Multimillionaire Activision Blizzard CEO cuts annual pay to $62,000 amid sexual harassment probes
Bobby Kotick vows zero tolerance on discrimination, will waive forced arbitration, and more
Activision Blizzard CEO Bobby Kotick is cutting his salary to $62,500 and promised to turn down bonuses and equity packages as the gaming giant continues to be investigated for sexual harassment.
The mega-studio is facing a string of lawsuits all while various executives have hit the eject button. Activision came under fire in July when California's Department of Fair Employment and Housing accused bosses of supporting a "frat boy" culture, in which staff endured gender and racial discrimination, and women were paid less than their male colleagues. Employees also told America's National Labor Relations Board managers had intimidated them when they attempted to speak out against the discrimination and form a union.
The biz could be facing more litigation as the SEC – the US financial watchdog – launched its own investigation into the video game publisher. Not to mention it just agreed to pay $18m to settle a discrimination case with the US Equal Employment Opportunity Commission.
All in all, things aren’t looking too peachy for Activision, and someone has to be held accountable for the mess. Kotick, who has been CEO since 1991 and is fabulously wealthy, is shouldering at least some of the blame.
In a letter to employees on Thursday, he promised to stamp out sexual harassment in his organization with a zero-tolerance approach; waive forced arbitration for claims of sexual harassment and discrimination; and usher in a more diverse workforce by increasing the percentage of women and non-binary people by 50 per cent.
He also pledged to spend $250m to "accelerate opportunities for diverse talent," and another $250m "over the next 10 years in initiatives that foster expanded opportunities in gaming and technology for under-represented communities." And all it took was months if not years of staff protests, public and internal.
He also agreed to take a pay cut while the above issues are worked out. “Specifically, I have asked the board to reduce my pay to the lowest amount California law will allow for people earning a salary, which this year is $62,500," he said.
"To be clear, this is a reduction in my overall compensation, not just my salary. I am asking not to receive any bonuses or be granted any equity during this time,” he clarified.
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It’ll be the second time his salary has been slashed this year. In April, he agreed to a 50 per cent pay reduction to $875,000, and a 50 per cent or $1.75m reduction in target bonus. That said, he was still allowed to collect an annual bonus of up to 200 per cent of his yearly salary, depending on performance.
Now, that’s all set to go to sub-six-figures: about $60,000 and no extras. Although he won’t be granted fresh equity or bonuses, he was just awarded a $155m stock-based pay package by shareholders in June, so we're sure he’ll be fine even with effectively a 99 per cent pay cut going forward.
Kotick also appears to have sold a bunch of Activision Blizzard shares in August for tens of millions of dollars. His net worth ranges from an estimated $600m to $7bn, depending on who you read.
“I truly wish not a single employee had had an experience at work that resulted in hurt, humiliation, or worse – and to those who were affected, I sincerely apologize. You have my commitment that we will do everything possible to honor our values and create the workplace every member of this team deserves,” he concluded.
“I am grateful for how much people care about this company, and I appreciate that many past and present employees have reached out with their thoughts, concerns, complaints, and suggestions. Your experiences, so courageously shared, serve as reason and reminder for why it is so important for us to do better. And we will.” ®