SWITZERLAND - Zurich Financial Services and Swiss Re have agreed to submit their remuneration reports to an advisory vote of shareholders at their next annual general meetings (AGM), following pressure from Swiss pension funds.
The Ethos foundation and eight Swiss pension funds filed a 'say on pay' resolution in September 2009 requesting Zurich, Swiss Re, Holcim and Novartis make changes to their corporate governance and remuneration policies. (See earlier IPE article: Swiss pension funds continue 'say-on-pay' struggle)
The eight pension funds - 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 in the initiative last year and successfully encouraged companies including UBS, Credit Suisse, Nestlé to make changes. (See earlier IPE article: CS, Nestlé give in to 'say on pay' pressure)
Zurich Financial Services has now committed to putting its remuneration system for 2010 to the shareholder vote, and Swiss Re will propose a vote on its 2009 remuneration report.
That said, the votes will only be advisory as Swiss company law does not currently permit a binding vote.
Ethos claimed that the advisory process would still allow investors to send a strong signal to management over pay issues. Dominique Biedermann, executive director of Ethos, said: "This is a step towards better self-regulation with regard to executive remuneration and enhanced shareholder democracy in Switzerland."
Following the latest success of the campaign, Ethos said eight of the 20 companies included in the Swiss SMI Index have agreed to implement a vote on remuneration issues. But it confirmed the lobbying group will maintain its 'say on pay' resolution' at the general meetings of Novartis and Holcim, to be held in February and May respectively.
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