Activision Blizzard’s controversial boss Bobby Kotick has asked for his salary to be cut until significant changes are made to the company’s culture, admist its ongoing State of California lawsuit which alleges sexual discrimination, harassment, and a “frat boy” culture.
Specifically, Kotick has said he will only accept California’s legal minimum salary of $62,500, and will not take any other bonuses or compensation. However, it’s worth remembering the CEO already earned $155m from the company via a bonus awarded earlier this year.
In a lengthy letter to staff, Kotick today outlined “progress and commitments made at Activision Blizzard”, with five new changes announced today. Most notable is the agreement drop forced arbitration of future sexual harassment cases – something requested by many employees.
The first change detailed today is a “new zero-tolerance harassment policy company-wide” which will mean “tougher rules and consistent monitoring across the entire company” and “the strictest harassment and non-retaliation policies of any employer”.
“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,” Kotick wrote.
“In many other instances of workplace misconduct, we will no longer rely on written warnings: termination will be the outcome, including in most cases of harassment based on any legally protected category.”
Second, Kotick pledged to increase the percentage of women and non-binary people in the company by 50 percent over the next five years and invest $250m million “to accelerate opportunities for diverse talent”. (Kotick said the company was currently 23 percent women or non-binary.) “Each franchise team, business unit, and functional area will be expected to have plans to help fulfill this ambition,” he continued.
Boosting Activision Blizzard’s 30 percent of staff from “diverse or under-represented communities” was also a “significant focus”, Kotick said, and would be given $250m over the next 10 years in initiatives that “foster expanded opportunities in gaming and technology for under-represented communities”, in particular to increase the number of women and those from under-represented communities in leadership positions.
Third, as mentioned, the company will now waive arbitration of sexual harassment and discrimination claims.
Fourth, the company will “continue to increase visibility on pay equity”, a topic where Kotick noted that “women at the company on average earned slightly more than men for comparable work in 2020”, according to US figures.
Fifth, the company will monitor progress and update staff and shareholders regularly on gender and diversity hiring, and overall progress in improving its workplace culture.
Wrapping up, Kotick called the company’s ongoing California lawsuit “a catalyst” to improve the company.
“I want to ensure that every available resource is being used in the service of becoming the industry leader in workplace excellence,” Kotick said, explaining his request for a salary cut. “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.
“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. 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.”
Kotick previously earned $1.75m per year running the Activision Blizzard empire, which also includes mobile game maker King. Back in April, his pay was cut by 50 percent to $875k, but this still let Kotick collect an annual bonus up to 200 percent of his base salary.
In June, Activision Blizzard shareholders narrowly voted to approve a $155m pay packet for Kotick, for awards tied to a 2016 goal of doubling the company’s market capitalisation. Indeed, its shares soared last year amid the pandemic.
The Activision Blizzard board has said that under Kotick, Activision Blizzard’s market capitalisation has increased from less than $10m to over $70bn, with an 8100 percent increase in shareholder return between 2000 and 2020.