Electronic Arts’ annual stockholders’ meeting in August. They have done the same thing in June with Activision Blizzard’s shareholders. However, that campaign didn’t reap rewards, but it got noticed, as CtW said back then that more than 43% of the shareholders voted against the company’s Say on Pay policy, which, according to them, is „the highest level of opposition the video-gaming giant has received in its history of having votes on CEO pay on its ballot.”

Sounds familiar: workers barely get paid anything, while the leadership takes home so much money the workers can only dream of.

Source: PCGamer