Our analysis of what the biggest global companies in Switzerland are up to. This week: polling Swiss voters on responsible business, US elections, and vaccine deals.This content was published on November 18, 2020 - 14:24
If the responsible business initiative wins at the ballot box on November 29, it would be a watershed. If it doesn’t, supporters are unlikely to put the orange flags away anytime soon.
There are just over ten days until the Swiss vote on two initiatives that are being billed as a referendum on ethics in the economy. According to the latest poll, the so-called responsible business initiative has lost some ground but still has a majority. A separate initiative to ban investments in arms manufacturers is split down the middle but both are too close to call.
If the responsible business initiative wins, Michael Hermann writes in the Tages-Anzeiger it would be a “turning point in the almost 130-year historyExternal link of the federal popular initiative”. Initiatives based on principles and that pull on emotional heartstrings have tended to struggle with voters skittish about economic implications.
However, we know from the US election – the polls don’t always get it right. We also don’t need polls to tell us that the initiative has struck a chord with a lot of people. As my colleague writes, orange flags are draped across much of the country as “visual centrepieces of a campaign which has taken the country by surprise”.
A reader in response to Hermann’s article wrote “With their lousy business practices, these companies are destroying Switzerland's reputation worldwide”. The reader concludes: “We don't need these corporations in Switzerland”.
Whether that’s true or not is a subject for another article but the reader captures an undercurrent here that the Swiss are fed up with big companies - many of which they don’t even consider “Swiss” - trampling on the good Swiss name.
Industry may not be doing themselves any favours with the attacks and argumentsExternal link writes Erwin Schmid from Swiss public television SRF. After staying on the sidelines until just a few weeks ago, board members and executives at companies like Glencore, LafargeHolcim and Nestlé waded into the debate with some claiming a “flood of lawsuits” or calling the initiative’s demands a “gigantic absurdity”. Credit Suisse took out a whole page add in the NZZ am Sonntag decrying the initiative.
These companies all espouse commitments to human rights and the environment backed up with policies and practices. So, why are they so nervous I asked some of the companies. For the answer, see this piece.
The topic is legally complex but the strong pushback stokes more public scepticism about big multinationals. Whatever the outcome of the vote, the emotional pleas for responsible business aren’t going away.
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What else caught my eye?
Companies will be able to write-off their sins committed abroad. This is thanks to the government’s stamp of approval last week on a parliamentary decision that financial penalties imposed abroad on Swiss banks or companies can be deducted from Swiss taxes starting in 2022. This doesn’t exactly discourage companies from bad behavior, but at least, bribes paid to private individuals are no longer tax-deductible writes the government.
The Biden/Harris win could be good for international Geneva, but Swiss business isn’t so sure. Under Donald Trump, the US has de-funded, withdrawn from, or publicly criticised several UN agencies based in Geneva including the World Health Organisation. The US election results therefore bring high hopes in the city of peace. Swiss business wasn’t exactly jumping for joy at the results though. Swiss-US trade has been booming in recent years. The big questions now are what the future holds for a bilateral trade deal and drug prices in the US – the largest market for Swiss pharmaceuticals.
Vaccine optimism means more secret deals with drug makers. On the heels of Pfizer/BionTech’s promising clinical trial results on a Covid-19 vaccine, the Swiss government announced it was shelling out another CHF100 million for vaccines, bringing the total to CHF400 million. It hopes this will help secure another 3.2 million doses on top of the 9.8 million already arranged through deals with Moderna and AstraZeneca. The government has been tight lipped on how much it’s paying companies for access to what many hope is the golden ticket out of this pandemic.
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Thanks for reading.