Gamers and esports professionals around the world are celebrating after Activision Blizzard Worldwide CEO Bobby Kotick announced he would take a pay cut, waive his company’s arbitration clause, and commit to change. The news of this commitment comes amidst new layoffs at ABK as well
The letter also follows his strongly worded remark on the most recent quarterly investor results call, in which he urged for Activision Blizzard to become an industry leader, and the pledges announced today closely resemble four employee requests made during their July walkout protest. During an interview with the Financial Times last week, Francis Townsend hinted that more changes were on the way, and that Kotick had given her a “blank check” to make changes inside the corporation.
While the commitments outlined above do not fully meet those employee demands, such as only waiving arbitration in specific cases rather than ending it entirely, they are a huge step in the right direction, and we will almost certainly hear more on the upcoming third quarter investor earnings conference call on Tuesday, November 2nd. The separate pledge to cut his own pay is a drastic follow-up to the 50% cut in his salary and bonus in April, capping him at the California state minimum for overtime exempt employees, which mandates that executive level employees be paid a monthly minimum salary of at least twice the state’s minimum wage of $15.00 per hour, bringing him to a total of $62,500 per year – which includes waiving all bonuses and equity until the company’s commitments are met, bringing him to a total of $6
I reaffirmed our commitment to become the most welcoming and inclusive organization in our sector a few weeks ago. Today, I’d want to provide you with an update on some early success as well as some key, additional initiatives we’re doing to advance our commitment with more effect, openness, and urgency.
First and foremost, I want to express my heartfelt thanks for your unwavering commitment to our athletes – and to one another. Throughout the epidemic, you’ve shown tremendous resilience, outstanding care for colleagues and communities, and the unwavering dedication to quality, creative freedom, and purpose that has always distinguished our firm – and our franchisees. Despite the fact that so many people are going through a difficult period, you’ve continued to offer pleasure and connection to our players and communities all across the globe.
My aim – and the goal of our Board, our whole senior corporate team, our business unit leaders, and their teams – is to ensure that you have the resources, culture, and leadership commitment you need to achieve our shared goal of being the model workplace in our industry.
We felt we had the procedures, rules, and people in place to guarantee that our firm always lived up to its reputation as a fantastic place to work during the previous decade while we brought in new businesses, grew our personnel, and expanded our business. Clearly, we didn’t get it right in several crucial areas.
There weren’t enough guardrails in place to guarantee that our ideals were respected everywhere. People didn’t always feel comfortable sharing issues, and their concerns weren’t always handled immediately or appropriately in certain circumstances. People were disappointed, and I apologize profusely.
In the context of our job, being friendly and inclusive is a no-brainer. We’ll continue to debate ideas passionately, use healthy skepticism when necessary, and expect quality and rigor in all we do – but we’ll always treat each other with decency and respect. Voices will be heard, viewpoints will be accepted, and contributions will be recognized, regardless of differences.
We are a company driven by passion and results. These are cornerstones of our creative excellence, but we must always recognize, embrace, and celebrate that the best ideas, the most rigorous execution of those ideas, and ultimately our responsibility to our players and each other are best served by a culture that recognizes and respects that true excellence comes from a diverse range of perspectives, voices, and talents.
Over the previous several years, we’ve made progress in cultivating diversity and improving the workplace – a commitment that has grown in breadth and pace in recent months. We’ve invested three times as much in anti-harassment and anti-discrimination training, made significant organizational changes, and significantly boosted resources for reporting and thoroughly investigating inappropriate conduct.
The EEOC’s investigation process, public debate on discrimination and harassment, and your complaints and ideas all contributed to highlight practices that need to be improved, rules that need to be enhanced, and resources that are now being added. The EEOC’s investigation prompted us to concentrate more intently on how we might become a firm that others look up to as an example for workplace excellence and unshakable dedication to our values.
If we want to be the firm that people look up to, we need to do a lot more.
I’d want to discuss five new improvements we’re making, but I know that becoming a model for workplace excellence will be a dynamic process that necessitates further adjustments and a never-ending commitment to progress.
- We’re implementing a new zero-tolerance harassment policy across the board. – When we detected and confirmed harassment in the past, we fired some workers and gave others verbal or written warnings or other disciplinary measures. In hindsight, this method is no longer appropriate for achieving our workplace excellence objectives. To ensure that reports are handled appropriately and punishment is appropriate and speedy, we need stricter regulations and constant monitoring throughout the whole firm.
As a consequence, Activision Blizzard is instituting a zero-tolerance policy that will be enforced uniformly. Our objective is to have the most stringent harassment and non-retaliation policies of any employer, and we will continue to assess and strengthen our standards everywhere we conduct business to accomplish this goal.
Any Activision Blizzard employee found to have retaliated against someone for filing a compliance complaint will be fired immediately as a result of our improved investigation methods and resources.
We shall no longer depend on written warnings in many other examples of workplace misconduct: termination will be the result, including in most cases of harassment based on any legally protected group.
Employment contracts and equity awards in the future will be clear: termination for these reasons will result in instant loss of future remuneration.
We also want to make sure that workers who submit complaints feel supported, safe, and heard. We will evaluate any allegations of harassment and retaliation to see whether the Activision Blizzard workers who received the complaint took the necessary actions to maintain the integrity of our compliance procedures.
Certain of these procedures may be restricted by local legislation in some parts of the globe. In certain circumstances, we shall apply the strictest possible discipline and the highest acceptable standards.
- We’ll double the number of women and non-binary individuals in our workforce, and we’ll spend $250 million to expand opportunities for diverse talent — Approximately 23% of our worldwide workforce base identifies as female or non-binary today. We will strive to expand our share of women and non-binary professionals by around 50% – to more than one-third across the whole firm – over the next five years, if not sooner, based on the success of King and other business units. Every franchise team, business unit, and functional area will be required to have strategies in place to assist in the achievement of this goal.
While we perform better than our counterparts in terms of diversity, with 30% of our U.S. employees coming from diverse or under-represented groups, widening this progress will remain a major goal of mine, as well as the company, business unit, and franchise leadership.
To demonstrate our commitment, we will spend an extra $250 million over the next ten years in projects that promote greater possibilities for under-represented populations in gaming and technology. This commitment includes encouraging diverse talent to pursue careers in gaming through the ABK Academy, which includes partnerships with colleges and technical schools serving under-represented communities, mentorships for participants, and a rotating apprenticeship program that leads to game development jobs, similar to the programs we started with the United Negro College Fund and Managem. We will also give existing workers with chances for learning, growth, and advanced degrees in order to boost the proportion of women and people from under-represented populations in leadership roles within the organization and in our industry.
Brian Bulatao, Julie Hodges, and I will give more specifics about how we’re putting these objectives into action, as well as how we’re implementing and monitoring this increased investment, in the coming months.
- We are waiving required arbitration of sexual harassment and discrimination claims based on employee feedback – Any Activision Blizzard employee who chooses not to arbitrate an individual claim of sexual harassment, unlawful discrimination, or related retaliation that arises in the future will be released from any obligation to do so.
- We will continue to raise awareness about pay equity – The firm continues to work on pay fairness for employees, as outlined in a recent statement from our President, Daniel Alegre, and our Chief Administrative Officer, Brian Bulatao. In reality, our research in the United States found that in 2020, women at the corporation earned somewhat more than males for equivalent employment. We will share these statistics on an annual basis to provide openness in our ongoing commitment to pay equality.
- We’ll keep you updated on our success — We’ll keep track of our business units, franchise teams, and functional leaders’ progress on workplace initiatives and offer a quarterly status report. We’ll also put a special emphasis on this important effort in our annual shareholder report and our annual ESG report, which will include data on gender hiring, diversity hiring, and workplace improvement. Details on how these measures will be implemented and monitored will be released soon.
Finally, I want to make certain that every available resource is put to good use in order to help us become the industry leader in workplace excellence. As a result, I’ve requested that our Board of Directors cut my overall remuneration until the Board determines that we’ve met the transformative gender-related objectives and other obligations outlined above. I’ve specifically requested that the Board decrease my compensation to the lowest level that California law allows for anyone receiving a salary, which is $62,500 this year. To be clear, this isn’t simply a pay cut; it’s a drop in my entire compensation. During this period, I request that no incentives or equity be provided to me.
When businesses confront adversity, it’s easy to lose sight of what makes them unique, what makes them great. You are a very unique group of individuals who, through their passion, conviction, drive, and tenacity, continue to achieve exceptional results. While the difficult work ahead will not be simple, I am certain that we will accomplish our united goal of workplace excellence.
I honestly hope that no employee had ever been harmed, humiliated, or worse at work, and I regret profusely to any who were. You have my word that we will do all we can to uphold our ideals and provide the environment that each member of this team deserves.
I appreciate how many former and current workers have come out with their ideas, worries, complaints, and recommendations, and I am glad for how much people care about our firm. Your bravely shared experiences serve as a cause and reminder for why it is so crucial for us to improve. We’ll do it.
Thank you, and please accept my heartfelt appreciation. Bobby