Bobby Kotick, CEO of Activision Blizzard, routinely receives millions in stock bonuses each year based on how the company is doing. Now he will get even more, for a total payout of nearly $ 200 million, according to CtW Investment Group, a union pension fund advocacy group. And that’s all thanks to a clause in his contract that was recently triggered by the company’s strong stock performance during the pandemic.
Like the Duty Creator CEO, Kotick receives bonuses based on helping the company achieve profit goals and other milestones. And because Activision Blizzard’s stock price has risen dramatically in 2020 as millions turned to games to distract themselves during the pandemic, it’s on track to rally all the incentive bonuses he has missed in recent years, in addition to the tens of millions he already earns annually, because of an “incentive” clause to create shareholder value in its contract.
In March 2016, the company’s stock price was approximately $ 32 per share. In March last year, it had risen to $ 56, and in the year since the pandemic began, it only climbed higher, peaking at over $ 100 at one point last month, before reverting back to slightly less than $ 92. Because the stock has remained more than double what it was then Kotick’s Employment contract 2016 became effective for more than 90 days, the “shareholder value creation incentive” provision was triggered earlier this month. “On March 1, 2021, the performance conditions for the four-year performance period 1/1/17 through 12/31/20 that underlie this performance share award at the maximum level were reached,” said Activision Blizzard’s most recent SEC filing
“While the rise in Activision’s stock price is somewhat commendable, as we stated and continue to claim last year, this performance alone does not justify such a substantial wage result for the CEO,” CtW Investment Group researcher Michael Varner said in a statement. In a telephone conversation with KotakuVarner called a “maximum” payout the c-suite equivalent of a six-minute mile walk, and said Activision Blizzard is in effect retrospectively awarding Kotick gold medals for its past performance based on the latest stock price.
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CtW Investment Group has criticized CEO remuneration at many companies, including one of the largest in gaming. It mentioned pay inequality and Kotick’s substantial bonuses at the annual meeting of Activision Blizzard shareholders last year, prompting the company’s board of directors to call back just how rich it makes the company’s ten-year boss. As Activision Blizzard posted record sales last summer, Bloomberg reported that some of his employees started sharing their personal pay information internally to protest a lack of pay increases in proportion to the company’s continued success.
While the pandemic has made Kotick even richer, it hasn’t ended the layoffs at Activision Blizzard. The company has been fired about 800 people at the beginning of 2019, followed by hundreds more in the following months, the closure of its French office and confirmed yesterday that somewhere between 50 and 190 more people would be released, including in the esports division, which has struggled with the ban on in-person gaming events for the past year.
Bloomberg reported that the most recently laid-off workers would receive a year-round health insurance benefit as part of their severance pay. They would also get $ 200 gift cards to Battle.net so they can still buy the latest Overwatch skins even when they don’t have a job, and even when their former boss is about to rake in millions of extra bonuses.
Activision Blizzard did not respond to a request for comment.