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As JPMorgan Chase & Co's Jamie Dimon prepares for a vote tomorrow on whether he should keep his chairman and chief executive officer titles, he may take comfort knowing most of his biggest shareholders are led by men with the same dual role.
Seven of JPMorgan's 10 largest owners - including top five BlackRock Inc, Vanguard Group Inc, State Street Corp, Wellington Management Co and FMR LLC - are run by CEOs who are also chairmen. The top 10 hold a combined 29.5 per cent of New York-based JPMorgan's stock, data compiled by Bloomberg show.
"People just like him are going to vote on this," said Erik Gordon, a business and law professor at the University of Michigan in Ann Arbor. "If you've told your own board that the best structure for the sake of the company is to combine the roles, then how do you turn around and say, 'But that's not true for JPMorgan?'"
Of JPMorgan's top 10 shareholders, only Baltimore-based T Rowe Price, the seventh-biggest with a 2.15 per cent stake, has commented publicly on Dimon's role. Brian Rogers - T Rowe Price's chairman and chief investment officer, and not the CEO - said in a May 16 statement that "I fully support the combined chairman and CEO role at JPMorgan under the superb leadership of Jamie Dimon."
No formula
Brian Lewbart, a T Rowe Price spokesman, said there's no single management formula that's right for every company. "Our own corporate structure does inform the voting positions we take, but there are all different types of board leadership structures that work and don't work," he said.
Since Dimon took over as CEO at the start of 2006, JPMorgan has climbed 32 per cent, the best performance in the KBW Bank Index of 24 US lenders. The shares have advanced 8.3 per cent since he became chairman at the end of that year, the fourth-best showing in the index. The company's net income in the seven years ended December 31 totalled $104.8 billion.
JPMorgan is holding its annual meeting tomorrow in Tampa, Florida. The vote on splitting the chairman and CEO roles, proposed this year by a group of retirement plans including the AFSCME Employees pension fund, won about 40 percent approval last year. Investors are set to vote on three other shareholder proposals at the meeting, as well as five from management.
Fidelity Investments, whose parent FMR is led by Chairman and CEO Edward C Johnson III, has a policy of opposing proposals for a separate chairman, according to its corporate-governance and policy guidelines. Fidelity is JPMorgan's fifth-biggest shareholder, with a 2.44 per cent stake as of March 31.
JPMORGAN & DIMON
- Since Jamie Dimon took over as CEO at the start of 2006, JPMorgan has climbed 32%
- Shares advanced 8.3% since Dimon became chairman at the end of 2006
- Company's net income in the seven years ended Dec 31 totalled $104.8 bn
