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Everything you need to know about Switzerland’s ‘corporate responsibility’ referendum

Swiss voters will go to the polls on Sunday, deciding whether to put in place the 'world's strictest corporate responsibility rules'. Here's what you need to know.

Everything you need to know about Switzerland's 'corporate responsibility' referendum
Photo: FABRICE COFFRINI / AFP

Swiss voters are to decide Sunday whether to impose the world's strictest corporate responsibility rules, making multinationals headquartered in the country liable for abusive business practices worldwide.

Recent polls indicate a slim majority supports an initiative to amend the Swiss constitution and force such companies to ensure they and their suppliers respect strict human rights and environmental protection standards.

READ: Everything you need to know about Switzerland's referendum to ban military exports 

The initiative was launched by an alliance of 130 non-governmental organisations as part of Switzerland's system of direct democracy, and has the backing of trade unions, church groups and actors across the political spectrum.

It is opposed however by both the government and parliament, which have warned that while the intention is good, the legislation goes “too far”.

EXPLAINED: What's at stake in Switzerland's November referendums?

They have put forward a counter-proposal that would also require companies to report on rights, environmental protections and corruption issues — without being liable for violations.

Supporters have plastered Swiss towns and cities with posters that highlight environmental degradation and human suffering caused by Swiss companies.

'Unscrupulous companies' 

One shows a picture of a mournful-looking girl in front of a Peruvian mine owned by mining giant Glencore, blamed for contaminating the local population with lead and other heavy metals.

The campaigners also underscore how pesticides long banned in Switzerland are still sold by agrochemicals giant Syngenta in developing countries, and deplore small-particle pollution spewed from a cement plant owned by LafargeHolcim in Nigeria.

These and other multinationals are important drivers of the Swiss economy, which at the end of 2018 counted close to 29,000 such corporations, accounting for more than a quarter of all jobs in the country, according to official statistics.

But while backers of Sunday's initiative acknowledge that most companies respect rights and environmental protections, they insist voluntary measures are not enough to bring the rest in line.

“It is very clearly an illusion to say that companies will do everything by themselves,” Chantal Peyer, a spokeswoman for the Responsible Business initiative, told AFP.

“There are responsible companies who respect human rights, but unscrupulous companies don't change.”

Swiss companies 'exemplary'

The Swiss business community, along with the government and parliament, argue that the constitutional amendments could be detrimental for all Swiss companies, not just those that behave badly.

The campaign, according to Vincent Simon of the Swiss employers' association EconomieSuisse, has “done a lot of damage overall to our economy.”

That is particularly true for the companies mentioned by name, he told AFP. Simon said: “More generally we have tarnished the reputation of our economy even though we are convinced… that Swiss companies are rather exemplary as a whole.”

Swiss businesses and employer organisations are hoping the initiative will fail, which would automatically activate the government's counter-proposal.

They have voiced particular concern over a provision that would make Swiss-based businesses liable for abuses committed by subsidiaries unless they can prove they had done required due diligence. 

 

'Reputational damage' 

Companies will be presumed “guilty until proven innocent”, Nestle President Paul Bulcke warned in an interview with public broadcaster RTS.

Glencore chief Ivan Glasenberg agreed, warning in a recent interview with the Neue Zurcher Zeitung newspaper that “everyone could then come to Switzerland to have their case tried in court”, and benefit from a “reversal of the burden of proof”.

But he insisted that while Glencore “would probably have to hire more lawyers, nothing would change in the way we operate our mines.”

He also rejected the notion that passing the initiative would prompt large multinationals like Glencore to pack up and leave Switzerland.

But he warned that “companies that are active in developing countries will think twice before moving their headquarters to Switzerland.”

Jean-Daniel Pasche, the head of the Swiss Watch Industry Federation, warned that even when companies prove in court they acted in good faith, “there could be reputational damage”.

Such damage, he told AFP, is hard to repair.

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Swiss decision to purchase US fighter jets could force second referendum

Switzerland's decision to purchase US-made fighter jets could be put to a referendum,

Swiss decision to purchase US fighter jets could force second referendum
Swiss fighter jets. Photo: JOE KLAMAR / AFP

Switzerland’s government on Wednesday backed the purchase of 36 F-35A fighter jets from Lockheed Martin to replace its fleet and five Patriot air defence units from fellow US manufacturer Raytheon.

Switzerland’s current air defence equipment will reach the end of its service life in 2030 and has been undergoing a long and hotly-contested search for replacements.

“The Federal Council is confident that these two systems are the most suitable for protecting the Swiss population from air threats in the future,” the government said in a statement.

‘No Trump fighter jets’: Swiss don’t want to buy American planes

The decision will now be put to the Swiss parliament — and also risks being challenged at the ballot box, with left-wingers and an anti-militarist group looking to garner enough signatures to trigger a public vote.

The F-35A was chosen ahead of the Airbus Eurofighter; the F/A-18 Super Hornet by Boeing; and French firm Dassault’s Rafale.

For the ground-based air defence (GBAD) system, Patriot was selected ahead of SAMP/T by France’s Eurosam.

“An evaluation has revealed that these two systems offer the highest overall benefit at the lowest overall cost,” the government statement said. Switzerland is famously neutral. However, its long-standing position is one of armed neutrality and the landlocked European country has mandatory conscription for men.

“A fleet of 36 aircraft would be large enough to cover Switzerland’s airspace protection needs over the longer term in a prolonged situation of heightened tensions,” the government said.

“The air force must be able to ensure that Swiss airspace cannot be used by foreign parties in a military conflict.” 

Long path to decision 

Switzerland began to seek replacements for its ageing fleet of fighter jets more than a decade ago, but the issue has become caught up in a political battle in the wealthy Alpine nation.

The Swiss government has long argued for the need to quickly replace its 30 or so F/A-18 Hornets, which will reach the end of their lifespan in 2030, and the F-5 Tigers, which have been in service for four decades and are not equipped for night flights.

In 2014, the country looked set to purchase 22 Gripen E fighter jets from Swedish group Saab, only to see the public vote against releasing the funds needed to go forward with the multi-billion-dollar deal.

Bern launched a new selection process four years later, and a referendum last year to release six billion Swiss francs ($6.5 billion) for the purchase of the fighters of the government’s choice squeezed through with 50.1 percent of voters in favour.

During the referendum campaign, the government warned that without a swift replacement for its fleet, “Switzerland will no longer be in a position to protect and even less defend its airspace by 2030”.

Currently, the fleet does not have the capacity to support ground troops for reconnaissance missions or to intervene against ground targets.

Meanwhile Switzerland’s current GBAD system is also old and lacks the capacity to meet the widening spectrum of modern threats.

The military currently relies on a range of Rapier and Stinger short-range missiles that have been in service since 1963.

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