Electronic Arts shareholders rejected the company’s new plan to pay annual bonuses to top managers. According to Bloomberg, this happened against the background of a protest by several groups of investors. Several EA shareholders voted against the new bonus program, including Trillium Asset Management, Calvert Investments, New York City Funds and CalSTRS and Calpers.
The main opponent of the payments was SOC Investment Group. According to investors, Electronic Arts should extend the moratorium on special payments to top managers for owning equity.
EA itself confirmed that it failed to achieve the desired results when discussing the issue of bonus payments with investors. At the same time, the company also noted that it appreciates the advice and recommendations received from them.
Shareholders have voted against the bonus program for the second year in a row. Last year, they already rejected the “bonus” plan, after which EA just decided to refuse payments for owning shares in the 2021 fiscal year. Now investors want this policy to be preserved.
The dissatisfaction is due to the fact that payments to EA top managers occur too often and too much. In particular, investors criticized the shareholder bonus of CEO Andrew Wilson, which amounted to $30 million last financial year.
Note that the protest of investors is advisory in nature. Electronic Arts can still pay bonuses at its discretion. However, the company does not want to spoil relations with large shareholders, and therefore can again listen to the recommendations.
EA is far from the only company whose investors oppose large compensation. SOC Investment Group, formerly known as CtW Investment Group, in March criticized Activision Blizzard for paying $200 million to Bobby Kotick. After that, he agreed to cut his salary twice — up to $875 thousand a year. Despite CtW’s protests, investors (albeit not unanimously) they still approved the payment of $155 million to the Seal.