Electronic Arts Executive Pay Draws Fire From Proxy Advisers
(Bloomberg) -- Institutional Shareholder Services is joining calls for Electronic Arts Inc. investors to vote against the video-game maker’s pay plan, citing “significant concerns” about a special round of stock awards.
Electronic Arts executives previously received special equity awards for fiscal 2018 that haven’t yet vested, raising questions about the necessity of the latest payouts, the proxy adviser said in a report. Electronic Arts will hold its annual meeting on Aug. 6, giving investors a chance to weigh in on the pay plan.
“While recognizing the need to retain top executives, investors may expect special awards to be relatively infrequent and may question executives receiving multiple special awards in a relatively short period of time,” ISS said.
The firm joins fellow proxy adviser Glass Lewis & Co. in opposing the pay plan. CtW Investment Group, a labor-backed group, also has urged shareholders to vote against it. CtW, which works with a coalition of union pension funds with more than $250 billion in assets, has criticized pay at Activision Blizzard Inc. as well.
Electronic Arts Chief Executive Officer Andrew Wilson is paid 56% more than a median CEO peer, ISS said, which “has a ratcheting effect on executive compensation.”
The company, based in Redwood City, California, said in a regulatory filing that its “pay practices align with our financial results.” Electronic Arts said it uses special performance-based equity awards “sparingly” and that it has shown strong results.
Its shares have risen 32% to $142.02 this year, boosted by industrywide growth in gaming during the pandemic.
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