JPMorgan Chase investors ought to vote versus CEO Jamie Dimon’s pay plan, the proxy advisory company Glass, Lewis suggested, mentioning a “disconnect” in between his payment and the bank’s efficiency.
Of specific issue is $52.6 million in alternative awards approved to Dimon, “nearly double the size of his regular equity grant for 2021” and representing much of his $84.4 million in yearly pay, Glass Lewis stated in a report.
The company likewise slammed the $53.3 million in overall payment for President and Chief Operating Officer Daniel Pinto, that included nearly $27.9 million in alternative awards.
Chris Ratcliffe/Bloomberg
“Excessive one-off grants to the CEO and COO amid tepid relative performance worsen long-standing concerns regarding the company’s executive-pay program,” Glass Lewis stated in its report. “Shareholders should consider the company’s sustained disconnect between executive pay and performance over the last nine years.”
The advisory resolution, up for a vote by investors at the New York-based bank’s yearly conference on May 17, is nonbinding. Glass Lewis and other companies that evaluate business disclosures to recommend financiers how to vote at annual conferences have actually come out versus a variety of current prominent awards. Companies have stated the awards are required to maintain management in a heated market for skill.
Read more: Jamie Dimon Gets $56 Million After Old Incentive Snowballs
The choices grant offered to Dimon is meant to reveal the board desires him “to continue leading the firm for a significant number of future years,” JPMorgan stated in action to Glass Lewis’s suggestion. In the case of spend for the business’s president, “the board is acting responsibly in shareholders’ best interests in case Mr. Pinto needs to once again serve as CEO as a result of unforeseen circumstances.”
In 2020, the 59-year-old Pinto functioned as acting co-CEO while Dimon was sidelined by emergency situation heart surgical treatment simply as the coronavirus pandemic roiled markets. Since then, Pinto has actually transferred to New York from London to presume the functions of sole president and COO, titles he showed Gordon Smith prior to Smith’s retirement.
JPMorgan valued the choices that comprise Dimon’s and Pinto’s unique perks for accounting functions, however the quantity they will eventually be paid goes through alter based upon JPMorgan’s stock rate.
The grant to Dimon “incentivizes a successful leadership transition by requiring the CEO’s leadership for at least five years before the awards vest and another five years until he may sell any vested shares,” which “ensures direct alignment with shareholder returns over the next decade,” JPMorgan stated in its action. (The 66-year-old Dimon, whenever asked for how long he will stay CEO, has actually long joked that he’ll remain for 5 more years.)
Read more: Dimon May Remain JPMorgan Chair When He Eventually Quits as CEO
Rival Wall Street huge Goldman Sachs Group granted unique benefit grants in October to CEO David Solomon and President John Waldron that put them in line for about $50 million in one-time perks, stating they were meant to ensure management connection and skill retention. Glass Lewis suggested investors vote versus their pay plan too.
Institutional Shareholder Services, another big proxy-advisory company, likewise has actually suggested voting versus the pay plans for Dimon and other JPMorgan executives. Compensation for leading financing executives, consisting of those at JPMorgan and Goldman, has actually lost much of its worth with current market decreases. JPMorgan’s share rate is down nearly 30% considering that its October high, and is listed below its prepandemic levels.
