Credit Suisse pay revolt rumbles on even after concessions
By Joshua Franklin
ZURICH (Reuters) - Credit Suisse has failed to completely quash a shareholder revolt over payouts to the bank's senior managers, even after offering to cut bonuses for top management by 40 percent and a pay freeze for its board of directors.
The Swiss bank made the concessions last week to head off shareholder criticism of its pay plans, which included bonuses of 78 million Swiss francs ($78 million) to top executives and higher pay for the board despite a 2.7 billion-franc net loss last year.
Proxy advisor Institutional Shareholder Services (ISS)softened its stance by asking shareholders of the bank to vote in favor of the board of directors' pay and the long-term variable pay for the executive committee.
ISS said it was still against the proposed short-term variable pay for the executive committee and the overall pay proposals.
Shareholder advisory service Glass Lewis said the concessions were "too little too late". It urged shareholders to reject the maximum amount of compensation for the board of directors, but advised them to support the proposed bonuses for Credit Suisse's executive board.
Shareholders in Switzerland have veto power over management and board pay following a 2013 "fat cat" referendum on the issue. If Credit Suisse shareholders reject the plan, it would be the first use of the Swiss veto at a leading company. Shareholders will vote at the bank's annual general meeting on April 28.
Investors have become much more vocal in opposing big increases in executive pay and bonuses when a company has not performed strongly.
American International Group Inc's CEO Peter Hancock will not get a cash bonus for last year after the company's poor performance roiled shareholders. BP cut CEO Bob Dudley's 2016 pay package by 40 percent after shareholders opposed the oil company's pay plans. Continued...