CtW Investment Group is a group that is dedicated to holding directors of companies responsible for unethical behavior and overly excessive pay. Back in June, the CtW Investment Group claimed that Activision CEO, Bobby Kotick, was paid too much and followed that claim with a message urging shareholders to take action to fix that issue. Now, CtW Investment Group has made that came claim against Electronic Art’s CFO Blake Jorgensen and CTO Kenneth Moss. In an open letter to shareholders, the CtW Investment Group complained about the multi-million dollar bonuses that have been issued to executives while lower-level staff are routinely laid off.
The letter is intended to sway shareholders to vote against a “Say-On-Pay” proposal (Proposal 2) at Electronic Arts’ upcoming annual meeting on August 6, 2020. This proposal is expected to give more retention awards to the directors of Electronic Arts despite the fact that the awards and bonuses that were issued for the fiscal 2018 year are yet to be concluded. “On the matter of incentivizing executives, we have repeatedly stated and continue to vehemently argue that the notion that executives need to be incentivized with pay above-and-beyond the ordinary course program is a complete fallacy in almost all cases. In reality, executives are already well incentivized through a company s ordinary course executive pay program alone because they receive significant amounts of annual equity grants in the first place that appreciate in value when the company performs well.” The letter read.
CtW Investment Group acknowledged that shareholders have been benefiting the direction Electronic Arts has been going, they argue that the decisions being made are short-sighted. CtW Investment Group cited the dip Electronic Arts took in at the end of the fiscal year 2019, which resulted with a wave of layoffs for lower-level employees, yet at the beginning of 2020 executives received multi-million dollar bonuses with CEO Andrew Wilson getting 4 million, which was 1.6 million more above the promised 2.5 million dollar bonus.
CtW Investment Group did carry some weight with its campaign in June with Activision. Although the campaign was a failure, 43 percent of Activision-Blizzard shareholders voted against the company’s “Say on Pay” policy, which is an industry record. Several shareholders for EA has already expressed displeasure with how much executives were being paid, and the CtW Investment Group believes that the upcoming policy has a chance to fail.