The CEO of Activision Blizzard, Bobby Kotick, has taken a massive pay cut to his salary following the company’s legal issues. Activision Blizzard is facing extensive legal action after allegations of harassment and sexism were made against the company. The state of California, the Communications Workers of America, and the U.S Equal Employment Opportunity Commission sued the developer and in turn revealed stories of the terrible treatment of employees which were at first downplayed by the company. Now Kotick has taken a hit to his earnings and explained five changes being made in a public letter.
The letter was published earlier today, on October 28, and is addressed to the employees of Activision Blizzard. It says that although the company tried to “become the most welcoming, inclusive company in our industry”, “guardrails weren’t in place everywhere to ensure that our values were being upheld”.
The five changes being made to the company, as a result, are as follows:
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“We are launching a new zero-tolerance harassment policy company-wide – In the past, when we discovered and substantiated harassment, we terminated some employees and provided verbal or written warnings or different disciplinary actions to others. In retrospect, to achieve our goals for workplace excellence, this approach is no longer adequate. We need tougher rules and consistent monitoring across the entire company to make sure reports are being handled correctly and discipline is appropriate and swift.
As a result, we are implementing a zero-tolerance policy across Activision Blizzard that will be applied consistently. Our goal is to have the strictest harassment and non-retaliation policies of any employer, and we will continue to examine and tighten our standards to achieve this goal everywhere we do business.
Any Activision Blizzard employee found through our new investigative processes and resources to have retaliated against anyone for making a compliance complaint will be terminated immediately.
“We will increase the percentage of women and non-binary people in our workforce by 50% and will invest $250 million to accelerate opportunities for diverse talent –Today, approximately 23% of our global employee population identifies as women or non-binary. Building on the success that King and other business units have achieved, we will seek to increase our percentage of women and non-binary professionals by approximately 50% – to more than one-third across the entire company – within the next five years and hopefully faster. Each franchise team, business unit, and functional area will be expected to have plans to help fulfill this ambition.
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With respect to diversity, while we perform better than our peers with 30% of our U.S. workforce from diverse or under-represented communities, broadening this progress will continue to be a significant focus of mine as well as company, business unit, and franchise leadership.
To further this commitment, we’ll be investing an additional $250 million over the next 10 years in initiatives that foster expanded opportunities in gaming and technology for under-represented communities.” “We will also provide learning, development, and advanced degree opportunities for current employees to increase the number of women and those from under-represented communities in leadership positions across the company and in our industry.”
“Based on feedback from employees, we are waiving required arbitration of sexual harassment and discrimination claims – For any Activision Blizzard employee who chooses not to arbitrate an individual claim of sexual harassment, unlawful discrimination, or related retaliation arising in the future, the company will waive any obligation to do so.
“We will continue to increase visibility on pay equity – As described in the recent note from our President, Daniel Alegre, and our Chief Administrative Officer, Brian Bulatao, the company continues to focus on pay equity for employees. In fact, our U.S. analysis showed that women at the company on average earned slightly more than men for comparable work in 2020. To ensure transparency on our continuing commitment to pay equity, we will report these results annually.
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“We will provide regular progress updates – We will be monitoring the progress of our business units, franchise teams, and functional leaders with respect to workplace initiatives and we will provide a status report quarterly. We also will be adding a dedicated focus on this vital work in our annual report to shareholders and in our annual ESG report with information on gender hiring, diversity hiring, and workplace progress.”
As pointed out by Kotaku journalist, Ethan Gach, the CEO is also taking a pay cut and will not be accepting bonuses. The letter says: “Lastly, I want to ensure that every available resource is being used in the service of becoming the industry leader in workplace excellence. Accordingly, I have asked our Board of Directors to reduce my total compensation until the Board has determined that we have achieved the transformational gender-related goals and other commitments described above.
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“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 is year is $62,500. 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.”
Bobby Kotick has been increasingly pressured from onlookers to lower his pay, especially as this legal case began. Earlier this year, it was reported that the CEO earned about $33 million in 2019 alone. Additionally this year, Eurogamer reported that a $155 million pay package had been agreed by shareholders of Activision Blizzard for Kotick. Kotick did take a 50% pay cut in 2021 but kept the bonuses the company provided, still making him millions. Now he's fully reeled those back until we see a change at Activision Blizzard.
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