The CEO of Activision Blizzard, Bobby Kotick, has recently filed an extension agreement with the SEC where it is stated that the CEO’s salary and annual bonus will be cut by 50%. This comes soon after criticisms of the CEO’s excessive pay and bonuses even during the stream of layoffs at both European and NA offices.
Bobby Kotick found himself well suited to the role of CEO at Activision Blizzard early on when he was credited with rescuing the company’s predecessor from almost being dissolved. For 30 years, Kotick served as the CEO of the mother company that brought fans titles like Call of Duty Modern Warfare, DOTA 2, and much more. This citation of Kotick’s role in the company’s development was included in the SEC extension agreement.
Excessive pay and bonuses
The new payment plan was established with the goal of reflecting shareholder feedback, incorporating best practices, and connecting pay to performance. This statement directly addresses some of the points that were brought up earlier when a Shareholder Value Creation Incentive clause was triggered in Kotick’s contract.
This clause entitled the CEO close to $200 million in additional stocks. CtW Investment Group, which aims to hold company executives accountable for irresponsible and unethical behavior, criticized Kotick while questioning whether he was the reason for the increased performance of the company.
Now, Bobby Kotick is expected to earn $875,000 annually from the $1,750,000 he earned previously. This puts his salary in the median of the salary earned by peer companies. As for bonuses, the maximum potential was reduced to $1,750,000 coming from $3,500,000.