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Swiss pension funds continue 'say-on-pay' struggle

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  • Swiss pension funds continue 'say-on-pay' struggle

SWITZERLAND - The Ethos foundation together with eight pension funds is planning to petition for 'say-on-pay' at another four large Swiss listed companies.

The group, which successfully launched the initiative last year, will now target building materials group Holcim, pharmaceutical giant Novartis and the two financial firms Swiss Re and Zurich Financial Services, arguing for changes to their corporate governance and remuneration regimes.

The pension funds - the Aargauische Pensionskasse (APK), the public fund for civil servants in the city of Geneva (CAP), one in the canton of Geneva (CIA), another scheme for medical staff in the canton of Geneva (CEH), the public fund for the canton of Jura, the fund for the canton of Luzern (LUPK), the pensionskasse Post and the pension fund for the city of Zurich - joined Ethos last year in its campaign to get a say on remuneration as shareholders of large Swiss companies.

The campaign succeeded with UBS, Credit Suisse, Nestlé and ABB, provider for energy technology, all agreeing to make changes to their policy. (See earlier IPE story: CS, Nestlé give in to 'say on pay' pressure

"Only Novartis refused to discuss the matter and recommended the resolution be opposed but it nevertheless received support from 31% of votes cast," said Ethos.

The foundation noted that transparency on remuneration among Switzerland's 47 largest listed companies of the SMI index had "not improved and still does not exceed the minimum required by law".

It was also critical that share-based incentive plans for executive and non-executive staff are often not based on performance targets which, according to Ethos, "is contrary to international best practice rules".

Ethos and the eight Swiss pension funds said in their petition that they "request an advisory vote of the shareholder general meeting on the remuneration report".

The companies were chosen because they are "the largest within the SMI that do not confer any shareholder rights on executive pay".

At Novartis' AGM in 2010, Ethos and the pension funds will also file a petition against the "continuation of the combination of the positions of chairman and CEO" in order to ensure "a balance of power" within the pharmaceutical company.

If you have any comments you would like to add to this or any other story, contact Julie Henderson on + 44 (0)20 7261 4602 or email


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