A shareholders' investment group has called for the immediate resignation of Activision Blizzard CEO Bobby Kotick. In a scathing letter penned to the company's board, the SOC Investment Group called on the board to seek "more qualified replacements" for Kotick and two other AB staffers immediately.
What does the SOC want from Activision Blizzard?
This letter relates to the ongoing firestorm of allegations and lawsuits currently pelting Activision Blizzard. In the letter, the SOC decries the Activision Blizzard board's "almost entirely silent" lack of response to recent developments concerning Kotick. The group says it wants Kotick, as well as chairman Brian Kelly and lead independent director Robert Morgado, to "announce their retirement" on or before December 31st this year. Signatories on the letter include the SOC's corporate engagement manager and executive director, as well as officials from other ethical investment companies like Verve Super and NEI Investments. You can read the letter in full here.
In addition to the resignation of these three men, the SOC calls for several systemic changes within Activision Blizzard's corporate structure. The group says it wants an independent investigation into the board's "oversight policies and practices", as well as structural reforms including a full review by an "established governance expert". The SOC also calls for a board position for a "non-executive employee" chosen by the AB workforce as a nominee for next year's annual meeting. In closing, the letter declares that the time for "timidity and silence" has passed, and that the board needs to either account for itself or step aside.
What impact will this letter have?
Unfortunately, this letter isn't likely to change much. Activision Blizzard's board of directors has already said it will stand by Kotick despite recent revelations by the Wall Street Journal. In addition, the SOC represents a mere 0.6% of Activision Blizzard's total shares, and the group has been criticizing Kotick for a long time now. In its mission statement, the SOC describes itself as an organization intended to hold corporate leadership responsible for unethical behavior, so this stance isn't unexpected from the group. There's a small chance this could form part of a larger movement to oust Kotick and Activision Blizzard's leadership, but by itself, this letter probably won't have much impact.
If you're not up to speed on the Activision Blizzard story, here's a quick rundown. Back in July this year, the California Department for Fair Education and Housing sued Activision Blizzard, citing a toxic workplace culture in which women were continually harassed, belittled, and devalued. More lawsuits and complaints followed from shareholders and unions, leading to the departure of Blizzard head J. Allen Brack, among other things. Along the way, Activision Blizzard constantly made noises about creating a more inclusive workplace and emphasizing diversity and inclusivity in its hiring processes.
Throughout this process, Activision Blizzard CEO Bobby Kotick claimed not to have known these abuses were happening. Yesterday, however, explosive allegations emerged claiming Kotick not only knew about the allegations but kept quiet about them and allegedly threatened to have a female employee killed after she complained about him, prompting a walkout by employees. Obviously, this flies in the face of most of the things Kotick has claimed in the past (and continues to claim, if a rather passive-aggressive recent statement on Activision Blizzard's website is anything to go by). We'll bring you more on this as we get it.