Swiss executive pay initiative, 2013
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The 2013 Swiss executive pay initiative of 2013 was a successful
federal popular initiative In Switzerland, a popular initiative (German: ''Volksinitiative'', French: ''Initiative populaire'', Italian: ''Iniziativa popolare'', Romansh: ''Iniziativa dal pievel'') allows the people to suggest law on a national, cantonal, and municipal ...
in Switzerland to control executive pay of companies listed on the stock market, and to increase shareholders' say in corporate governance. It was one of three questions put to the electorate in the March 2013 referendums. The vote took place on the 3 March 2013, and passed with a majority of 67.9%, with a 46% turnout. The initiative mandates the Federal Government to implement the provisions within one year, pending implementation of the final law. The initiative partly reflected developments in the United States Dodd-Frank Wall Street Reform Act 2010 ยง957, that banned brokers from voting on their clients' money, and the Stewardship Code 2010 in the United Kingdom, which placed a duty on financial intermediaries to disclose their voting policies and make use of voting power. It also reflected a long running debate in Germany, which had not yet been reformed, about the position of banks. In German, the title of the referendum is the , literally "Against Rip-off" and in French, the , literally "against abusive remuneration".


Background

Given the a number of corporate scandals, leading up to the
global financial crisis Global means of or referring to a globe and may also refer to: Entertainment * ''Global'' (Paul van Dyk album), 2003 * ''Global'' (Bunji Garlin album), 2007 * ''Global'' (Humanoid album), 1989 * ''Global'' (Todd Rundgren album), 2015 * Bruno ...
beginning in 2007 a medium-size businessman and politician named
Thomas Minder Thomas Minder (born 26 December 1960 in Schaffhausen, Switzerland) is a Swiss entrepreneur and politician. Minder was elected to the Swiss Council of States for the canton of Schaffhausen in 2011. He is an independent but sits with the Swiss Peo ...
launched a campaign "against rip-off salaries" (). By 26 February 2008, he had gathered 118,583 signatures to launch a referendum under the Swiss constitutional rules. Minder's concern focused on # the excesses of executive pay # the ability of banks, who in the Swiss (and German) system of shareholding hold all share certificates, to vote by proxy using shares owned by other people, and # the inability of pension beneficiaries and policyholders to determine their deposits were being used for voting. Supporters of the initiative spent 200,000 Swiss franc, whilst opponents spent 8 million Swiss francs in their campaign to block the reform. The public campaign drew particular attention to the large payouts for executives of
Novartis Novartis AG is a Swiss-American multinational pharmaceutical corporation based in Basel, Switzerland and Cambridge, Massachusetts, United States (global research).name="novartis.com">https://www.novartis.com/research-development/research-loc ...
and major Swiss banks. On 3 March, the referendum results showed that 67.9 per cent of voters supported the reforms. A German initiative followed a month later, and if passed would represent a significant broadening of pay controls in Europe.


Text of the initiative

The translation of the text is as follows.


Results


Significance

The Swiss referendum had an immediate impact on other countries seeking its own reforms. It led to calls by the German Social Democratic Party to introduce similar reforms in Germany and it is quoted in the Bill proposed in Italy on cap-salaries for public employees. Daniel Alpert of The Century Foundation saw the measures as unnecessary.


See also

* Say on pay


Notes


External links


Official initiative committee "against rip-off salaries"




*Background information on the initiative in th
Swissvotes
database {{Swiss elections executive pay initiative executive pay initiative executive pay initiative Executive compensation