Former Team Lead For World Of Warcraft Mark Kern Explains How ESG Influences Video Game Developers And How The Industry Will Suffer

Former World of Warcraft Team Lead Mark Kern recently detailed how influential ESG (Environmental, Social, and Corporate Governance) standards are for video game developers.

Screenshot of Black Wing from World of Warcraft Classic (2020), Blizzard Entertainment

If you are unfamiliar with the term ESG, it is essentially a set of standards that a number of governments and financial institutions have created to determine how they will invest their money. As noted by BlackRock CEO Larry Fink the standards are used to force behaviors on companies seeking investment for their projects.

Fink detailed during an appearance at The New York Times’ DealBook conference, “You have to force behaviors. And if you don’t force behaviors whether it’s gender, or race, or, just any way you want to say, the composition of your team. You’re going to be impacted. And that’s not just recruiting, it is development as Ken said.”

When asked how he plans to force change, Fink said, “It has to be imbued in the culture of a firm. It has to be talked about. It has to be shown. Behaviors across the entire firm and entire region have to be similar. And every citizen of the firm has to understand what is acceptable behaviors and what are unacceptable behaviors.”

It’s all a conspiracy, they said. No one is trying to socially engineer corporate America, they said.

BlackRock CEO, Larry Fink: “You have to force behaviors…If [firms] don’t force behaviors, whether it’s gender or race…you’re going to be impacted.” pic.twitter.com/RDqtKOjQeM

— Charlie Kirk (@charliekirk11) June 5, 2023

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In an interview with Jeremy Hambly on TheQuartering YouTube channel discussing Sweet Baby Inc.’s harassment of Brazilian gamer Kabrutus and the company’s mission and activities, Kern detailed how influential this type of investment is.

He said, “It’s very profitable. There’s an entire industry built up around DEI initiatives, consultancy, [and] sensitivity reading, [which] has plagued novels for a long time. I have many writer friends who were basically edged out of their publishing houses and went independent because of stuff like this.”

“It’s a very profitable industry,” he reiterated. “It’s financially motivated and it’s as old as time. Consultancy is a very profitable business. There are huge firms on Wall Street that do this. And it’s exactly that. You create a problem, you go in  and you say you’re going to solve it, but actually just move the deck chairs around the Titanic because if you actually solved it they would rehire you. And then you have a recurring business stream. And this is as old as time.”

Harley Quinn about to execute Batman in Suicide Squad: Kill the Justice League (2024), Rocksteady

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Kern then brought the conversation to Sweet Baby Inc.’s narrative consulting business, “The real question I have is why writing? Why are are these game companies hiring writers? It is the smallest portion of your game team. It is the cheapest part of your budget. It makes no sense to outsource it unless you’re after a specific expertise that you do not have in-house. And what is that expertise that is marketed by Sweet Baby Inc.? It’s wokeness. ‘We sell wokeness.’ Why is wokeness valuable to that company?

“And for that you got to get into where I was: CEO level game companies, how games are funded, ESG, and why that matters to your credit score, and why that helps get your game funded when you can check boxes on hiring firms like this,” he said.

Suicide Squad: Kill the Justice League Sweet Baby Inc. credits

Later in the interview, while discussing Sweet Baby Inc.’s involvement with Suicide Squad: Kill the Justice League and how the game likely lost Warner Bros. upwards of $100 million, Kern said, “It’s not that gamers are upset about, ‘Oh, hey, we have some diversity in the game.’ It’s actually the way they go about it with pure tokenism, with phoning in weak characters instead of creating strong new characters.”

“And more importantly it’s about a vindictiveness to destroy the past, to destroy the IP, to ignore the source material, and to tear apart these beloved characters in some sort of fitful rage that we don’t understand that is very disingenuous,” he continued. “And I think that is the tremendous reaction to Suicide Squad.”

Harley Quinn in Suicide Squad: Kill the Justice League (2024), Rocksteady

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He then shared his opinion on how this will affect the way games are financed, “This is going to have an immense financial impact. The way games are funded, you don’t use your own money. Even EA. Games are hugely expensive to make. They are upwards of $250, sometimes $600 million for certain live games. It’s incredible how expensive they are.”

“And to do that your CFO is your best friend,” Kern explained. “You’re counting on your CFO to get you tax breaks, to put studios in regions which are financially favorable, and you will borrow the cheap money. You will get the cheap money to do it.”

He continued, “Even EA does this. I worked with EA. We were putting together a deal where they were taking bailout money from the banks in the last financial crisis that we had and they were applying that cheap towards games. Same thing with Covid money. They’re applying that cheap money towards games. And what has been the cheapest money while interest rates were still low a couple of years ago? It was ESG financing. And so they’re going to take this money and they’re going to put it into games.”

A screenshot of Saints Row (2023), Volition

However, Kern notes this landscape is changing, “But now that they don’t have that money anymore because ESG is either being diminished or rebranded because the returns on investment have been so poor on Wall Street for ESG funds that that source of revenue is drying up.”

“This woke machine cannot continue in the way that it is now for AAA gaming,” he asserted.

A screenshot from Palworld (2024), Pocketpair

However, he believes it might be too late for many of the studios that bought in, “Unfortunately, it’s so entrenched that you’re not going to see much of an ability to course correct because the studios are so infected. They’re going to shut down. And this is truly the rise of AA gaming or what some fans call S-tier gaming like Helldivers, like Palword, [and Last Epoch]. Really incredible success stories in a period where game companies are experiencing significant losses.”

“The bleeding will continue, and no one’s going to wake up from it, unfortunately. It’s going to be a total nose dive,” he concluded.

Screenshot of Helldivers 2 (2024), Arrowhead Game Studios

What do you make of Kern’s diagnosis of the industry and his outlook?

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