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from Breakingviews:
Pyrrhic victory for Dimon is defeat for governance
By Agnes T. Crane and Antony Currie
The authors are Reuters Breakingviews columnists. The opinions expressed are their own.
The Pyrrhic victory Tuesday for Jamie Dimon is a defeat for governance. Just over two-thirds of JPMorgan shareholders voted to keep him as both chairman and chief executive at the bank’s annual meeting in Tampa on Tuesday. And Dimon and the board had to devote a considerable amount of time to preserving his titles rather than running America’s largest bank by assets. The episode perfectly illustrates the common sense behind separating the two roles.
Having a third of shareholders vote against Dimon is hardly an overwhelming vote of confidence. It is, though, a marked improvement from last year when 40 percent of shareholders voted for a split just weeks after the bank announced what turned into a $6 billion hit to revenue from the so-called London Whale trading fiasco.
The support comes after the directors lobbied hard - and very late in the day – to keep Dimon at the helm of both the management team and the board. They had even gone so far as to warn that a change in leadership would be disruptive to the bank, unsubtly implying that Dimon might leave if he didn’t get his way.
from Bethany McLean:
How much does Jamie Dimon matter?
So today is the day. After weeks of near-constant coverage of the big decision — will JPMorgan Chase shareholders keep Jamie Dimon as chairman and CEO or relegate him to just CEO? — the verdict came at JPMorgan’s annual meeting in Tampa, Florida: Dimon gets to keep both titles. The next question is whether the result will get as much press as the original question did.
The subject has gotten so much coverage in part because Dimon is so divisive. To his supporters, he’s the personification of everything that’s best about the financial system. Those who defend Dimon, like New York Times columnist Andrew Ross Sorkin, point out that JPMorgan Chase hasn’t lost money in any quarter while Dimon has been in charge. Others, including Warren Buffett, Jack Welch, Michael Bloomberg and Rupert Murdoch, praise Dimon, who is often called “America’s most famous banker,” for his management skills. But to detractors, he’s the personification of all that’s wrong with modern banking — the arrogance, the resistance to new regulation, the astronomical pay in the face of obvious mistakes. The way he acted — threatening to resign entirely if his chairmanship was taken away — is proof that he’s no more than a spoiled child.
from Breakingviews:
Dimon has little to lose in shareholder vote
By Antony Currie
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Jamie Dimon has little to lose if JPMorgan’s shareholders choose to split the chairman and chief executive roles at Tuesday’s annual meeting. Quitting, a response that has been hinted at by the board in recent weeks, would be a rather childish move. There are better options for all concerned.
from Breakingviews:
Glencore should just name Ivan Glasenberg chairman
By Kevin Allison
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
John Bond’s ouster is an opportunity for Glencore Xstrata to make a fresh start in the boardroom. Best practice would dictate that the departing chairman’s permanent replacement be a strong outsider. That precludes tapping Ivan Glasenberg, the newly-merged miner’s CEO and its biggest shareholder. However, a dual mandate might better reflect corporate reality.
from Breakingviews:
What Would Jamie Dimon Do?
By Rob Cox
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
What Would Jamie Dimon Do? That’s a question investors need to answer before voting to split the chairman and chief executive roles at JPMorgan’s annual meeting next week. The risk is that shareholders score a corporate governance point but lose Dimon. As a general rule, cutting off your nose to spite your face is a bad investment strategy.
from Breakingviews:
It’s about good governance, not Jamie
By Rob Cox
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Another day, another pressure point for JPMorgan. The latest rebuke of the U.S. bank’s board arrived on Tuesday from proxy adviser Glass Lewis, which like Institutional Shareholder Services helps investors make up their minds about how to vote at the annual meetings of companies. Both firms are now arguing for JPMorgan to split the roles of chairman and chief executive.
from Breakingviews:
Lufthansa governance farce marks new low point
By Olaf Storbeck
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Europe’s largest airline in the last 24 hours has gone through a series of self-inflicted turbulences that raise doubts about the quality of its governance. On Monday morning, the nominated new chairman of Lufthansa, a former chief executive of the company, unexpectedly announced that he would not be available for the task. One day ahead of the annual shareholder meeting, Wolfgang Mayrhuber, 66, seemed to cave in to pressure from international investors unhappy with his candidacy. Then, a few hours later, he changed his mind once again, and decided to run after all.
from Counterparties:
The last big Lauder gift?
The big news early this week in the often overlapping worlds of art, philanthropy, and sophisticated tax strategies was Leonard Lauder's $1 billion donation of cubist art to the Met. It's Lauder's largest charitable donation to-date, and even though he has a long history of philantrophy and is still worth more than $7 billion according to Forbes, it's unlikely he'll ever make a bigger gift. Lauder's wealth is tied up in Estée Lauder stock you see: he simply isn't rich enough to give away much more money or add to his museum worthy art collection, and maintain his controlling stake in the family's business.
The more likely scenario is that Leonard, along with his brother Ronald, will maintain their earlier level philanthropy. While large, their earlier gifts were far below the billion dollar level. Leonard has given $131 million to the Whitney, and Ronald is a large supporter of Jewish charities. Both brothers and their wives have also founded, endowed, and serve on the boards of numerous non-profits (the full lists run for text dense paragraphs on the Carnegie Foundation and Estée Lauder websites).
from Global Investing:
Big Beasts
This week might just have seen a marked shift in how British investors think about their role as owners of companies.
First up we had three of our largest unions teaming up behind a set of governance guidelines which they will wave noisily in the air at AGMs, but more significantly, Tuesday morning saw the first steps towards building the kind of collaborative architecture for investors envisioned by the Kay Review.
from Breakingviews:
U.S. oil billionaire’s divorce is no private affair
By Christopher Swann
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
American oil billionaire Harold Hamm’s impending divorce is not simply a private affair. Investors swiftly stripped half a billion dollars from the market value of Continental Resources on Thursday following news that founder and 68 percent owner Hamm and his wife are splitting. That may not do the threat justice. Any division of the tycoon’s $11 billion fortune leaves Continental exposed to hefty stock sales or a feud at the top.
