BASEL (Reuters) - Roche shareholders overwhelmingly backed its compensation report on Tuesday, suggesting the company has little to fear from tough new legislation to limit executive pay.
Roche’s AGM in Basel is the first gathering of shareholders since Swiss citizens voted on Sunday to impose some of the world’s strictest limits on executive pay.
Opponents have warned the measures would scare away international talent and damage the country’s competitiveness.
In a consultative vote, 99.6 percent of Roche shareholders approved the company’s pay plans which shareholder group Ethos had urged investors to reject.
Roche is seen as having a stable shareholder base as the Hoffmann-Oeri family owns a controlling stake in the voting shares.
Chairman Franz Humer told the meeting that Roche will have to “wait and see” what legislation is passed and will then amend its practice accordingly, by allowing a binding vote on pay and electing board members and the chairman annually.
Humer, who announced he will step down as chairman from next year, will also receive a bonus payment when he leaves, Roche Vice Chairman Andre Hoffmann told the meeting.
He added the payment would be “completely different” from the $76 million payoff the board of cross-town rival Novartis had originally planned to pay its outgoing chairman Daniel Vasella.
Under the new law, big rewards for arriving and departing managers will be banned. The initiative also forbids bonus payments to managers if their companies are taken over.
Roche Chief Executive Severin Schwan earned 12.5 million Swiss francs in 2012, including cash, bonus, pension and other benefits, while Humer was paid 8.66 million francs. ($1 = 0.9417 Swiss francs)
Reporting by Caroline Copley; Editing by David Cowell