Reference no: EM133146140

In July 2021, after a two-year investigation, the California Department of Fair Employment and Housing sued Activision Blizzard, the videogaming giant behind popular games such as Call of Duty, Candy Crush, and World of Warcraft, over allegations of widespread sexual misconduct and other discriminatory practices. The suit noted the presence of "a pervasive frat boy" culture that fostered a "breeding ground for harassment and discrimination against women." Approximately 20% of Activision Blizzard's 9, 500 employee are women. Female employees were subjected to constant sexual harassment, including having to continually fend off unwanted sexual comments and advances by their male co-workers and supervisors including being groped during company events. There were also allegations that supervisors made hiring decisions based on female candidates' looks, and asked employees for dates. When employees complained, the HR department treated their concerns in a dismissive manner and failed to maintain confidentiality, which resulted in retaliation (e.g., removed from work projects, transferred unwillingly to different units, layoffs). It was also alleged that high level executives including to company President, J. Allen Brack, and CEO, Bobby Kotick, had known about the harassment and discrimination for years.  When faced with the lawsuit, Activision Blizzard said that the claims were "distorted, and in many cases false." However, after over 1, 500 employees walked out of work in protest, and 3, 000 current and former employees signed a petition against the company's characterizations of its workplace issues, Kotick noted that the initial statement was "tone deaf" and pledged to investigate "each and every" claim of wrongdoing.

In January 2022, Microsoft announced plans to purchase Activision Blizzard for USD$68.7 billion.  While this deal has the potential to make Microsoft a leader in the video gaming space, the company inherits Activision Blizzard's workplace issues. In discussing the importance of righting Activision Blizzard's workplace, Microsoft CEO, Satya Nadella, said that culture is his "number one priority," and Microsoft will have "significant work to do in order to continue to build a culture where everyone can do their best work." In fact, he noted, "The success of this acquisition will depend on it."

Based on your knowledge of ethical organizational cultures, identify, and discuss the specific measures that may taken to foster an ethical organizational culture at Activision Blizzard.