This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
EXCLUSIVE OFFER: Jim Cramer's Protégé, Dave Peltier, only buys Stock Under $10 that he thinks could potentially double or triple in the next 6 to 12-months. See what he's trading today with a 14-day FREE pass.

Katz: This Dimon Is Forever

Editor's Note: This article was originally published on Real Money at 11:32 a.m. EDT on May 13. To see latest Real Money commentary as it's published, sign up for a free trial of Real Money.

NEW YORK (Real Money) -- A company's annual proxy vote is the one time each year that its shareholders can effectively participate in the composition of the board of directors and setting executive compensation. Recently, the threat (or reality) of shareholder activism has focused the directors' discussions, and, for the most part, has served to improve board behavior. Occidental Petroleum (OXY) is a case in point, where a widespread uprising of shareholders (in which we participated) successfully reversed a wrong-headed initiative to force out a highly effective CEO.

Now a highly visible issue has emerged regarding JPMorgan Chase's (JPM) continued employment of Jamie Dimon as both its chairman and CEO. As a general policy, having a separate chairman and CEO is a better practice. We strongly endorse this structure for companies that have already made the distinction, and for those where a CEO transition is under way.

But in companies with unified chairman and CEO roles, the issue often requires more thought. For JPMorgan, the issue is ultimately one of textbook policy vs. pragmatic reality. Contrary to some commentary, the role of the chairman is not to "supervise" the CEO. If this were true, a single person occupying both positions would face an obvious conflict of interest. Actually, the responsibility for executive succession and assessment is a primary responsibility of the entire board.

The role of the chairman is to direct the board's discussion setting the company's long-term strategic evolution (director: direct). The CEO should be part of that discussion as a board member. The role of the CEO is to execute (executive: execute) that plan by leading the team through day-to-day operations. For a company like JPM, which has one highly capable individual currently filling both roles in Dimon, shareholders must determine pragmatically whether separation helps or hurts the company.

We've been owners and buyers of JPM since well before the global financial crisis of 2008, in part because we believe that the company has superior management, as exemplified by its performance both during and since the crisis.

Dimon has proven himself to be one of the very top-tier managers in the extremely complex financial sector. Judging by his public appearances at conferences, hearings and on earnings calls, it's clear that he understands all the issues throughout the company's many businesses, and has a thoughtful and analytical viewpoint on each. He's hands-on, action-oriented, and holds people accountable for their commitments and performance.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

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.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

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.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
DOW 16,960.57 -123.23 -0.72%
S&P 500 1,978.34 -9.64 -0.48%
NASDAQ 4,449.5640 -22.5440 -0.50%

Our Tweets

Brokerage Partners

Top Rated Stocks Top Rated Funds Top Rated ETFs