reprinted from TooMuchOnline.org
Young activists in Switzerland have plutocrats
hyperventilating -- and spending a fortune to beat back a ballot
initiative that would establish a legal limit on the pay gap
between top execs and their workers.
Something astounding is happening in Switzerland. For the first time ever, voters in a modern developed nation are going to be voting on whether to create what essentially amounts to a "maximum wage."
The vote will come this Sunday, November 24, on a ballot initiative that bans any Swiss corporate executive compensation that runs over 12 times worker pay.
In effect, under this " 1:12 Initiative for Fair Pay," no Swiss company would be able to pay its top executives more in a month than the company's lowest-paid workers make in a year.
Swiss corporations currently compensate their top execs more generously than any other nation in continental Europe. At pharmaceutical giant Roche, CEO pay runs 236 times the firm's lowest wage. At Nestle, the divide spreads 188 times.
Gross margins like these four years ago caught the attention of activists in Juso, the youth wing of Switzerland's Social Democratic Party. The activists sensed growing public outrage at a corporate pay system that has, as former Juso president CÃ©dric Wermuth recently told Too Much, "greedy managers earning millions while other people earn too little for living."
wiss 1:12 activists CÃ©dric Wermuth and Mattea Meyer - See more at: toomuchonline.org/a-daring-bid-to-stomp-out-ceo-pay-excess/#sthash.vuwXIfXk.dpuf"populumcaptn="1:12.org/ toomuchonline.org
(image by 1:12.org/ toomuchonline.org) DMCA
The " 1:12 " initiative that Wermuth and his Juso vice-president Mattea Meyer organized would go on to gain broad union support and backing from Switzerland's top two progressive parties, the Social Democrats and the Greens.
This past spring, the 1:12 effort filed enough signatures for ballot status -- and Corporate Switzerland has been feverishly attacking the initiative ever since.
Any move to limit CEO pay to 12 times worker pay, charges SwissHoldings, the federation of Swiss-based multinationals, would constitute "a frontal attack on freedom" -- and "prosperity," too! If the measure passes, the SwissHoldings anti- 1:12 manifesto declares, "almost all" of Switzerland's 57 corporate giants "would be forced to restructure or move parts of their companies abroad."
One Swiss lawmaker, Zurich's Ruedi Noser, has ratcheted up the hysterics to an even higher level. A "yes" vote on the 1:12 proposition, he's claiming, would turn Switzerland into the "North Korea of Europe."
But Swiss society, 1:12 supporters counter, has functioned quite successfully in the not-so-distant past with quite narrow gaps between executive and worker compensation. In 1984, points out the Swiss Denknetz think tank, CEOs in Switzerland only averaged six times more in pay than average Swiss workers.
Many Swiss today still remember those more equal times, one reason why headlines about 21st century executive paydays -- like the $100.5 million Credit Suisse CEO Brady Dougan grabbed in 2010 -- so infuriate the general public.
In 2007, Swiss chief execs nationwide averaged 56 times more than average worker pay. But big companies pay their execs far more, the Swiss trade union federation points out, and these execs desperately want their gravy trains to continue. Nestle, the drugmaker Novartis, and other Swiss companies have been bombarding their employees with letters decrying the dangers 1:12 poses.
Swiss corporate execs unleashed a similar political blitz earlier this year when corporate gadfly Thomas Minder, a successful entrepreneur, led a campaign to give shareholders more say over top executive pay -- and ban executive new-hire and "golden parachute" bonuses.
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