Hayek family defeats activist investor’s latest push to join Swatch board
Watchmaker’s controlling shareholders use dominant voting stake to block Steven Wood’s fresh bid to win seat
The billionaire Hayek family that controls The Swatch Group thwarted a fresh attempt by US activist investor Steven Wood to win a seat on its board, despite strong backing for his candidacy from minority shareholders.
Wood, founder of US-based GreenWood Investors, won support from 80.4 per cent of so-called bearer shareholders at the Swiss watchmaker’s annual meeting on Tuesday, up from 62 per cent support when he sought to win a board seat a year ago.
But Swatch’s dual-share structure allowed the Hayeks to defeat his appointment through its high-voting registered shares, preserving their tight grip on the world’s largest finished watch company. The family own about a quarter of the equity but close to half the voting rights. They also make up three board seats.
The result triggered tense exchanges at the AGM, with several minority investors accusing the board of ignoring the clearly expressed wishes of bearer shareholders.
Swatch, which owns leading brands including Omega, Longines and Blancpain, has objected to Wood’s candidacy because he is a US citizen who neither lives in nor has close ties to Switzerland.
The watchmaker instead proposed Andreas Rickenbacher, a Swiss businessman and politician, as its preferred new independent board member to represent bearer shareholders.
Wood launched legal action over last year’s AGM, challenging the Swatch board’s handling of his failed nomination and the treatment of bearer shareholder votes.
Representatives from the Ethos Foundation, a proxy adviser representing pension funds and itself a Swatch investor, argued during the AGM that bearer shareholders should be properly represented on the board and that their votes should carry meaningful weight in the company’s governance.
Another shareholder said that while Wood formally needed approval from all shareholders, the Swatch board could not legitimately override the clear support he had received from bearer shareholders “unless there are objective reasons”.
Another investor slammed the current board as being “part of the woodwork” and said bearer shareholders had made their will clear through the vote.
Swatch chair Nayla Hayek criticised Wood during the meeting, noting that he had already brought legal action against the company and accusing him of focusing on short-term profit growth rather than Swatch’s long-term development.
Hayek, whose late father founded the company, strongly rejected suggestions that the board had acted improperly or illegally, and said that ultimately “the court will decide”.
GreenWood said it was considering filing an injunction to invalidate the decisions made at the AGM.
Proxy advisers Ethos Foundation, Glass Lewis and Institutional Shareholder Services had all backed Wood’s candidacy, citing concerns over Swatch’s governance and board independence.
Swatch shares have risen 20 per cent since the start of the year but are down about a third over the past decade. Net profit plunged almost 90 per cent last year to just SFr25mn ($32mn), on top of a 75 per cent drop in 2024.
The company has been hit by weakening demand from China, the impact of US tariffs and a stronger Swiss franc, as well as broader problems in the luxury market.