Activision CEO Bobby Kotick is still charging too much, according to the investment group

Activision ceo bobby kotick is still charging too much, according to the investment group

In June 2020, CtW Investment Group, which "works with union-sponsored pension funds to improve long-term shareholder value," asked Activision shareholders to vote against a package of compensation proposed by CEO Bobby Kotick. Kotick had received nearly $ 100 million in combined rewards for shares and options, then-CEO Dieter Waizenegger said, an amount that "has been consistently greater than the total salary (the sum of the base salary, the annual bonus and the CEO’s salary) The CEO shares similar companies ”.

(Not that CtW was particularly in love with Activision's competitors: it filed a similar complaint about Electronic Arts a month later. Activision's offer failed, but shareholders rejected the shares of Activision. proposed payments for EA executives).

In April of this year, Kotick signed a new extension agreement with Activision in which he agreed to cut his base salary and bonuses. in the middle, a move that the company said "reflects shareholder feedback, incorporates market best practices, and continues to directly connect compensation with performance." Not that he suffers too much as a result: his base salary was still $ 875,000 after the cut and bonuses could mean another $ 1.75 million. You've probably saved some of your previous bond payments as well.

Still, it’s a deep cut, but it doesn’t go far enough for CtW Group. In a statement, said the two – year term of his extension "is too short to significantly affect his total pay for an extended period of time". As a result, it is again asking shareholders to vote against the "Say On Pay" proposal and the re-election of the chairman of Activision's Compensation Committee.

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"The Compensation Committee did not address long-standing shareholder concerns about executive salary practices at Activision by extending CEO Kotick's contract in less than two years. shareholders should expect to see a long – term reform of their compensation for a period of more than just one year, "the statement said. "The CEO's 2021 Wealth Award will be accelerated to the highest level of payment and will allow most compensation reductions to be applied to a single full year, 2022, and as such can only cover the next year 's heritage award ".

The duration of Kotick's extension of employment means that his salary could be renegotiated again, and presumably up—Before April 2023, in less than two years. In addition, the period coincides with Actionision's "Shareholder Value Creation" incentive programs, the terms of which have already been met to obtain the maximum possible payment. This means that "the only full year during which Mr Kotick will see a significant reduction in equity remuneration is 2022," CtW Investment Group said. "In other words, the extension is not long enough to represent an effort made by the Compensation Committee to reduce the CEO's oversized capital salary for a sustained period."

He would never argue that Kotick’s salary even remotely came close to justification, but he would still not bet too much on the likelihood that shareholders would back down. Activision’s share price has been moving in the right direction in recent years, and the recent company quarterly results they were “well ahead of expectations,” which is all that really matters.



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