The Swiss vote to wholeheartedly back proposals to impose tough limits on executive pay and ban huge payouts to new and departing managers, has been both praised and damned in Europe.
The anti-fat cat initiative proposed by Thomas Minder, the head of a herbal toothpaste company, was backed by all 26 cantons in the country.
Some believe the move will damage Switzerland as a place to do business, but it has the backing of some big players in Germany.
Julia Kloeckner, the deputy party chairwoman of Germany’s CDU party, said: “I am very surprised about the Swiss result and well done, hats off! I think it is a strong step, because Switzerland has set different priorities in other finance political issues compared to Germany.”
Public fury erupted when pharmaceutical giant Novartis planned to pay outgoing chairman Daniel Vasella 60 million euros, despite laying off thousands of workers.
Swiss bank UBS continued to pay high salaries and whopping bonuses to managers even as multi-billion franc losses were posted.
Alpesh Patel, from London based asset management group Praefinium Partners, explained the problems with what the Swiss are doing: “The only way for any of these things to work is if it is global. Because bankers are willing more than ever to move locations. I think this could be the tipping point to encourage them back to cities and places with a bit more life than Switzerland.”
The Swiss are not alone; last week EU member states agreed a cap on bonuses at a year’s salary, which could rise to two years pay if approved by shareholders.