Nearly two-thirds of the Swiss would, if they could, tell their pension schemes how to vote on important governance issues like executive pay and board discharge at company annual meetings, according to a survey by AXA Investment Managers.
Under the so-called Minder initiative, which was approved by the Swiss in a referendum last March and which is to take effect at the start of 2014, pension funds must vote in the interests of their beneficiaries at AGMs and inform them on how they voted. Currently, the schemes face no voting requirement.
Yet the government’s draft law transposing Minder allows the schemes to either abstain or not vote at all if they feel this is in the interest of their beneficiaries. The measure, which is still being hotly debated, leaves it up to the pension funds’ managers to decide that question. Swiss pension fund association ASIP backs the draft law, calling it a “workable solution.”
The survey suggests that Swiss beneficiaries want their funds’ managers to at least ascertain their concerns instead of unilaterally deciding when and how to vote.But ASIP managing director Hanspeter Konrad told RI that he could see no contradiction between the Swiss’ wishes on governance and what their schemes were actually doing.
Moreover, “the Minder initiative, in our view, does not require that pension funds vote all of the time. Instead, the initiative only requires them to vote when their abstinence would harm the interests of their beneficiaries,” Konrad said.
The survey also said three-fourths of respondents want their pension funds to take environmental, social and governance (ESG) issues into consideration when they invest. Of the country’s 2,500 pension funds, only four schemes have signed up to the UN-backed Principles for Responsible Investment (PRI) so far.
Other findings: Exactly half of the Swiss would prefer to choose their pension fund’s investment strategy, and 51% want the right to choose their type of pension fund. For the survey, AXA interviewed 685 people throughout Switzerland late last spring.