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Councillor of State and initiator of the 'Against Rip-off' initiative Thomas Minder addresses during Switzerland's Christian Democratic Party's (CVP) meeting in the northern Swiss town of Olten Jan. 19, 2013. (ARND WIEGMANN/REUTERS)
Councillor of State and initiator of the 'Against Rip-off' initiative Thomas Minder addresses during Switzerland's Christian Democratic Party's (CVP) meeting in the northern Swiss town of Olten Jan. 19, 2013. (ARND WIEGMANN/REUTERS)

The Swiss turn on the superrich Add to ...

Few top executives have dared speak out on this land-mine issue. Nestlé chairman Peter Brabeck, an Austrian who has accumulated a fortune of up to $215-million, is one of the few.

“If the Mr. Minder initiative were to be adopted, Switzerland would unnecessarily give up one of the world’s best company laws,” he wrote in an opinion piece in the Neue Zürcher Zeitung daily. “No well-advised company would chose to set up headquarters in a country where an infringement of corporate government rules can lead to imprisonment.”

Many believe support for Mr. Minder’s initiative is driven by a national allergy to high achievers. The Swiss seem to feel the need to cut their stars down to size, such as former Swiss central bank chief Philipp Hildebrand, who was long vilified as too proud even before a currency-trading scandal forced him to resign in January 2011. One exception to that aversion is tennis player Roger Federer, who has managed to stay popular, in part by retaining a down-to-earth image despite his wealth and success with a racket.

Experts attribute the Swiss aversion to star culture to a long history of consensus building between the German-speaking majority and French– and Italian-speaking minorities, and between Protestants and Catholics. Apart from folk hero William Tell, Swiss history is thin on great figures, perhaps because, having stayed out of the continent’s major wars, the country has not needed strong leaders.

“Switzerland has no kings, no emperors, no pre-eminent president, no one person upon whom everything is focused,” says Karin Frick, an economist at the Gottlieb Duttweiler Institute, an independent research body. “Egalitarian thinking and behavior is in the DNA of Switzerland, which means that people who are richer or more successful than others tend not to show it. The name of the game is understatement.”

Communicaid, a London-based business consultancy specializing in cross-cultural awareness, cautions executives visiting Switzerland that its business leaders tend to be modest about their role and discreet in their exercise of authority. “People expect others to be on an equal level, and from someone in leadership or senior management they expect a certain amount of modesty and frugality in the way they approach money or material goods,” says Cora Malinak, an intercultural specialist from Communicaid.

In his campaign, Mr. Minder, the vice-president of his local soccer club and a keen birdwatcher and Alpine sports enthusiast, has repeatedly jabbed at the growing number of foreign CEOs, tapping into simmering resentment of outsiders in this tight-knit nation of just eight 8 million.

The highest-paid chief executives in Switzerland in 2011 were all foreigners: Americans Joe Jiminez and Joe Hogan at Novartis and ABB, Roche’s Severin Schwan from Austria, and Nestlé’s Paul Bulcke from Belgium. Mr. Minder regularly pillories Credit Suisse’s American CEO, Brady Dougan, who has drawn fire for the $75-million stock windfall he received in 2009.

“The moment you have the guys like Brady Dougan and all the foreigners, if it’s not working, they’re on the next plane back to New York,” Mr. Minder says. “Swiss guys in my position, usually they’re accepted in the village. They don’t only have their work, but they have something besides their work – they cannot manage a company the same way as Brady Dougan.” (The ill will is compounded by the fact that Mr. Dougan still can’t speak German, even after five years leading Switzerland’s second-biggest bank.)

Regardless of which reform plan the Swiss adopt, David Roth, the leader of the youth wing of the Social Democrats, says it won’t do much to address Switzerland’s deep inequality of wealth. Roth, 27, who organized the “Occupy Davos” camp of igloos in Davos in 2011, is pushing for a much more radical reform: Limit the annual compensation of top executives to just 12 times that of their lowest-paid worker. Both World Economic Forum founder Klaus Schwab and French President François Hollande have called for top pay to be capped at 20 times that of the lowest pay-tier. “If the shareholders vote on executive pay, it is still the rich voting about the rich,” Mr. Roth says. “This whole cartel needs to be broken.” His initiative is likely to be put to a vote in late 2013.

A separate campaign to end special tax deals for wealthy foreigners who live but don’t work in Switzerland has also been driven by the growing wealth divide and taps into Swiss hostility to immigrants. The annual list of Switzerland’s wealthiest 300 people published by Bilanz names 131 foreigners, with IKEA founder Kamprad in first place, at $38-billion.

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  • Updated July 28 12:09 PM EDT. Delayed by at least 15 minutes.


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