Activision shareholders demand Kotick's head after CEO 'failed' to take claims of staff sex assault seriously

Plus workers stage walk out in protest against games giant's big cheese

A group of Activision Blizzard investors called for CEO Bobby Kotick to resign on Wednesday, claiming he knew about sexual harassment and assault claims made against his staff for years and failed to adequately address them.

The shareholders, who together own a fraction of the gaming giant, also urged chairman Brian Kelly and lead independent director Robert Morgado to step down by the end of the year. In addition they urged the board to conduct an independent review of the "frat boy" culture at the company and to commit to "structural reform" of the corporation's governance system.

"In contrast to past company statements, CEO Bobby Kotick was aware of many incidents of sexual harassment, sexual assault, and gender discrimination at Activision Blizzard," the investors wrote in an open letter [PDF], "but failed either to ensure that the executives and managers responsible were terminated, or to recognize and address the systemic nature of the company’s hostile workplace culture.

"Absent the termination of Mr Kotick and the thoroughgoing overhaul of the board of directors described above, we would be unable to support the re-election of incumbent directors and would urge our fellow shareholders to do the same.

"The time for timidity and silence, if there ever was one, has clearly passed, and it is time for the Activision Blizzard board of directors to step forward or step aside."

In addition they suggested adding a new board member, selected from the non-management workforce by "an open and fair process." The candidate would be nominated for possible election to the board at next year's annual general meeting by shareholders.

The Register has asked Activision Blizzard for a response.

The gathering avalanche

The letter comes after the Wall Street Journal reported Kotick knew of alleged cases of sexual assault and harassment within his company, and inappropriate behavior at drunk work parties, for years and didn’t inform the board – not even telling directors of an out-of-court settlement with a woman who said she was raped by her male supervisor.

Not only that, the chief exec told senior colleagues he wasn’t aware of many of the allegations and played down others, the newspaper reported, citing sources. The SEC is, by the way, investigating whether Kotick and other managers withheld word of these claims from shareholders.

It was also reported that Jen Oneal, who just quit three months after she was made co-lead of Blizzard Entertainment, said she was sexually harassed during her earlier years at Activision.

The Californian games publisher, best known for titles like Call of Duty and World of Warcraft, has fallen from grace hard this year. In July, its home state’s Department of Fair Employment and Housing accused the company of supporting a frat boy culture, and another case is pending with the National Labor Relations Board.

Activision Blizzard this week denied its chief exec ignored, overlooked, or hushed up claims of misconduct and serious sexual assault.

“We are disappointed in the Wall Street Journal’s report, which presents a misleading view of Activision Blizzard and our CEO,” the biz said in a statement.

“Instances of sexual misconduct that were brought to his attention were acted upon. The WSJ ignores important changes underway to make this the industry’s most welcoming and inclusive workplace and it fails to account for the efforts of thousands of employees who work hard every day to live up to their – and our - values. We will not stop until we have the best workplace for our team.”

Sony's PlayStation boss Jim Ryan said he was "disheartened and frankly stunned" by the internal state of Activision in an email sent to employees and obtained by Bloomberg.

“We outreached to Activision immediately after the article was published to express our deep concern and to ask how they plan to address the claims made in the article,” he said. “We do not believe their statements of response properly address the situation.”

Trouble at the top

Kotick has held the position of chairman and CEO of Activision for 30 years, making him a multimillionaire. Last month, he announced he cut his salary to $62,500 and is turning down bonuses and stock options until the company cleans up its act. He promised to implement a zero-tolerance approach to sexual harassment, make it easier for victims of sexual harassment and discrimination to come forward, and increase the number of women and non-binary staff by 50 per cent.

That isn't enough for him to keep his job, however, the aforementioned shareholders believe. They asked the company to commit to hiring an external investigator to root out "sexist and discriminatory workplace practices" and to probe past board practices to see where it failed to deal with sexual harassment claims.

If Kotick isn't terminated, they asked that his salary remains low for the next five years of his contract, and beyond if it's renewed, until his workplace goals are met. Other execs should also have pay cuts and not be given any bonus pay or shares until these goals are met, according to their letter.

Polygon reported hundreds of employees staged a walkout this week outside Activision Blizzard offices in California and Minnesota calling for Kotick to resign. ®

Other stories you might like

  • Prisons transcribe private phone calls with inmates using speech-to-text AI

    Plus: A drug designed by machine learning algorithms to treat liver disease reaches human clinical trials and more

    In brief Prisons around the US are installing AI speech-to-text models to automatically transcribe conversations with inmates during their phone calls.

    A series of contracts and emails from eight different states revealed how Verus, an AI application developed by LEO Technologies and based on a speech-to-text system offered by Amazon, was used to eavesdrop on prisoners’ phone calls.

    In a sales pitch, LEO’s CEO James Sexton told officials working for a jail in Cook County, Illinois, that one of its customers in Calhoun County, Alabama, uses the software to protect prisons from getting sued, according to an investigation by the Thomson Reuters Foundation.

    Continue reading
  • Battlefield 2042: Please don't be the death knell of the franchise, please don't be the death knell of the franchise

    Another terrible launch, but DICE is already working on improvements

    The RPG Greetings, traveller, and welcome back to The Register Plays Games, our monthly gaming column. Since the last edition on New World, we hit level cap and the "endgame". Around this time, item duping exploits became rife and every attempt Amazon Games made to fix it just broke something else. The post-level 60 "watermark" system for gear drops is also infuriating and tedious, but not something we were able to address in the column. So bear these things in mind if you were ever tempted. On that note, it's time to look at another newly released shit show – Battlefield 2042.

    I wanted to love Battlefield 2042, I really did. After the bum note of the first-person shooter (FPS) franchise's return to Second World War theatres with Battlefield V (2018), I stupidly assumed the next entry from EA-owned Swedish developer DICE would be a return to form. I was wrong.

    The multiplayer military FPS market is dominated by two forces: Activision's Call of Duty (COD) series and EA's Battlefield. Fans of each franchise are loyal to the point of zealotry with little crossover between player bases. Here's where I stand: COD jumped the shark with Modern Warfare 2 in 2009. It's flip-flopped from WW2 to present-day combat and back again, tried sci-fi, and even the Battle Royale trend with the free-to-play Call of Duty: Warzone (2020), which has been thoroughly ruined by hackers and developer inaction.

    Continue reading
  • American diplomats' iPhones reportedly compromised by NSO Group intrusion software

    Reuters claims nine State Department employees outside the US had their devices hacked

    The Apple iPhones of at least nine US State Department officials were compromised by an unidentified entity using NSO Group's Pegasus spyware, according to a report published Friday by Reuters.

    NSO Group in an email to The Register said it has blocked an unnamed customers' access to its system upon receiving an inquiry about the incident but has yet to confirm whether its software was involved.

    "Once the inquiry was received, and before any investigation under our compliance policy, we have decided to immediately terminate relevant customers’ access to the system, due to the severity of the allegations," an NSO spokesperson told The Register in an email. "To this point, we haven’t received any information nor the phone numbers, nor any indication that NSO’s tools were used in this case."

    Continue reading

Biting the hand that feeds IT © 1998–2021