Jamie Dimon likes his two jobs, thank you very much.
Dimon, the CEO and chairman of the board of JPMorgan Chase, the biggest U.S. bank by assets, is under pressure to give up one of his titles. On May 21, the bank's shareholders will vote on a proposal to give the chairmanship to somebody else, in response to the "London Whale" trading losses and bouquet of regulatory troubles that have bloomed on Dimon's watch. The proposal is garnering a surprising amount of support -- but not from Dimon.
Asked about the proposal earlier this week, Dimon told a private group of investors that he'd like to keep both jobs and that he can't imagine doing anything but running JPMorgan, the Wall Street Journal reported on Wednesday.
Not reported: Whether anybody at the meeting informed Dimon that he can still keep running JPMorgan simply by being the CEO.
It's not clear why Dimon needs to be in charge of the board of directors as well. A growing number of shareholders and proxy advisory firms like Glass Lewis and Institutional Shareholder Services believe Dimon holding both positions is actually harming the bank, weakening the board's oversight of its sprawling operations.
At last year's annual meeting, when the London Whale debacle was still in its early stages, a proposal to strip Dimon of his chairmanship won 40 percent of shareholder votes. It's not clear how much support there is for this year's proposal, but there's a lot more suspense about it in advance, with every possible vote being studied and counted.
The bank has been pushing back hard, arguing that it is still turning record profits, despite $6 billion in London Whale trading losses. Some "board members and shareholders" worry that, if Dimon were to lose his chairmanship job, he might just take his presidential cufflinks and retire, The New York Times reported recently. To quote from Dimon's favorite movie, "The horror!"
But the bank just can't seem to stop running afoul of regulators. It is currently in hot water with the Office of the Comptroller of the Currency and the Federal Energy Regulatory Commission, to name two.
These regulatory woes might be holding back the bank's stock performance, suggests CNN/Money's Paul LaMonica, who points out that JPMorgan's stock-market valuation lags that of its other Too Big To Fail peers.
"JPMorgan Chase has made it painstakingly clear that the bank is better off with Jamie Dimon serving as both chief executive officer and chairman," LaMonica writes. "But the market seems to disagree ... which is one reason why the company's board might want to listen to the growing cries from some JPMorgan investors to separate the two roles."
There may be higher-minded reasons for Dimon to give up the chairmanship than massaging the stock price or doing penance for the bank's mistakes. Dimon should also do it burnish his own legacy, argues Roger Lowenstein, author of the classic financial-disaster book When Genius Failed.
"Dimon, who takes corporate governance more seriously than most, has a chance to redefine best practice for Wall Street -- Lloyd Blankfein at Goldman Sachs take note -- and for corporate America," Lowenstein writes at the Harvard Business Review. "He shouldn't wait for the shareholders. Jamie, do the right thing."
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