Less than a third of shareholders approved Dimon’s pay package at the bank’s annual meeting this week. That’s the first time since 2009, when JPMorgan first began investor votes on executive compensation, that a majority voted against such a measure. Last year 90% of shareholders voted in favor of the bank’s 2020 pay packages.
The rejection suggests that shareholders may be unhappy with Dimon, who has led the bank since 2006 and guided JPMorgan through two recessions as it emerged to become the biggest US bank by assets. Or maybe they thought the pay increase was just too high.
Two prominent proxy advisory firms, Glass, Lewis & Co. and Institutional Shareholder Services, campaigned heavily against the bonuses, arguing that the huge payday didn’t line up with the bank’s recent performance. JPMorgan shares are down more than 25% in 2022, and are performing worst among the large US banks.
“Excessive one-off grants to the CEO and COO amid tepid relative performance worsen longstanding concerns regarding the company’s executive pay program,” Glass, Lewis & Co. wrote in a report to shareholders. “The lack of performance-based vesting conditions tied to the awards while the Company has not achieved adequate alignment between executive pay and performance warrants shareholders scrutiny,” they wrote.
A JPMorgan spokesperson said after the vote that the compensation package was a rare one-time payment meant to reflect “exemplary leadership.”