Swiss vote to curb excessive salaries

Swiss voters have given the government a clear message to curb excessive director pay following the outcome of a referendum in which they approved proposals by a 67.9% margin.

The proposals - expected to be among the toughest rules on executive pay in the world - could see reforms include a binding annual shareholder vote on executive compensation for listed firms and a ban on golden handshake and parachutes - bonus payments for new or departing executives.

The proposals also pose punishment of jail for executives who violate the terms.

Swiss voters have felt particularly sore about executive pay after UBS had to be bailed out with taxpayer money in 2008. Foreign executives have also been paid as much as £9.2m in annual pay while blue collar workers have complained of immigration impacting on their wages.

Developments in Switzerland come as the latest statistics for FTSE 100 board chairmen indicate an average 6% increase.

The figures, released by Income Data Services, show that the average fee for a non-executive chairman was £397,350 in 2012.

Average fees for chairmen ranged from £270,000 in technology businesses to £517,943 in oil and gas companies.

IDS explained that fewer FTSE 100 companies increased their non-executive directors' (NED) fees during 2012 than in the previous year. One third of FTSE 100 companies increased their NED fees in 2012, down from two thirds over the same period in 2011.

Figures for the chairmen of remuneration committees saw their average fees rise by 14% in 2012, while senior independent directors serving on FTSE 100 boards received pay rises averaging 10% in 2012.

Penny Sukhraj |Content editor, Accountancy - (up to 2016)

Penny Sukhraj, former content editor and writer for Accountancy and Accountancy Live, responsible for commissioning and editing news...

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