Swiss strike a blow against fat cat culture
UNI Global Union says the Swiss people have sent a positive message to the rest of the world by overwhelmingly backing proposals to impose strict controls on executive pay. Nearly 70% of voters agreed to plans to give shareholders a veto on compensation and ban golden hellos and parachutes for CEOs. The appeals for good behaviour and voluntary codes failed to convince as the people voted for a new law.
The referendum initiative was led by Thomas Minder who collected the 100,000 signatures necessary. The vote took place in the wake of the scandal around the $78 million golden parachute which was to go to retiring Novartis CEO Daniel Vassella. Public pressure resulted in the golden parachute being withdrawn.
The referendum result came just days after the EU approved measures to cap bankers’ bonuses.
UNI Global Union General Secretary Philip Jennings said, “The Swiss people have spoken and shown their concern for the growing wealth divide in their country. They find it unacceptable that while UBS makes multibillion dollar losses and thousands are made redundant at Novartis, the culture of massive salaries for top management coupled with obscene bonuses continued unabated. $78 million for Vassella, just weeks before the referendum, was the tipping point. CEOs take note: at least in Switzerland the golden parachute has turned to stone.”
Jennings continued, “The Swiss have taken the lead – this is a world first. We expect other countries to follow suit. Investors and worker pension funds have a new tool to bring sanity back to CEO pay. The global labour movement will take this message to the G20. We have to close the wealth gap and lift the bottom rather than feed the greed at the top. There are positive signs, not only in Switzerland but across Europe. The EU has also finally woken up and approved measures to cap bankers’ bonuses. The seeds of a new banking culture are finally being sown although much remains to be done.”
The "fat cat initiative" will be written into the Swiss constitution and applied to all Swiss companies listed on country's stock exchange.
The EU deal has agreed that bonuses will be capped at a year's salary and only rise to two year's pay if there is approval from shareholders.