SWITZERLAND Law and Practice Contributed by: Lorenzo Olgiati and Pascal Hubli, Schellenberg Wittmer Ltd
5. Shareholders 5.1 Relationship Between Companies and Shareholders The shareholders’ meeting is the paramount body of a company. The shareholders are enti - tled to elect and remove the board of directors and the statutory auditors. Swiss company law grants shareholders a variety of rights, which can be categorised in (i) participation and (ii) property rights. These include the right to information and inspection as well as the right to determine dividends. The SCBP emphasises the importance of providing comprehensive information to shareholders to enable them to exercise their rights on a fully informed basis. 5.2 Role of Shareholders in Company Management By statutory law, the management of a company is entrusted to its governing bodies (board of directors and executive management). Conse - quently, shareholders are not supposed to be involved in the management of the company (for their competences, see 3.2 Decisions Made by Particular Bodies ). Shareholders may, however, try to exert pressure and thus indirectly influence the decision-making process and actions of the board – for example: • by formally requesting additional informa - tion or a non-binding vote in a shareholders’ meeting on a specific issue that falls within the competence of the board; or • by threatening or bringing removal motions relating to certain board members, or through shareholders’ claims against the company to protect their rights, or against liable directors or officers to penalise non-compliance with statutory duties and to recover damages.
Some shareholder activists also use the media to make the relevant position of the (dissident) shareholder known to the public. 5.3 Shareholder Meetings Ordinary and extraordinary shareholders’ meet - ings are a core element of corporate governance in Switzerland. The ordinary shareholders’ meet - ing takes place either physically, virtually, or in a hybrid form once a year within six months of the end of the financial year. The in-person meeting may also be held abroad if explicitly provided for in the articles of association and if the chosen venue does not make it unreasonably difficult for shareholders to exercise their rights. Pro - vided that the interventions of the participants are broadcasted to all venues, it is also possible to hold a shareholders’ meeting simultaneously at several venues in Switzerland and/or abroad. At a hybrid shareholders’ meeting, shareholders who are unable to attend the meeting in per - son may exercise their rights electronically. It is further possible to hold shareholders’ meetings entirely virtually without an in-person meeting, provided that the articles of association contem - plate this format. Further, extraordinary shareholders’ meetings may be convened as and when required. Convening a Meeting In general, the board of directors convenes the shareholders’ meeting. In order to validly hold a shareholders’ meeting, the notice convening the meeting must be given at least 20 days before such meeting date. Further, shareholder(s) of a listed company may request the convening of a shareholders’ meeting, provided they hold at least 5% of the share capital or the voting power in the company. If the board of directors receives a request to convene a shareholders’
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