Contents/media/s... · non-ons or ret c di eiv xeut c e SMI company boards International diversity Swiss boards continue to be among the most inter-national in the world. In Europe,

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2o15

switzerlandBoard Index

Contents

Foreword 1Highlights 2Understanding Sika: who controls a Swiss public company? 5A foot in two camps: What it means to have a state entity as your majority shareholder 10Our survey approach 14Board size and composition 15Added perspective: The executive committee 19Board governance 20Remuneration 23International comparison 24Data tables 28About Spencer Stuart 32

SPENCER STUART PAGE 1

Foreword

The Spencer Stuart Board Index is an annual study that analyses aspects of board governance, including composition, committees and remuneration, among major listed companies. First published 28 years ago in the US, there are now editions in 18 countries around the world, including 11 in Europe.

In 2013, we released the first Switzerland Board Index, which focused on the 20 companies that comprise the Swiss Market Index (SMI). This third edition updates our analysis of the SMI based on data available for the most recent fiscal year.

Our purpose is to provide business leaders with a snapshot of current practice on Swiss boards. In addition to data for each SMI company, we have again published a detailed chart showing how the SMI 20 compare with leading companies in the US and other European markets on a key range of governance measures.

In this edition, we also include articles by two experts on Swiss corporate govern-ance. Dr Daniel Daeniker reflects on the nature of public company ownership in light of the Sika case, and Olivier Steimer considers what it means to have a state entity as your majority shareholder. We are grateful to both for their thoughtful contributions.

We hope that you will find this new edition of the Switzerland Board Index an inter-esting read. We welcome your feedback and the opportunity to discuss any of the issues that arise from our research.

Maurice Zufferey & Antonio Maturo Spencer Stuart Switzerland

PAGE 2 SPENCER STUART

Highlights of the 2015 Switzerland Board Index

62%The proportion of foreign non- executive directors on

SMI company boards

International diversitySwiss boards continue to be among the most inter-national in the world. In Europe, only companies in the Netherlands come close in terms of geographic diversity where 46% of non- executives are non- nationals. In the US, by contrast, only 8% are non- nationals. The number of non- national chairmen remains the same as last year at 11 out of 20. 14 out of 20 SMI CEOs are also non- nationals, of whom five sit on the board. Seven companies have both a non- national chairman and CEO. See page 16.

19%The proportion of board

members who are women

Women on boardsThe number of women sitting on Swiss boards has increased from 16% to 19%, which is impressive given the absence of targets or quotas. Swiss boards still lag behind most other European countries, but they are steadily closing the gap with the Netherlands and Italy (both 22%). There is still only one female chairman and no female CEOs in the SMI. 29% of non- executive directors appointed during the 12- month period covered by this survey were women, 10% fewer than last year. See page 16.


chf 153,208The average retainer for

SMI directors

Director remunerationSMI company directors continue to be better remu-nerated than their counterparts across Europe. When share- based payments are included, the aver-age total compensation for SMI directors, excluding committee fees, is CHF 236,772. Disclosure on director pay remains more opaque than in some other countries, but there is no doubt that the aver-age level of remuneration is on a par with that of directors in, for example, FTSE 10 companies. Additional committee membership fees, where they are paid, vary greatly. Remuneration committee membership fees, for example, range from CHF 9,000 (Actelion) to CHF 100,000 (UBS and Credit Suisse). See page 23.

1The number of SMI

companies that had an externally facilitated board

evaluation

Board performance reviewA quarter of the companies in the SMI do not dis-close whether they have undergone an evaluation of the board. Of those that do disclose, only one com-pany (Novartis) used an external facilitator during the period covered by this report, with the remaining companies opting for an internal assessment. Many European boards undergo an external board evalua-tion every three years. External board evaluations were most common in the UK (44%) and France (35%). See page 21.


highlights of the 2015 switzerland board index

12The number of women on

SMI company ExCos — out of 188 executives

Women in senior managementLast year, we analysed the size and composition of the executive committee (ExCo) in SMI companies for the first time, when eight out of 184 executives were women (4%). There are now 12 women sitting on ExCos or 6%, a small increase on last year. This figure is lower than all other European countries for which we have data, and significantly lower than Sweden (22%) and the UK (17%). See page 19.

2.4The average number of

listed company boards on which SMI directors serve

Board commitmentsThe average number of listed company boards on which SMI directors serve remains at 2.4, which is the fourth- highest in Europe behind Italy (3.5), Germany (3) and Sweden (2.6). See page 22.


In the spotlIght

Understanding Sika: who controls a Swiss public company?

by Dr Daniel Daeniker

Over the past year, the attempt by a French conglomerate to ac-

quire control of Sika AG, a Swiss listed specialty chemicals compa-

ny, has been closely watched by Swiss and international investors

alike. To understand the background of the case, it is worth explor-

ing the rules under Swiss law that govern the structure of voting

rights and takeover offers. From a wider perspective, the Sika case

is part of a perennial debate about who controls a company:

founding families, public shareholders or the board of directors?

The facts of the Sika case

The facts are quickly told. The Sika family holds a controlling block of shares, constituting more than half of the voting rights, but well below 20% of the company’s capital. In late 2014, this family block was sold to Saint- Gobain, a French construction and materials company, at a substantial premium over the prevailing stock market price. The sale is subject to conditions and has not yet closed.

Saint- Gobain acquired the controlling block without announcing a public take-over offer for Sika’s public shareholders, who own well in excess of 80% of its capital. These shareholders were therefore deprived of the chance to cash out on their shareholdings in light of the change of control. In addition, the found-ing family arranged the sale without involving Sika’s board of directors. The board promptly took legal action against the planned share transfer by curtail-ing the family’s voting rights. In addition, various investors appealed to the Takeover Board to prevent the sale from going ahead.


Weighted voting rights structures in Switzerland and beyond

How could the Sika family shareholders control the majority of votes, yet hold only a fraction of the company’s equity? The answer is that Sika — entirely lawfully — had issued two classes of shares with differing voting rights.

Globally, the mantra of “one share, one vote” — a concept that aligns financial risk and corporate control — resonates well with analysts and investors. Nonetheless, many countries, Switzerland among them, permit the creation of so- called weight-ed voting rights (WVR) structures, where one class of shares has higher voting rights than others.

WVR structures are the opposite of “one share, one vote”. Conventional wisdom suggests that these structures are unpopular with investors. However, some of the darlings of the US stock market, including Google, Facebook and Alibaba, have WVR structures in which the founders dominate the company’s governance, even as their share in the equity gets smaller and smaller. As long as investors are neutral towards this governance structure, there is no reason to prohibit it. On the contrary: it is often argued that investors want to buy shares in such companies precisely because the founders — who ensure the continued success of the business venture — remain in control. Similar arguments have been heard in Switzerland

In the spotlIght

Weighted voting rights (WVR) structures for listed companies

UK ◆Permitted under company law but generally forbidden for listed companies

Germany ◆Some exceptions for “golden shares” (e.g. Volkswagen share held by the State of Lower Saxony)

France ◆

“Loyalty shares”: shareholders registered for more than two years can receive double voting rights. Companies can declare loyalty shares inapplicable by share-holder vote

Switzerland ◆ Maximum ratio 1:10

USA ◆No restrictions under most state corporate laws or under federal securities laws

Hong Kong ◆ Rule change under review


with respect to family- controlled companies where the public has a high trust in the controlling shareholder families, as is the case with Roche and Schindler.

Sika is one of the Swiss companies that has had a WVR structure in place since its initial public offering. Until the announcement of the sale to Saint- Gobain, inves-tors did not attribute great importance to the differing voting rights because the company had been so successful. The positive perception perhaps also followed from the fact that investors did not expect the family would ever sell out. But this was a mere expectation of investors rather than a binding promise given by the company or its controlling shareholders.

Mandatory bid provisions in Switzerland: for some, but not for all

How could the Sika family shareholders sell voting control without forcing the buyer to make a public takeover offer to all shareholders? The answer is that Swiss law has a mandatory bid rule on the books, but nearly 20 years ago Sika lawfully opted out of the rule.

In 1968, the UK’s City Code on Takeovers and Mergers introduced a rule that any person or group acquiring 40% or more of a UK listed company’s voting rights would have to make an offer to all remaining shareholders. The offer price had to be at or above the highest price paid in previous share purchases. In 1974, the figure was reduced to 30%. This rule, known as a mandatory bid provision, re-ceived increasing traction over time. In 2006, the mandatory bid provision was declared applicable for all EU/EEA member states. Many other countries have a similar rule. Delaware, the most important place of incorporation for US listed companies, has no mandatory bid rule strictly speaking. However, in light of the fiduciary duties imposed on the boards of directors of Delaware companies — specifically, the duty to safeguard the interests of all shareholders of a company — control transactions are almost always combined with a takeover offer.

Switzerland introduced a mandatory bid provision in 1998, almost 10 years before the corresponding rule was enacted in the EU member states. At the time, the rule faced some resistance in the legislative process: Swiss listed companies therefore were allowed to opt out of the mandatory bid requirement before the rule became effective (and, under certain conditions, even thereafter).


In the spotlIght

Sika opted out of the mandatory bid requirement at the very beginning, before the new rules took effect in Swiss law. A sale of the controlling block of shares to Saint- Gobain is therefore lawful without Saint- Gobain being obliged to launch a takeover offer to Sika’s public shareholders. But again, investor expectations were different. Cries of foul play are understandable; allegations that the rules have been breached less so.

Thresholds and particularities for mandatory bids

UK 30% of votes

If a control transaction precedes the mandatory bid, shareholders in the public takeover offer are entitled to receive at least the same price

Germany 30% of votes Similar to UK

France 33¹∕³% of votes Similar to UK

Switzerland 33¹∕³% of votes“Opting out” permitted by shareholder resolution

USA (Delaware)No mandatory bid rule

“All or nothing” bids are nonethe-less the norm

India 25% of votesOnce the threshold is exceeded, an offer needs to be made for an additional 20%

Brazil 50% of votes

If a control transaction precedes the mandatory bid, a 20% premium is permit-ted over the price paid in the public take-over offer

Japan 33% of votesIf a control transaction precedes the mandatory bid, a premium is permitted

Legal skirmishes

The Sika case might have had a different outcome if the board of directors had been involved in the sales process at an early stage. (Under Swiss law, the board is required to act in the best interests of the company, which do not necessarily coincide with the interests of the shareholders.) As it happened, the founding family sold the controlling block without involving the board at all. Not surprisingly, once the Sika board was confronted with such a fait accompli, it tried to pursue


every avenue available to halt the sale, supported by angry investors. Various cases are in court now, and a judgment on the key issues is likely to be handed down only in 2016. In the meantime, the incumbent board stays in charge, despite the protests of the family shareholders.

The future

For now, the Sika case shows how the owners of a majority of voting rights can outflank the public shareholders if the rules so permit. It also shows, though, that director resistance — even if ultimately it may not turn out to be justified — can stall a control transaction for a long time. But is the Sika example a reason to change the rules?

One could use the Sika case to argue that “one share, one vote” is the better legal principle. But Sika is too fact- specific to signal an end to structures where a share-holder group is given a disproportionate amount of voting rights. Rather, WVR struc-tures fulfil a sensible role even for listed companies, in Switzerland and elsewhere.

The legitimacy of the opting out provision is more debatable. What was a sensible regulatory compromise in 1998 looks increasingly anachronistic today. Nevertheless, this author believes that there always will be reasons to allow the transfer of a controlling block of shares without forcing the acquirer to make a bid to all public shareholders. Abolishing the opting- out provision would therefore be regulatory overkill.

Dr Daniel Daeniker is managing partner of Homburger, one of the leading corporate law firms in Switzerland.


A foot in two camps What it means to have a state entity as your majority shareholder

Olivier Steimer

When you’re the chairman of a listed company that is majority- owned

by a state entity, your role is essentially the same as in any standard

listed company. Essentially — but not exactly. As in most companies,

you need to establish good governance and the right strategy in order

to create value for all stakeholders: customers, employees, your ma-

jority shareholder and other investors alike. Yet as your company is

partially owned by the state, you have the added mission of serving

the public interest — which can have several implications.

Reconciling value creation for both shareholders and other stakehold-

ers is no mean feat, and can be quite an interesting challenge.

Not that long ago, companies that were partially owned by state entities — such as Switzerland’s cantons — were considered old- fashioned. But in recent years they have proven their worth. Partially- state- owned enterprises now make up more than 5% of the companies listed on the SIX Swiss Exchange, and most of these are cantonal banks. Seats on the boards of those companies are now seen as a chal-lenge fit even for the most seasoned director.

So what is it that sets these companies apart? Well, to begin with, they are not private- sector companies in the strictest sense; they are not entirely free to set goals and outline their own strategies, and they cannot simply do whatever it takes to boost profits, for example. And yet they are not public services either. They fall somewhere in between: while they operate in competitive free markets in order to maintain sound corporate finances, they also have a specific mission to benefit the greater community. That mission can be stated in many different ways — it could be laid down by law, set forth in the company’s articles of association, or

In the spotlIght


summarised in a mission statement. But whatever form it takes, that mission is steadfast and serves to guide the companies’ corporate governance.

Keeping the majority shareholder in the loop

In terms of corporate governance, majority- state- owned companies do not differ dramatically from run- of- the- mill listed companies either. Loyalty and due diligence — not to mention good management and solid profit margins — are just as important. The main, and most obvious, difference stems from the very nature of the majority shareholder and its representatives, who are often elected officials and therefore in the political limelight. They are not interested only in the bottom line — they also care about the impact the company has on the environment, econ-omy and local community. So corporate social responsibility plays an essential role.

What’s more, majority shareholders and their representatives may be called upon by fellow politicians or the press to discuss their company’s strategy and even defend its choices, which is not something shareholders normally have to do. That means that any decision taken by the company could reflect poorly on the majority shareholder, so partially- public companies must ensure that their strategies are perfectly aligned with their mission. To ensure that the government does not come under fire, the company must be financially stable and have a squeaky- clean repu-tation. And to make sure that government representatives don’t get wrong- footed, they need to be fully informed of all important aspects of the company’s opera-tions in a timely manner. The risk of insider trading here is minimal, since state entities rarely engage in trading, if at all.

To help foster dialogue between the company’s management and its majority state shareholder, an information- sharing agreement could be used to clearly set out the obligations of each party and ensure that they are on the same page. In my experi-ence as chairman of Banque Cantonal Vaudoise (BCV), the cantonal bank majority- owned by the Canton of Vaud, such an agreement can be a real asset for building long- term trust, if it is properly thought out and discussed between the parties.

A loyal, long- term shareholder

In return for the service they provide to the community, partially- state- owned com-panies get a loyal shareholder that is in it for the long term. Given today’s volatile financial markets, that’s a serious advantage, not to mention the stability it


In the spotlIght

provides in times of crisis. Of course, there’s always a risk of excessive shareholder interference. But that can be true with large private shareholders as well. Having a state entity as majority shareholder is not incompatible with independent decision- making, but that independence must be managed responsibly.

A majority state shareholder can also make customers (who are also taxpayers, of course) feel emotionally bound to the company — they feel it is “their” company. And those ties can be a boon for business development, particularly in terms of market share. But the flip side is that there are additional costs, and certain types of investments may not be allowed. Swiss cantonal banks, for example, must maintain a relatively dense branch network, accept lower profit margins on some businesses while keeping their finances sound, and be actively involved in the cultural, sporting and social life of their canton through sponsoring initiatives and donations.

Striking the right balance

In the end, it’s difficult to say whether the costs associated with majority state ownership — i.e., not being able to pursue certain profit drivers — are bigger or smaller than the benefit of increased customer loyalty. However, serving the public interest is by no means a burden for any conscientious company. With the right strategy, effective cost control and efficient operations, it’s perfectly possible to fulfil your mission, be a responsible corporate citizen and remain attractive to investors.

Because of their special status, partially- state- owned companies have to factor serving the community into the trade- off between growth and earnings. A compa-ny’s management and board must strike the right balance between these three elements, while at the same time keeping all stakeholders happy. Developing a strategy that achieves this is not always easy, given the additional economic and political constraints. At BCV, for instance, each business line undergoes a scrupu-lous review, looking at its usefulness, growth potential, risks, and required capital. In addition, expanding into new regions can entail risks that the majority share-holder is not willing to take. So growth must often be concentrated in the local market, with the possibility of developing certain niche businesses elsewhere.

The resulting strategy should allow the company to fulfil its mission while at the same time creating value. This can and is being done — just look at how popular Switzerland’s cantonal banks are with both customers and investors. State involve-ment does not mean that value creation is off the cards — a company can only


fulfil its mission if it is financially sound. As a “community asset”, partially- state- owned enterprises must increase, or at least preserve, their value. And it goes without saying that a company will not find loyal shareholders unless it can provide a reasonable return on equity.

Don’t forget your minority shareholders

In all this, minority shareholders, who usually have more financially oriented objec-tives, mustn’t be left by the wayside. Since a state majority shareholder does not, or does so only rarely, engage in trading, the company’s share price will depend on the buy or sell orders of minority shareholders. And that share price is an impor-tant signal for the public, which interprets it — rightly or wrongly — as a sign of the company’s health.

A partially- state- owned company therefore has to attract minority shareholders whose interests are aligned with those of the majority shareholder, and should take the needs of both types of investors fully into account. Aiming to be a growth stock is not realistic. But positioning the company as a value stock that offers long- term sustainable growth, stable earnings and a high payout ratio is a good way to reconcile the interests of both public- and private- sector shareholders. A high dividend, for example, will attract a large number of investors and bolster the government’s revenues at the same time.

In addition, the board of directors can play a key role in facilitating a constructive dialogue between the company’s management, the majority shareholder and other investors. That’s why it’s important to ensure that both majority and minority shareholders are fairly represented on the board, and that board members ap-pointed by the state shareholder have the right background and experience to make a value- enhancing contribution.

All of this is in everybody’s interest. And it’s not an impossible square to circle.

Olivier Steimer is chairman of the board of directors of Banque Cantonale Vaudoise, vice chairman of the Bank Council of the Swiss National Bank, and member of the boards of directors of Allreal Holding AG and ACE Limited.


our survey approach

Our survey approach

The 2015 Switzerland Board Index is a survey of the Swiss Market Index (SMI), the 20 largest companies listed on SIX Swiss Exchange by market capitalisation.

We analysed board size and composition, committee structure and director com-pensation for the 2014 financial year, compiling our research from a combination of publicly available sources such as company annual reports and websites, and from BoardEx.

The 2015 Switzerland Board Index focuses on quantifiable data pertaining to boards of directors and offers comparisons with leading companies in a number of other European countries, namely Belgium, France, Germany, Italy, The Netherlands, the Nordics, Russia, Spain, Turkey and the UK, as well as with S&P 500 companies in the USA.


Board size and composition

Board sizeThe average board consists of 10.3 shareholder- elected directors, down from 10.6 the previous year. The smallest board comprises five members (Swatch Group), while the largest has 18 (Richemont).

The average board size of the European countries in our sample is 10.8 although, as the chart below shows, the size of boards varies a great deal across the region, ranging from an average of 7.9 directors in Finland to 16.2 in Germany (including employee representatives).

the broader vIew: Average board size

BE CH FR DE IT NL DK FI NO SE RU ZA ES TR UK US

10.3 10.3 14.3 16.2 11.9 10.7 9.9 7.9 8.2 9.7 10.3 12.5 10.9 9.8 10.3 10.8

“The Broader View” compares key statistics averaged across in 16 countries worldwide. All data is sourced from the most recent Spencer Stuart Board Index covering that country.

the roles of chairman and chief executiveFollowing the decision by Geberit to split the roles of chairman and CEO, there are no longer any companies in the SMI that combine the two roles, matching the situa-tion in Belgium, Germany, the Netherlands, the Nordics and the UK. In the US, the number of companies with a combined chairmen and CEO has been falling steadily in recent years. Today, 53% of S&P 500 companies combine the roles compared with 71% 10 years ago (although only 29% of chairmen are truly independent).

vice- chairman and senior independent director13 companies have one vice- chairman, three companies have two vice- chairmen and four companies do not have this role on their board. Four companies have a senior independent director (Credit Suisse, Richemont, Swiss Re and UBS), two of which have the role performed by a vice- chairman. At the end of 2014 Geberit abolished the role of lead director following its decision to split the roles of chairman and CEO.


board size and composition

independence88% of SMI board members are independent. 14 boards comprise only non- execu-tives and five boards have one executive (the CEO) as a director. Richemont is a slight anomaly in that three executive directors sit on the board, although this is partly explained by having two co- CEOs.

Switzerland continues to rank highest for the proportion of independent members among its European peers, with Finland and Norway the closest at 84% and 80% respectively.

women on BoardsThe proportion of female board members has increased from 16% last year to 19% (a total of 39 women). 18 of the 20 SMI boards have at least one female director, whereas SGS and Geberit currently have male- only boards. There remains only one female chairman in the SMI (Nayla Hayek of Swatch Group) and no female CEO or other executive director.

Of the 24 non- executives appointed to SMI boards in the 12 months covered by this Board Index, seven (29%) were women.

The proportion of female non- executives in Switzerland is now lower than in Italy but remains above Spain. Switzerland still has some way to catch up with those countries that have significant gender balance in the boardroom, as the chart below shows.

the broader vIew: Women on boards


24.2% 19% 34.3% 24.9% 22.4% 21.6% 23% 30% 42% 35% 7.3% 20.9% 14% 9.5% 23% 19.8%

foreign directorsSwitzerland has long been known for attracting board members from outside the country, and this year’s data confirms that continuing trend. 62% of non- executive directors on SMI boards are foreign, an increase from 55% last year. The Netherlands continues to be the country closest to Switzerland in this regard at 45.8%, while sitting at the other end of the spectrum are Italy (9%) and the USA (8.2%).


Of the 24 non- executives appointed to SMI boards in the past year, 19 (79%) were foreign. All new directors appointed to the boards of Zurich, Swiss Re, Givaudan and Actelion were non- nationals.

The average number of nationalities represented on an SMI board has increased from 5.5 last year to 6.1 this year. SMI boards continue to be more internationally diverse than their European peers. The average number of nationalities on boards in France and the Netherlands are 4.6 and 4.4 respectively.

The board directors of Credit Suisse represent 10 different nationalities, while those on SGS and UBS have nine. Actelion and Transocean have no Swiss nation-als on the board while the board of Swatch Group contains no foreign directors.

Eleven chairmen and 14 CEOs of SMI chairmen are non- Swiss nationals. In eight companies both the chairman and CEO are foreign: Actelion, Holcim, Nestlé, Novartis, Richemont, Roche, Syngenta and Transocean. In four companies both the chairman and CEO are Swiss: Geberit, Julius Baer, Swatch Group and Swisscom.

the broader vIew: Foreign directors as a percentage of the full board


32.6% 62% 33% 7.7% 42.7% 42% 35% 29.6% 24% 22.2% 21.3% 12.5% 15% 32.1% 23% 19.8%

1 company

3 companies

7 8

3 companies

5 companies

5 6

2 companies

3 4

1 company

5 companies

1 2

International representation Number of nationalities represented on SMI boards


board size and composition

age of directorsThe average age of SMI non- executive directors is 60.5 years, a slight decrease on the previous year. This average remains the highest in Europe, with Spain slightly lower at 60.

The board of Credit Suisse has the lowest average age among non- executive direc-tors (55.2) and the board of Swatch Group has the highest (66).

The average age of executive directors on SMI boards has increased from 56.8 last year to 58.7. Only Norway has a higher average (59.3). The countries with the low-est average age are Russia (49.5), Netherlands (52), and the UK (52.6).

SMI board chairmen are on average 61.9 years old, a slight decrease from 62.3 the previous year.

the broader vIew: Average all (all directors)

BE CH FR IT NL DK FI NO SE RU ZA ES TR UK

56.9 60.5 59.7 58.9 58.7 57.2 57.3 55.3 57.3 53.1 56.8 60 57.6 57.5

length of serviceThe average tenure across all SMI board directors is 6.1 years, a decrease from 6.8 in 2014. For chairmen, the average tenure is 3.5 years, almost identical to last year, and for all CEOs (regardless of whether they are board members or not), the aver-age tenure is 5.2 years. This places SMI boards between the UK, where the average tenures for chairmen and non- executives are 4.6 and 4.2 years respectively, and the US, where the average tenure for all directors is 8.5 years and for CEOs is 7.1 years.

The boards with the shortest average tenure of directors at the cut- off date were Geberit (3.7 years) and Julius Baer (3.8 years) and the boards with the longest average tenure were Richemont (10.8 years) and Swatch Group (11.8 years).

The independence criteria for Belgian board members stipulate that in order to qualify as independent, a director cannot have served for more than three consecu-tive terms or 12 years on the same board. Four companies also impose a limit of 12 years for non- independent non- executive directors.


added perspectIve: The executive committee

For the second year, we have studied the size and composition of the executive committee (ExCo) in SMI companies. Gender diversity in the pipeline of potential new non- executive directors continues to be a challenge facing many companies.

Although there is no obligation for companies to publish information about the composition of their ExCos, we were able to obtain details for all SMI companies.

The average size of an SMI company ExCo is 9.4 members. The average number of foreign executives on this committee is 6.4.

It is notable that there is an even higher proportion of foreigners among ExCo members than among non- executives; the figure has increased from 59% to 67.6%.

By contrast, only 6.4% of ExCo members are women (12 out of 188 executives), which is extremely low by European standards.

the broader vIew: Female ExCo members (%)

BE CH FR IT NL DK FI NO SE TR UK

16.1% 6.4% 11.6% 8.6% 12.9% 10% 15% 20% 22% 9.8% 17.3%


board governance

Board governance

Board meetingsSMI boards held an average of 9.9 meetings annually, compared with 8.3 the previ-ous year. Actelion held just four meetings during the year, whereas at the other extreme UBS held 36 board meetings.1

An international comparison shows that the number of board meetings in Switzerland is on a par with France, the Netherlands and the USA, but some way below Italy, Spain and the Nordics.

the broader vIew: Board meetings

BE CH FR DE IT NL DK FI NO SE ES TR UK

9.5 9.9 9 6.5 11.1 8.5 11.4 11.7 12.6 10.9 10.7 20 7.6

Board committeesSMI boards have an average of 3.8 committees. Board committees vary widely in number and type. Aside from the audit, nomination and remuneration/compensa-tion committees, a further 16 types of additional committee are to be found among the top 20 companies, of which the risk committee is the most common. Some boards elect to combine certain committees. For example, 17 of the 20 companies have entirely separate audit committees, while at ABB the audit committee is combined with finance & compliance, at Actelion with finance, and at Novartis with compliance. (The details of committees for each company can be viewed in the table on pages 30–31.)

1 UBS Group AG met five times and UBS AG held a total of 31 meetings and calls, 11 times with the presence of Group Execu-tive Board (GEB) members and 20 times without GEB participation.


table 1

Committees of SMI 20 boards (number of committees)

2 3 4 5 6 7

Percentage of companies 15% 25% 35% 20% 0% 5%

All SMI boards have an audit committee with an average of 7.3 meetings per com-mittee, which is an increase from 6.4 the previous year. UBS had the most meet-ings (24 in total, including 9 in- person meetings and 15 by phone) while the audit committees of Geberit and Swatch Group met only twice in 2014.

Fifteen boards have a compensation/remuneration committee, with an average of 4.5 meetings per committee, down from 5.2 meetings last year, with Credit Suisse holding the highest number of meetings (10).

Sixteen boards have a committee with nomination in the title, although the work of the nomination committee may in some instances be taken up by a committee with a different title, such as the chairman’s or governance or HR committee.

Four boards have designated risk committees (Credit Suisse, Novartis, UBS and Zurich Insurance) meeting on average 7.3 times in the year. The UBS committee met most often (11 in total, including 9 in- person meetings and 2 by phone).

Board evaluation Companies are not obliged to go through a formal board evaluation, however during the period of this survey one company, Novartis, did undertake an externally facilitated assessment. Fourteen companies carried out an internal evaluation, while five do not disclose details in this area. By contrast, in the UK and Germany respectively, 43% of FTSE 150 and 23% of DAX 30 companies conducted an exter-nally facilitated board evaluation during the same period.


board governance

service on other listed company BoardsIn light of the country’s high exposure to business abroad and/or export activities, it is quite natural for many directors to sit on the boards of other publicly listed companies. The average number of listed company boards on which an SMI board director sits is the same as last year (2.4). The chairmen of SMI boards average 1.4 listed company directorships, down from 2.3 last year. The average number of additional board seats per director on the SGS board is 4.1, while only 1.7 of direc-tors at Novartis and Swisscom sit on external boards.

With the exception of Actelion, Julius Baer and Roche, each SMI company has at least one director sitting on a total of four listed company boards.


Remuneration

The average retainer fee for non- executive directors at SMI companies is CHF 153,208. This figure remains the highest in Europe, behind Russia, and is more than twice as high as the average retainer paid to non- executive directors of lead-ing companies in other European countries. The lowest retainer is paid by Swisscom (CHF 90,000) and the highest is paid by Roche (CHF 300,000).

When share- based payments are included, the average total compensation for SMI directors, excluding committee membership and attendance fees, is CHF 236,772. The lowest total fee, excluding committee membership and attendance fees, is paid by Richemont (CHF 100,000) and the highest is paid by Swiss Re (CHF 350,600).

Only two companies pay attendance fees: Richemont (CHF 20,000 per meeting) and Swisscom (CHF 1,250 per meeting).

The average additional fee for audit committee membership is CHF 42,445 and the average additional fee for nomination committee membership is CHF 31,087. Not all companies pay additional fees for committee membership.

There is no standard reporting template for the disclosure of board remuneration in SMI companies. Since companies report director remuneration in different ways, obtaining a comprehensive breakdown of fees paid to directors is not possi-ble. For example, four companies do not disclose committee fees separately. Further details comparing board director remuneration across Europe and the US can be found on pages 24–27.

the broader vIew: Non- executive fees in Europe and US (€000)

64

9384

205

US

54

82

Spain Switzerland UK

70

133 127

197

81

110

Italy Netherlands

26

73 75

126

France Germany

Retainer Total fee

Source: 2015 Spencer Stuart Board Index research. Fees converted to Euros where relevant, taking the average rate for 2014.


international comparison

International comparison

In this edition of the Switzerland Board Index we provide two sets of tables.

In addition to the detailed company data for the SMI (beginning on page 28), we are publishing a chart comparing aggregated data from 16 countries (pages 26–27).

All data is taken from individual country Board Indexes published by Spencer Stuart in 2015.

Composition information

BELGIUM BeL20 + BelMid

FRANCE CAC40

GERMANY DAX30

ITALY 38 (FTSE MIB) + 62 (Mid Cap, Small Cap, Other)

NETHERLANDS AEX

NORDICS

Denmark OMX Copenhagen

Finland OMX Helsinki

Norway Oslo Stock Exchange

Sweden OMX Stockholm

RUSSIA Top companies from Expert 400

SOUTH AFRICA JSE Top 40 + top companies by market cap + select SOEs

SPAIN IBEX- 35 + top companies by market cap

SWITZERLAND SMI

TURKEY BIST 30

UK FTSE 150

USA S&P 500


Notes for international comparison tableGeneralN/A = Not applicable

A blank cell denotes that either the information is not available or we did not include it in our research

Fees for committee membership are based on those boards which provide a separate breakdown. We exclude fees where committees are combined, for example NomCo and RemCo in the Nordics.

France1 Only includes new directors appointed after the

2015 AGM

2 Total average remuneration

Germany3 According to goals regarding the portion of

independent shareholder representatives

4 Shareholder representatives only

5 Chairperson only

6 Total average remuneration is 132 896 Euros. Half of the DAX companies offer directors equity- linked performance- related pay

7 Only 3 companies have a remuneration committee

Netherlands8 Excludes Luxembourg- based ArcelorMittal which

is a statistical outlier. Its ExCo has 29 members, none of whom are from Luxembourg

Denmark9 No executives sit on Danish boards

Finland10 Excluding non- execs holding academic or govern-

ment posts

11 Figures based on meeting fees multiplied by the number of meetings

12 Although Finnish companies have a one- tier (unitary) structure, only occasionally will the managing director be a board member

Norway13 Excluding Olav Thon Eiendomsselskap ASA

14 Only 4 executives in total

15 Excluding non- execs holding academic or govern-ment posts

16 Oyvind Eriksen (Akastor) and Bijan Mossavar (DNO) were both described as executive chairmen

17 Company executives are not normally elected to the board of directors, although there are a handful of exceptions which are not included in these results

Sweden18 Includes 2 exec chairmen

19 Excluding non- execs holding academic or govern-ment posts

Russia20 In- person meetings only. The average number of

meetings in total, including absentee votes, is 21

21 Female executive directors as a percentage of all directors

22 9.5% if two companies listed outside Russia are included

Switzerland23 Only includes cash element of fees. 15 compa-

nies also pay directors in shares

Turkey24 18% excl chairmen

UK25 TUI AG has a supervisory board

USA26 98% of S&P 500 boards conduct some type of

evaluation; 33% conduct an evaluation on the full board, committes & directors — not possible to confirm what percentage are conducted externally

27 Independent directors only

28 Top 200 S&P 500 companies only

29 CEOs only. On most US boards, the CEO is the only executive director

30 Average for all committees when paid the same amount


international comparison

BELGIUM FRANCE GERMANY ITALYNETHER- LANDS

NORDICSRUSSIA

SOUTH AFRICA SPAIN

SWITZER- LAND TURKEY UK USADenmark Finland Norway Sweden

gen

eral

Info

rmat

Ion

Size of sample 53 40 30 100 25 25 25 2513 50 47 79 95 20 30 150 486

Supervisory or two- tier board/unitary board of directors 1/52 4/36 30/0 3/97 18/7 25/0 1/24 0/25 1/49 4/43 0/79 0/95 20/0 0/30 1/14925 0/486

Average number of board meetings per year 9.5 9 6.5 11.1 8.5 9.3 10.6 10.9 9.4 6.820 6.1 10.7 9.9 20 7.6 8.1

% companies which conducted an external board evaluation 1.9% 30% 23.3% 35% 28% 17% 0% 0% 11% 8.5% 17.7% 15% 5% - 43.3% - 26

Combined chairman and CEO 7.5% 62.5% 0 22% 4% n/a n/a n/a16 0% 0% 5.1% 57% 0% 7% 1.3% 52%

% boards with SID, lead director or equivalent 0% 70% 0 43% 60% 0% 0% 4% 0% 14.9% 55.7% 27% 20% n/a 98.7% 89%

boar

d

Average board size (total) 10.3 14.3 16.2 11.9 10.7 9.9 7.9 8.2 9.7 10.3 12.5 10.9 10.3 9.8 10.3 10.8

Average board size (excluding employee representatives) 10.2 12.7 8.2 n/a n/a 7 7.8 5.8 8.1 8.6 n/a 10.9 10.2 8.8 10.3 n/a

Average number of independent board members 4.4 8.4 n/a 5.8 7.2 4.6 6.4 4.7 5.0 3.6 7.2 4.2 9.1 3.2 6.3 9.1

Percentage of independent board members 43.3% 58% 60%3 49.2% 66.8% 76% 84% 80% 62% 35% 58.1% 39% 88.3% 33% 60.5% 84%

Average number of non- executive directors 7.8 11.2 7.34 9.3 6.9 6 6.6 4.8 6.4 7.1 8.6 8.6 9.8 8.7 6.7 -

Average number of executive directors 1.6 1.2 n/a 2.6 3 n/a n/a n/a 0.718 1.6 2.9 1.9 0.45 1.1 2.7 -

age

Average age: all directors 56.9 59.7 - 58.9 58.7 57.2 57.3 55.3 57.3 53.1 56.8 60 60.5 57.6 57.5 -

Average age: non- executive directors 57.4 60.9 61.44 59.0 61.3 57.2 57.3 55.2 57.7 53.7 58.2 n/a 60.5 58.3 59.2 63.127

Average age: executive directors 54.1 58.4 n/a 58.5 52 n/a9 n/a12 n/a17 53.9 49.5 52.5 n/a 58.7 54.9 52.6 -

fore

Ign

Percentage of foreign board members (all) 32.6% 33% n/a 7.7% 42.7% 42% 35% 29.6% 24% 22.2% 21.3% 12.5% 62% 15% 32.1% -

Percentage of foreign non- executive directors 33% 37% 18.1% 9% 45.8% 42% 35% 28.9% 25% 26.2% 23.3% 14% 61.7% 14.6% 35.3% 8.2%28

Percentage of foreign executive directors 32.6% 12% n/a 3.1% 33.3% n/a n/a n/a 14% 2.6% 14.6% 4% 66.7% 0.4% 23% -

Average number of nationalities represented on the board 3.1 4.6 2.84 1.7 4.4 3.3 3.1 2.614 2.8 2.8 2.9 - 6.1 1.87 3.2 -

gen

der

Percentage of female board directors (all) 24.2% 34.3% - 22.4% 21.6% 23% 30% 42% 35% 7.6% 20.9% 14% 19% 9.5% 23% 19.8%

Percentage of female non- executive directors 26.7% 37% 24.9% 26.2% 26.4% 23% 30% 43% 37% 7.7% 24.8% 16% 19.9% 8.8% 28.4% -

Percentage of female executive directors 10.5% 4% n/a 8.2% 9.3% n/a n/a n/a 8% 6%21 8% 3% 0% 0.7% 7.9% -

Percentage of companies with at least one woman on the board 96.2% 100% 93% 96% 80% 88% 100% 96% 100% 38% 97.5% 74% 90% 57% 99.3% 97.3%

new

m

embe

rs

Percentage of new board members 12.5% 8% 10.3% 18.2% 16.8% 15% 15% 21% 9% 20.2% 9.6% 14% 11.7% 16% 14.4% 7.1%27

Percentage of women among new board members 44.1% 62%1 24% 33.8% 33.3% 31% 33% 48% 57% 2% 28% 18% 29.2% 10% 35.7% 31%27

Percentage of non- nationals among new board members 50% 47%1 20% 10.2% 44.1% 50% 43% 26% 50% 3.5% 30% 28% 70.8% 18.8% 43.3% 9%27

oth

er

boar

ds

Average number of boards per director (total) 1.9 2.1 35 3.5 2.1 2 1.9 1.7 2.6 1.5 2.1 1.13 2.4 1.5 2.0 2.127

Percentage of executive directors with an outside board 31.4% 71% n/a 56.8% 30.7% n/a n/a n/a 59% 16.7% 27% 10% 22.2% 24% 28.4% 43%29

Percentage of non- executive directors with a full- time executive role 65.2% 49% 37.9%4 n/a 30.6% 59% 49%10 56%15 44%19 9% 36.1% n/a 46.9% 16%24 36.5% -

age

lIm

Its Percentage of companies with a mandatory retirement age 41.5% 33% 73.4% 4% 4.0% 68% 8% 0% 0% 0% 6% 24% 65% 34% n/a 73%

Average mandatory retirement age 70.1 72.4 73 72 70 70.6 68.5 n/a n/a n/a 70.4 71.6 71 60.9 n/a 73.1

rem

un

erat

Ion Average retainer for non- executive directors €32,646 €72,6082 €70,0006 €43,000 €64,383 €47,835 €52,644 €35,319 €49,032 €144,104 €26,830 €67,686 €127,34623 €51,450 €80,874 $91,857

Average fee for audit committee membership €22,513 €18,460 €34,500 €17,000 €11,551 €19,728 €4,53311 €9,063 €11,460 - €9,253 €25,118 €35,28823 - €16,669 $10,178

Average fee for remuneration committee membership €32,834 €13,997 - 7 €10,000 €7,710 €15,458 €3,57311 €6,486 €7,319 - €7,129 - €25,83923 - €14,387 $9,646

Average compensation for nomination committee membership €12,016 €15,106 €23,250 €13,000 €6,972 €11,443 €1,62011 €2,532 n/a - €5,689 €21,094 €25,03523 - €9,484 $7,31130

exco

Average size of ExCo/executive board 6.3 12.5 - 5.48 7.1 7.6 9.5 8 9.2 10.2 10.4 - 9.4 11.9 10.3 -

Percentage of foreigners on the ExCo 31.9% 28.5% - 3.6%8 47.4% 32% 31% 21% 27% 5.2% 16.8% - 67.6% 2.3% 28.2% -

Percentage of women on the ExCo 16.1% 11.6% - 8.6%8 12.9% 10% 15% 20% 22% 11.3%22 13.5% - 6.4% 9.8% 17.2% -


BELGIUM FRANCE GERMANY ITALYNETHER- LANDS

NORDICSRUSSIA

SOUTH AFRICA SPAIN

SWITZER- LAND TURKEY UK USADenmark Finland Norway Sweden

gen

eral

Info

rmat

Ion

Size of sample 53 40 30 100 25 25 25 2513 50 47 79 95 20 30 150 486

Supervisory or two- tier board/unitary board of directors 1/52 4/36 30/0 3/97 18/7 25/0 1/24 0/25 1/49 4/43 0/79 0/95 20/0 0/30 1/14925 0/486

Average number of board meetings per year 9.5 9 6.5 11.1 8.5 9.3 10.6 10.9 9.4 6.820 6.1 10.7 9.9 20 7.6 8.1

% companies which conducted an external board evaluation 1.9% 30% 23.3% 35% 28% 17% 0% 0% 11% 8.5% 17.7% 15% 5% - 43.3% - 26

Combined chairman and CEO 7.5% 62.5% 0 22% 4% n/a n/a n/a16 0% 0% 5.1% 57% 0% 7% 1.3% 52%

% boards with SID, lead director or equivalent 0% 70% 0 43% 60% 0% 0% 4% 0% 14.9% 55.7% 27% 20% n/a 98.7% 89%

boar

d

Average board size (total) 10.3 14.3 16.2 11.9 10.7 9.9 7.9 8.2 9.7 10.3 12.5 10.9 10.3 9.8 10.3 10.8

Average board size (excluding employee representatives) 10.2 12.7 8.2 n/a n/a 7 7.8 5.8 8.1 8.6 n/a 10.9 10.2 8.8 10.3 n/a

Average number of independent board members 4.4 8.4 n/a 5.8 7.2 4.6 6.4 4.7 5.0 3.6 7.2 4.2 9.1 3.2 6.3 9.1

Percentage of independent board members 43.3% 58% 60%3 49.2% 66.8% 76% 84% 80% 62% 35% 58.1% 39% 88.3% 33% 60.5% 84%

Average number of non- executive directors 7.8 11.2 7.34 9.3 6.9 6 6.6 4.8 6.4 7.1 8.6 8.6 9.8 8.7 6.7 -

Average number of executive directors 1.6 1.2 n/a 2.6 3 n/a n/a n/a 0.718 1.6 2.9 1.9 0.45 1.1 2.7 -

age

Average age: all directors 56.9 59.7 - 58.9 58.7 57.2 57.3 55.3 57.3 53.1 56.8 60 60.5 57.6 57.5 -

Average age: non- executive directors 57.4 60.9 61.44 59.0 61.3 57.2 57.3 55.2 57.7 53.7 58.2 n/a 60.5 58.3 59.2 63.127

Average age: executive directors 54.1 58.4 n/a 58.5 52 n/a9 n/a12 n/a17 53.9 49.5 52.5 n/a 58.7 54.9 52.6 -

fore

Ign

Percentage of foreign board members (all) 32.6% 33% n/a 7.7% 42.7% 42% 35% 29.6% 24% 22.2% 21.3% 12.5% 62% 15% 32.1% -

Percentage of foreign non- executive directors 33% 37% 18.1% 9% 45.8% 42% 35% 28.9% 25% 26.2% 23.3% 14% 61.7% 14.6% 35.3% 8.2%28

Percentage of foreign executive directors 32.6% 12% n/a 3.1% 33.3% n/a n/a n/a 14% 2.6% 14.6% 4% 66.7% 0.4% 23% -

Average number of nationalities represented on the board 3.1 4.6 2.84 1.7 4.4 3.3 3.1 2.614 2.8 2.8 2.9 - 6.1 1.87 3.2 -

gen

der

Percentage of female board directors (all) 24.2% 34.3% - 22.4% 21.6% 23% 30% 42% 35% 7.6% 20.9% 14% 19% 9.5% 23% 19.8%

Percentage of female non- executive directors 26.7% 37% 24.9% 26.2% 26.4% 23% 30% 43% 37% 7.7% 24.8% 16% 19.9% 8.8% 28.4% -

Percentage of female executive directors 10.5% 4% n/a 8.2% 9.3% n/a n/a n/a 8% 6%21 8% 3% 0% 0.7% 7.9% -

Percentage of companies with at least one woman on the board 96.2% 100% 93% 96% 80% 88% 100% 96% 100% 38% 97.5% 74% 90% 57% 99.3% 97.3%

new

m

embe

rs

Percentage of new board members 12.5% 8% 10.3% 18.2% 16.8% 15% 15% 21% 9% 20.2% 9.6% 14% 11.7% 16% 14.4% 7.1%27

Percentage of women among new board members 44.1% 62%1 24% 33.8% 33.3% 31% 33% 48% 57% 2% 28% 18% 29.2% 10% 35.7% 31%27

Percentage of non- nationals among new board members 50% 47%1 20% 10.2% 44.1% 50% 43% 26% 50% 3.5% 30% 28% 70.8% 18.8% 43.3% 9%27

oth

er

boar

ds

Average number of boards per director (total) 1.9 2.1 35 3.5 2.1 2 1.9 1.7 2.6 1.5 2.1 1.13 2.4 1.5 2.0 2.127

Percentage of executive directors with an outside board 31.4% 71% n/a 56.8% 30.7% n/a n/a n/a 59% 16.7% 27% 10% 22.2% 24% 28.4% 43%29

Percentage of non- executive directors with a full- time executive role 65.2% 49% 37.9%4 n/a 30.6% 59% 49%10 56%15 44%19 9% 36.1% n/a 46.9% 16%24 36.5% -

age

lIm

Its Percentage of companies with a mandatory retirement age 41.5% 33% 73.4% 4% 4.0% 68% 8% 0% 0% 0% 6% 24% 65% 34% n/a 73%

Average mandatory retirement age 70.1 72.4 73 72 70 70.6 68.5 n/a n/a n/a 70.4 71.6 71 60.9 n/a 73.1

rem

un

erat

Ion Average retainer for non- executive directors €32,646 €72,6082 €70,0006 €43,000 €64,383 €47,835 €52,644 €35,319 €49,032 €144,104 €26,830 €67,686 €127,34623 €51,450 €80,874 $91,857

Average fee for audit committee membership €22,513 €18,460 €34,500 €17,000 €11,551 €19,728 €4,53311 €9,063 €11,460 - €9,253 €25,118 €35,28823 - €16,669 $10,178

Average fee for remuneration committee membership €32,834 €13,997 - 7 €10,000 €7,710 €15,458 €3,57311 €6,486 €7,319 - €7,129 - €25,83923 - €14,387 $9,646

Average compensation for nomination committee membership €12,016 €15,106 €23,250 €13,000 €6,972 €11,443 €1,62011 €2,532 n/a - €5,689 €21,094 €25,03523 - €9,484 $7,31130

exco

Average size of ExCo/executive board 6.3 12.5 - 5.48 7.1 7.6 9.5 8 9.2 10.2 10.4 - 9.4 11.9 10.3 -

Percentage of foreigners on the ExCo 31.9% 28.5% - 3.6%8 47.4% 32% 31% 21% 27% 5.2% 16.8% - 67.6% 2.3% 28.2% -

Percentage of women on the ExCo 16.1% 11.6% - 8.6%8 12.9% 10% 15% 20% 22% 11.3%22 13.5% - 6.4% 9.8% 17.2% -


Nationalities on the board (incl. Swiss)

non- executIve dIrectors (excludIng chaIrman)

non- executIves appoInted In past year

number of outsIde quoted

boardsTenure of

non- executives (excl.

chairman)

Age of non- executives (inc. chairman)

Board meetings

Financial Year End

Total number of directors

Chairman also CEO?

Foreign chairman

Foreign CEO Vice chairmen

SID/ Lead director Total Foreigners Women Total Foreigners Women Chairman

All non- exec directors (incl.

chairman)

ABB LTD Dec- 14 8 No No Yes 1 No 8 7 7 1 2 1 0 2 2.9 8.5 60.4 12

ACTELION LTD Dec- 14 10 No Yes Yes 0 No 5 8 8 1 2 2 1 2 2.2 4.5 59.4 4

ADECCO SA Dec- 14 9 No No Yes 1 No 5 8 6 2 2 1 1 2 2.2 5.1 61.2 9

COMPAGNIE FINANCIERE RICHEMONT SA Mar- 15 18 No Yes Yes 2 Yes 7 14 12 1 0 N/A N/A 2 2.3 10.8 66.4 5

CREDIT SUISSE GROUP AG Dec- 14 12 No No Yes 2 Yes* 10 11 8 3 1 1 1 1 1.9 5 55.2 16

GEBERIT AG Dec- 14 6 No No No 1 No 3 5 2 0 1 0 0 0 2 3.7 58 12

GIVAUDAN AG Dec- 14 9 No No Yes 1 No 5 8 2 2 2 2 1 1 2.6 4.8 61 7

HOLCIM LTD Dec- 14 9 No Yes Yes 1 No 5 8 3 2 0 N/A N/A 3 2.3 9.3 57.9 8

JULIUS BAER GRUPPE AG Dec- 14 8 No No Yes 0 No 6 7 4 1 1 1 0 1 1.8 3.8 57.8 6

NESTLE SA Dec- 14 14 No Yes Yes 1 No 7 12 5 4 3 1 1 2 2.5 5.3 63.7 9

NOVARTIS AG Dec- 14 11 No Yes Yes 1 No 3 10 6 3 1 1 1 0 1.7 6.2 60 8

ROCHE HOLDING AG Dec- 14 12 No Yes Yes 1 No 8 10 5 2 2 2 0 1 1.8 7.5 59.6 9

SGS SA Dec- 14 10 No Yes No 0 No 9 9 5 0 1 1 0 5 4.1 6.1 60.3 6

SWATCH GROUP LTD Dec- 14 5 No No No 1 No 1 3 0 0 0 N/A N/A 0 2 11.8 67.5 5

SWISS RE AG (Swiss Re Ltd) Dec- 14 13 No No Yes 2 Yes* 6 12 7 3 2 2 0 0 2.5 4.8 63.2 10

SWISSCOM AG Dec- 14 9 No No No 1 No 3 8 2 2 0 N/A N/A 1 1.7 6.8 57.1 13

SYNGENTA AG Dec- 14 10 No Yes Yes 1 No 7 8 5 3 0 N/A N/A 1 2.2 5.2 59.8 5

TRANSOCEAN LTD Dec- 14 10 No Yes Yes 0 No 5 9 9 1 1 1 0 3 3.4 5.1 59.7 8

UBS AG Dec- 14 11 No Yes No 1 Yes 9 10 6 3 1 1 0 0 2.1 4.4 58.5 36

ZURICH INSURANCE GROUP AG Dec- 14 11 No Yes No 1 No 7 10 7 4 2 2 1 2 2.7 3.9 62.5 10

Board composition

* One vice chairman is also the lead independent director


Nationalities on the board (incl. Swiss)

non- executIve dIrectors (excludIng chaIrman)

non- executIves appoInted In past year

number of outsIde quoted

boardsTenure of

non- executives (excl.

chairman)

Age of non- executives (inc. chairman)

Board meetings

Financial Year End

Total number of directors

Chairman also CEO?

Foreign chairman

Foreign CEO Vice chairmen

SID/ Lead director Total Foreigners Women Total Foreigners Women Chairman

All non- exec directors (incl.

chairman)

ABB LTD Dec- 14 8 No No Yes 1 No 8 7 7 1 2 1 0 2 2.9 8.5 60.4 12

ACTELION LTD Dec- 14 10 No Yes Yes 0 No 5 8 8 1 2 2 1 2 2.2 4.5 59.4 4

ADECCO SA Dec- 14 9 No No Yes 1 No 5 8 6 2 2 1 1 2 2.2 5.1 61.2 9

COMPAGNIE FINANCIERE RICHEMONT SA Mar- 15 18 No Yes Yes 2 Yes 7 14 12 1 0 N/A N/A 2 2.3 10.8 66.4 5

CREDIT SUISSE GROUP AG Dec- 14 12 No No Yes 2 Yes* 10 11 8 3 1 1 1 1 1.9 5 55.2 16

GEBERIT AG Dec- 14 6 No No No 1 No 3 5 2 0 1 0 0 0 2 3.7 58 12

GIVAUDAN AG Dec- 14 9 No No Yes 1 No 5 8 2 2 2 2 1 1 2.6 4.8 61 7

HOLCIM LTD Dec- 14 9 No Yes Yes 1 No 5 8 3 2 0 N/A N/A 3 2.3 9.3 57.9 8

JULIUS BAER GRUPPE AG Dec- 14 8 No No Yes 0 No 6 7 4 1 1 1 0 1 1.8 3.8 57.8 6

NESTLE SA Dec- 14 14 No Yes Yes 1 No 7 12 5 4 3 1 1 2 2.5 5.3 63.7 9

NOVARTIS AG Dec- 14 11 No Yes Yes 1 No 3 10 6 3 1 1 1 0 1.7 6.2 60 8

ROCHE HOLDING AG Dec- 14 12 No Yes Yes 1 No 8 10 5 2 2 2 0 1 1.8 7.5 59.6 9

SGS SA Dec- 14 10 No Yes No 0 No 9 9 5 0 1 1 0 5 4.1 6.1 60.3 6

SWATCH GROUP LTD Dec- 14 5 No No No 1 No 1 3 0 0 0 N/A N/A 0 2 11.8 67.5 5

SWISS RE AG (Swiss Re Ltd) Dec- 14 13 No No Yes 2 Yes* 6 12 7 3 2 2 0 0 2.5 4.8 63.2 10

SWISSCOM AG Dec- 14 9 No No No 1 No 3 8 2 2 0 N/A N/A 1 1.7 6.8 57.1 13

SYNGENTA AG Dec- 14 10 No Yes Yes 1 No 7 8 5 3 0 N/A N/A 1 2.2 5.2 59.8 5

TRANSOCEAN LTD Dec- 14 10 No Yes Yes 0 No 5 9 9 1 1 1 0 3 3.4 5.1 59.7 8

UBS AG Dec- 14 11 No Yes No 1 Yes 9 10 6 3 1 1 0 0 2.1 4.4 58.5 36

ZURICH INSURANCE GROUP AG Dec- 14 11 No Yes No 1 No 7 10 7 4 2 2 1 2 2.7 3.9 62.5 10

Women

0

1

1

N/A

1

0

1

N/A

0

1

1

0

0

N/A

0

N/A

N/A

0

0

1


Board data

A AuditN NominationR Remuneration AF Audit & FinanceACo Audit & ComplianceCCR Corporate, Culture & ResponsibilityCG Corporate GovernanceCGSus Corporate Governance & SustainabilityChCG Chairman’s & Corporate GovernanceChRi Chairman’s & RiskCR Corporate Responsibility

EHS Environment, Health & SafetyF FinanceFACo Finance, Audit & ComplianceFRi Finance & RiskGN Governance & NominationGNC Governance, Nomination &

Corporate ResponsibilitiesGSt Governance & StrategyHRR Human Resources & RemunerationInv InvestmentNR Nomination & RemunerationPC Professional Conduct

R&D Research & DevelopmentRi RiskSpec SpecialSt StrategyStS Strategic Security

commIttees and meetIngs evaluatIon, term and age lImIts executIve commIttee

Number and type of committees Number of committee meetings Board evaluation Term limits Mandatory retirement Members Foreigners Women

ABB LTD (Prior to 30/4/14) 2: FACo, GNR (From 30/4/14) 3: FACo, GN, R FACo8; GN3; GNR3; R4 Yes, internal No 72 12 10 1

ACTELION LTD 3: AF, GN, R AF8; GN4; R4 Not disclosed No N/A 5 5 0

ADECCO SA 3: A, CG, NR A8; CG4; NR4 Not disclosed No N/A 12 12 0

COMPAGNIE FINANCIERE RICHEMONT SA 4: A, N, R, StS A3; N5; R2; StS4 Yes, internal No N/A 11 8 0

CREDIT SUISSE GROUP AG 4: A, ChCG, R, Ri A18; ChCG10; R10; Ri7 Yes, internal No 70 10 8 1

GEBERIT AG 2: A, NR A2; NR4 Not disclosed No 70 5 2 0

GIVAUDAN AG 3: A, GN, R A5; GN2; R4 Yes, internal No 70 6 5 0

HOLCIM LTD 3: A, GSt, NR A4; GSt13; NR4 Yes, internal No N/A 7 3 0

JULIUS BAER GRUPPE AG 4: A, ChRi, N, R A9; ChRi12; N3; R5 Yes, internal No 75 6 2 0

NESTLE SA 4: A, ChCG, N, R A4; ChCG8; N4; R4 Yes, internal No 72 13 9 1

NOVARTIS AG 5: ACo, GNC, R, Ri, R&D ACo7; GNC4; R6; Ri4; R&D3 Yes, external No 70 12 9 0

ROCHE HOLDING AG 4: A, CGSus, N, R A5; CGSus3; N5; R3 Not disclosed No N/A 6 3 1

SGS SA 3: A, NR, PC A3; NR2; PC2 Yes, internal No N/A 24 15 3

SWATCH GROUP LTD 2: A, R A2; R2 Not disclosed No N/A 8 2 1

SWISS RE AG (Swiss Re Ltd) 5: A, ChCG, FRi, Inv, R A8; ChCG7; FRi6; Inv6; R6 Yes, internal No 70 12 8 0

SWISSCOM AG 4: A, F, N, R A5; F3; N0; R3 Yes, internal Yes 70 7 2 0

SYNGENTA AG 5: A, ChCG, CR, N, R A5; ChCG3; CR2; N2; R5 Yes, internal Yes 70 9 8 2

TRANSOCEAN LTD 5: A, CG, F, EHS, R A8; CG6; F4; EHS4; R5 Yes, internal No 72 2 2 0

UBS AG 7: A, CCR, GN, HRR, Ri, Spec, St A24; CCR5; GN9; HRR12; Ri11; Spec26; St5 Yes, internal Yes 70 10 6 0

ZURICH INSURANCE GROUP AG 4: A, GN, R, Ri A7; GN4; R5; Ri7 Yes, internal Yes 72 11 8 2


commIttees and meetIngs evaluatIon, term and age lImIts executIve commIttee

Number and type of committees Number of committee meetings Board evaluation Term limits Mandatory retirement Members Foreigners Women

ABB LTD (Prior to 30/4/14) 2: FACo, GNR (From 30/4/14) 3: FACo, GN, R FACo8; GN3; GNR3; R4 Yes, internal No 72 12 10 1

ACTELION LTD 3: AF, GN, R AF8; GN4; R4 Not disclosed No N/A 5 5 0

ADECCO SA 3: A, CG, NR A8; CG4; NR4 Not disclosed No N/A 12 12 0

COMPAGNIE FINANCIERE RICHEMONT SA 4: A, N, R, StS A3; N5; R2; StS4 Yes, internal No N/A 11 8 0

CREDIT SUISSE GROUP AG 4: A, ChCG, R, Ri A18; ChCG10; R10; Ri7 Yes, internal No 70 10 8 1

GEBERIT AG 2: A, NR A2; NR4 Not disclosed No 70 5 2 0

GIVAUDAN AG 3: A, GN, R A5; GN2; R4 Yes, internal No 70 6 5 0

HOLCIM LTD 3: A, GSt, NR A4; GSt13; NR4 Yes, internal No N/A 7 3 0

JULIUS BAER GRUPPE AG 4: A, ChRi, N, R A9; ChRi12; N3; R5 Yes, internal No 75 6 2 0

NESTLE SA 4: A, ChCG, N, R A4; ChCG8; N4; R4 Yes, internal No 72 13 9 1

NOVARTIS AG 5: ACo, GNC, R, Ri, R&D ACo7; GNC4; R6; Ri4; R&D3 Yes, external No 70 12 9 0

ROCHE HOLDING AG 4: A, CGSus, N, R A5; CGSus3; N5; R3 Not disclosed No N/A 6 3 1

SGS SA 3: A, NR, PC A3; NR2; PC2 Yes, internal No N/A 24 15 3

SWATCH GROUP LTD 2: A, R A2; R2 Not disclosed No N/A 8 2 1

SWISS RE AG (Swiss Re Ltd) 5: A, ChCG, FRi, Inv, R A8; ChCG7; FRi6; Inv6; R6 Yes, internal No 70 12 8 0

SWISSCOM AG 4: A, F, N, R A5; F3; N0; R3 Yes, internal Yes 70 7 2 0

SYNGENTA AG 5: A, ChCG, CR, N, R A5; ChCG3; CR2; N2; R5 Yes, internal Yes 70 9 8 2

TRANSOCEAN LTD 5: A, CG, F, EHS, R A8; CG6; F4; EHS4; R5 Yes, internal No 72 2 2 0

UBS AG 7: A, CCR, GN, HRR, Ri, Spec, St A24; CCR5; GN9; HRR12; Ri11; Spec26; St5 Yes, internal Yes 70 10 6 0

ZURICH INSURANCE GROUP AG 4: A, GN, R, Ri A7; GN4; R5; Ri7 Yes, internal Yes 72 11 8 2


about spencer stuart

About Spencer Stuart

Spencer Stuart has had an uninterrupted presence in Switzerland since 1959, when it opened its Zurich office. Spencer Stuart is one of the world’s leading executive search consulting firms. We are trusted by organisations around the world to help them make the senior- level leadership decisions that have a lasting impact on their enterprises. Through our executive search, board and leadership advisory services, we help build and enhance high- performing teams for select clients ranging from major multinationals to emerging companies to nonprofit institutions.

Privately held since 1956, we focus on delivering knowledge, insight and results though the collaborative efforts of a team of experts — now spanning 56 offices, 30 countries and more than 50 practice specialties. Boards and leaders consist-ently turn to Spencer Stuart to help address their evolving leadership needs in areas such as senior- level executive search, board recruitment, board effectiveness, succession planning, in- depth senior management assessment and many other facets of organisational effectiveness.

For more information on Spencer Stuart, please visit www.spencerstuart.com.

© 2015 Spencer Stuart. All rights reserved. For information about copying, distributing and displaying this work, contact: [email protected].

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Contents/media/s... · non-ons or ret c di eiv xeut c e SMI company boards International diversity Swiss boards continue to be among the most inter-national in the world. In Europe,

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