* Investors block up to 16 mln Sfr in bonuses for top execs
* Part of boarder Swiss backlash over executive pay
* Run-up to AGM dominated by activist effort win board seats
* RBR unsuccessful in attempt to win three seats on GAM
(Adds detail, comments from chairman)
By Joshua Franklin
ZURICH, April 27 GAM Holding
shareholders on Thursday blocked up to 16 million Swiss francs
($16.1 million) in bonuses for the Swiss asset manager's senior
management, the strongest example yet of a backlash in
Switzerland over executive pay.
It is apparently the first time in Switzerland that
shareholders have blocked bonuses for senior management,
according to shareholder advisory group Ethos.
The run-up to GAM's annual general meeting (AGM) had been
dominated by a campaign from activist investor RBR Capital
Advisors to gain three GAM board seats, part of a broader effort
to cut costs at GAM and replace the chief executive.
RBR's attempt to win board representation failed but one of
its major objections over compensation for GAM's executive
management struck a chord with other investors.
"I'm not surprised insofar as during the course of
conversations that I've had with shareholders over the course of
the last few weeks...it became clear that there were concerns
that shareholders wanted to articulate," Hugh Scott-Barrett, who
was elected chairman at the AGM, told journalists after the pay
In a binding vote, investors holding 64.83 percent of the
voting rights opposed the proposed bonuses, using veto power
over executive and board compensation given to shareholders in
Swiss companies by a 2013 referendum.
GAM had already announced a review of its pay policy and
Scott-Barrett said he would wait until he had completed this
before proposing a new bonus package, which will also require
investor approval, for GAM's eight-person management team.
Shareholders voted down GAM's overall compensation report
but signed off on directors' salaries and fixed pay for senior
GAM has described 2016 as a "disappointing" year, during
which it suffered net withdrawals of 10.7 billion francs and its
share price slumped almost 30 percent. Performance fees also
plummeted to 3 million francs from 82.8 million.
Outgoing Chairman Johannes de Gier said GAM needed to keep a
competitive pay policy in order to attract top global talent.
The veto by GAM shareholders is the latest sign of the anger
in Switzerland over a perceived disconnect between pay and a
Senior management at Credit Suisse, Switzerland's
second-biggest bank, volunteered a 40 percent cut in their
bonuses amid an investor revolt over the pay packets on the back
of 5.65 billion francs in losses since 2015.
Credit Suisse shareholders will vote on executive and board
pay at the bank's AGM on Friday.
Investors at machinery, pipes and car-parts maker Georg
Fischer this month also voted down the company's
compensation report in a non-binding vote.
($1 = 0.9935 Swiss francs)
(Editing by Michael Shields)