Deal with activists lets JPMorgan avoid battle over chairman
(Reuters) - A deal with shareholder activists outlined by JPMorgan Chase & Co on Thursday will allow the bank to avoid another battle at its spring shareholder meeting over whether the firm should have an independent chairman.
In exchange for the withdrawal of a shareholder proposal the bank agreed to develop some type of public event on the criteria boards should use in setting up the roles of chairman and chief executive officer, shareholder activists said on Thursday.
In addition, the bank will provide more details of its risk mitigation efforts, both sides said, leading to the withdrawal of a related proposal.
"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," Lee Raymond, JPMorgan's lead independent director, said in a statement.
The filers of both resolutions are affiliated with the Interfaith Center on Corporate Responsibility in New York. Its vice chairman, Seamus Finn, said the bank was likely looking to resolve lingering questions over matters such as its $6 billion "London Whale" trading losses and scrutiny of its mortgage practices.
"I think they decided this may be a way to get the monkey off their back in terms of restoring the public trust," Finn said in a telephone interview.
Jamie Dimon holds both the chairman and CEO titles at the bank. But the dual roles had become a flashpoint and at JPMorgan's last two annual meetings Dimon faced resolutions that would have stripped him of the chairman title.
This year activists had sought only to phase in an independent chairman requirement when the bank seeks its next CEO eventually. Still the proposal could have led to another personalized debate over Dimon's management.
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