* Ethos urges investors to vote out Novartis board members
* Chairman's pay rose while net profit dropped
* Ethos renews calls for UBS investment bank head to quit
(Adds Novartis comment)
By Katharina Bart
ZURICH, Feb 2 Shareholder group Ethos
called for Novartis investors to vote against
re-electing board members who were among those deciding on the
pay awarded 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's pay rose to 13.5 million Swiss francs ($14.8
million) in 2011, when Novartis' profit fell 7 percent, from
roughly 12 million Swiss francs the year prior.
Novartis does not conduct a say-on-pay vote annually, though
it did so in 2010. Ethos, which is influential because it makes
recommendations to Swiss pension funds, said shareholders should
vote against the re-election of board members William Brody and
Srikant Datar, two members of the compensation committee who are
up for re-election.
In a detailed response, Novartis said board pay is
comparable to healthcare companies and other Swiss blue-chips
such as UBS AG and Nestle AG, and that the
chairman's role is a full-time job requiring exceptional
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 and resign. The
loss prompted a 39 percent drop in third-quarter profit.
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 the unauthorised trades quickly.
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 and Elaine