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EA cuts exec pay for 2021, changing how bonuses work

EA cuts exec pay for 2021, changing how bonuses work

US publishing giant Electronic Arts is making changes to how its executives are paid and compensated.

In a filing with the SEC, the company said it was "disappointed" by the fact that only 26 per cent of shareholders supported its 2020 say-on-pay proposal, especially given that it had received 96 per cent, 86 per cent and 94 per cent support in the previous three years.

As a result, EA has conducted a "comprehensive review" of how its execs are compensated, which involved speaking to some of its shareholders. One item of feedback is that management like CEO Andrew Wilson (pictured) are awarded equity bonuses far too often, so execs are not going to be able to receive these awards in the 2021 fiscal year. Management can only receive these bonuses over a three year period.

Moving forward, at least 60 per cent of Wilson's equity awards for the 2022 financial year "and beyond" is going to be tied to performance. Exec bonuses are now limited to twice their target bonus percentage. In practice, these bonus payments have been roughly halved for the 2021 fiscal year, though nearly all execs saw massive bonus payments for 2020.

Wilson's overall compensation for 2021 is almost doubling, however. The CEO is set to earn $39,165,820, an 83 per cent increase that's the result of a $32 million stock award that – speaking to Axios – was designed to "continue to retain and motivate Mr. Wilson." Marketing chief Chris Bruzzo is also receiving a 34 per cent pay rise.

CFO and COO Blake Jorgensen's total compensation is dropping 39 per cent, while studios boss Laura Miele is seeing a 30 per cent decline and CTO Ken Moss will be down 32 per cent.

The shareholder backlash against EA exec pay was partly triggered by CtW Investment Group, who said that the company was "developing a special award grant addiction."

The outfit has also criticised Activision Blizzard over its compensation of CEO Robert Kotick, saying in 2020 that the company had "unnecessarily enriched" its chief exec.

The Call of Duty giant recently squeezed a win for its say-on-pay proposals, with only 54 per cent of shareholders voting Activision Blizzard's way after the firm delayed the vote by a week.


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PCGamesInsider Contributing Editor

Alex Calvin is a freelance journalist who writes about the business of games. He started out at UK trade paper MCV in 2013 and left as deputy editor over three years later. In June 2017, he joined Steel Media as the editor for new site PCGamesInsider.biz. In October 2019 he left this full-time position at the company but still contributes to the site on a daily basis. He has also written for GamesIndustry.biz, VGC, Games London, The Observer/Guardian and Esquire UK.

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