Swiss companies: highest salaries for CEOs in Europe

7 years ago - Published in Finance, Fundamental Analysis

The chief executive officers of Switzerland’s top firms take home almost double the median salaries of Europe’s 100 biggest companies, according to a study by consultants Willis Towers Watson.

The Eurotop 100 study, presented on Thursday, studied the direct remuneration – not including pension or bonuses – of the CEOs of the 100 most highly capitalised blue-chip companies in Europe.

The median salary of CEOs from seven Swiss firms stood at €10.29 million (CHF11.79 million)last year (+15% on 2015), followed by Britain €7.44 million), Spain €5.63 million and Germany €5.06 million.

The Swiss companies included ABB, Credit Suisse Group, LafargeHolcim, Nestlé, Novartis, Roche Holding and UBS. Richemont, Swiss Re, Syngenta and Zurich Insurance Group were not included in the evaluation as their CEOs had not been in office for the full year or they did not provide sufficient survey data.

Last year’s overall top earner was Rakesh Kapoor, the Indian head of British consumer goods company Reckitt Benckiser, who made €14.4 million. He was followed by Martin Sorrell, founder and owner of the media and PR group WPP (€13.3 million).

Third was Sergio Ermotti, CEO of Swiss bank UBS, who took home €12.3 million, down from €13.1 million in 2015.

Joe Jimenez, the American boss of the Basel-based pharma giant Novartis, was ranked fifth with €10.8 million. He was followed by Roche CEO Severin Schwan (€10.6 million).

Last year, the median direct remuneration for all CEOs in the Eurotop 100 study was €5.4 million, down 6% compared to 2015, mainly due to lower bonuses, the survey said.

However, new rules being prepared in Europe could have an impact on Swiss pay. The European Union’s new shareholders’ rights directive (SRD) requires a binding vote by shareholders on remuneration policy and a non-binding vote on the individual salaries of executives. Firms must also disclose the relationship between the highest and lowest pay packages. The directive must be implemented by June 2019.

Willis Towers Watson said its impact in Switzerland was likely to be minor. “We nevertheless recommend that Swiss companies ensure that they are prepared by getting to grips with the new requirements in good time and reviewing their current practices,” said senior consultant Annu Walth.