New York's DiNapoli asks Dimon to back off a proxy reform

BOSTON (Reuters) - JPMorgan Chase & Co JPM.N CEO Jamie Dimon, who has faced tough shareholder resolutions, is being asked to save them.

James Dimon, Chairman of the Board and Chief Executive Officer of JPMorgan Chase & Co, attends the Paris Europlace International Financial Forum in Paris, France, July 11, 2017. REUTERS/Gonzalo Fuentes

In a letter to the bank chief earlier this month, New York State Comptroller Thomas DiNapoli asked Dimon to stop efforts by an executive group he leads that would make it harder to file shareholder resolutions.

The changes would go so far they would “ultimately jeopardize corporate transparency and accountability,” wrote DiNapoli, who oversees a state worker retirement fund with $192 billion.

In addition to running JPMorgan, Dimon chairs the Business Roundtable, an association of corporate CEOs that has pushed to scale back securities regulations. One change it backs would be to raise the threshold needed to file a shareholder resolution, which currently can be done with $2,000 worth of company stock, held for one year.

The Roundtable praised a bill passed by the U.S. House in June that would do that, by effectively raising the minimum holding requirement to one percent of a company’s stock, held for three years. The measure faces an uncertain future in the Senate, however.

A JPMorgan spokeswoman said the company would not comment, and a spokeswoman for the Roundtable declined to comment beyond a statement in support of the House changes.

Dimon has famously faced off with his own investors, such as in 2012, when 40 percent backed a shareholder measure at the company’s annual meeting that would have taken away his title of chairman. While the measure did not pass, the bank’s board the next year gave more power to its lead independent director.

A spokesman for DiNapoli said that he and Dimon have spoken, and that “Mr. Dimon indicated that he was reviewing the issues raised in the letter.”

The proposed changes come even as some shareholder measures begin to receive a critical mass of investor support.

A notable example came in May at Exxon Mobil Corp XOM.N where DiNapoli's fund filed a measure calling for it to report on risks it could face from climate change policies.

It passed with an unprecedented 62 percent of votes cast, reflecting support from big investors including BlackRock Inc BLK.N and Vanguard Group, according to people familiar with the matter.

DiNapoli’s fund would not have been able to file the Exxon resolution under the one percent threshold. The fund holds about 12 million Exxon shares, according to Thomson Reuters data, or 0.28 percent of the company.

BlackRock and Vanguard did not comment for this article. Both big asset managers and others have hired new governance executives in recent years to help them take a more active role on issues like climate change and gender diversity.

According to researcher Proxy Insight, at S&P 500 companies from 2013 through 2016, BlackRock funds supported shareholder proposals up to 21 percent of the time.

And funds run by JPMorgan’s asset management unit -- one of Dimon’s businesses -- supported the resolutions up to 43 percent of the time.

Reporting by Ross Kerber in Boston; Editing by Phil Berlowitz