Zurich, Switzerland (GenevaLunch) – Executives at the 20 companies that make up the SMI (Swiss Market Index), the leading Swiss companies on the Swiss stock exchange, earned 18 percent more in 2009 than in 2008. The figures were released by PricewaterhouseCoopers (PwC) 29 September, which also surveyed the 28 companies on the SMIM index.
Their earnings nevertheless fall short, by 12 percent, of what they earned in 2007. The average income was CHF8 million, with about 25 percent of that salary, and more than half in long-term investments, particularly in company shares.
Chairmen of the board saw their earnings rise by nearly 11 percent, for an average compensation of CHF1.3 million.
Overall wealth of CEOs and board chairmen suffered in 2008 and improved in 2009, the report shows: “The median wealth change for CEOs was -CHF900,000 for 2008 and +CH480,000 for 2009.
For chairmen, it amounted to -CHF1.0 million in 2008 and +CHF240,000 in 2009. For other board members, it was -CHF200,000 in 2008 and +CHF50,000 in 2009.
PwC Executive Compensation and Corporate Governance Survey 2010
Chairman apologizes for role in helping some US clients evade taxes, says bankers’ pay will eventually come down
Basel, Switzerland (GenevaLunch) - “Are we to blame ourselves, because we believed the board and accepted their proposals?” asked a Mr Gerber, from a group of shareholders that calls itself the Association of Persons Injured by UBS, at the annual general meeting of the bank, taking place Wednesday 14 April in Basel. “There’s only one thing that is sure, that nothing in the bank was safe . . . and certainly I cannot be blamed for that.” The group has called for a social fund to be created to reimburse shareholders who lost money, a call quickly rejected by Kaspar Villiger, chairman of the board.
Rudolf Meyer, Association for Responsible and Sustainable Economic Management (Actares), followed Meyer with harsh criticism of pay packages and pointed remarks about the lost faith of the Swiss public in the bank. He recommended that shareholders not approve two contentious agenda items: the remuneration package and a move to absolve former directors of responsibility for the bank’s 2007-2009 activities.
The two were part of what Geneva newspaper Le Temps describes as an increasingly vocal group of minority shareholders who are changing the nature of the annual meetings, speaking more critically of the decisions and behaviour of the bank’s directors and senior executives.
Chairman Kaspar Villiger opened the meeting with a prepared speech that acknowledged that “we know how much UBS – an institution of which our country was so proud – has disappointed the Swiss people.”
Charges against Tribune de Geneve journalist dismissed by judge
Geneva, Switzerland (GenevaLunch) - The legal case opened Thursday 18 March between Hannibal Qadaffi, son of Libya’s leader, and canton Geneva plus the Tribune de Genève newspaper. The judge quickly dismissed charges against a journalist working for the Tribune who had approved but not selected the article and photograph, the newspaper reports. But swissinfo reports that Hannibal Qadaffi, who has asked for damages of CHF100,000, said Thursday evening he is no longer interested in the money: he wants an international tribunal to acquit him. Qadaffi was interviewed by news agency AFP.
Zurich, Switzerland (GenevaLunch) - UBS’a annual report, published Monday 15 March, stoked the fire under a debate in the lower house of Swiss parliament over limiting executive pay packages. Thirteen top managers at the Swiss bank were paid CHF68.7 million in 2009, of which nearly CHF55 was in the form of bonuses, and the bank spent another CHF41.3 paying former managers a mix of compensation.
The figures were nearly 10 times those for 2008, when the bank turned to the government for a bailout package.
The bank two weeks earlier, 1 March, announced losses for a third quarter running, and the details about payouts come just as the lower house of the Swiss parliament has been debating putting a cap on executive pay.
Geneva airport, vacation week
Geneva, Switzerland (GenevaLunch) - A very small number of Geneva airport’s Swissport baggage handlers remain on strike after lengthy negotiations with cantonal officials failed to bring about a settlement by 8 January. Airline passengers took little interest in the striket, faced with their own concerns about lost bags and missed flights: bags misplaced a week ago have still not all been found and UK weather forced scores of flights to be canceled.
GenevaLunch has been flooded with e-mails and comments on our articles about the chaos at the airport 2-3 January, which resulted in thousands of bags going missing for most of the week.
For those who have still not received their bags, or who were bumped from canceled flights to the UK, due to weather, this week, Swiss law provides the same compensation as European Union law. Details are available in German, French and Italian, the national languages, on a federal government site. Key points include:
Goldman Sachs executives who are expected to receive some $20 billion in bonuses in 2009 will receive the payments in the form of company shares that they cannot sell for five years, the New York-based group said Thursday 11 December. Goldman has been at the centre of a heated public debate over compensation to managers in financial institutions that were bailed out by their governments some months ago. The new policy is designed to align compensation with longer-term performance but it leaves open the issue of the size of bonuses. The company will be allowed, under the new plan, to defer the expense of compensation so it will not report this for 2009.
Links to other sites: Bloomberg, Reuters and Goldman Sachs announcement
US bank Goldman Sachs is fighting a backlash against its plans to share profits with staff by opening a fund that will use the equivalent of about 2.3 percent of staff remuneration, or $500 million to help 10,000 small businesses. The bank Tuesday 17 November apologized publicly for the role it played in the global economic crisis. Goldman has recovered, with analysts saying they expect it to pay close to $22 billion in compensation to staff in 2009. Warren Buffett, a Goldman investor who will oversee the small business programme, told the FT it is not designed to compensate for the bank’s errors.
Links to other sites: Bloomberg, Financial Times, Yahoo Finance
Geneva, Switzerland (GenevaLunch) – Manuel Echeverría, the head of Optimal in Geneva, faces criminal charges for his role in the Madoff ponzi scheme. Optimal is Spanish bank Santander’s hedge fund arm, based in Geneva. Echeverria, who left the company some months ago after 19 years, according to the Wall Street Journal, becomes “one of the first and most senior wealth managers known to be facing criminal charges in connection with the Madoff scandal”, according to the Financial Times (FT). The newspaper, which has seen court documents, says the charges were filed in August but have just become known now, with Echeverría losing a legal bid to disqualify asset manager Franck Berlamont in the case. Five Aurelia asset managers are implicated in the case, says the FT. The company lost $800 million of its clients’ money to Madoff, Reuters reported in April 2009.
The G20 group of the world’s largest economies has a large menu to work through when it meets Thursday and Friday in Pittsburgh, Pennsylvania in the US, with changes to the banking world heading the list. The debate over limiting bankers’ bonuses continues from their last meeting earlier this year: the group will, according to the Wall Street Journal, decide ” how draconian the restrictions on banker compensation should be.” Brazil will be suggesting that bank regulation should be tightened and that recent changes to bank capitalization should be extended to include derivatives markets, referring to the Basel II agreement that have recently gone into effect, which are designed to help avoid the kind of global banking meltdown seen in 2008. US President Barack Obama faces a second major international test in less than a week, after the UN General Assembly, convincing G20 leaders that the buzz words “sustainable” and “balanced” are the keys to getting the world economy back on track, according to AP/NPR. Financial Times (subscription), Forbes/Reuters, MSNBC news roundup
Tower Office, head of the BIS in Basel, Switzerland
Basel, Switzerland (GenevaLunch) – Central bank heads from 27 leading countries meeting in Basel agreed Sunday to follow recommendations made Saturday 5 September by finance officials, who met in London, to impose tougher capital requirements on banks. The new measures are designed to avoid a repeat of the collapse of much of the global banking system at the end of 2008.
Nine US banks paid their employees bonuses that exceeded the banks’ net income in some cases, a report by New York Attorney General Andrew Cuomo details. The banks all received government aid in 2008. The report says banks’ compensation policy “has become unmoored from their financial performance”. Cuomo writes that “when the banks did well, their employees were paid well. When the banks did poorly, their employees were paid well. And when the banks did very poorly, they were bailed out by taxpayers and their employees were still paid well.” The nine banks received $125 billion in bailout money under the Troubled Asset Relief Program (TARP). Most of the banks have paid the money back. NYT, Reuters
French officials denied claims of a relationship between nuclear weapons tests and health problems among the testers for decades. Defense Minister Hervé Morin told Le Figaro, Tuesday 23 March, that they will compensate those suffering from illnesses linked to radiation exposure from the test. French authorities carried out more than 200 nuclear tests between 1960 and 1996 that theoretically affected approximately 150,000 civilian and military personnel, according to Morin. International Herald Tribune
Zurich, Switzerland (GenevaLunch) – UBS shares briefly slipped to an all-time low of CHF13.88 Monday after it announced its new compensation package, with no bonuses for bank officials in 2008 and stricter rules for the future.
Title: Personnel compensation in Switzerland – 2009 outlook
Location: Geneva, Ramada Park Hotel
Link out: Click here
Description: Panelists: Giorgio Cortiana,
head corporate research Europe, UBS Wealth Management Research, Martin Naville
chief executive officer, Swiss-American Chamber of Commerce
Start Time: 11:45
Date: 03 Nov 2008
End Time: 14:00
