Bobby Kotick Will Consider Stepping Down if He Can't Fix Problems at Activision Blizzard

Bobby Kotick Will Consider Stepping Down if He Can't Fix Problems at Activision Blizzard

The Wall Street Journal

Mr. Kotick, who has led Activision for three decades, stopped short of saying he would step down in a Friday meeting with executives of the company’s Blizzard Entertainment unit, but left the possibility open if misconduct issues across the company weren’t fixed “with speed,” these people said.

Activision’s board of directors is considering creating a “workplace excellence committee” to oversee implementation of steps the company is taking to improve its culture but hasn’t taken steps to separately investigate Mr. Kotick, according to people with knowledge of the plans.

Nearly everyone turned against the CEO after another scathing article by the Journal in which former Blizzard co-lead Jen Oneal revealed that she was paid less than Mike Ybarra, and several unnamed sources reported that CEO Bobby Kotick knew full well of and was directly involved in some cases of sexual harassment and discrimination throughout Activision, further reinforcing the already negative public perception of Kotick and resulting in widespread condemnation from fans and industry professionals alike. For their part, the board has expressed continued confidence in the CEO, although this may threaten to change if outside pressure continues to mount against Kotick.

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Like many executives, Kotick’s compensation has frequently been tied to performance, as exhibited last March when the CEO was awarded nearly half a million shares of stock by way of a Shareholder Value Creation Incentive written into Kotick’s contract five years earlier in 2016. While the clause was triggered by ATVI’s consecutively high market performance, resulting in a bonus valued at approximately $41 million dollars at the time, the plummeting stock price has since degraded that down to $28 million, showing just how quickly the tables have turned for Activision Blizzard. The triggering of bonus did lead to increased complaints of Kotick being overpaid however, following which the CEO cut his compensation (including bonuses) twice; by 50% in April and again down to the California state minimum of $62,500 in October, where he pledged it would stay until the company’s new commitments were achieved.

Although this possibility of Kotick stepping down is by no means a pledge or guarantee, it will certainly invigorate those who wish to see him gone and likely lead to increased reporting on the CEO’s failures. Despite having outlined numerous plans and new initiatives over the last several months, he has simultaneously been criticized for not doing anything to address the deep rooted issues within the company, for which he has repeatedly been the target of derision. Interestingly, there have also been conflicting reports as to whether Activision is actually to blame for all of the problems exhibited at subsidiaries like Blizzard Entertainment – nobody wants to think that the studio which makes some of their favorite games may also be responsible for their failures, but the studio’s cultural problems are reported to stretch back more than a decade, all the while said to have been allowed to operate largely independent of Activision. While most of the senior leaders who have been implicated in wrongdoing or ran the studio at the time are now gone, it’s therefore unclear how much impact the CEO leaving would have if years of ingrained behavior remain embedded within the studios themselves.

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