JPMorgan to let investor groups nominate directors, disclose pay clawbacks
27 October 2015
JPMorgan Chase & Co said on Monday its board will consider a bylaw amendment to make it easier for small groups of investors access to nomination of candidates for the New York bank's board of directors.
The bank also said in a filing on Monday that it would make a public disclosure any time it retrieves compensation from any member of the company's operating committee.
JPMorgan has, in recent years, faced complaints from shareholders about the bank's executive compensation disclosures.
The move came just hours before fast-food leader McDonald's Corp announced that its board had amended the company bylaws to provide shareholders with new rights of access to the board of directors.
In a filing with the Securities Exchange Commission (SEC), JPMorgan said its board has told the management to prepare an amendment to grant groups of up to 20 shareholders the right to nominate their own candidates, or ''proxy access'', a change several companies have accepted.
The amended bylaws would, however, require shareholders to have owned at least 3 per cent of the company for three years, a common threshold and an approach the board requested.
JPMorgan Chase, which had initially resisted pressures to improve disclosures, has now bowed to shareholders demand to disclose more information when it claws back money from top executives.
Earlier this year, the bank had rejected a proposal calling for more information about clawbacks, although the proposal won support from 44 per cent of the bank's voting shareholders.
Since then, the Securities and Exchange Commission approved a rule requiring public companies to disclose clawbacks under certain conditions, though the rule is narrower than the one JPMorgan announced for itself on Monday.
The issue of clawbacks came to the forefront after JPMorgan took back payments it had previously given to executives connected to the so-called London Whale incident, in which traders from the bank's chief investment office lost nearly $6 billion.