* Firm urges shareholders to vote for separation
* Executive pay package gets another endorsement
By David Henry and Rick Rothacker
April 30 (Reuters) – Jamie Dimon’s $23.1 million paycheck is
OK, but he should not be both chairman and CEO of JPMorgan Chase
& Co, an adviser to institutional investors said on
Monday.
ISS Proxy Advisory Services said it has recommended that
shareholders endorse the company’s executive pay plan at the
annual meeting on May 15, but urge directors to separate the
roles of CEO and board chairman.
The views from ISS further reduce the chances that the
company will suffer a rebuke over pay like that at Citigroup Inc
two weeks ago, but could add to momentum for independent
chairmen of public companies.
Another advisory firm, Glass, Lewis & Co, last week
recommended the same votes on the issues.
At the Wells Fargo & Co shareholder meeting last
week, a proposal to split the chairman and CEO roles held by
John Stumpf was backed by 38 percent of votes cast, up from 30
percent the year before. A similar proposal at JPMorgan last
year received 12 percent of votes cast.
Some 19 percent of companies in the Standard & Poor’s 500
stock index had directors who were not executives serving as
chairmen at the end of June 2011, up from 16 percent three years
earlier, ISS said. Proposals to separate the positions last year
garnered an average of 33 percent of votes cast, up from 28
percent in 2010, according to the ISS.
The separation of the chairman and CEO positions gained
renewed attention in March when a national union agreed to
withdraw a similar proposal at Goldman Sachs Group Inc after the
Wall Street bank created a lead director position. Lead
directors typically can set agendas at board meetings, call
meetings that exclude management and oversee corporate
governance processes.
Among the four biggest U.S. banks, Bank of America Corp
and Citigroup Inc have separate chairmen. Citigroup
split the roles after suffering massive losses in the financial
crisis. Bank of America split the positions after shareholders
backed the move in 2009 as the company reeled from its
troublesome Merrill Lynch & Co acquisition.
ISS said it generally recommends votes for shareholder
proposals for independent chairmen.
JPMorgan’s board, which opposes the move, said the bank’s
current structure provides “independent leadership and oversight
of management,” according to the company’s proxy filing. An
independent director is annually appointed to be the presiding
director each year and more than 90 percent of directors are not
executives, the board said.
Taking the chairmanship from Dimon “could cause uncertainty,
confusion and inefficiency,” the board said.
Dimon received $23.1 million in total compensation in 2011.
ISS said the pay, essentially the same as the year before, was
“reasonably aligned” with company performance.
