SWITZERLAND - Swiss pension funds have shown increasing interest in joining Ethos's Engagement Pool (EEP), with one or two new schemes signing up each month, according to company director Dominique Biedermann.

Founded in 2004 by a number of pension funds, the shareholder platform engages with Switzerland's 100 largest listed companies on a range of issues set by EEP members.

Biedermann told IPE the number of EEP members had grown from 60 in the spring of 2006 to 76 by year-end.

"It has become state of the art, and more and more pension funds are looking at the list of members and deciding they should become members, too," he said.

Biedermann conceded, however, that some pension funds, such as Publica, already had their own shareholder engagement programmes in place, and that membership was problematic for the schemes of some of the larger listed companies.

In total, EEP members currently manage more than CHF112bn (€92.7bn) in assets, one-fifth of overall funds in the second pillar.

Of these assets, CHF11bn is invested in Swiss equity, which means EEP members represent about 1% of the total market capitalisation of the Swiss stock exchange.

In its first summary report on engagement, Ethos found that, while many Swiss companies have adopted corporate governance standards, some have failed to apply those standards across supply chains.

Ethos also announced that another three companies would be introducing 'say on pay' policies this year, bringing the total number of the largest 100 listed companies to do so to 48.

However, Biedermann acknowledged that many companies had reacted negatively to Ethos's recommendations to adopt similar policies on pay.

He also criticised Swiss institutional investors for failing to make use of their voting rights.
In total, 45% of shareholders in Switzerland do not vote at AGMs, according to Ethos.

Biedermann conceded that foreign shareholders made up some of that figure, but he said he was convinced that a large majority were Swiss institutionals, for which there should be "no excuse not to vote".