JPMorgan Chase & Co.’s directors asked shareholders to oppose the calls to make Chief Executive Officer Jamie Dimon to resign from one of his roles as CEO and chairman of the company. The directors said that it could be disruptive and go against the best interests of investors.
JPMorgan’s board has a structure that allows appropriate accountability to its shareholders and acts as counterbalance to the combined CEO/chair role enjoyed by Dimon. This was according to former Exxon Mobil Corp. chairman and CEO Lee R. Raymond and former Johnson & Johnson chairman and CEO William C. Weldon. Raymond is the board’s presiding director. Weldon is the head of the board’s corporate governance and nominating committee
In a letter sent to shareholders, Weldon and Raymond said that an inflexible approach to question the capability of a person to serve as both CEO and chairman is not the right move to solve the problems the bank is facing.
Proxy advisers at Institutional Shareholder Services and Glass Lewis told investors to name a separate chairman and remove some directors from the bank. Calls for Dimon to step down as chairman of JPMorgan have escalated since May when the company disclosed there were lapses in risk control at its chief investment office during the London Whale scandal that resulted to around $6.2 billion losses.
JPMorgan is the largest bank in the United States in terms of deposits and assets. Institutional Shareholder Services urged a vote to divide Dimon’s roles and remove three directors. Glass Lewis echoed the same sentiments as it wanted to fire three members of the risk committee as well as all three members of the audit committee after congressional and internal probes showed questionable risk-management practices at both the board and senior management levels. Shareholders of JPMorgan Chase will vote on the issue at their annual meeting on May 21.
