Abstract
This paper provides an account of the specific provisions contained in the new resolution. Furthermore, the paper examines the pros and cons of the Swiss new law on executive compensation in light of recent corporate governance advances. In March of 2013, Swiss voters were asked whether they supported a federal order on family policy, a modification to the federal law on spatial planning, and a popular initiative on executive pay, which would introduce compulsory shareholder votes on salary levels, in addition to banning golden hellos for new employees and golden parachutes for departing staff. However, we need to warn that the binding say-on-pay is not a magic potion. This is because influential shareholders are likely to influence opinion for executive pay plans that further shareholders narrow interests at the disadvantage of key voters in the company, including less prevailing shareholders, employees, and debt holders.
Highlights
In view of the number of high-level corporate scandals, leading up to the global financial meltdown starting in 2007, In March 2013, the citizens of Switzerland voted in a national referendum to place new limitations on executive pay within the country
This paper provides an account of the specific provisions contained in the new resolution
Executive compensation is a business cost, and as such, it is appropriate to try to place it at a cost level that is “reasonable” and “competitive.” There is good reason to believe that executive compensation in many corporations is too high by some reasonable standards
Summary
In view of the number of high-level corporate scandals, leading up to the global financial meltdown starting in 2007, In March 2013, the citizens of Switzerland voted in a national referendum to place new limitations on executive pay within the country. The paper examines the pros and cons of the Swiss new law on executive compensation in light of recent corporate governance advances. Take care that while a binding vote may possibly bring about a major revolution in the executive pay setting, it may not produce the desired worldwide cure. This is since powerful stockholders are likely to influence opinion for executive pay plans that further shareholders narrow interests at the hindrance of key communities in the corporation, including less dominant shareholders, as well as other stakeholders. Being an important element of corporate governance, executive compensation should persistently attempt to blend the incentive packages of senior executives with shareholders rights [1]
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