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Salary caps may force Nestlé out

Nestlé's chairman has said the group could pull out of Switzerland if a proposal to cap top salaries is approved.

“It will be the beginning of the end,” Peter Brabeck-Letmathe told the Sonntag newspaper, after being asked about the impact such a measure would have on the group.

“We would be forced to ask ourselves if Switzerland is still the most appropriate place for us.” The food and beverage giant is headquartered in Vevey.

The proposal was put forward in response to bonuses and fat cat salaries being continued despite the economic downturn.

Brabeck-Letmathe noted that Switzerland’s most attractive characteristic was its “legal security” but added that this security, once “as solid as a block of granite”, was now weakening. It was vital that this be restored, he told the newspaper on Sunday.

He said Switzerland had submitted to outside and internal populist pressure to rethink its laws.

A people’s initiative has demanded restrictions to counter what it considers excessive pay packages. The initiative was rejected by the Senate which instead came out in favour of granting shareholders the right to set the remuneration for company board members.

The other parliamentary chamber, the House of Representatives, is still to discuss the issue before Swiss voters have the final say at a later stage.

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