Salaries for top managers at the largest Swiss banks declined by 23 per cent in 2011 while senior staff in other business sectors earned five per cent more, according to latest data from the Swiss Foundation for Sustainable Development, Ethos.
Forty-nine of the 100 biggest Swiss companies also put their managers’ salaries to a shareholder vote, four more than did so in 2010.
The accompanying report from the Geneva-based foundation, suggests that more self-regulation is still needed, despite the “positive impact of these votes on the transparency and structure of board and executive remuneration.”
According to the report, the management team at pharmaceutical giant Novartis pulled in the highest salaries in 2011, with CEO Joe Jimenez earning SFr15.7 million ($16.4 million) and chairman of the board Daniel Vasella bringing home SFr13.5 million.
Credit Suisse CEO Brady Dougan saw his salary decline the furthest since the previous year, by more than half to SFr5.8 million.
Hot topic
The issue of executive pay has been a hot topic in Switzerland since the global financial crisis in 2008, in the aftermath of which Swiss businessman-turned-politician Thomas Minder launched an initiative to curb executive pay.
His proposal was followed by years of back-and-forth counter-proposals from parliament.
In June, parliament submitted its final take on the proposal to go to a nationwide vote by March next year. It is a multi-pronged plan that would let voters choose among three options.
The public could vote to give shareholders the binding right to reject company remuneration plans.
Or, it could opt for a counterproposal to impose a new tax on the biggest executive pay-outs. A third option would be to reject both of these ideas and trust politicians to enact an indirect counterproposal – essentially a watered-down version of Minder’s original proposal.
The initiative to put an end to excessive executive pay and boost shareholder rights was handed in with more than 118,000 signatures in 2008.
Unions regularly complain that the gap between the pay of top managers and shop floor workers has been steadily increasing in recent years in Switzerland.
Minder’s initiative plans to allow shareholders to veto listed company pay plans, force pension funds to vote every year and reveal their voting patterns and to outlaw golden hellos and parachutes.
In 2010, Minder struck a deal with the strongman of the rightwing Swiss People’s Party Christoph Blocher and agreed to withdraw his initiative if parliament approved a reform of the shareholder law.
This plan was botched by the other main parties, which accused Blocher, a multi-billionaire businessman and former justice minister, of misleading voters.