Just over half of Activision Blizzard shareholders have backed chief executive Bobby Kotick’s $155m pay package, following a delayed vote that critics described as an effort to avoid an embarrassing rebuke.
After holding its scheduled annual meeting on June 14, the video game company had adjourned the meeting until Monday to address “misleading” information about Kotick’s 2020 pay. The delay drew criticism from the Council of Institutional Investors, which represents big pension funds.
“With only 54 per cent of votes cast in favour, the proposal nearly failed to receive majority support — it appears Activision did just enough arm-twisting for the measure to pass,” said Michael Varner, director of executive pay research at CtW Investment Group.
The company was in danger of receiving only meagre support for the pay vote after proxy advisers Institutional Shareholder Services and Glass Lewis recommended investors vote against it.
“The additional time shareholders requested allowed them to thoroughly review the facts about Activision Blizzard’s rigorous pay-for-performance compensation practices,” a company spokeswoman said in a statement.
The company changed Kotick’s pay after feedback from shareholders — his 2019 pay package received support from 58 per cent of shareholders. Activision cut Kotick’s 2021 salary by 50 per cent to $875,000 and reined in bonuses for 2021 and 2022.
Most of Kotick’s $155m package for 2020 was in awards tied to a 2016 goal of doubling the company’s market capitalisation, and its shares soared last year amid the coronavirus pandemic. Strong share performance typically appeases investors upset about outsized executive pay, but Kotick’s large rewards drew concerns.
Activision was under pressure from CtW, which called on other shareholders to reject the company’s executive pay.
Glass Lewis said it knew of no precedent for such a move to adjourn a say-on-pay vote.
Investors typically rubber-stamp companies’ pay votes with at least 90 per cent support. So far this year, S&P 500 companies have received 88.6 per cent support for executive pay, according to Semler Brossy, a pay consultancy.