Ethos and seven Swiss pension funds have filed a shareholders' resolution at Credit Suisse's 2022 general meeting calling for a special audit of the bank in connection with the Greensill affair – and the “supply chain finance funds” debacle that followed – and the recent so-called “Suisse Secrets” revelations.
On 11 March 2022, the Ethos Foundation and seven Swiss pension funds shareholders of Credit Suisse (see below) addressed to the board of directors of the bank a request for information in connection with the “Greensill” and “Suisse Secrets” cases, in accordance with article 697 of the Swiss Code of Obligations. At the same time, the Ethos Foundation requested the inclusion of a shareholders' resolution on the agenda of the 2022 general meeting demanding a special audit in accordance with article 697a of the Swiss Code of Obligations. This request figures at item 8 of the general meeting agenda published this Wednesday by Credit Suisse.
As long-term shareholders, Ethos and the other investors expect Credit Suisse to provide additional information on the Greensill affair, which led the bank to freeze investment funds with CHF 10 billion under management in March 2021. Especially since the board decided in February 2022 not to publish the main conclusions of the investigation report written by the law firm Walder Wyss, despite what had been indicated in the minutes of the 2021 general meeting.
“While we understand that the publication of the entire report may pose confidentiality issues, we believe that shareholders are entitled to know the main conclusions of this investigation as well as the measures that have been or will be taken to prevent such cases to repeat in the future, explains Vincent Kaufmann, CEO of Ethos. We also believe that this information is essential to exercise our rights as shareholders at the next general meeting.”
After sending a list of 17 questions (see below), several exchanges took place with the bank in the past weeks. The initial responses have been completed and Credit Suisse agreed to publish them before the 2022 general meeting. For Ethos, it is crucial to have a better understanding of the elements that led to the debacle and the closing of the “supply chain finance funds” which were actively offered by Credit Suisse Asset Management up to the bankruptcy of its partner Greensill in February 2021. This debacle, and the numerous scandals which have tarnished the bank's reputation in recent years, led to a loss of investor confidence and caused the share price to plunge to historic lows. For Ethos, it is therefore essential and urgent for the bank to restore the confidence of its shareholders, customers, employees, and other stakeholders.
While Credit Suisse agreed to answer all the questions from Ethos, Ethos on its side was willing to withdraw its request if certain answers could be checked by an independent auditor within the framework of a simplified procedure of “negative assurance”. However, at this stage, no agreement has been reached to give such a mandate to a third party. “This approach would have been simpler and faster than a special audit and would have cleared up some doubts", says Vincent Kaufmann.
After an in-depth analysis, Ethos and the seven other shareholders are of the opinion that Credit Suisse's responses remain insufficient. Since Credit Suisse is unable for the moment to provide a “negative assurance” from an independent third party on the answers provided, Ethos has decided to maintain its request for a special audit. The shareholders will thus vote at the general meeting of 29 April on the organisation of such an audit. If accepted, an independent expert will be appointed by a judge to verify the veracity and completeness of the answers provided by Credit Suisse to Ethos' questions.
Since very important decisions will have to be taken at the 2022 general meeting, Ethos is calling on Credit Suisse shareholders to exercise their voting rights or be represented to exercise their voting rights.
The list of co-filers of the shareholders' resolution:
- Bernische Lehrerversichergungskasse
- Bernische Pensionskasse
- Cap Providence
- CIEPP – Inter-Company Professional Provident Fund,
- Foundation Ethos
- Pensionskasse of the Bundes PUBLICA
- Pensionskasse Post
- Pensionskasse Stadt Zürich