Top management salaries at Switzerland's biggest companies have jumped by 18 per cent, reaching an average of SFr1.97 million ($1.63 million) in 2005.This content was published on May 24, 2006 - 11:52
The Handelszeitung, a Swiss economics weekly, surveyed the country's 56 largest industrial firms, financial service providers and retail traders.
Most of the companies are linked to the SWX Swiss Exchange, and the bank chiefs, many of whose salaries include variables such as stocks and options, did particularly well as a result of booming stock markets.
Top management at Credit Suisse had the most to smile about with an average salary jump of 70 per cent to almost SFr17 million, just shy of their rivals at UBS, Switzerland's largest bank.
The heads of banks, insurance companies and pharmaceutical firms dominate the list of best-paid managers.
Marcel Ospel and Daniel Vasella, the bosses of UBS and pharmaceutical specialist Novartis respectively, were once again the leading individual earners in Switzerland, taking home SFr21-24 million.
The survey revealed considerable differences between countries regarding sectors and job groups, but managers in Switzerland were usually among the best paid.
A separate survey by the Handelszeitung last October found that three out of four companies pay their board members in cash and that it is only seldom that salaries are linked to business success.
It's not all good news for Swiss CEOs however. According to a report published by consultants Booz Allen Hamilton on Monday, last year more of them stepped down – or were forced to step down – than ever.
Almost one in seven top Swiss managers cleared their desks last year – almost 60 per cent of them against their will, compared with a global average of 50 per cent.
Worldwide a third of company bosses leave due to poor performance, whereas in Switzerland the figure is one in two.
Swiss managers who left their jobs in 2005 were also young – 52.0 years old against an average in German-speaking countries of 54.9.
In addition the average stint for a top manager in Switzerland was almost half as long as the global average – 4.2 versus 7.9 years.
Managers' salaries have recently been debated within reforms of Swiss company law. The justice ministry announced on Wednesday that these reforms would come into effect on January 1.
Under the reforms, the salaries of board members of companies listed on the stock exchange must be published individually and in detail. This also applies to the highest salary within the management, and the total sum of earnings of the whole management.
Each individual board member also has to be elected or confirmed in office on an annual basis.
Earlier this month Justice Minister Christoph Blocher – a successful and wealthy former businessman himself - said the current debate on managers' salaries was characterised by lack of insight and envy.
He described other proposals, including maximum salaries for managers, determining salaries by outsiders, or even the "battle cry" of the socialists for the "same wages for everyone" as nonsense, saying they would have "disastrous long-term consequences" for the national economy.
Best-paid chairmen (2005, with percentage increase from 2004):
Marcel Ospel, UBS – SFr23,975,954 (12.7%)
Daniel Vasella, also CEO, Novartis – SFr21,257,120 (2.3%)
Franz Humer, also CEO, Roche – SFr14,741,295 (11.2%)
Peter Brabeck, also CEO, Nestlé – SFr13,757,351 ( - )
Walter Kielholz, Credit Suisse – SFr12,100,000 (0%)
UBS – SFr17,119,727 (7.8%)
Credit Suisse – SFr16,933,333 (71.6%)
Novartis – SFr7,179,844 (-4.3%)
Roche – SFr5,023,233 (17.9%)
ABB – SFr4,344,280 (89.3%)
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