Shareholders at Julius Baer, Switzerland’s largest private bank, have scored the first direct hit on fat cat salaries by voting overwhelmingly against the proposed remuneration package for top executives.This content was published on April 11, 2013 - 11:12
Nearly 64 per cent of shareholders rejected the pay plan in a non-binding ballot does that not compel Julius Baer make changes. But it follows last month’s decision by the Swiss voters to accept a proposal that will make such shareholder ballots binding in the coming years.
Julius Baer plans to shell out CHF15.2 million ($16.3 million) to senior managers to reward their work in 2012.
The package contained a CHF6.68 million ($7.15 million) award to chief executive Boris Collardi, including an CHF800,000 bonus relating to last year’s purchase of Merrill Lynch’s wealth management business outside the United States.
"The board of directors will take the appropriate measures to work towards a positive vote at the next annual general meeting," Julius Baer said in a statement that did not include details of how the bank would respond the Wednesday’s negative vote.
The landmark decision is the first time that Swiss shareholders have openly rejected a bank’s pay policy. It also sends an unwelcome signal to Switzerland’s two biggest banks, UBS and Credit Suisse, that face similar votes in the coming weeks.
Last month, Swiss pharmaceutical giant Novartis was forced to ditch a proposed CHF72 million pay-off to departing chairman Daniel Vasella. But days later, shareholders overwhelmingly approved the rest of the company’s remuneration package.
The controversial payout offer to Vasella gave further momentum to an initiative, launched by businessman-turned politician Thomas Minder, to give shareholders a bigger say on corporate payouts. It won an overwhelming 68 per cent of the vote last month.
Meanwhile, shareholders at Swiss food giant Nestlé have accepted the company's compensation report in a separate advisory vote at an annual general meeting on Thursday.
Nestlé chairman Peter Brabeck used the occasion to speak of the need to find a new consensus between the economy, politics and society.
"The political and regulatory environment for publicly listed companies is becoming more difficult in this country," Brabeck said, adding that Nestlé wanted to stay in Switzerland, but the "right balance" had to be found.
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