JPMorgan avoids third showdown over Dimon role
JPMorgan Chase has avoided a third successive showdown with shareholders at its annual meeting in Florida by convincing activists to forgo a vote on whether the bank should split the roles of chairman and chief executive.
Jamie Dimon holds both positions and last year's meeting in Tampa saw a contentious vote over whether to strip him of one of the roles in the wake of the "London whale" trading fiasco. After lobbying from both sides, the bank ultimately quelled revolt over the issue.
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On Thursday it announced that it had managed to remove it from the agenda altogether.
Lee Raymond, lead independent director of JPMorgan's board, said: "Engagement with shareholders is important and facilitates a better understanding of governance practices and communications that promote the best interests of the company and its shareholders."
The proposal was already a watered-down version of the 2013 proposal. Rather than calling for Mr Dimon to be stripped of one of the roles, it only advocated splitting the positions when he eventually steps down from the helm of JPMorgan.
Timothy Smith of Walden Asset Management, representing the sponsor of the proposal to separate the roles, said: "We are pleased with the positive response from the company and are confident that the goodwill stimulated from both of the agreements announced today will lead to productive ongoing work regarding these important governance matters."
To attempt to assuage shareholders' concern that the dual structure concentrates too much power in the hands of a single person, the board has strengthened the role of Mr Raymond, codifying his responsibilities for holding Mr Dimon to account.
That change follows a similar move at Goldman Sachs, which was also sufficient to neutralise an attempt to split the chairman and chief executive roles held by Lloyd Blankfein.
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JPMorgan said it had also managed to satisfy a group of nuns, who agreed to withdraw their proposal that the bank should be forced to produce a report to shareholders into its "multiple scandals", ranging from the London whale to mis-selling of mortgage-backed securities.
The Sisters of Charity of Saint Elizabeth said they were agreeing to withdraw their proposal after JPMorgan had pledged to write a similar report.The thaw in relations between the bank and the nuns comes only weeks after JPMorgan's lawyers told the Securities and Exchange Commission that their proposal was "materially false and misleading".
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