Rare species discovered in Switzerland!
I could only utter “what the?” when I read – wait for it – a very rare species has been discovered. The rare species is called “Remorseful Chairman and Directors”. Yeah, yeah I know: the word “remorseful” is usually not associated with top organisational types. But Switzerland seems to have uncovered this rare species.
Three former officials of UBS (the Swiss financial giant) – a former Chairman and two former directors – are willingly forgoing $US 27 million in compensation. I told you recently about the CEO of Japan Airlines giving himself a haircut – willingly slashing his salary by 60%. And now it seems Swiss executives have been inspired.
Marcel Ospel is the former Chairman of UBS, which recently reported nearly $50 billion in losses and the Swiss Government had to step in on a rescue mission. Ospel said: “With the involvement of the Swiss government, I realized that decisive action was required on my part”. And that decisive action was to cough up the obscene bonuses. Even the current Chairman, Marcel Rohner, will enjoy a bonus-free 2008 (well, he can join me. I can’t recall a time in my career when I’ve enjoyed a bonus!).
Probably they coughed up the money because of the increase in community dissatisfication with humungous bonuses and payouts. Whilst the rest of us are tightening our belts, US executives like the top dog of former Lehman Bros is sitting on $U480 million in remuneration and showing no signs of giving any of it back. I think it will be interesting to see whether companies that have received taxpayer bailouts will agree in return to eliminate the ridiculously obscene bonuses that senior executives have been getting.
UBS is going one interesting step further. 2009 will see a new annual bonus scheme: a maximum of one-third of a top executive’s bonus will be paid at year’s end with the rest held in escrow. And the amount in escrow could be reduced if UBS continues to suffer poor results. Wow, unheard of but ten out of ten to UBS for showing ethical leadership during financially turbulent times.
Source: The New York Times