NEW YORK ( TheStreet) -- Shareholder activists calling for an independent chairman at JPMorgan Chase (JPM) may be guided by principles of sound corporate governance, but they fail to see the biggest weakness in their case.
So long as Jamie Dimon stays CEO, he will be the boss.
JPMorgan's annual meeting is on Tuesday. Among the various proxy items subject to a shareholder vote is a proposal to split Dimon's dual roles as CEO and chairman of the board of directors.
Press reports suggest Dimon might quit if the vote goes against him. But if he does decide to stay and gives up his chairman title, it will probably make zero difference to how things are run at JPMorgan.If history is any guide, when you have a strong CEO with a forceful personality, the chairman is often the one toeing the CEO's line and not the other way around. Strong CEOs often have an overpowering influence on their boards, whether they are chairmen or not. Steve Jobs was never chairman of Apple (AAPL) except for a brief period during his illness. But it was always clear that Jobs called the shots at Apple. The late Apple co-founder famously hand-picked his board. The company was often criticized by corporate governance experts for having a board that was too cozy with the co-founder and CEO. But who would have been strong enough to stand up to Jobs' fiery personality and win an argument with him? And can anyone really argue that that model did not work for Apple? Was anyone successfully able to argue that Jobs be fired because he had too much power? Surely, not the second time.
"There's no 'we' in 'CEO,'" American International Group (AIG) CEO Bob Benmosche, told Bloomberg News in a recent interview. The famously "in-your-face CEO" has a good relationship with AIG current chairman Steve Miller. But he constantly locked horns with former Chairman Harvey Golub, another strong personality, to the point of calling his relationship with Golub "ineffective and unsustainable." In the end, it was Golub who turned in his resignation, not Benmosche. Golub said in a letter to the board that he was stepping down because "it was easier to replace a chairman than a CEO."
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV