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What just happened? This week, Activision CEO Bobby Kotick announced to investors that he has asked for his salary to be cut to the lowest legal amount for California this year. It is one of the commitments he's promised to address the controversy surrounding Activision Blizzard's multiple investigations over discrimination and sexual harassment.
In a letter published on Activision Blizzard's investor relations page, Kotick asks the board of directors to cut his total compensation to $62,500 until it determines the company has achieved "transformational gender-related goals" along with a series of commitments he lays out in the letter. Kotick also asked to receive no bonuses or equity compensation until they determine he has met these obligations.
In the letter, Kotick proposed a company-wide zero-tolerance policy for harassment. That means no longer using written warnings and terminating employees found retaliating against anyone making a complaint. Kotick wants to increase the number of women and non-binary people in Activision Blizzard by 50 percent while dedicating $250 million to boost opportunities for diverse talent. He also says employees will no longer be required to arbitrate sexual harassment and discrimination claims.
In April, Kotick took a 50 percent pay cut and a 50 percent reduction in his target bonus, but he was still eligible to earn up to 200 percent of that cut salary. Earlier, in March, an investment group criticized Kotick over a bonus payment it says was worth almost $200 million.
Today was a huge win for ABK Worker's Alliance! Forced arbitration has been removed for cases that deal in sexual harassment and discrimination. The company announced they will raise the number of women and non-binary people it employs by 50% 💙 https://t.co/N6ZGkUIsiA— ABetterABK 💙 ABK Workers Alliance (@ABetterABK) October 28, 2021
However, over the summer, the California Department of Fair Housing and Employment slapped Activision Blizzard with a lawsuit for allegedly allowing a "frat house" culture rife with sexual harassment and discrimination against female employees. It received complaints from the Equal Employment Opportunity Commission and the Communication Workers of America , the former of which Activision later settled for $18 million. The company also came under investigation by the Securities and Exchange Commission.
Since then, at least 20 employees have left Activision Blizzard, including Blizzard's former president, chief legal officer, and multiple game designers.
The ABK Workers Alliance—a group of Activision Blizzard employees the emerged to seek changes in the company after the lawsuit started, called Kotick's announcement "a huge win." It particularly praised the removal of forced arbitration. "We still stand firm by our demand that the investigation must be done by an unbiased third party, of which WilmerHale is not one."