40% back union pension fund’s proposal for independent chair at J.P. Morgan

Dutch pension giant PGGM votes against Dimon as director

The proposal by the AFSCME Employees Pension Plan for an independent chairman at J.P. Morgan Chase got more than 40% support at the troubled US banking giant’s annual meeting yesterday.
The 1.6m-member American Federation of State, County and Municipal Employees had tabled the proposal before the bank’s $2bn (€1.55bn) trading losses were revealed earlier this month.
Responsible Investor reported yesterday that major US institutional investors backed the AFSCME proposal.

Dutch pension fund manager PGGM has now disclosed that it also supported the motion, saying the board’s primary responsibility is to represent shareholders and oversee management and instil accountability. “Conflicts of interest may arise when one person holds both the chairman and CEO positions,” it said.
PGGM, which has €121bn under management, added that it even voted against Jamie Dimon’s re-election as a director. It argued his dual role as chairman and CEO is “obviously compromised”. The fund giant also voted against ratifying the named executive officers’ pay.
Meanwhile, New York State Comptroller, the trustee of the five New York City Pension Funds, called on the bank’s board to claw back “every single dollar possible” from the executives responsible for trading losses.Liu, who oversees funds which have a combined $400.6m stake in the bank, said this would send a message that those recklessly gambling with shareholder money are jeopardizing long-term value.
Liu’s office earlier this year concluded a dialogue with the bank, which agreed to clarify its compensation clawback policies in return for the withdrawal of a shareholder resolution on the matter.
At the meeting in Tampa, Florida, 91.5% of shareholders approved the bank’s executive compensation in a non-binding annual advisory vote, up from 73% last year.
The meeting coincided with reports that the US Justice Department and Federal Bureau of Investigation have opened inquiries into the trading losses.
Campaign group Investors Against Genocide’s proposal on genocide-free investing gained 9.2% backing, up from 7.69% in 2011. The motion refers to the bank’s holdings of more than $3.5bn in PetroChina and Sinopec, which are linked to atrocities in Sudan. IAG said it has begun engaging with institutional investors to build support for its case.

J.P. Morgan’s fund management arm J.P. Morgan Asset Management has around $1.4trn under management and is a signatory to the United Nations Principles for Responsible Investment.