SWITZERLAND Law and Practice Contributed by: Lorenzo Olgiati and Pascal Hubli, Schellenberg Wittmer Ltd
4.4 Appointment and Removal of Directors/Officers
enced non-executive member of the board, may be appointed in the event that a single individual assumes the functions of chairperson and CEO. The appointment of lead directors is not uncom - mon for listed companies in Switzerland. 4.3 Board Composition Requirements/ Recommendations Regarding the composition of the board, current Swiss company law is flexible and the share - holders enjoy broad discretion. Swiss company law contains no rules on the maximum number of seats and no age restrictions on board mem - bers. However, listed Swiss companies must observe the newly implemented gender repre - sentation guidelines for the board of directors in listed companies (see 2.2 ESG Considerations ). Regulated Industries In regulated industries – particularly in the finan - cial sector – regulations require the members of the executive bodies of supervised institutions to grant assurance of proper business conduct and required knowledge and experience ( “fit and proper” ). According to FINMA, the main purpose of these requirements is to maintain public confi - dence in those institutions and to safeguard the reputation of the Swiss financial centre. Assurance of proper business conduct covers matters of personal character (including criminal records) and professional qualifications required for the proper management of a supervised enti - ty. The principal criterion used in assessing a person’s suitability is their past and present busi - ness activity. As to the requirements regarding the composition of the board relating to inde - pendent directors, see 4.5 Rules/Requirements Concerning Independence of Directors .
Only the shareholders may vote on the appoint - ment or the removal of any of the directors. This is permissible whenever a shareholders’ meeting is held and its agenda provides for the respec - tive election or removal. Significant shareholders (see 5.3 Shareholder Meetings ) are entitled to request the board to convene an extraordinary shareholders’ meeting and put the requested items on the agenda. For listed companies, the chairperson of the board of directors, each member of the board of directors and the members of the compensation committee must be appointed and (re-)elected individually and annually by the shareholders’ meeting. In non-listed companies, the elected board members may resolve on the board’s organisation, constitution and its members’ functions, and notably may appoint the chair - person among its elected members without a shareholders’ vote. Unless otherwise provided by the articles of association, the shareholders’ meeting passes resolutions on the election and removal of any director by an absolute majority of the votes rep - resented at the respective meeting. 4.5 Rules/Requirements Concerning Independence of Directors Swiss company law does not require business corporations to have independent directors. The SCBP, however, emphasises that well- founded decisions can emerge only by exchang - ing ideas and critical views among the mem - bers of the board of directors and the executive management. Therefore, it recommends that the majority of the board should consist of inde - pendent members. Independent members are
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