Internationale Zeitschrift für Wirtschafts- und Managementwissenschaften

Integrative research paper: Swiss executive pay referendum

Abstract

Abbott Haron

This paper provides an account of the specific provisions contained in the new resolution. Furthermore, the paper examines the pros and cons of the Swiss new law on executive compensation in light of recent corporate governance advances. In March of 2013, Swiss voters were asked whether they supported a federal order on family policy, a modification to the federal law on spatial planning, and a popular initiative on executive pay, which would introduce compulsory shareholder votes on salary levels, in addition to banning golden hellos for new employees and golden parachutes for departing staff. However, we need to warn that the binding say-on-pay is not a magic potion. This is because influential shareholders are likely to influence opinion for executive pay plans that further shareholders narrow interests at the disadvantage of key voters in the company, including less prevailing shareholders, employees, and debt holders.