Unveiled Earnings of CEOs from Switzerland's Largest Corporations: An Inside Look
In a recent study by Unia trade union, it has been revealed that CEOs of Switzerland's largest companies, including Novartis, UBS, Roche, and Nestlé, earned an average of 18% more in 2024 compared to the previous year. The study, titled 'Top salaries continue to rise, minimum wages at risk,' shows that CEOs of the 39 largest Swiss corporations earned an average of 143 times more than their lowest-paid employees. The nationwide median wage in Switzerland is estimated to be around CHF 84,000. However, the gap between the highest and lowest salaries has been increasing over a number of years. In 2024, UBS chief executive Sergio Ermotti's pay packet was 14.9 million Swiss francs, which is 276 times more than the lowest UBS salary in the same year. Similarly, Galderma CEO Flemming Ørnskov saw an annual salary of CHF 19 million in 2021, which was 298 times more than the lowest salary. The ratio between the highest and lowest salaries across all 39 companies surveyed is 1:143 on average, slightly less than last year's 1:150. The average salaries of CEOs in 2024 is about 8.3 million Swiss francs, according to data for the top 20 biggest Swiss companies; however, the highest CEO salary was 19 million Swiss francs (Flemming Ornskov of Galderma), which is an outlier and not a traditional largest company. The average maximum salary in the surveyed companies was 13.2 million Swiss francs. The study notes that dividend payments to shareholders in 2024 would have amounted to CHF 46 billion for the 39 companies surveyed. Despite this, pay expert Timon Forrer from the consulting firm Kienbaum believes that the actual wage increase in Switzerland could even be lower than the predicted 1.3 percent. Unia union president Vania Alleva is calling for a general wage increase of 2 to 2.5 percent, and higher minimum wages of CHF 4,500 for unskilled workers and CHF 5,000 for employees with an apprenticeship certificate. Alleva stated that the current wage gap is downright absurd. She believes that their demands for wage increase and higher minimum wages would be justified and possible. The forecast for salary development predicts a wage increase of 1.3 percent, which is above the expected inflation rate of 0.5 percent. However, Forrer believes that this forecast could be optimistic. He suggests that the actual wage increase in Switzerland could be lower than the predicted 1.3 percent. In nine of the 10 companies in Switzerland with the highest salaries, bosses took home a pay rise in 2024. This includes the CEO of Basel-based pharmaceutical multinational Novartis, Vasant Narasimhan, who earned CHF 19.2 million in 2024, around 333 times higher than the lowest employee salary. A person with a median salary would have to work for 228 years to earn the annual salary of the Novartis CEO. Despite these findings, Forrer maintains that the demands for wage increase and higher minimum wages are considered unrealistic by some experts. He suggests that the Swiss economy is not in a position to absorb such drastic wage increases without causing significant economic instability. The study serves as a stark reminder of the widening wage gap in Switzerland and the urgent need for action to address this issue. As the economy recovers from the pandemic, it is crucial to ensure that the benefits are shared equitably among all sectors of society, including the lowest-paid workers.
