(Bloomberg) -- Switzerland will still up the ante on multinational corporations with new ethics standards for businesses after voters rejected a popular initiative on Sunday.
A counter-proposal will now go ahead. It also seeks to ensure companies based in Switzerland don't abuse human rights or breach environmental standards elsewhere, but stops short of allowing them to be sued for liability.
Multinationals play a big role in Switzerland, employing just over a quarter of the country's workforce. The wealthy country has low tax, light-touch regulation that makes it attractive as a base for commodity traders and other companies.
Voters “disapproved of the path the initiative proposed but not of the issue itself,” Justice Minister Karin Keller-Sutter said at a press conference in Bern. “Swiss companies must respect people and the environment abroad too.”
The counter-proposal will enter into force if no referendum on it is called in the next 100 days.
Swiss Reject Business Liability Measure, Ban on SNB Investments
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The Swiss on Sunday also rejected a measure that would have banned the country's central bank from investing in defense companies.
Switzerland Inc. Sweats as Global Accountability Vote Nears
Switzerland's bid to establish new standards comes in tandem with efforts elsewhere. The European Union is planning legislation that could make companies responsible for human rights abuses and environmental harm in their supply chain.
The corporate world, from Nestle SA to commodities trader Glencore Plc and cement maker LafargeHolcim Ltd. had opposed the Responsible Business Initiative, citing bureaucracy and a potential flurry of lawsuits.
“We welcome a quick implementation of the counter-proposal and with it, binding rules for all companies,” a Nestle spokesperson said in an email following the vote.
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