Shareholder group slams Novartis over chairman pay
ZURICH Feb 2 (Reuters) - Shareholder group Ethos said Novartis investors should vote against re-electing board members in charge of allotting bonus pay to the Swiss drugmaker's chairman, Daniel Vasella.
The call is part of an attack on Vasella for "earning a million Swiss francs a month, which goes too far," Ethos director Dominique Biedermann told journalists in Zurich.
Vasella was paid 13.5 million Swiss francs ($14.8 million) in 2011, when Novartis profit fell 7 percent.
Novartis does not conduct a say-on-pay vote annually, though it did so in 2010. As a result, Ethos - which is influential because it makes recommendations for Swiss pension funds - is recommending shareholders vote against the reelection of Novartis board members William Brody and Srikant Datar, two members of the compensation committee.
Novartis was not available to comment.
Ethos also took aim at UBS for $2 billion in losses on trades the Swiss bank says were unauthorized by renewing calls for investment banking boss Carsten Kengeter to take responsibility for failing to detect the trades, which prompted a 39 percent drop in third-quarter profit, by resigning.
UBS, which reports its fourth quarter results on Tuesday, has held fast to Kengeter, though several others including overall Chief Executive Oswald Gruebel left as a result of the trading scandal, while risk head Maureen Miskovic was ousted by incoming CEO Sergio Ermotti.
"UBS results haven't been good, and even UBS's executives have to admit that when that's the case, there's no basis for bonuses," Biedermann said.
A spokesman for UBS declined to comment.
Kengeter was explicitly backed by incoming CEO Sergio Ermotti in November, as well as by Juerg Zeltner, the head of UBS's flagship private bank. UBS chairman Kaspar Villiger has also expressed his gratitude to Kengeter for sparing UBS worse losses by unwinding Adoboli's alleged trades quickly and efficiently.
Kengeter earned 9.32 million Swiss francs in overall pay for 2010. His pay for last year will be disclosed in March. UBS is expected to say it will slash bonuses as part of dramatic cuts at its investment bank when it reports the quarter on Tuesday. ($1 = 0.9130 Swiss francs) (Reporting By Katharina Bart, Editing by Mark Potter)