Boris F.J. Collardi, chief executive officer of Julius Baer Group Ltd.

Julius Baer’s shareholders have rejected the Swiss private bank’s pay report in a non-binding vote as widespread discontent over executive pay continues to rumble around Europe.

Swiss voters last month overwhelmingly backed proposals put forward by the businessman-turned-politician Thomas Minder that will, from next year, give shareholders a binding say on the total remuneration of the boards and senior managers of listed Swiss companies.

However, the backing of the referendum has not made the topic of executive pay any less contested, and in the run-up to Julius Baer’s annual meeting on Wednesday, ISS, the proxy advisory firm, advised shareholders to vote against the Swiss bank’s pay plans.

In the event, 63.9 per cent of shareholders rejected the pay plans, which included SFr15.2m ($16.3m) in payments to senior managers, SFr6.7m of which was assigned to Boris Collardi, the bank’s chief executive.

Some shareholders were unhappy that variable remuneration at the bank was uncapped, while others took issue with equity awards to some employees that vested in less than three years.

Dissenting investors also cited a lack of clarity on how discretionary awards relating to the integration of the Merrill Lynch wealth management assets bought last year by Julius Baer from Bank of America were defined.

Senior managers were paid SFr1.95m in bonuses relating to the integration, with Mr Collardi receiving SFr800,000.

As well as giving shareholders a say on pay, the Minder plan will also ban specific types of bonuses, such as golden hellos and golden goodbyes. There was also some concern among Julius Baer’s shareholders that the company did not provide information on such payments. However, a spokesman for Julius Baer said the bank did not make welcome or farewell payments.

In response to the setback, Julius Baer stressed it would work to ensure it achieved a positive vote at next year’s meeting.

“We now have one year to decide how to respond, so there is no need for short-term reactions. Clearly we need to take some positive measures and we will make sure that we stay in close contact with shareholders as we develop our new plans,” the bank said.

All other motions were passed at the meeting.

Switzerland’s two biggest banks, Credit Suisse and UBS, which have both drawn fire for their bonus plans, are due to face shareholder votes in late April and early May respectively. Last year both groups faced sizeable rebellions against their pay plans.

This year, ISS has backed Credit Suisse’s remuneration report.

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