This astounding concentration of wealth riles the Swiss, although their economy has held up relatively well through the financial crisis. For all its prosperity and success in international banking, Switzerland is a country still firmly rooted in its farming past, a nation with no history of monarchy or even aristocracy.
“Even though Swiss people earn good money and have an average high salary, we also have a strong traditional feeling about what is good corporate governance,” Mr. Minder says as he sucks one of his company’s herbal throat lozenges. “You can have your second home, you can drive your Ferrari, you can eat your beef every day, but Swiss people are middle class, with no extreme highs or lows.”
Mr. Minder is the epitome of the Swiss entrepreneurs whose small businesses are the backbone of the country’s economy. They chide big banks and other homegrown multinationals – like Roche, Novartis, Nestlé and ABB – for adopting an American-style get-rich-quick corporate culture. That, in their view, contrasts with a Swiss business ethos that favours sustainability and long-term relationships, one that has helped build a reputation for high-quality products like watches and other precision instruments. Mr. Minder took over the family business, Trybol, from his father in 1999; his grandfather bought the company in 1913. Founded by a dentist in 1900 in the northern town of Schaffhausen, Trybol produced one of the first toothpastes in Switzerland and is also known for its herbal mouthwash and natural cosmetics.
Mr. Minder blames bankers like Mr. Ospel, a Swiss national who spent several years in investment banking in London and New York, for infecting Swiss business with a high-pay culture. “He was working for Merrill Lynch in New York – Wall Street – and there is where the music was playing. (Big bonuses) came over, and now (they’re) not only in the financial industry: (They’re) also in productive industry, pharma, Nestlé and others. There’s a lot of bullshit coming from America. There’s no sustainable feeling of how managers lead a company. It shouldn’t be for the money, it shouldn’t be personal gain – it should be for the customer.”
In 2001, just two years after Mr. Minder took over at Trybol, it was threatened with ruin when Swissair reneged on a $530,000 contract. In a blow to national pride, the debt-ridden airline had to ground its fleet for two days in October 2001. That same year, Swissair paid Mario Corti $13.4-million, even though he had failed to keep the company aloft. “It was nearly the grounding of Switzerland, not only of Swissair,” says Mr. Minder, who saved his company by begging the new head of the airline, which was taken over by Lufthansa, to honor the contract. But his rage over Mr. Corti still burns. “That guy is now in America. He has not given back any money. He was working for one year. I would say it is even criminal.”
Mr. Minder spent several years venting his outrage to newspapers before deciding to go to war. He spent two years raising funds to force a referendum on executive compensation and another two years gathering signatures. It took him another five years to actually put the issue to the people as the Swiss Parliament wrangled over alternative proposals and tried to get Mr. Minder – elected to parliament as an independent in 2011 – to drop his initiative.
The influential business federation Economiesuisse, which represents 100,000 companies, says Mr. Minder’s proposals could undermine Switzerland’s position as the world’s most competitive economy, a title awarded to it this year for the fourth year running by the World Economic Forum because of its low taxes, stable politics and business-friendly laws. Swiss companies accounted for five of the top 10 best-paid chairmen in Europe in 2011, but only the heads of Novartis and Roche made it into the continent’s top 10 for chief executives.
While Mr. Minder expects Economiesuisse to spend up to $16-million to defeat his referendum, a poll conducted in May showed that 77 per cent of Swiss voters back his proposals. Even the Swiss monthly business magazine Bilanz has criticized high pay for CEOs and chairmen. “Too powerful, too expensive,” it scolded in a recent cover story, noting that the board presidents of Novartis and Roche earn more than 10 times the compensation of their counterparts at British pharma companies.