It’s a proposal that has not yet been voted on by Activision-Blizzard shareholders but could end millions in executive bonuses. It might also help make the company a usual place to work for everyone.
They say that real change only happens when it hits you in the pocket. And perhaps that is the one thing Activision-Blizzard needed to solve the problem of sexual harassment allegations that have already tarnished the company’s image. Although this has been the most talked-about issue in recent weeks, it has not been the only complaint against the company, which has also been criticised for the enormous sums paid out in annual bonuses to executives. Because we’re not talking about an extra salary, we’re talking about prizes of up to $200 million. At the request of shareholders, the executives will not be able to take their bonuses this year because of the inadequate handling of sexual harassment cases.
Before we go any further, it should be noted that this is just a proposal being put to the vote, so it does not mean that a decision has been made. As shared by Gamesindustry, there is a long story behind the idea. The shareholder group in question, the SOC Investment Group, has been urging Activision-Blizzard and EA for months to review the big money their executives receive annually, even though this proposal was consistently voted down in the end.
The SOC Investment Group believes that the criteria for awarding bonuses, which are based primarily on performance within the company, are disproportionate for both companies. Thus, focusing on Activision-Blizzard, it began by pointing out that the company had “unnecessarily enriched” its CEO, Bobby Kotick. As a result, Kotick’s salary was halved, but even then, he did not give up his annual bonuses.
Complicating matters, however, are recent allegations of a toxic working environment in the Activision-Blizzard offices, which has forced the company to make changes that employees claim have not been made. This, coupled with the fact that Activision-Blizzard’s crisis has reached the ears of government agencies and the Securities and Exchange Commission, which is currently investigating Kotick, has further prompted SOC Investment Group to make changes to the company financially and in terms of diversity.
They have called for a reshuffle of the Board of directors, with only two women on the 10-person team. They suggest that the company’s bosses should not receive an annual bonus because the “problem of sexual harassment is unresolved”. In addition, the investor group adds that “bonuses should be contingent on Activision-Blizzard meeting certain equality, diversity and inclusion benchmarks”.
In this regard, SOC Investment Group insists that the company was already having problems with investor satisfaction before the sexual harassment crisis: “Activision-Blizzard was already having difficulty gaining shareholder support before the big scandal surrounding the company’s environment because the company was focused solely on executive pay, so I think there is some basis to believe that investors would want to see something different.”
Of course, the company is going through turbulence that can have a lasting impact on its image, so it’s not surprising that after what happened, adding the recent resignation of Overwatch’s executive producer and Blizzard’s legal chief, it’s taking steps to not only cut millions in executive bonuses but also ensure a fair working environment for all.
Source: Game Industry