The time spent on video games soared by 40% during the pandemic, as a similar percentage of the world’s population is now reported to play them. Since many new players were attracted to gaming as something to do during the crisis, gaming hours are expected to stay at 21% above pre-crisis levels in future years.
For millions of people, gaming provides hours of harmless fun, and much of it is educational. However, they also face numerous risks, such as online abuse, exposure to violent content, and gaming addiction. Within the industry itself, employees of gaming companies face sustainability issues that include excessive overtime and a lack of diversity among the workforce.
In 2021, Robeco’s Active Ownership team started an engagement program focused on the social risks for companies operating in the video game industry. Six topics were identified: four are linked to risks associated with the use of gaming products, especially by children who are the most vulnerable group of users. Two engagement objectives will focus on the gaming companies’ human capital management and stakeholder management.
Stopping online abuse
“In-game harassment may harm people’s well-being and put individual gamers off,” says Engagement Specialist Daniëlle Essink. “Therefore, gaming companies should minimize the risks of misbehavior.”
“Gamers should also be able to take action against toxicity, such as by using a private profile, or having the ability to block, ignore, or mute someone in the game. They should also be able to make a complaint or flag misbehavior through a system of user reporting.”
“Beyond gamer intervention, companies should have human or automated content moderation, including a text chat filter. Lastly, it is important to share knowledge and cooperate via platforms such as the Fair Play Alliance, an initiative to create healthy online gaming communities.”
Addiction and time management
Becoming addicted to the games is an age-old problem that many parents will understand when trying to get their children to stop playing them for hours on end. It can also lead to people getting into debt from repeatedly buying in-game features, some of which must be purchased in order for the game to continue.
“It is undesirable that gamers become exclusively interested in gaming at the cost of other aspects of their lives,” says Essink. “Gaming addiction can lead to both health and financial risks.”
“These risks can be minimized if players are able to manage both their online spending and gaming time. When it comes to time management, this can be done for instance by showing warning messages about risk of overuse (as occurs in World of Warcraft), or by inserting reminders for breaks or ‘cooling off’ periods.”
“Similarly, gamers should be prevented getting into debt due to excessive purchases of in-game features by being made aware of how much they are spending. Gaming companies should find a balance in this part of their business model. From the outset, they are encouraged to disclose in their policies what in-game monetization mechanisms are not acceptable.”
Creating in-game diversity
The diversity of in-game characters – many of whom follow the ‘white male warrior’ stereotype – is another issue. “Games should ideally represent a cross-section of society,” says Essink. “Gaming companies have the ability to implement strategies that embed diversity in the gaming environments they create.”
“Game narratives can be made inclusive through representation of different groups, with representative characteristics and non-stereotypical characters. It also helps if feedback loops are integrated into the development process. The development of specific tools for analyzing characters' diversity is also a good way to look at such issues.”
“Besides using published industry ratings and age verification, we ask companies to commit to a higher-level reflection during the game development process,” she says. “Questions might relate to the proportionality of violence, the targets of violence, good versus bad militaries, and the type of weapons used.”
Human capital management
Within the companies, two sustainability issues are excessive amounts of overtime, known as ‘crunch’, and a lack of diversity among game company employees. “Excessive overtime work for longer periods is a practice endemic in the gaming industry and commonly observed around the release of a new game or feature,” says Essink.
“We ask companies to carefully reflect on their product expectations, such as over-specification, their approach to design, under-staffing and planning, and the working culture in the firm. We encourage companies to take a public stance on the question of work life balance, and to have that supported and verified through, for example, employee engagement surveys.”
“We note that involvement in initiatives and programs towards diversity and an inclusive culture are increasing in the gaming sector. We expect companies to adopt a clear diversity and inclusion policy laying out their position on the topic.”
This information is for informational purposes only and should not be construed as an offer to sell or an invitation to buy any securities or products, nor as investment advice or recommendation. The contents of this document have not been reviewed by the Monetary Authority of Singapore (“MAS”). Robeco Singapore Private Limited holds a capital markets services license for fund management issued by the MAS and is subject to certain clientele restrictions under such license. An investment will involve a high degree of risk, and you should consider carefully whether an investment is suitable for you.