Score another win for the C-suite.
As we’ve been covering, Activision-Blizzard investors purportedly represented by CtW Investment Group had been agitating to vote down the company’s “say-on-pay” policy and curb its executive payout excesses. Last year, the group was successful at EA but could only declare spiritual victory at AB when it convinced only 43% of shareholders to vote down “say-on-pay.” The group increased its margin during this year’s vote, but only to 46% of the vote – not the majority it needed, which effectively gives the board another year of shenanigans. The vote was especially unusual because it had already been extended an extra week and allowed executives to pressure shareholders to vote their way as well as disparage industry reporting on the situation.
CtW was pretty grumpy about the loss, suggesting AB “arm-twisting” was barely enough for victory.
“Such marginal support for Say on Pay votes is extremely rare: fewer than 4% of companies in the broader Russell 3000 index receive support around 50%, with average support in the S&P 500 at 88.6%. This vote, conducted after last week’s desperate attempt to avoid a loss, marks the sixth time in the past eight years Activision has received less than 70% support for its Say on Pay proposal, and the lowest support the company has received on this proposal in its history. The 46% of shareholders who expressed discontent will now certainly exert pressure on Activision to enact further changes. We urge the Board to take a long look in the mirror and make substantial changes to Mr. Kotick’s pay in response to shareholders’ clear mandate.”
MMO readers will recall that earlier this year in the middle of yet another round of corporate layoffs (at least the fourth in the last couple of years that we know of), Kotick was poised to scoop up as much as $200M more in payouts. Following the backlash, Activision’s board said it would halve Kotick’s base salary and annual bonus in the future, without actually touching or directly denying the $200M figure.