At the UBS annual general meeting held today in Basle, Ethos objected to the Board's proposal to create a conditional capital corresponding to 7.1% of total capital; the requested capital is intended to service the stock options granted to Directors, management and staff. Indeed, under UBS’s compensation policy, over 2% of the Bank's capital is distributed each year in the form of stock options, which is more than twice the amount recommended by international best practice. Such a transfer of value is not acceptable to the shareholders.
When it came time to vote, 25.3% of the shareholders present voted against the creation of conditional capital, a clear sign that a large minority of shareholders no longer agrees with the overly generous compensation policy established in recent years.
In view of this opposition, Ethos considers that the Board of Directors should rapidly review the structure of the Bank’s compensation policy and align it with international best practice standards. Ethos further considers that an advisory vote on the compensation policy should be placed on the agenda of the UBS 2007 annual general meeting.
