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Shareholders: Executive Pay Reform Too Limited

Shareholders: Executive Pay Reform Too Limited by Matthew Allen,

Small shareholders still face a raw deal despite new laws giving them a greater say in the running of Swiss firms, according to pension fund advisor Ethos Foundation. Foreign shareholders also have a hard time understanding the evolving Swiss system.

On Thursday, Ethos presented the results of a survey of corporate annual general meetings, two years after Swiss voters approved the Minder “anti-fat cat pay” initiative - named after its author Thomas Minder. The resulting reforms were rolled out in full in time for this year’s AGM season.

They included binding shareholder votes on remuneration packages and the election of board members.

Ethos acknowledged that the worst excesses of inflated executive pay have been largely eliminated. But it also noted that the average chairman’s pay of Switzerland’s largest 20 firms last year was CHF2.5 million ($2.6 million) - down 11% on 2013 - whilst chief executives took home an average CHF8.2 million (+6% on...