May 17, 2012
JP Morgan Chase Holds Annual Meeting Days After $2 Billion Loss
by Robert Kropp
A resolution calling for improved corporate governance through separating the roles of Chair and
CEO gains 40% of shareowner support.
The annual general meeting of JP Morgan Chase occurred on Tuesday in Tampa, days after the bank's
disclosure that its London-based investment office had lost $2 billion in risky proprietary
trading. It has been estimated that the losses could eventually total as much as $4 billion.
"JPMorgan's CEO James Dimon also serves as chairman of the Company's board of
directors," the resolution states. "We believe the combination of these two roles in a single
person weakens a corporation's governance which can harm shareholder value."
resolution was introduced at the meeting by Lisa Lindsley, director of capital strategies at
AFSCME, who said, "Mr. Dimon is effectively in charge of monitoring his own performance. The stakes
are too high to continue where an all-powerful CEO is his own boss. Looking for an infallible CEO
is a fool's errand... Independent board leadership would be in the best interest of the
The resolution gained an impressive 40% of shareowner support.
second resolution, filed by Investors Against Genocide (IAG), called on JP
Morgan's board to "institute transparent procedures to avoid holding investments in companies that,
in management’s judgment, substantially contribute to genocide or crimes against humanity, the most
egregious violations of human rights."
Support for the genocide-free investing proposal
increased this year to 9.2%, compared to 7.7% last year, when it was filed for the first time.
Despite the shareowner vote in favor of the proposal last year—and despite the fact that it is a
signatory to the United Nations' Principles for
Responsible Investment (PRI)—JPMorgan Chase actually increased its holding in PetroChina in
2011. It now owns $1.5 billion worth of PetroChina, and is one of the company's largest investors.
The issue of mortgage loan modifications and foreclosures were also very much on the minds
of sustainable investors at the meeting, as well as hundreds of protestors gathered outside. Rev.
Seamus Finn of the Interfaith Center on Corporate
Responsibility (ICCR) said to Dimon at the meeting, "You acknowledged JPMC’s mismanagement in
the servicing of loans including robo signings and other sloppy practices that have wreaked havoc
with the lives of millions of Americans. You seemed to acknowledge the voices of the individual
homeowners impacted by these mistakes."
"We heard you recognize that management oversight
of processes large and small was essential to the firm's credibility and profitability and your
implicit commitment to ensure that proper oversight was in place," Finn continued. "We heard your
words echoed again in the voices of the former-homeowners of today and the demonstrators outside at
this moment, all demanding to know what is our company doing every day to earn this privilege, this
public, social license?"
"We are all weary of mistakes and as shareholders we will
continue to hold you to a very high standard," Finn concluded. "But we can't help wondering, Mr.
Dimon, do you truly hear the voices of the people outside? Do you hear us, your investors?"