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Second shareholder advisory group comes out against chief executive Dimon’s chairmanship ahead of annual meeting.
Influential investment adviser Glass Lewis has called for JP Morgan to appoint an independent chairman and for shareholders to vote out directors who oversaw the bank’s “London whale” losses.
The move will put further pressure on Jamie Dimon, the chairman and chief executive, ahead of the bank’s annual shareholder meeting later this month.
Shareholders have already been advised to vote for an independent chairman by Glass Lewis’s main rival, Institutional Shareholder Services. The two firms advise many of JP Morgan’s largest shareholders.
Glass Lewis and ISS have advised shareholders to vote against three members of the board’s risk committee – David Cote, Ellen Futter and chairman James Crown – for what they allege are failures of oversight. Glass Lewis also added three members of the firm’s audit committee to its hit list – James Bell, Crandall Bowles and chairman Laban Jackson Jr.
Calling for the directors to be ousted, Glass Lewis cited their alleged role in JP Morgan’s $6bn (£3.9bn) London trading losses: “Shareholders should be concerned that company management was allowed to build a massive exposure to credit derivatives, switch VaR [value at risk] models following a breach of risk limits, and value its positions so to minimize losses, and that it was able to do each of these things without triggering a board-level review or a mandatory containment of risk.”
The bank has been lobbying shareholders ahead of the meeting on 21 May. It has the support of another proxy adviser, Egan-Jones Proxy Services, and the backing of billionaire investor Warren Buffett. “I’m 100% for Jamie,” Buffett told Bloomberg Television last week. “I couldn’t think of a better chairman.”
Three of the bank’s largest shareholders – Blackrock, Vanguard and Fidelity – are reportedly still undecided about how they will vote. The three hold 12% of JP Morgan shares and last year backed Dimon in a similar vote over his chairmanship.