Activision Blizzard has reportedly decided to pay the US Securities and Exchange Commission (SEC) as many as US $35 million to settle charges including an alleged failure to maintain adequate disclosure controls, and violation of the whistleblower protection rule in relation to employee complaints of workplace misconduct.
The SEC stated the organization had broken United States law by violating these rules, and alleged it lacked the tools to adequately deal with complaints brought by employees.
‘The SEC's order finds that Activision Blizzard didn't implement necessary controls to gather and review employee complaints about workplace misconduct, which left it without the way to determine whether larger issues existed that must be disclosed to investors,’ Jason Burt, SEC Denver director said inside a press release.
‘Moreover, following through to impede former employees from communicating directly with the Commission staff in regards to a possible securities law violation isn't just bad corporate governance, it's illegal.’
Activision Blizzard has now submitted to these charges, settling with the SEC using a significant payment. Notably, this settlement means the SEC charges won't be investigated further, and also the matter will be concluded.
‘We're pleased to have amicably resolved this condition,’ an Activision spokesperson reportedly told VGC. ‘Because the order recognises, we have enhanced our disclosure processes regarding workplace reporting and updated our separation contract language. We did so included in our continuing resolve for operational excellence and transparency. Activision Blizzard is positive about its workplace disclosures.’
Despite recognition for Activision Blizzard’s internal overhaul, that has reportedly included stricter rules for employees and stronger support lines for those staff, it’s likely the SEC will continue to analyse the company’s next steps closely.
Over a period of many years, Activision Blizzard has been the subject of many lawsuits, largely stemming from an alleged ‘fratboy culture‘ in the company which alienated many staff, and contributed to a toxic workplace. In recent years, Activision Blizzard has worked to fix these mistakes, however, change is a difficult beast. Whether the company will learn from these lessons – delivered through the SEC and a number of current and former staff members – remains to be seen.
