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JPMorgan buyers hand Jamie Dimon a uncommon rebuke with disapproval of $52.6 million bonus

JP Morgan Chase & Co. Chairman & Chief Govt Officer Jamie Dimon testifies earlier than the Home Monetary Companies Committee on accountability for megabanks within the Rayburn Home Workplace Constructing on Capitol Hill in Washington, DC on April 10, 2019.

Mandel Ngan | AFP | Getty Pictures

JPMorgan Chase CEO Jamie Dimon was handed a uncommon rebuke on Tuesday with the shareholder disapproval of his huge retention bonus introduced by the financial institution final 12 months.

Simply 31% of buyers collaborating within the New York-based financial institution’s annual shareholder assembly supported the $52.6 million award that was a part of Dimon’s 2021 compensation package deal.

The bonus, within the type of 1.5 million choices that Dimon can train in 2026, was designed to maintain the CEO and chairman on the helm of JPMorgan for an additional 5 years. Its estimated worth, pegged final 12 months, fluctuates and depends on the financial institution’s share value appreciation, in keeping with financial institution spokesman Joe Evangelisti.

“The particular award was extraordinarily uncommon — the primary in additional than a decade for Mr. Dimon — and it mirrored exemplary management and extra incentive for a profitable management transition,” Evangelisti stated.

Whereas the outcomes of the so-called “say on pay” vote are nonbinding, JPMorgan’s board stated it takes investor suggestions “severely” and meant Dimon’s bonus to be a one-time occasion, he added.

The disapproval was the primary time JPMorgan’s board suffered a down vote on compensation because the pay-watch measures had been launched greater than a decade in the past. Dimon, 66, has led JPMorgan since 2006, serving to information it via a number of crises and constructing it into the largest U.S. financial institution by property.

Earlier this month, proxy advisory companies together with Glass, Lewis & Co. really useful that shareholders vote towards the pay package deal of Dimon and his prime lieutenant, Daniel Pinto. Together with the retention bonus, Dimon’s pay final 12 months was valued at $84.four million.

“Extreme one-off grants to the CEO and COO amid tepid relative efficiency worsen long-standing issues relating to the corporate’s executive-pay program,” Glass Lewis stated in its report.

Dimon and his different administrators acquired help in any other case from buyers, which is extra typical of a shareholder vote at a big firm.

Glass Lewis had additionally suggested that shareholders vote towards the compensation of rival CEO David Solomon, who leads Goldman Sachs and was awarded a $30 million retention bonus in October. In that case, nonetheless, about 82% of Goldman’s shareholders voted in favor of administration.

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