Human Capital & Careers

Activision Will Fine-tune Option Dates

Former heads of finance and legal, outgoing head of human resources, and former outside legal adviser ''bore significant responsibility'' for the i...
Stephen TaubMarch 9, 2007

Video-game publisher Activision disclosed that a special subcommittee has found inaccurately reported measurement dates for certain stock options granted from 1994 through 2006. The company has not yet determined the additional expense it must take for prior periods.

Activision stated that four individuals — the former heads of the finance and legal departments, the outgoing head of human resources, and a former outside legal adviser — “bore significant responsibility,” in varying degrees, for the inaccuracies.

The company stressed, however, that the subcommittee found no evidence of intentional wrongdoing on their part, or by chairman and chief executive officer Robert A. Kotick, co-chairman Brian G. Kelly, director and senior adviser Ronald Doornink, or senior vice president, general counsel, and secretary George Rose.

The subcommittee recommended that ten current and former officers and directors should relinquish the economic benefits resulting from the misdating and mispricing of stock options.

Activision also announced that it planned to realign certain internal responsibilities for granting and reporting on stock options, engage new outside legal advisors, establish the position of principal compliance officer, and reconfigure its compensation committee.

Last July, Activision disclosed that the Securities and Exchange Commission had launched an informal inquiry into its practices of granting stock options.

Other video-game companies that have been caught up in the stock options backdating scandal included Take-Two Interactive Software, THQ, and Electronic Arts.