On Tuesday, JPMorgan Chase shareholders will vote on a proposal to strip Jamie Dimon of his dual title as chairman and CEO. The banking industry appears divided on the issue.
Several pundits and bankers have rushed to defend Dimon and his stewardship of the bank with the "fortress balance sheet," while critics argue that an independent chairman is called for in light of the bank's ongoing woes.
American Banker readers were slightly less divided on the issue. According to the results of our latest poll, 44% of respondents said Dimon should be stripped of his chairmanship, believing a dual title to be an example of bad corporate governance, while another 17% were on the fence about the move. 27% believed he should retain the chairman position and 12% felt it didn't matter who was at the helm in their view, JPMorgan is just too big to be managed.
But, while there's been ample debate over what should happen, there's no clear indication of how the vote will ultimately play out.
Earlier this month, Dimon's ouster as chairman appeared to be a definite possibility with two major proxy firms, Glass, Lewis and Co. and Institutional Shareholder Services, advising shareholders to support the proposal. Reports also surfaced that three of JPMorgan's largest shareholders BlackRock, Vanguard Group and Fidelity Investments were undecided as to how they would vote.
But the bank stepped up its lobbying efforts, prompting certain institutional investors to come forth in support of Dimon. The most recent unofficial tally of shareholder sentiment came courtesy of a Wall Street Journal story last week, in which an anonymous source put support for severing the chairman and CEO roles "slightly ahead of the 40% it received last year."
Should this number grow to a majority, there's no guarantee anything will actually change. The proposal is nonbinding and the board has continually voiced strong support for Dimon as chairman and CEO. There is also the possibility that Dimon will vacate both roles, given reports he will quit if shareholders vote against him.
How do you think the vote tomorrow is likely to play out? Will shareholders support Dimon? And if they vote against him, is the board likely to heed their recommendation? Would Dimon really quit if the vote goes against him? Leave a comment below.