Swiss Referendum Backs Executive Pay Curbs

gollum123 writes in with news that Switzerland may soon have the world's strictest corporate rules. "Swiss voters have overwhelmingly backed proposals to impose some of the world's strictest controls on executive pay, final referendum results show. Nearly 68% of the voters supported plans to give shareholders a veto on compensation and ban big payouts for new and departing managers. The new measures will give Switzerland some of the world's strictest corporate rules. Shareholders will have a veto over salaries, golden handshakes will be forbidden, and managers of companies who flout the rules could face prison.The 'fat cat initiative', as it has been called, will be written into the Swiss constitution and apply to all Swiss companies listed on Switzerland's stock exchange. Support for the plans — brain child of Swiss businessman turned politician Thomas Minder — has been fueled by a series of perceived disasters for major Swiss companies, coupled with salaries and bonuses staying high."

Comments

Good

[AmiMoJo]

The job doesn't justify the salary. They claim it offsets the high risks, but then they walk away with millions when it all goes wrong.

I do a good job as a matter of personal pride and professionalism, even though I'm not earning a massive salary and annual bonus.

Re:Good

[Anonymous Coward]

It isn't the government controlling anything. It gives legal backing to the shareholders.You know, the ones that OWN THE COMPANY. Essentially this is giving more power via property rights and prohibiting the fleecing of wealth by deadweight managers.

If you do not understand why this is good both for society and the individual by reducing the damage done by incompetents, guess what camp you are rallying for.

Re:Good

[RazzleFrog]

A) The government is not controlling anything in this case. it is just saying that shareholders be allowed to veto big raises and golden parachutes for outgoing failed executives.

B) The government in the US has lots of rules that may not "control" a deal but that do make sure things are handled in a way that is fair to the shareholders and to the public. For example, if all the makers of widgets got together and said - hey let's raise all of our prices by 100% - then that would be price collusion/fixing and illegal.

C) Just because the government has rules for deals doesn't mean it invalidates property and creates communism. I am not even sure how you made that creative leap.

D) Pro sports players aren't even in the ballpark (excuse the pun) of the folks we are talking about. They are high profile and get a lot of attention but the "1%" is worth 1000 times most athletes.

E) Socialism enforced by people with guns? First. There is no completely socialist country in the world. There are many that come close. Some, like Canada, are more socialistic than the US and I don't see them using guns up there to enforce it.

Re:Good

[AmiMoJo]

A large company with vast resources wants to do a deal with me, a puny individual with limited funds to spend on getting a lawyer to check it out and monitoring compliance. I want my government, on my behalf, to regulate the deal so that I don't get ripped off and don't have to be an expert on every single thing I want to deal in.

Before people scream socialism

[Anonymous Coward]

Before people scream socialism, this rule is to make shareholders vote on the executive pay of the company they own shares in, not government bureaucrats. This is to protect shareholders from greedy upper management.

Re:Before people scream socialism

[fustakrakich]

In any case watch out for unintended consequences.

You mean, like a robust economy that's not dependent on these people?

Re:Before people scream socialism

[Pascal Sartoretti]

Switzerland has fucking hygene inspectors that have to OK your moving out of any apartment or house for fucks sake. Sink not clean enough to use as an operating room? You must stay and clean.

Bullshit. When you move out, your landlord checks that the apartment or house is clean, that's all. If not, they will retain a certain amount on your 3 month deposit.

Re:Before people scream socialism

[Archangel Michael]

Which is why the Boards of Directors and all the three letter jobs should be held accountable when a company defrauds the shareholders and public.

it's not even really a curb

[Trepidity]

It provides a mechanism by which shareholders can set a pay limit for executives, and veto large pay packages which they don't think are in their interests. Since shareholders nominally "own" the company, I'm not sure why that would be particularly controversial, except that companies have been to some extent captured by their management.

There is nothing here that prevents high corporate pay if the owners of the company feel it's justified.

Re:it's not even really a curb

[Trailer Trash]

Technically, the shareholders *should* be able to do this already through the Board. I think the problem in the US is that few people invest in companies directly nowadays - instead they invest in mutual funds which in turn own companies.

I always suggest that people who work in publicly traded companies own stock and show up at annual meetings when possible. The problem is that for the normal worker they can't buy stock at the same pace that it's being given to the executives. My wife's former company was terrible about that - execs and even divisional managers were being given thousands of shares each year, either outright or as options that allowed them to buy the stock at a low price and sell it immediately at a much higher price, with the risk totally eliminated by the fact that they had no requirement to buy in the first place.

We really need to get back to free market principles here, instead of this crazy system where executives rape companies and get huge bonuses or parting gifts.

Re:Jealousy

[Anonymous Coward]

Who are you to say that another person's salary is unjustified

A voice representing the majority who are not rewarded (to excess) for failure.

I'm guessing you make a lot more than that, as do most slashdotters. But the difference between you and me isn't money. The difference is that I have accepted my place in life, as well as the fact that certain others will have orders of magnitude more than I have.

I am compensated by my employer based on my performance and contributions to my company. Should I be compensated by my employer if I take away from my company?

The difference is that I can see right through the smokescreen of moral superiority.

Your moral compass is out of calibration.

Re:Jealousy

[Khashishi]

The difference is that I have accepted my place in life,

and ye shall forever be downtrodden as a result.

Re:Anti-capitalist is anti-freedom

[Anonymous Coward]

If the swiss economy is doing well, it's probably BECAUSE of decent regulations like this. We have a financial corruption and theft problem. A lot of things would be better if we hadn't deregulated in the US.

Re:Jealousy

[macbeth66]

As a shareholder of a given company, I have, or should have, the right to squeeze you by the balls as I take the money BACK out of your pocket and return it to the us, the owners of the company.

And I could give a rat's ass about moral superiority. You go do whatever your little heart desires, but keep your hands off of my money.

Re:Jealousy

[DMiax]

After all, your solution is coercion.

No, our solution is give the right of determining the salary to the people that actually pay said salary.

One law that everyone should implement

[thetoadwarrior]

You should never be able to get a bonus, as an executive, when you're company is losing money. Bankers seems to get bonuses no matter what. That defeats the point of a bonus.

Re:Jealousy

[FrozenFOXX]

The difference is that I have accepted my place in life,

and ye shall forever be downtrodden as a result.

While I understand what you're trying to say to the parent and even, to an extent, agree with you the other side of the argument is that if you don't learn to accept where you are in life then you can never be content. I would imagine the parent is probably referring to having found a place in life that they are happy with. That's kind of an important bit of wisdom since for many people being at the "top" doesn't lead to happiness.

For an example I'm at the top of my game, but not at the top of earnings. Still, I make plenty of money, have no problem paying bills, buy anything I want, and do whatever I want (within reason). I don't let people walk over me but I don't need to walk over them, either. I find most people would be a lot happier if they'd take a few moments to realize that they don't actually want to be at "the top," it's just our media machine that blasts you with that.

Of course I could be wrong, I don't know for certain, none of us do. Maybe the parent's just a slacker.

Re:Jealousy

[sa1lnr]

"A voice representing the majority who are not rewarded (to excess) for failure."

A majority that often picks up the tab for those failures.