Frequently Asked Questions
Shareholder Advocates Push for Climate-Competent Governance at JPMorgan Chase
(link to exempt solicitation here)
1. What do the composition and structure of JPMorgan’s Board of Directors have to do with climate change?
JPMorgan Chase is the largest bank in the United States, and the largest funder of fossil fuel expansion, providing $196 billion in lending and underwriting in the three years (2016-2018) since the Paris Agreement was adopted in 2015. JPMorgan Chase is also a leading funder within many of the riskiest and most potentially harmful of fossil fuel sectors, including Arctic oil and gas, tar sands, and coal mining. Without visionary leadership and rigorous, independent oversight, Chase will not undertake the comprehensive transformation of its financing practices needed to ensure that we achieve net-zero carbon emissions by 2050 at the latest to limit global warming to 2ºC and mitigate the escalating, systemic risks that climate change poses to the global financial system.
2. Why is Lee Raymond unfit to provide independent leadership to address the risks of climate change at JPMorgan Chase?
Raymond has served on the Board of JPMorgan Chase (and its predecessor) for 33 years, far longer than corporate governance best practices suggest. As lead independent director, he is supposed to exercise independent oversight over Jamie Dimon, who holds both CEO and Chair roles at JPMorgan Chase. However, as the Council of Institutional Investors cautions, “extended periods of service may adversely impact a director’s ability to bring an objective perspective to the boardroom.” Moreover, as former chair and CEO of ExxonMobil (and its predecessor Exxon), Raymond was the architect of the company’s efforts to promote denial of the risks and likelihood of climate change, even after Exxon scientists warned executives of the dangers of warming due to rising CO2 emissions. Raymond’s family members, and potentially Raymond himself, have ongoing financial interests in the fossil fuel industry at a time when financial leaders and regulators are warning of the risks of sudden re-valuations of assets in the sector. Considering Raymond’s long tenure, his uniquely poor record on climate issues, and his potential conflicts of interests, he is unqualified to provide the kind of oversight needed to drive reforms on climate, promote long-term shareholder value at JPMorgan Chase, and protect the financial system as a whole.
3. What is JPMorgan Chase CEO Jamie Dimon’s role in this?
Jamie Dimon holds both the chair and CEO roles at JPMorgan Chase, giving him near total control over the corporation’s decision-making, including on fossil fuel finance. That leaves Lee Raymond, lead independent director at JPMorgan Chase, where he is seen as serving as providing the only potential counterweight on the board to Jamie Dimon.
Shareholders have raised concerns about Jamie Dimon’s singular control over JPMorgan Chase and Lee Raymond’s unwillingness to hold him accountable for mismanagement. For example, after Raymond was chosen to oversee the company’s response to the high-profile “London Whale'' controversy, Raymond continued to back Dimon’s bid to remain as both chair of the board and CEO––while an effort to separate the roles of chair and CEO was one of the highest profile campaigns of the 2013 shareholder season and received 32% support from voting shareholders. A similar resolution was refiled in 2018 and received support from 34% of voting shareholders. A majority of S&P 500 companies now separate the roles of chair and CEO, and resolutions calling for that structural boardroom reform routinely receive a strong baseline of shareholder support.
4. What is an exempt solicitation?
An exempt solicitation is a communication between shareholders that recommends voting in a specific way on company matters, including on the appointment of board members. Exempt solicitations, unlike standard proxy solicitation, exempts the author from distributing the material to all shareholders, reducing the costs of communication among shareholders.