UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Rule 14a-101)
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No.__ )
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JPMorgan Chase & Co. 383 Madison Avenue New York, New York 10179-0001 April 4, 2022 Dear fellow shareholders: We are pleased to invite you to attend the annual meeting of shareholders to be held in a virtual meeting format only, via the Internet, on May 17, 2022 at 10:00 a.m. Eastern Time. Shareholders are provided an opportunity to ask questions about topics of importance to the Firm’s business and affairs, to consider matters described in the proxy statement and to receive an update on the Firm’s activities and performance. We hope that you will attend the meeting. We encourage you to designate the persons named as proxies on the proxy card to vote your shares even if you are planning to attend. This will ensure that your common stock is represented at the meeting. This proxy statement explains more about the matters to be voted on at the annual meeting, about proxy voting, and other information about how to participate. Please read it carefully. We look forward to your participation. Sincerely,  James Dimon Chairman and Chief Executive Officer  | |||||
A Letter from Jamie Dimon, Our Chairman and CEO, and Stephen B. Burke, Our Lead Independent Director
April 4, 2022
Dear fellow shareholders:
In connection with the 2022 Annual Meeting, we want to share with you some of the highlights of the work of the Board. The Firm demonstrated strong financial performance in 2021, building upon its momentum from prior years. We gained market share in our businesses, demonstrated strong expense discipline while continuing to invest into our businesses, maintained a fortress balance sheet and returned $28.5 billion of capital to shareholders. That said, our clients and customers, employees and communities continued to face the challenges posed by COVID-19, societal gaps, including with respect to racial equity and access to health care, and climate change. We worked to support them, while remaining true to our fundamental business principles and commitment to building long-term value for our shareholders.
The Board recognizes that long-term strong performance requires disciplined focus on the factors that drive performance and continued investment in products, technology and people who will lead the firm in the future. We have continued to prioritize management development and succession, growing senior leaders, and overseeing plans to give them greater responsibility and broader exposure to firmwide issues. We have built a deep bench of potential leaders who can execute the firm’s strategy and enhance our strong culture. This was illustrated clearly as Gordon Smith, co-President and Chief Operating Office and CEO of Consumer & Community Banking (“CCB”) retired, Daniel Pinto was appointed sole President and Chief Operating Officer, Marianne Lake and Jennifer Piepszak were appointed co-heads of CCB, Jeremy Barnum succeeded Jenn as CFO and the Firm expanded the Operating Committee. As part of our long-term executive retention and succession planning, we also granted special awards to Mr. Dimon and Mr. Pinto. These awards reflect our desire for them to continue their outstanding leadership in their respective roles.
More broadly, we are guided by the firm’s core business principles – exceptional client service, a commitment to integrity, fairness and responsibility, operational excellence and a great team and winning culture. We hold management accountable for developing strategic priorities that will reinforce these principles. In the past year, we added a Sustainable Business Practices tenet to the Firm’s strategic framework, in recognition of the importance of investing in and supporting our communities, integrating sustainability into business and operating decisions, serving a diverse customer base and promoting sound governance. In furtherance of our commitments to sustainable business practices, the Firm announced a ten-year target to finance and facilitate $1 trillion for climate action, as part of a $2.5
trillion target for sustainable development, and deployed or committed more than $18 billion towards our $30 billion goal to advance racial equity and promote inclusive growth.
Through our oversight of the strategic planning process, we also hold management accountable to navigate change and drive innovation while maintaining a strong risk and control environment. In today’s rapidly changing business space, it is critical that we keep pace with innovations in technology and investments in our business offerings. New technologies are changing the way we operate our business, the products and services we offer and even the way we engage with our clients. And the environment in 2021 offered the opportunity to complement our product offerings through acquisitions and investments. Board discussions have focused on what will contribute to the Firm’s future success, including thoughtful investments in technology, acquisitions and the continued identification and retention of top talent.
We are committed to maintaining a vital Board in the future. Our ongoing board recruitment process enables us to build a strong pipeline of prospective directors. We are seeking to recruit those candidates who will contribute to the Board’s balance of skills, experience, personal attributes and tenure and we are developing relationships with near-term and long-term prospective candidates. We also adopted enhancements to our policies that, building on the robust Lead Independent Director role, consider shareholder concerns and allow the Board to make the best decision on leadership structure at the time of the next CEO succession.
We are optimistic about the future and look forward to continuing to deliver value to our customers, shareholders and stakeholders. On behalf of the entire board, we are grateful for your support of the Board and the Firm.
James Dimon
Chairman and Chief Executive Officer
Stephen B. Burke
Lead Independent Director
Notice of 2022 Annual Meeting of Shareholders and Proxy Statement
| DATE | Tuesday, May 17, 2022 | ||||
| TIME | 10:00 a.m. Eastern Time | ||||
| ACCESS | The 2022 Annual Meeting will be held in a virtual meeting format only, via the Internet. If you plan to participate in the virtual meeting, please see “Information about the annual shareholder meeting.” Shareholders will be able to attend, vote, examine the stockholders list and submit questions (both before, and for a portion of, the meeting) from any location via the Internet. Shareholders may participate online by logging in at www.virtualshareholdermeeting.com/JPM2022. We encourage you to submit your proxy prior to the annual meeting. | ||||
| RECORD DATE | March 18, 2022 | ||||
| MATTERS TO BE | •Election of Directors | ||||
| VOTED ON | •Advisory resolution to approve executive compensation •Ratification of PricewaterhouseCoopers LLP as our independent registered public accounting firm for 2022 •Shareholder proposals, if they are properly introduced at the meeting •Any other matters that may properly be brought before the meeting By order of the Board of Directors John H. Tribolati Secretary April 4, 2022 | ||||
YOUR VOTE IS IMPORTANT TO US. PLEASE VOTE PROMPTLY.
JPMorgan Chase & Co. uses the Securities and Exchange Commission (“SEC”) rule permitting companies to furnish proxy materials to their shareholders via the Internet. In accordance with this rule, on or about April 4, 2022, we sent to shareholders of record at the close of business on March 18, 2022, a Notice of Internet Availability of Proxy Materials (“Notice”), which includes instructions on how to access our 2022 Proxy Statement and 2021 Annual Report online, and how to vote online for the 2022 Annual Shareholder Meeting.
If you received a Notice and would like to receive a printed copy of our proxy materials, please follow the instructions for requesting such materials included in the Notice.
To be admitted to the annual meeting at www.virtualshareholdermeeting.com/JPM2022, you must enter the control number found on your proxy card, voting instruction form or Notice you previously received. See “Information about the annual shareholder meeting” on page 104. At the virtual meeting site, you may follow the instructions to vote, access the stockholders list and ask questions before or during the meeting.
If you hold your shares through a broker, your shares will not be voted unless (i) you provide voting instructions or (ii) the matter is one for which brokers have discretionary authority to vote. Of the matters to be voted on at the annual meeting, the only one for which brokers have discretionary authority to vote is Proposal 3, the ratification of the independent registered public accounting firm. See “What is the voting requirement to approve each of the proposals?” on page 106.
| Table of Contents | RECOMMENDATIONS |  | ||||||
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This proxy statement contains forward-looking statements. These statements can be identified by the fact that they do not relate strictly to historical or current facts. Forward-looking statements often use words such as “anticipate,” “target,” “expect,” “estimate,” “intend,” “plan,” “goal,” “believe” or other words of similar meaning. Forward-looking statements provide JPMorgan Chase & Co.’s (“JPMorgan Chase” or the “Firm”) current expectations or forecasts of future events, circumstances, results or aspirations, and are subject to significant risks and uncertainties. These risks and uncertainties could cause the Firm’s actual results to differ materially from those set forth in such forward-looking statements. Certain of such risks and uncertainties are described in JPMorgan Chase’s Annual Report on Form 10-K for the year ended December 31, 2021 ("2021 Form 10-K"). JPMorgan Chase does not undertake to update the forward-looking statements included in this proxy statement to reflect the impact of circumstances or events that may arise after the date the forward-looking statements were made.
No reports, documents or websites that are cited or referred to in this proxy statement shall be deemed to form part of, or to be incorporated by reference into, this proxy statement.
| PROXY SUMMARY | ||||||||
2022 Proxy summary
This summary highlights information in this proxy statement. This summary does not contain all the information you should consider, and you should read the entire proxy statement carefully before voting. Terms not defined in the text of this proxy statement can be found in the “Glossary of selected terms and acronyms” on page 112.
Your vote is important. For more information on voting and attending the annual meeting, see “Information about the annual shareholder meeting” on page 104. This proxy statement has been prepared by our management and approved by the Board of Directors, and is being sent or made available to our shareholders on or about April 4, 2022.
Annual meeting overview: Matters to be voted on
| MANAGEMENT PROPOSALS | ||||
The Board of Directors recommends you vote FOR each director nominee and FOR the following proposals (for more information see page referenced): | ||
| 1. | Election of Directors | |||||||
| 2. | Advisory resolution to approve executive compensation | |||||||
| 3. | Ratification of independent registered public accounting firm | |||||||
 | SHAREHOLDER PROPOSALS (if they are properly introduced at the meeting) | ||||
The Board of Directors recommends you vote AGAINST each of the following shareholder proposals (for more information see page referenced): | ||
| 4. | Fossil fuel financing | |||||||
| 5. | Special shareholder meeting improvement | |||||||
| 6. | Independent board chairman | |||||||
| 7. | Board diversity resolution | |||||||
| 8. | Conversion to public benefit corporation | |||||||
| 9. | Report on setting absolute contraction targets | |||||||
| 2022 PROXY STATEMENT | 1 | JPMORGAN CHASE & CO. | ||||||||||||
| PROXY SUMMARY | ||||||||
| The Firm demonstrated strong financial performance in 2021 | ||
The Firm continued to build upon its strong momentum from prior years amid the continued challenges of COVID-19. In 2021, the Firm reported record revenue1 of $125.3 billion and net income of $48.3 billion, or $15.36 per share, with return on common equity ("ROE") of 19% and return on tangible common equity ("ROTCE")2 of 23%, while returning $28.5 billion of capital to shareholders (including common dividends and net share repurchases). The Firm's results for 2021 included a reduction in the allowance for credit losses of $12.1 billion. We gained market share in our businesses, demonstrated strong expense discipline while continuing to invest into our businesses, continued to achieve high customer satisfaction scores and maintained a fortress balance sheet.
| JPMORGAN CHASE & CO. | ||||||||||||||||||||||||||||||||||||||
$48.3B | $15.36 | 19% | 23% | $88.07 | $71.53 | $28.5B | ||||||||||||||||||||||||||||||||
NET INCOME | EARNINGS PER SHARE (“EPS”) | ROE | ROTCE2 | BOOK VALUE PER SHARE (“BVPS”) | TANGIBLE BOOK VALUE PER SHARE (“TBVPS”)2 | NET CAPITAL DISTRIBUTIONS3 | ||||||||||||||||||||||||||||||||
| CONSUMER & COMMUNITY BANKING | CORPORATE & INVESTMENT BANK | COMMERCIAL BANKING | ASSET & WEALTH MANAGEMENT | |||||||||||||||||||||||||||||||||||||||||||||||||||||
$20.9B NET INCOME | 41% ROE | $21.1B NET INCOME | 25% ROE | $5.2B NET INCOME | 21% ROE | $4.7B NET INCOME | 33% ROE | |||||||||||||||||||||||||||||||||||||||||||||||||
•Revenue1 of $50.1B •Average deposits of $1.1T (up 24%); average loans of $434.0B (down 3%) •#1 in U.S. retail deposit market share4 •Maintained #1 market share in Card, based on U.S. sales and outstandings •Largest active digital and mobile customer base among U.S. banks, customers up 6% and 11% respectively4 | •Record net income on record revenue1 of $51.7B •Record Investment Banking ("IB") fees of $13.4B (up 41%) •#1 in IB fees for 13 consecutive years with 9.5% wallet share; #1 in Markets revenue •#2 custodian globally as measured by assets under custody of $33.2T (up 7%) •#1 in USD Payments volume | •Record revenue1 of $10.0B •Record gross IB revenue5 of $5.1B (up 52%), including record year for both Middle Market Banking & Specialized Industries and Corporate Client Banking & Specialized Industries •Record payments revenue of $1.8B6 (up 15%) •Strong credit performance with a net charge-off ratio of 4bps | •Record net income on record revenue1 of $17.0B; pre-tax margin of 37% •Record assets under management ("AUM") of $3.1T (up 15%) and client assets of $4.3T (up 18%) •AUM flows of $232B and client asset flows of $389B •Record average deposits of $230.3B (up 42%); record average loans of $198.5B (up 19%) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| EXCEPTIONAL CLIENT FRANCHISES | UNWAVERING PRINCIPLES | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| LONG-TERM SHAREHOLDER VALUE | SUSTAINABLE BUSINESS PRACTICES | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
1The Firm reviews the results of the lines of business on a managed basis. Refer to Additional notes, Note 1, on page 111 for a definition of managed basis.
2ROTCE and TBVPS are each non-GAAP financial measures; refer to Note 1 on page 110 for a further discussion of these measures.
3Refer to Note 2 on page 39.
4Refer to Notes 2 and 3 on page 69.
5Refer to Additional notes, Note 3, on page 111.
6Refer to Additional notes, Note 4, on page 111.
| JPMORGAN CHASE & CO. | 2 | 2022 PROXY STATEMENT | ||||||||||||
| PROXY SUMMARY | ||||||||
| The Firm has demonstrated sustained, strong financial performance over time | ||
We have generated strong financial results over time, significantly increasing net income by over 125% over the past 10 years while adding substantial capital. Over this period we increased average common equity by over 35% to $251 billion, and average tangible common equity ("TCE")1 by over 45% to $203 billion to support growth in the businesses and maintain a fortress balance sheet. We have maintained strong ROE and ROTCE1 over time.
We have also delivered sustained growth in EPS, BVPS and TBVPS1 over the past 10 years, reflecting compound annual growth rates of 13%, 6% and 7%, respectively over the period.
1Average TCE, ROTCE and TBVPS are each non-GAAP financial measures; refer to Note 1 on page 110 for a further discussion of these measures.
2Excluding the impact of the enactment of the Tax Cuts and Jobs Act (“TCJA”) of $(2.4) billion and a legal benefit of $406 million (after-tax) in 2017, adjusted net income would have been $26.5 billion, adjusted ROTCE would have been 13% and adjusted EPS would have been $6.87. Adjusted net income, adjusted ROTCE and adjusted EPS are each non-GAAP financial measures; refer to Notes on non-GAAP financial measures, Note 2, on page 110 for a further discussion of these measures.
| 2022 PROXY STATEMENT | 3 | JPMORGAN CHASE & CO. | ||||||||||||
| PROXY SUMMARY | ||||||||
| Total shareholder return (“TSR”) | ||
TSR1 was 28% in 2021, following a TSR of (6)% in 2020 and 47% in 2019, for a combined three-year TSR of 78%. The graph below shows our TSR expressed as the cumulative return to shareholders over the past decade. As illustrated, a $100 investment in JPMorgan Chase common stock on December 31, 2011 would be valued at $627 as of December 31, 2021, which significantly outperformed the financial services industry over the ten-year period, as measured by the S&P Financials Index and the KBW Bank Index.
1TSR shows the actual return of the stock price, with dividends reinvested.
| JPMORGAN CHASE & CO. | 4 | 2022 PROXY STATEMENT | ||||||||||||
| PROXY SUMMARY | ||||||||
| We are committed to strong corporate governance practices | ||
| Our Board reviews its composition for the right mix of experience, refreshment, skills and diversity | ||
•We seek directors with experience and demonstrated success in executive fields relevant to the Firm’s businesses and operations who contribute to the Board’s effective oversight of management and its diversity across a range of attributes, executive experience and skills.
•Our directors have a well-balanced tenure with a mix of experience and fresh perspectives
| A strong Lead Independent Director role facilitates independent Board oversight of management | ||
•The Firm’s Corporate Governance Principles (“Governance Principles”) require the independent directors to appoint a Lead Independent Director if the role of the Chair is combined with that of the CEO
•The Board reviews its leadership structure annually as part of its self-assessment process
•Responsibilities of the Lead Independent Director include:
 | has the authority to call for a Board meeting or a meeting of independent directors | | provides advice and guidance to the CEO on executing long-term strategy | ||||||||
 | presides at Board meetings in the Chair’s absence or when otherwise appropriate | | guides the annual performance review of the Chair/CEO | ||||||||
| advises the CEO of the Board’s information needs | ||||||||||
| approves agendas and adds agenda items for Board meetings and meetings of independent directors | | guides the annual independent director consideration of Chair/CEO compensation | ||||||||
| acts as liaison between independent directors and the Chair/CEO | | meets one-on-one with the Chair/CEO following executive sessions of independent directors | ||||||||
| presides over executive sessions of independent directors | | guides the Board in its consideration of CEO succession | ||||||||
| engages and consults with major shareholders and other constituencies, where appropriate | | guides the self-assessment of the Board | ||||||||
| Our Board provides independent oversight of the Firm’s business and affairs | ||
•Sets the cultural “tone at the top”
•Reviews and approves the Firm’s strategic plan, and oversees strategic objectives including environmental, social and governance (“ESG”)-related matters
•Evaluates the CEO’s performance and oversees talent management for other senior executives
•Oversees the Firm’s financial performance and condition
•Oversees the Firm’s risk management and internal control frameworks
| We actively engage with shareholders | ||
•We regularly engage with shareholders throughout the year on a wide variety of topics, such as strategy, financial and operating performance, competitive environment, regulatory landscape and ESG matters
•In 2021, our shareholder engagement initiatives included:
–Shareholder Outreach Program: In approximately 90 engagements with nearly 70 shareholders representing approximately 46% of the Firm’s outstanding common stock, we solicited feedback on strategy, financial and operating performance, executive compensation and ESG matters, among others. Directors, including our Lead Independent Director, participated in engagements with several large shareholders.
–Meetings/Conferences: Senior management hosted approximately 25 investor meetings, and presented at approximately 15 investor conferences
| Our governance practices promote Board effectiveness and shareholder interests | ||
•Annual Board and committee assessment •Robust shareholder rights: –proxy access –right to call a special meeting –right to act by written consent | •Majority voting for all director elections •Stock ownership requirements for directors •100% principal standing committee independence •Executive sessions of independent directors at each regular Board meeting | ||||
| 2022 PROXY STATEMENT | 5 | JPMORGAN CHASE & CO. | ||||||||||||
| PROXY SUMMARY | ||||||||
| 2021 Highlights | ||
| Advancing climate and sustainability solutions | ||
We are applying our capital, data, expertise and other resources to help address climate change by supporting responsible business practices and providing our clients with financing to accelerate the transition to a low-carbon future.
•In April 2021, we announced a target to finance and facilitate $1 trillion by the end of 2030 for climate action, as part of a broader target to finance and facilitate $2.5 trillion by the end of 2030 to advance sustainable development around the world.
•In May 2021, we became one of the first U.S. banks to set 2030 carbon intensity targets for our financing portfolio in three key sectors - Oil & Gas, Electric Power and Auto Manufacturing - and published our Carbon Compass Methodology, which details our approach for aligning our client financing with the goals of the Paris Agreement. We also announced our intention to expand to new sectors over time.
•In October 2021, we announced our support for the goals of the Net Zero Banking Alliance ("NZBA"), a global network of banks working to align their lending and investment portfolios with the goal of reaching net zero emissions by 2050. Our participation reflects our ambition for greater climate action globally, the sharing of best practices, and a collaborative approach between the public and private sectors to address climate change.
Advancing racial equity | ||
Our five-year commitment, announced in October 2020, brings together our business, policy, data and philanthropic expertise to advance racial equity and promote inclusive growth.
•By the end of 2021, we had deployed or committed more than $18 billion toward our $30 billion Racial Equity Commitment. We achieved this progress primarily in the areas of affordable rental housing preservation and homeownership refinance – areas where we had existing products and processes and could take prompt action toward fulfilling our commitment. We are building a long-term, sustainable infrastructure to enable our Firm to accelerate progress and reach more people going forward.
•The Firm's Public Engagement team is dedicated to connecting with external stakeholders, including civil rights organizations, civic leaders, trade associations and diverse chambers of commerce. In addition to ongoing relationship building, Public Engagement facilitates the Chase Advisory Panel ("CAP") program, a series of regular conversations between stakeholders and JPMorgan Chase senior executives. The CAP program is grounded in the Firm's commitment to including diverse voices in the development of products, services and approaches, including accountability for racial equity. In 2021, Public Engagement connected with over 200 groups around the Racial Equity Commitment.
•We are holding ourselves accountable to achieving our Racial Equity Commitment. We have established a robust reporting and governance process for tracking our commitment and plan to publicly share our progress annually in the Firm's ESG reports.
•To further transparency, the Board of Directors will oversee an audit, conducted by a third party firm of independent auditors, of the Firm's activities related to our Racial Equity Commitment, and the publication of a report in the fourth quarter of 2022.
| Supporting employees during the COVID-19 pandemic | ||
Throughout 2021, the Firm continued to support employees through various efforts in response to the COVID-19 pandemic.
•We continued to update and enhance safety protocols and support based on evolving practices and employee needs. For the second year in a row, the Firm was awarded the "WELL Health-Safety Rating" for all our approximately 6,200 locations globally based on our operational policies, maintenance protocols, stakeholder engagement and emergency plans to address a COVID-19 environment.
•A key area of focus was supporting employees in getting vaccinated. Since 2021, we have facilitated the delivery of over 70,000 vaccine and/or booster doses to employees and their families globally. To further support employees in getting vaccinated, we provided paid time off for employees to get initial vaccines and vaccine booster shots. We also ran an educational campaign featuring 15 events with over 30 medical doctors and industry experts who discussed the importance of vaccines and addressed employee questions.
•We enhanced our paid time off policies for our employees who contract or are exposed to COVID-19. In addition, to support employees and their families, we provided additional days of backup childcare in the U.S. and U.K., discounts for virtual tutoring and subsidized full-service childcare at our 13 U.S. onsite childcare centers.
•We continued to adapt and expand mental health and well-being support for employees in response to the increased stresses caused by the pandemic, including hosting virtual forums with mental health clinicians.
| JPMORGAN CHASE & CO. | 6 | 2022 PROXY STATEMENT | ||||||||||||
| PROXY SUMMARY | ||||||||
| Proposal 1: Election of Directors – page 10 | ||
The Board of Directors has nominated the 10 individuals listed below. All are independent other than our CEO. If elected at our annual meeting, all nominees are expected to serve until next year’s annual meeting.
Nominee/Director of JPMorgan Chase since1 | Age | Principal Occupation | Other Public Company Boards (#) | Committee Membership2 | |||||||||||||
 | Stephen B. Burke Lead Independent Director Director since 2004 | 63 | Retired Chairman and Chief Executive Officer of NBCUniversal, LLC | 1 | Compensation & Management Development (Chair); Corporate Governance & Nominating | ||||||||||||
 | Linda B. Bammann Director since 2013 | 66 | Retired Deputy Head of Risk Management of JPMorgan Chase & Co.3 | 0 | Risk (Chair); Compensation & Management Development | ||||||||||||
 | Todd A. Combs Director since 2016 | 51 | Investment Officer at Berkshire Hathaway Inc. President and CEO of GEICO | 0 | Corporate Governance & Nominating (Chair); Compensation & Management Development | ||||||||||||
 | James S. Crown Director since 2004 | 68 | Chairman and Chief Executive Officer of Henry Crown and Company | 1 | Public Responsibility (Chair); Risk | ||||||||||||
 | James Dimon Director since 2004 | 66 | Chairman and Chief Executive Officer of JPMorgan Chase & Co. | 0 | |||||||||||||
 | Timothy P. Flynn Director since 2012 | 65 | Retired Chairman and Chief Executive Officer of KPMG International | 2 | Audit (Chair) | ||||||||||||
 | Mellody Hobson Director since 2018 | 53 | Co-Chief Executive Officer and President of Ariel Investments, LLC | 1 | Public Responsibility; Risk | ||||||||||||
 | Michael A. Neal Director since 2014 | 69 | Retired Vice Chairman of General Electric Company and Retired Chairman and Chief Executive Officer of GE Capital | 0 | Audit; Public Responsibility | ||||||||||||
 | Phebe N. Novakovic Director since 2020 | 64 | Chairman and Chief Executive Officer of General Dynamics Corporation | 1 | Audit | ||||||||||||
 | Virginia M. Rometty Director since 2020 | 64 | Retired Executive Chairman, President and Chief Executive Officer of International Business Machines Corporation | 0 | Compensation & Management Development; Corporate Governance & Nominating | ||||||||||||
1Director of a heritage company of the Firm as follows: Bank One Corporation: Mr. Burke (2003–2004), Mr. Crown (1996–2004), Mr. Dimon, Chairman of the Board (2000–2004); First Chicago Corp.: Mr. Crown (1991–1996).
2Principal standing committee
3Retired from JPMorgan Chase & Co. in 2005
| 2022 PROXY STATEMENT | 7 | JPMORGAN CHASE & CO. | ||||||||||||
| PROXY SUMMARY | ||||||||
| Proposal 2: Advisory resolution to approve executive compensation – page 37 | ||
We are submitting an advisory resolution to approve the compensation of our Named Executive Officers (“NEOs”).
| We believe shareholders should consider three key factors in their evaluation of this year’s proposal: | ||
1. How we think about pay decisions
The Firm’s How We Do Business Principles ("Business Principles") and strategic framework form the basis of our Operating Committee ("OC") members’ strategic priorities. The Compensation & Management Development Committee ("CMDC") references those strategic priorities and the Firm’s compensation philosophy to assess OC members’ performance and to determine their respective total compensation levels and pay mix.
2. How we performed against our business strategy
We continued to deliver strong multi-year financial performance, invest in our future, strengthen our risk and control environment, and reinforce our culture and values, including our long-standing commitment to serve our customers, employees and communities, and conduct business in a responsible way to drive inclusive growth.
3. How performance determined pay in 2021
In determining OC member pay, the CMDC took into account performance across four broad performance dimensions: Business Results; Risk, Controls & Conduct; Client/Customer/Stakeholder; and Teamwork & Leadership. CEO pay is strongly aligned to the Firm’s short-, medium- and long-term performance, with approximately 85% of the CEO’s variable pay deferred into equity, of which 100% is in at-risk performance share units ("PSUs"). Other NEO pay is also strongly aligned to Firm and line of business ("LOB") performance, with a majority of variable pay deferred into equity, of which 50% is in at-risk PSUs.
| Disciplined performance assessment process to determine pay | ||
The CMDC uses a balanced discretionary approach to determine annual compensation, which includes a disciplined assessment of performance against the aforementioned four broad dimensions over a sustained period of time. For 2021, compensation awarded to the OC members also represents a balance between the outstanding efforts and performance of the Firm with the continued impact of the COVID-19 pandemic on the Firm's other stakeholders.
The table below summarizes the salary and incentive compensation awarded to our NEOs for 2021 performance.
| Incentive Compensation | |||||||||||||||||||||||||||||||||||
| Name and principal position | Salary | Cash | Restricted stock units | Performance share units | Total | ||||||||||||||||||||||||||||||
James Dimon1 Chairman and CEO | $ | 1,500,000 | $ | 5,000,000 | $ | — | $ | 28,000,000 | $ | 34,500,000 | |||||||||||||||||||||||||
Daniel Pinto1,2 Co-President & Co-Chief Operating Officer; CEO Corporate & Investment Bank | 9,055,948 | — | 9,722,026 | 9,722,026 | 28,500,000 | ||||||||||||||||||||||||||||||
Gordon Smith Co-President & Co-Chief Operating Officer; CEO Consumer & Community Banking | 750,000 | 8,700,000 | 6,525,000 | 6,525,000 | 22,500,000 | ||||||||||||||||||||||||||||||
Mary Callahan Erdoes CEO Asset & Wealth Management | 750,000 | 7,900,000 | 5,925,000 | 5,925,000 | 20,500,000 | ||||||||||||||||||||||||||||||
Jennifer Piepszak Co-CEO Consumer & Community Banking; Former Chief Financial Officer | 750,000 | 6,300,000 | 4,725,000 | 4,725,000 | 16,500,000 | ||||||||||||||||||||||||||||||
Jeremy Barnum Chief Financial Officer | 693,750 | 3,722,500 | 2,791,875 | 2,791,875 | 10,000,000 | ||||||||||||||||||||||||||||||
Consistently strong relative CEO pay-for-performance alignment The CEO pay allocation chart alongside compares Mr. Dimon’s compensation to that of the CEOs of our six financial services peers, based on three-year average total compensation expressed as a percentage of net income. The Firm's trailing average percentage of net income paid to Mr. Dimon continues to rank among the lowest of our peers, demonstrating our strong pay-for-performance alignment, and a more efficient CEO pay allocation ratio. | Prior 3-Year Average % of Profits Paid to CEOs (2018-2020)3  | ||||||||||
1Mr. Dimon and Mr. Pinto were granted special awards in the form of stock appreciation rights that are not part of their regular annual compensation and will not be awarded on a recurring basis. Refer to page 66 for further information.
2Mr. Pinto, who was based in the U.K. in 2021, received a fixed allowance of $8,400,000 paid in British pound sterling and a salary of £475,000.
3Total compensation is comprised of base salary, cash bonus paid and long-term incentive compensation (target value) in connection with the performance year, which may be different from amounts reported in the Summary Compensation Table. Refer to Note 1 on page 66 for further information.
| JPMORGAN CHASE & CO. | 8 | 2022 PROXY STATEMENT | ||||||||||||
| PROXY SUMMARY | ||||||||
| Proposal 3: Ratification of the Firm’s independent registered public accounting firm – page 85 | ||
The Audit Committee has appointed PricewaterhouseCoopers LLP (“PwC”) as the Firm’s independent registered public accounting firm to audit the Consolidated Financial Statements of JPMorgan Chase and its subsidiaries for the year ending December 31, 2022. A resolution is being presented to our shareholders requesting ratification of PwC’s appointment.
| 2022 PROXY STATEMENT | 9 | JPMORGAN CHASE & CO. | ||||||||||||
Corporate Governance
Proposal 1: Election of Directors
Our Board of Directors has nominated 10 directors, who, if elected by shareholders at our annual meeting, will be expected to serve until next year’s annual meeting. | ||||||||
| RECOMMENDATION: Vote FOR all nominees | |||||||
| JPMORGAN CHASE & CO. | 10 | 2022 PROXY STATEMENT | ||||||||||||
CORPORATE GOVERNANCE | ELECTION OF DIRECTORS | ||||||||
Key factors for shareholder consideration
| 1 | Director nominees, Director independence & recruitment •Nominees have executive experience and skills aligned with the Firm’s business and strategy •Ongoing recruitment and refreshment promote a balance of experience and fresh perspective |  | ||||||
Pages 12-21 | ||||||||
| 2 | Board Governance | |||||||
•Lead Independent Director facilitates independent oversight of management •Board conducts an annual self-assessment and review of its leadership structure | •Board carries out a significant portion of its oversight responsibilities through its committees, allowing more in-depth attention devoted to overseeing key issues | |||||||
Pages 22-27 | ||||||||
| 3 | Board oversight of the business and affairs of the Firm | |||||||
•Board sets the cultural “tone at the top” •Board actively oversees the business and affairs of the Firm based on sound governance practices and effective leadership structure •Board reviews and approves the Firm's annual strategic plan, and oversees strategic objectives including ESG-related matters | •Board oversees the Firm’s financial performance and condition •Board oversees the Firm’s risk management and internal control frameworks •Board evaluates CEO performance and compensation, reviews succession plans for the CEO and oversees talent management for other senior executives | |||||||
Pages 28-29 | ||||||||
| 4 | Board engagement with the Firm’s stakeholders | |||||||
•We reached out to over 150 of our largest shareholders, representing over 50% of the Firm’s outstanding common stock, and proxy advisory firms. We received feedback through approximately 90 engagements with nearly 70 shareholders representing approximately 46% of the Firm’s outstanding common stock, focused on strategy, financial and operating performance, executive compensation, and ESG-related matters, among other matters. Directors, including our Lead Independent Director, participated in discussions with several large shareholders •The Board also engages with, and reviews feedback from, our stakeholders, including shareholders, employees, customers, suppliers and communities in which we work | ||||||||
Pages 30-31 | ||||||||
| 2022 PROXY STATEMENT | 11 | JPMORGAN CHASE & CO. | ||||||||||||
| Director nominees |  | Board governance | | Board oversight | | Board engagement | ||||||||||||||||||||||||||||||||
1. Director nominees
Our Directors
The Board is responsible for overseeing management and promoting sound corporate governance on behalf of shareholders. JPMorgan Chase seeks director candidates who uphold the highest standards, are committed to the Firm’s values and are strong independent stewards of the long-term interests of shareholders, employees, customers, suppliers and communities in which we work. The Board, including the Corporate Governance & Nominating Committee (“Governance Committee”), considers Board composition holistically, with a focus on recruiting directors who have the qualities required to effectively oversee the Firm, including its present and future strategy. The Board seeks directors with expertise in executive fields who will bring experienced and fresh perspectives and insight, and come together to effectively challenge and provide independent oversight of management. The Board looks for candidates with a diversity of experience, perspectives and viewpoints, as well as diversity with respect to gender, race, ethnicity and nationality.
The individuals presented on the following pages have been nominated for election because they possess the skills, experience, personal attributes and tenure needed to guide
the Firm’s strategy, and to effectively oversee the Firm’s risk management and internal control framework, and management’s execution of its responsibilities.
In the biographical information about our director nominees that follows, the ages indicated are as of May 17, 2022, and the other information is as of the date of this proxy statement. The information in the Board Diversity and Experience Matrix was provided by the nominees. The race and ethnicity information is based on U.S. Equal Employment Opportunity race/ethnicity categories. There are no family relationships among the director nominees or between any director nominee and any executive officer. Unless otherwise stated, all nominees have been continuously employed by their present employers for more than five years.
All of the nominees are currently directors of the Firm. Each nominee has agreed to be named in this proxy statement and, if elected, to serve a one-year term expiring at our 2023 annual meeting.
Directors are expected to attend our annual shareholder meetings. All 10 directors serving on our Board at the time of the 2021 annual meeting attended the meeting.
ATTRIBUTES AND SKILLS OF THE NOMINEES
When selecting and recruiting candidates, the Board considers a wide range of attributes, executive experience and skills. The following are brief summaries of complex and dynamic skills and experience found among our Board members.
| All of our nominees possess: independent perspective, integrity, judgment, strong work ethic, strength of conviction, collaborative approach to engagement, inquisitiveness and willingness to appropriately challenge management | |||||
Finance and Accounting | Knowledge of or experience in accounting, financial reporting or auditing processes and standards is important to effectively oversee the Firm’s financial position and condition and the accurate reporting thereof, and to assess the Firm’s strategic objectives from a financial perspective | ||||
Financial Services | Experience in or with the financial services industry, including investment banking, global financial markets or consumer products and services, allows Board members to evaluate the Firm’s business model, strategies and the industry in which we compete | ||||
International Business Operations | Experience in diverse geographic, political and regulatory environments enables the Board to effectively oversee the Firm as it serves customers and clients across the globe | ||||
Leadership of a Large, Complex Organization | Executive experience managing business operations and strategic planning allows Board members to effectively oversee the Firm’s complex worldwide operations | ||||
Management Development, Succession Planning and Compensation | Experience in senior executive development, succession planning and compensation matters helps the Board to effectively oversee the Firm’s efforts to recruit, retain and develop key talent and provide valuable insight in determining compensation of the CEO and other executive officers | ||||
Public Company Governance | Knowledge of public company governance matters, policies and best practices assists the Board in considering and adopting applicable corporate governance practices, interacting with stakeholders and understanding the impact of various policies on the Firm’s functions | ||||
Technology | Experience with or oversight of innovative technology, cybersecurity, information systems/data management, fintech or privacy is important in overseeing the security of the Firm’s operations, assets and systems as well as the Firm’s ongoing investment in and development of innovative technology | ||||
Regulated Industries | Experience with regulated businesses, regulatory requirements and relationships with global regulators is important because the Firm operates in a heavily regulated industry | ||||
Risk Management and Controls | Skills and experience in assessment and management of business and financial risk factors allow the Board to effectively oversee risk management and understand the most significant risks facing the Firm | ||||
ESG Matters | Experience with ESG matters allows the Board to provide effective oversight of efforts to assess and manage potential risks and anticipate emerging ESG-related matters that may impact the business, employees, customers and stakeholders, as well as shareholders | ||||
| JPMORGAN CHASE & CO. | 12 | 2022 PROXY STATEMENT | ||||||||||||
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| Director nominees | | Board governance | | Board oversight | | Board engagement | ||||||||||||||||||||||||||||||||
Board Diversity and Experience Matrix
| 10 Director Nominees: | Burke | Bammann | Combs | Crown | Dimon | Flynn | Hobson | Neal | Novakovic | Rometty | ||||||||||||||||||||||
| Experience and Skills | ||||||||||||||||||||||||||||||||
| Finance and Accounting |  | | | | | | | | | | ||||||||||||||||||||||
| Financial Services | | | | | | | | |||||||||||||||||||||||||
| International Business Operations | | | | | | | | | | |||||||||||||||||||||||
| Leadership of a Large, Complex Organization | | | | | | | | | | | ||||||||||||||||||||||
| Management Development, Succession Planning and Compensation | | | | | | | | | | | ||||||||||||||||||||||
| Public Company Governance | | | | | | | | | | | ||||||||||||||||||||||
| Technology | | | | | | | | | ||||||||||||||||||||||||
| Regulated Industries | | | | | | | | | | | ||||||||||||||||||||||
| Risk Management and Controls | | | | | | | | | | | ||||||||||||||||||||||
| ESG Matters | | | | | | | | |||||||||||||||||||||||||
| Background | ||||||||||||||||||||||||||||||||
| Gender | ||||||||||||||||||||||||||||||||
| Male | | | | | | | ||||||||||||||||||||||||||
| Female | | | | | ||||||||||||||||||||||||||||
| Non-binary | ||||||||||||||||||||||||||||||||
| Race | ||||||||||||||||||||||||||||||||
| American Indian or Alaska Native | ||||||||||||||||||||||||||||||||
| Asian | ||||||||||||||||||||||||||||||||
| Black or African American | | |||||||||||||||||||||||||||||||
| Hispanic or Latino | ||||||||||||||||||||||||||||||||
| Native Hawaiian or other Pacific Islander | ||||||||||||||||||||||||||||||||
| White | | | | | | | | | | |||||||||||||||||||||||
| Two or more races or ethnicities | ||||||||||||||||||||||||||||||||
| LGBTQ+ | ||||||||||||||||||||||||||||||||
| Heterosexual | | | | | | | | | | | ||||||||||||||||||||||
| LGBT+ | ||||||||||||||||||||||||||||||||
| Military Status | ||||||||||||||||||||||||||||||||
| Not a Veteran | | | | | | | | | | | ||||||||||||||||||||||
| Reservist and/or National Guard | ||||||||||||||||||||||||||||||||
| Veteran/Prior Military Service | ||||||||||||||||||||||||||||||||
| Age/Tenure | ||||||||||||||||||||||||||||||||
| Age | 63 | 66 | 51 | 68 | 66 | 65 | 53 | 69 | 64 | 64 | ||||||||||||||||||||||
| Years on the Board | 18 | 9 | 6 | 18 | 18 | 10 | 4 | 8 | 2 | 2 | ||||||||||||||||||||||
| 2022 PROXY STATEMENT | 13 | JPMORGAN CHASE & CO. | ||||||||||||
| Director nominees | | Board governance | | Board oversight | | Board engagement | ||||||||||||||||||||||||||||||||
 Age: 63 Director since: 2004 Committees: •Compensation & Management Development Committee (Chair) •Corporate Governance & Nominating Committee | Stephen B. Burke Lead Independent Director since 2021 Retired Chairman and Chief Executive Officer of NBCUniversal, LLC | ||||||||||||||||
Mr. Burke’s roles at Comcast Corporation and his prior work at other large global media corporations have given him broad exposure to the challenges associated with managing large and diverse businesses. In these roles, he has dealt with a variety of issues including audit and financial reporting, risk management, executive compensation, sales and marketing, technology and operations. These experiences have also provided Mr. Burke a background in regulated industries and international business. Mr. Burke has served as the Lead Independent Director since 2021. More information regarding the duties and responsibilities of the Lead Independent Director can be found on page 23. | |||||||||||||||||
Career Highlights Comcast Corporation/NBCUniversal, LLC, leading providers of entertainment, information and communication products and services •Senior Advisor, Comcast Corporation (since 2021) •Chairman of NBCUniversal, LLC and NBCUniversal Media, LLC (2020) •Senior executive officer of Comcast Corporation (2011-2020) •Chief Executive Officer and President of NBCUniversal, LLC and NBCUniversal Media, LLC (2011-2019) •Chief Operating Officer, Comcast (2004–2011) •President, Comcast Cable Communications Inc. (1998–2010) | Other Public Company Directorships Within the Past Five Years •Berkshire Hathaway Inc. (since 2009) Other Experience •Chairman, Children's Hospital of Philadelphia Education •Graduate of Colgate University •M.B.A., Harvard Business School | ||||||||||||||||
 Age: 66 Director since: 2013 Committees: •Risk Committee (Chair) •Compensation & Management Development Committee | Linda B. Bammann Retired Deputy Head of Risk Management of JPMorgan Chase & Co. | ||||||||||||||||
Through her service on other boards, including as Chair of the Business and Risk Committee of the Federal Home Loan Mortgage Corporation and her management tenure at JPMorgan Chase and Bank One Corporation, Ms. Bammann has developed insight and wide-ranging experience in financial services and extensive expertise in risk management and regulatory matters. | |||||||||||||||||
Career Highlights JPMorgan Chase & Co., a financial services company (merged with Bank One Corporation in July 2004) •Deputy Head of Risk Management (2004–2005) •Chief Risk Management Officer and Executive Vice President, Bank One Corporation (2001–2004) •Senior Managing Director, Banc One Capital Markets (2000–2001) | Other Public Company Directorships Within the Past Five Years •None Other Experience •Former Board Member, Risk Management Association •Former Chair, Loan Syndications and Trading Association •Board Member, Travis Mills Foundation Education •Graduate of Stanford University •M.A., Public Policy, University of Michigan | ||||||||||||||||
| JPMORGAN CHASE & CO. | 14 | 2022 PROXY STATEMENT | ||||||||||||
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 Age: 51 Director since: 2016 Committees: •Corporate Governance & Nominating Committee (Chair) •Compensation & Management Development Committee | Todd A. Combs President and Chief Executive Officer of GEICO and Investment Officer at Berkshire Hathaway Inc. | ||||||||||||||||
Mr. Combs’ roles have provided him with extensive experience in financial markets, risk assessment and regulatory matters. His service on three of Berkshire Hathaway’s subsidiary boards has given him expertise and insight into matters such as corporate governance, strategy, succession planning and compensation. | |||||||||||||||||
Career Highlights Berkshire Hathaway Inc., a holding company whose subsidiaries engage in a number of diverse business activities including finance, insurance and reinsurance, utilities and energy, freight rail transportation, manufacturing, retailing and other services •President and Chief Executive Officer, GEICO (since 2020) •Investment Officer (since 2010) Castle Point Capital Management •Chief Executive Officer and Managing Member (2005–2010) | Other Public Company Directorships Within the Past Five Years •None Education •Graduate of Florida State University •M.B.A., Columbia Business School | ||||||||||||||||
 Age: 68 Director since: 2004 Committees: •Public Responsibility Committee (Chair) •Risk Committee | James S. Crown Chairman and Chief Executive Officer of Henry Crown and Company | ||||||||||||||||
Mr. Crown’s position with Henry Crown and Company and his service on other public company boards have given him extensive experience with risk management, audit and financial reporting, investment management, capital markets activity and executive compensation matters. | |||||||||||||||||
Career Highlights Henry Crown and Company, a privately owned investment company that invests in public and private securities, real estate, and operating companies •Chairman and Chief Executive Officer (since 2018) •President (2002–2017) •Vice President (1985–2002) | Other Public Company Directorships Within the Past Five Years •General Dynamics (since 1987) — Lead Director since 2010 Other Experience •Chairman of the Board of Trustees, Aspen Institute •Trustee, Museum of Science and Industry •Trustee, University of Chicago •Member, American Academy of Arts and Sciences •Former member, President’s Intelligence Advisory Board Education •Graduate of Hampshire College •J.D., Stanford University Law School | ||||||||||||||||
| 2022 PROXY STATEMENT | 15 | JPMORGAN CHASE & CO. | ||||||||||||
| Director nominees | | Board governance | | Board oversight | | Board engagement | ||||||||||||||||||||||||||||||||
 Age: 66 Director since: 2004 and Chairman of the Board since 2006 | James Dimon Chairman and Chief Executive Officer of JPMorgan Chase & Co. | ||||||||||||||||
Mr. Dimon is an experienced leader in the financial services industry and has extensive international business expertise. As CEO, he is knowledgeable about all aspects of the Firm’s business activities. His work has given him substantial insight into the regulatory process. | |||||||||||||||||
Career Highlights JPMorgan Chase & Co., a financial services company (merged with Bank One Corporation in July 2004) •Chairman of the Board (since 2006) and Director (since 2004); Chief Executive Officer (since 2005) •President (2004–2018) •Chief Operating Officer (2004–2005) •Chairman and Chief Executive Officer at Bank One Corporation (2000–2004) | Other Public Company Directorships Within the Past Five Years •None Other Experience •Member of Board of Deans, Harvard Business School •Director, Catalyst •Member, Business Roundtable •Member, Business Council •Trustee, New York University School of Medicine Education •Graduate of Tufts University •M.B.A., Harvard Business School | ||||||||||||||||
 Age: 65 Director since: 2012 Committees: •Audit Committee (Chair) | Timothy P. Flynn Retired Chairman and Chief Executive Officer of KPMG International | ||||||||||||||||
Through his leadership positions at KPMG, Mr. Flynn gained perspective on the evolving business and regulatory environment, expertise in many of the issues facing complex, global companies, and extensive experience in financial services, auditing matters and risk management. | |||||||||||||||||
Career Highlights KPMG International, a global professional services organization providing audit, tax and advisory services •Chairman, KPMG International (2007–2011) •Chairman, KPMG LLP (2005–2010) •Chief Executive Officer, KPMG LLP (2005–2008) •Vice Chairman, Audit and Risk Advisory Services, KPMG LLP (2001–2005) | Other Public Company Directorships Within the Past Five Years •UnitedHealth Group Inc. (since 2017) •Wal-Mart Stores, Inc. (since 2012) •Alcoa Corporation (2016–2021) Other Experience •Member of Board of Trustees, The University of St. Thomas •Former Trustee, Financial Accounting Standards Board •Former Member, World Economic Forum’s International Business Council •Former Board Member, International Integrated Reporting Council Education •Graduate of The University of St. Thomas | ||||||||||||||||
| JPMORGAN CHASE & CO. | 16 | 2022 PROXY STATEMENT | ||||||||||||
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| Director nominees | | Board governance | | Board oversight | | Board engagement | ||||||||||||||||||||||||||||||||
 Age: 53 Director since: 2018 Committees: •Public Responsibility Committee •Risk Committee | Mellody Hobson Co-Chief Executive Officer and President of Ariel Investments, LLC | ||||||||||||||||
Ms. Hobson’s roles at Ariel Investments, LLC, as well as on public company boards, have provided her with significant experience in financial services and financial markets, corporate governance, strategic planning, operations, regulatory matters and international business. | |||||||||||||||||
Career Highlights Ariel Investments, LLC, a private global asset management firm •Co-Chief Executive Officer (since 2019) •President and Director (since 2000) •Chairman of the Board of Trustees of Ariel Investment Trust, a registered investment company (since 2006) | Other Public Company Directorships Within the Past Five Years •Starbucks Corporation — Chair (since 2021); Vice Chair (2018-2021); member (since 2005) •The Estée Lauder Companies Inc. (2005–2018) Other Experience •Chair, After School Matters •Ex Officio / Former Chair, The Economic Club of Chicago •Executive Committee of the Board of Governors, Investment Company Institute •Vice Chair, World Business Chicago •Former regular contributor and analyst on finance, the markets and economic trends for CBS news Education •Graduate of the School of Public and International Affairs at Princeton University | ||||||||||||||||
 Age: 69 Director since: 2014 Committees: •Audit Committee •Public Responsibility Committee | Michael A. Neal Retired Vice Chairman of General Electric Company and Retired Chairman and Chief Executive Officer of GE Capital | ||||||||||||||||
Mr. Neal has extensive experience managing large, complex businesses in regulated industries around the world. During his career with General Electric and GE Capital, Mr. Neal oversaw the provision of financial services and products to consumers and businesses of all sizes globally. His professional background has provided him with extensive expertise and insight in risk management, strategic planning and operations, finance and financial reporting, government and regulatory relations, and management development and succession planning. | |||||||||||||||||
Career Highlights General Electric Company, a global industrial and financial services company •Vice Chairman, General Electric Company (2005–2013) •Chairman and Chief Executive Officer, GE Capital (2007–2013) | Other Public Company Directorships Within the Past Five Years •None Other Experience •Trustee, The GT Foundation of the Georgia Institute of Technology Education •Graduate of the Georgia Institute of Technology | ||||||||||||||||
| 2022 PROXY STATEMENT | 17 | JPMORGAN CHASE & CO. | ||||||||||||
| Director nominees | | Board governance | | Board oversight | | Board engagement | ||||||||||||||||||||||||||||||||
 Age: 64 Director since: 2020 Committees: •Audit Committee | Phebe N. Novakovic Chairman and Chief Executive Officer of General Dynamics | ||||||||||||||||
Ms. Novakovic's leadership roles at General Dynamics, as well as her tenure with the Office of Management and Budget and as Special Assistant to the Secretary and Deputy Secretary of Defense, have provided her with significant experience in international business operations, leadership of a large complex organization, and regulated industries and regulatory matters. | |||||||||||||||||
Career Highlights General Dynamics, a global aerospace and defense company •Chairman and Chief Executive Officer (since 2013) •President and Chief Operating Officer (2012) •Executive Vice President, Marine Systems (2010-2012) •Senior Vice President, Planning and Development (2005-2012) •Vice President (2002-2005) | Other Public Company Directorships Within the Past Five Years •General Dynamics — Chairman since 2013; member since 2012 •Abbott Laboratories (2010-2021) Other Experience •Chairman of the Board of Directors, Association of the United States Army •Chairman of the Board of Trustees, Ford's Theatre •Trustee, Northwestern University •Director, Northwestern Memorial Hospital •Member, Business Roundtable Education •Graduate of Smith College •M.B.A., University of Pennsylvania Wharton School | ||||||||||||||||
 Age: 64 Director since: 2020 Committees: •Corporate Governance & Nominating Committee •Compensation & Management Development Committee | Virginia M. Rometty Retired Executive Chairman, President and Chief Executive Officer of International Business Machines Corporation (“IBM”) | ||||||||||||||||
| During her tenure spanning four decades at IBM, Mrs. Rometty has gained extensive expertise in technology, and in all aspects of leading a complex global business, including succession planning, public company governance, as well as operational and regulatory issues. | |||||||||||||||||
Career Highlights IBM, a global information technology company •Executive Chairman (2020) •Chairman, President and Chief Executive Officer (2012-2020) | Other Public Company Directorships Within the Past Five Years •IBM (2012-2020) Other Experience •Member, Mitsubishi UFJ Financial Group Advisory Board •Board and Trustee, Brookings Institution •Member, BDT Capital Advisory Board •Co-Chair, OneTen •Member, Business Roundtable •Member, Council on Foreign Relations •Member, Peterson Institute for International Economics •Vice Chairman, Board of Trustees, Northwestern University •Board of Trustees, Memorial Sloan-Kettering Cancer Center •Former Member, President’s Export Council Education •Graduate of Northwestern University | ||||||||||||||||
| JPMORGAN CHASE & CO. | 18 | 2022 PROXY STATEMENT | ||||||||||||
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| Director nominees | | Board governance | | Board oversight | | Board engagement | ||||||||||||||||||||||||||||||||
Director independence
All of the Firm’s non-management Board members are independent, under both the NYSE corporate governance listing standards and the Firm’s independence standards as set forth in its Governance Principles.
To be considered independent, a director must have no disqualifying relationships, as defined by the NYSE, and the Board must have affirmatively determined that he or she has no material relationships with JPMorgan Chase, either directly or as a partner, shareholder or officer of another organization that has a relationship with the Firm.
In assessing the materiality of relationships with the Firm, the Board considers relevant facts and circumstances. Given the nature and broad scope of the products and services provided by the Firm, there are from time to time ordinary course of business transactions between the Firm and a director, his or her immediate family members, or principal business affiliations. These may include, among other relationships: extensions of credit; provision of other financial and financial advisory products and services; business transactions for property or services; and charitable contributions made by the JPMorgan Chase Foundation or the Firm to a nonprofit organization of which a director is an officer. The Board reviews these relationships to assess their materiality and determine if any such relationship would impair the independence and judgment of the relevant director. The Board considered:
•Consumer credit: credit cards issued to directors Bammann, Combs, Crown, Flynn, Hobson, Neal, Novakovic and/or their immediate family members
•Wholesale credit: extensions of credit and other financial and financial advisory products and services provided to: Berkshire Hathaway Inc., for which Mr. Combs is an Investment Officer, and its subsidiaries; Henry Crown and Company, for which Mr. Crown is Chairman and Chief Executive Officer, and other Crown family-owned entities; Ariel Investments, LLC, for which Ms. Hobson is Co-Chief Executive Officer and President, and its subsidiaries and funds; certain entities wholly-owned by Ms. Hobson’s spouse; General Dynamics Corporation, for which Ms. Novakovic is Chairman and Chief Executive Officer, and its subsidiaries; and Louis Dreyfus Company B.V., for which Mrs. Rometty's sibling serves as the Trading Operations Officer and a member of its Executive Group
•Goods and services: commercial office space leased by the Firm from subsidiaries of companies in which Mr. Crown and members of his immediate family have indirect ownership interests; purchases from Berkshire Hathaway subsidiaries of private aviation services, professional services related to the Firm’s corporate-owned aircraft, desktop displays and other merchandising fixtures primarily for retail branches, and modular data center buildings for installation at existing JPMorgan Chase data centers; and maintenance services and parts for corporate aircraft provided by General Dynamics subsidiaries
The Board, having reviewed the relevant relationships between the Firm and each director, determined, in accordance with the NYSE’s listing standards and the Firm’s independence standards, that each non-management director (Linda B. Bammann, Stephen B. Burke, Todd A. Combs, James S. Crown, Timothy P. Flynn, Mellody Hobson, Michael A. Neal, Phebe N. Novakovic and Virginia M. Rometty) had only immaterial relationships with JPMorgan Chase and accordingly is independent.
All directors who served on the Audit and Compensation & Management Development Committees of the Board were also determined to meet the additional independence and qualitative criteria of the NYSE listing standards applicable to directors serving on those committees. For more information about the committees of the Board, see pages 24-26.
| 2022 PROXY STATEMENT | 19 | JPMORGAN CHASE & CO. | ||||||||||||
| Director nominees | | Board governance | | Board oversight | | Board engagement | ||||||||||||||||||||||||||||||||
Director recruitment
The Governance Committee oversees the ongoing evaluation of candidates for Board membership and the candidate nomination process.
 | | |||||||||||||
| BOARD REVIEWS ITS NEEDS | CANDIDATE RECOMMENDATIONS | ASSESSMENT The Governance Committee considers the following in evaluating prospective directors, among other items: •The Firm’s Governance Principles •The Firm’s strategy, risk profile and current Board composition •Candidate’s specific skills and experiences based on the needs of the Firm •Candidate's contribution to Board diversity | ||||||||||||
The Board considers its composition and needs holistically, determining the diversity of experience, background and perspective required to effectively oversee the Firm, including its present and future strategy. | The Governance Committee solicits candidate recommendations from shareholders, directors, and management and, from time to time, has been assisted by a third-party advisor in identifying qualified candidates. | |||||||||||||
 |  | |||||||||||||
 | ||||||||||||||
FULL BOARD CONSIDERATION | CANDIDATE MEETINGS The potential nominee meets with the Governance Committee, Lead Independent Director, Chair of the Board, other members of the Board and senior management, as appropriate. Nominees may be invited to participate in Firm events, including as a featured speaker. | |||||||||||||
| The Governance Committee puts the candidate forward for consideration by the full Board. | ||||||||||||||
Our By-laws also permit a shareholder group of up to 20 shareholders who have continuously owned at least 3% of the Firm’s outstanding shares for at least three years to nominate up to 20% of the Board (but in any event at least two directors). For further information, see page 109. All candidates recommended to the Governance Committee are evaluated based on the same standards.
Recent Board refreshment
The Governance Committee is engaged in an ongoing recruitment process enabling the Board to build a strong pipeline of prospective directors for the near-term and the long-term. This includes candidates who are not available for board membership immediately but may become available in the future, such as candidates whose current professional commitments preclude board service and emerging leaders who require more experience. Often the Board works to develop a relationship with prospective candidates, becoming familiar with their skills and effectiveness, before the candidate is formally considered. The Board looks to recruit those who will contribute individually and it seeks to balance skills, experience, personal attributes and tenure.
| JPMORGAN CHASE & CO. | 20 | 2022 PROXY STATEMENT | ||||||||||||
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Director re-nomination
The Governance Committee also oversees the re-nomination process. In determining whether to re-nominate a director for election at our annual meeting, the Governance Committee reviews each director, considering:
Retirement policy
Our Governance Principles require a non-management director to offer not to stand for re-election in each calendar year following a year in which the director will be 72 or older. The Board (other than the affected director) then determines whether to accept the offer. The Board believes that the appropriate mix of experience and fresh perspectives is an important consideration in assessing Board composition, and the best interests of the Firm are served by taking advantage of all available talent, and evaluations as to director candidacy should not be determined solely on age.
None of our director nominees will be 72 or older this year.
For a description of the annual Board and committee self-assessment process, see page 27.
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2. Board governance
Strong governance practices
Our Board is guided by the Firm’s Governance Principles, and we adhere to the Commonsense Corporate Governance Principles and the Investor Stewardship Group’s Corporate Governance Principles for U.S. Listed Companies. Our sound governance practices include:
 | Annual election of all directors by majority vote | ||||
| 100% principal standing committee independence | ||||
| Lead Independent Director with an independent perspective and judgment as well as clearly-defined responsibilities | ||||
| Executive sessions of independent directors at each regular Board meeting without the presence of the CEO | ||||
| Annual Board and committee self-assessment guided by Lead Independent Director and review of progress on key action items throughout the year | ||||
| No poison pill | ||||
| Ongoing director education | ||||
| Robust shareholder engagement process, including participation by our Lead Independent Director | ||||
| Semi-annual Board review of investor feedback | ||||
| Ongoing consideration of Board composition and refreshment, including diversity in director succession | ||||
| Strong director attendance: each director attended 75% or more of total meetings of the Board and committees on which he or she served during 2021 | ||||
| Stock ownership requirements for directors | ||||
| Board oversight of corporate responsibility and ESG matters | ||||
| Robust anti-hedging and anti-pledging policies | ||||
| Direct Board access to, and regular interaction with, management | ||||
Our Board’s leadership structure
The Board’s leadership structure is designed to promote Board effectiveness and to appropriately allocate authority and responsibility between the Board and management.
Based on consideration of the factors described on page 23, our Board has determined that combining the roles of Chair and CEO is the most effective leadership structure for the Board at this time. The Board believes the present structure provides the Firm and the Board with strong leadership, appropriate independent oversight of management, continuity of experience that complements ongoing Board refreshment, and the ability to communicate the Firm's business and strategy to shareholders, clients, employees, regulators and the public in a single voice.
As required by the Firm’s Governance Principles when the role of the Chair is combined with that of the CEO, the independent directors appointed a Lead Independent Director. Our Lead Independent Director provides a strong counterbalance to the Chair including by facilitating independent oversight of management, promoting open dialogue among the independent directors during and in between Board meetings, leading executive sessions at each regular Board meeting without the presence of the CEO, and focusing on the Board's priorities and processes.
In March 2022, the independent directors conducted a review of the Board’s leadership structure. This review was conducted first by the Corporate Governance & Nominating Committee, which considered the factors on page 23, the
Firm’s governance practices, which include executive sessions of independent directors as part of each regularly scheduled Board meeting and the directors’ frequent and open interactions with senior management, and the effectiveness of the Lead Independent Director role. Following its review, the Committee recommended that the Board continue its current leadership structure and that Stephen B. Burke be re-appointed as Lead Independent Director. The independent directors of the Board conducted their own review, again taking into account the factors on page 23, the Committee’s recommendation and Mr. Burke’s effective performance in the Lead Independent Director role over the course of the prior year, and determined to maintain the current leadership structure with Mr. Burke serving as Lead Independent Director.
In addition, the Board considered the potential separation of the Chair and CEO positions in the context of succession planning. The Board has adopted a general policy, upon the next CEO transition, that the Chair and CEO positions shall be separate, subject to the Board's determination of the leadership structure that best serves the Firm and its shareholders at that time. This policy is reflected in the Firm's Corporate Governance Principles and reinforces the Board's longstanding commitment to independent oversight while also maintaining the Board's ability to fulfill its fiduciary duty to make the ultimate decision regarding the leadership structure that best serves shareholders.
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Factors the Board considers in reviewing its leadership structure
The Board reviews its leadership structure not less than annually, and conducted its most recent review in March 2022, considering the following factors:
•The respective responsibilities for the positions of Chair and Lead Independent Director (see table below for detailed information)
•The people currently in the roles of Chair and Lead Independent Director and their record of strong leadership and performance in their roles
•The current composition of the Board
•The policies and practices in place to provide independent Board oversight of management (including Board oversight of CEO performance and compensation, regular executive sessions of the independent directors, Board input into agendas and meeting materials, and Board self-assessment)
•The Firm’s circumstances, including its financial performance
•The views of our stakeholders, including shareholders
•Trends in corporate governance, including practices at other public companies, and studies on the impact of leadership structures on shareholder value
•Such other factors as the Board determines
Respective duties and responsibilities of the Chair and Lead Independent Director
| CHAIR | | calls Board and shareholder meetings | |||||||||
| presides at Board and shareholder meetings | ||||||||||
| approves Board meeting schedules, agendas and materials, subject to the approval of the Lead Independent Director | ||||||||||
| LEAD INDEPENDENT DIRECTOR | | has the authority to call for a Board meeting or a meeting of independent directors | |||||||||
| presides at Board meetings in the Chair’s absence or when otherwise appropriate | ||||||||||
| approves agendas and adds agenda items for Board meetings and meetings of independent directors | ||||||||||
| acts as liaison between independent directors and the Chair/CEO | ||||||||||
| presides over executive sessions of independent directors | ||||||||||
| engages and consults with major shareholders and other constituencies, where appropriate | ||||||||||
| provides advice and guidance to the CEO on executing long-term strategy | ||||||||||
| guides the annual performance review of the Chair/CEO | ||||||||||
| advises the CEO of the Board’s information needs | ||||||||||
| guides the annual independent director consideration of Chair/CEO compensation | ||||||||||
| meets one-on-one with the Chair/CEO following executive sessions of independent directors | ||||||||||
| guides the Board in its consideration of CEO succession | ||||||||||
| guides the self-assessment of the Board | ||||||||||
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| Director nominees | | Board governance | | Board oversight | | Board engagement | ||||||||||||||||||||||||||||||||
Board meetings and attendance
10 Board Meetings Communication between meetings as appropriate | 8 Executive sessions of independent directors Led by Lead Independent Director | 43 Meetings of principal standing committees | 9 Meetings of specific purpose committees | |||||||||||||||||||||||
The Board conducts its business as a whole and through a well-developed committee structure in adherence to our Governance Principles. The Board has established practices and processes to actively manage its information flow, set meeting agendas and promote sound, well-informed decisions.
Board members have direct access to management and regularly receive information from and engage with management during and outside of formal Board meetings.
In addition, the Board and each committee has the authority and resources to seek legal or other expert advice from sources independent of management.
The full Board met 10 times in 2021. For more information on committees, see below. Each director attended 75% or more of the total meetings of the Board and the committees on which he or she served in 2021.
Committees of the Board
A significant portion of our Board’s oversight responsibilities is carried out through its five independent, principal standing committees: Audit Committee, CMDC, Governance Committee, Public Responsibility Committee ("PRC") and Risk Committee. Allocating responsibilities among committees allows more in-depth attention devoted to the Board’s oversight of the business and affairs of the Firm.
Committees meet regularly in conjunction with scheduled Board meetings and hold additional meetings as needed. Each committee reviews reports from senior management and reports its actions to, and discusses its recommendations with, the full Board.
Each principal standing committee operates pursuant to a written charter. These charters are available on our website at jpmorganchase.com/about/governance/board-committees. Each charter is reviewed at least annually as part of the Board’s and each respective committee’s self-assessment.
The Governance Committee annually reviews the allocation of responsibility among the committees as part of the Board and committee self-assessment. For more information about the self-assessment process, see page 27.
Each committee has oversight of specific areas of business activities and risk, and engages with the Firm’s senior management responsible for those areas.
All committee chairs are appointed at least annually by our Board. Committee chairs are responsible for:
•Calling meetings of their committees
•Approving agendas for their committee meetings
•Presiding at meetings of their committees
•Serving as a liaison between committee members and the Board, and between committee members and senior management, including the CEO
•Working directly with the senior management responsible for committee mandates
The Board determined each member of the Audit Committee in 2021 (Timothy P. Flynn, Michael A. Neal and Phebe N. Novakovic) to be an audit committee financial expert in accordance with the definition established by the SEC, and that Ms. Bammann, the chair of the Risk Committee, has experience in identifying, assessing and managing risk exposures of large, complex financial firms in accordance with rules issued by the Board of Governors of the Federal Reserve System (“Federal Reserve”).
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| Key oversight responsibilities of the principal standing committees of the Board: | ||
| BOARD OF DIRECTORS | |||||||||||||||||||||||||||||
| Audit | CMDC | Risk | PRC | Governance | |||||||||||||||||||||||||
17 meetings in 2021 Oversees: •The independent registered public accounting firm’s qualifications and independence •The performance of the internal audit function and the independent public accounting firm •Management’s responsibilities to assure that there is an effective system of controls •Internal control framework •Integrity of financial statements •Compliance with the Firm’s ethical standards, policies, plans and procedures, and with laws and regulations •Reputational risks and conduct risks within its scope of responsibility | 6 meetings in 2021 Oversees: •Development of and succession for key executives •Compensation principles and practices •Compensation and qualified benefit programs •Operating Committee performance assessments and compensation •Firm’s Business Principles, culture and significant employee conduct issues and any related actions •Reputational risks and conduct risks within its scope of responsibility | 7 meetings in 2021 Oversees: •Management’s responsibility to implement an effective global risk management framework reasonably designed to identify, assess and manage the Firm’s risks, including: –Strategic risk –Market risk –Credit and investment risk –Operational risk •Applicable primary risk management policies •Risk appetite results and breaches •The Firm’s capital and liquidity planning and analysis •Reputational risks and conduct risks within its scope of responsibility | 5 meetings in 2021 Oversees: •Community investing and fair lending practices •Political contributions, major lobbying priorities and principal trade association memberships related to public policy •Sustainability •Consumer practices, including consumer experience, consumer complaint resolution and consumer issues related to disclosures, fees or the introduction of major new products •Reputational risks and conduct risks within its scope of responsibility | 8 meetings in 2021 Oversees: •Review of the qualifications of proposed nominees for Board membership •Corporate governance practices applicable to the Firm •The framework for the Board’s self-assessment •Shareholder matters •Board and Committee composition •Reputational risks and conduct risks within its scope of responsibility | |||||||||||||||||||||||||
For more information about committee responsibilities, see Committee Charters available at: jpmorganchase.com/about/governance/board-committees.
Other Standing Committees
The Board has two additional standing committees:
Stock Committee: The committee is responsible for implementing the declaration of dividends, authorizing the issuance of stock, administering the dividend reinvestment plan and implementing share repurchase plans. The committee acts within Board-approved limitations and capital plans.
Executive Committee: The committee may exercise all the powers of the Board that lawfully may be delegated, but with the expectation that it would not take material actions absent special circumstances.
The Board may establish additional standing committees as needed.
Specific Purpose Committees
The Board establishes Specific Purpose Committees as appropriate to address specific issues. The Board currently
has two such committees, the Markets Compliance Committee and the Omnibus Committee. The Markets Compliance Committee provides oversight in connection with certain markets-related matters, including the Deferred Prosecution Agreement entered into with the U.S. Department of Justice to resolve the Firm's precious metals and U.S. Treasuries investigations.
The Omnibus Committee reviews matters delegated by the Board.
As the Firm achieves its objectives in a specific area, the work of the relevant Specific Purpose Committee will be concluded and, the Committee appropriately disbanded.
Additional Specific Purpose Committees may be established from time to time in the future to address particular issues.
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Current Board committee membership
| Director | Audit | CMDC | Governance | PRC | Risk | Specific Purpose1 | ||||||||||||||
Stephen B. Burke2 | Chair | Member | A | |||||||||||||||||
| Linda B. Bammann | Member | Chair | B | |||||||||||||||||
| Todd A. Combs | Member | Chair | A | |||||||||||||||||
| James S. Crown | Chair | Member | B | |||||||||||||||||
| James Dimon | ||||||||||||||||||||
| Timothy P. Flynn | Chair | |||||||||||||||||||
| Mellody Hobson | Member | Member | A | |||||||||||||||||
| Michael A. Neal | Member | Member | B | |||||||||||||||||
| Phebe N. Novakovic | Member | |||||||||||||||||||
| Virginia M. Rometty | Member | Member | A | |||||||||||||||||
1The Board’s Specific Purpose Committees in 2021 were:
A – Markets Compliance Committee
B – Omnibus Committee
2Lead Independent Director
All directors of the Firm were elected by shareholders in 2021 and comprise the full Boards of JPMorgan Chase Bank, National Association (the “Bank”) and an intermediate holding company, JPMorgan Chase Holdings LLC (the “IHC”). Mr. Burke is the independent Chair of the Board of the Bank; IHC does not have a Chair of the Board.
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Board and Committee self-assessment
The Board conducts an annual self-assessment aimed at enhancing its effectiveness. Through this regular assessment, including an assessment of its policies, procedures and performance, the Board identifies areas for further consideration and improvement. In assessing itself, the Board takes a multi-year perspective. The Board self-assessment is guided by the Lead Independent Director and is conducted in phases.
Self-assessment framework The Governance Committee reviews and provides feedback on the annual self-assessment process including specific topics to be addressed. | ||
 | ||
Board and Committee assessments The Board reviews the actions taken in response to the previous year’s self-assessment and reviews the Board’s performance against regulatory requirements, including its responsibilities under the OCC’s “Heightened Standards” for large national banks, as well as the Federal Reserve's Supervisory Guidance on Board of Directors' Effectiveness. Topics addressed in the Board assessment generally include: strategic priorities; board structure; how the board spends its time; oversight of and interaction with management; oversight of culture; diversity and talent, and related risk controls framework; committee effectiveness; and specific matters that may be relevant. Each principal standing committee conducts a self-assessment that includes a review of performance against committee charter requirements and focuses on committee agenda planning and the flow of information received from management. Committee discussion topics include committee composition and effectiveness, leadership, and the content and quality of meeting materials. | ||
| ||
One-on-one discussions The directors hold private individual discussions with the General Counsel using a discussion guide that frames the self-assessment. The General Counsel and Lead Independent Director review feedback from the individual discussions. | ||
| ||
Action items The General Counsel and Lead Independent Director report the feedback received to the Board. Appropriate action plans are developed to address the feedback received from the Board and committee assessments and the one-on-one discussions. Throughout the year, the Board and Committees partner with management to execute and evaluate progress on action items. | ||
Director education
Our director education program assists Board members in fulfilling their responsibilities. The director education program commences with an orientation program when a new director joins the Board. Ongoing education is provided through “deep dive” presentations from LOBs, discussions and presentations by subject matter experts and other opportunities, including events that provide client, employee and other perspectives that can have a significant impact on the Firm. In 2021, directors were provided with education on subjects including the following:
•the Firm’s products, services and lines of business;
•cybersecurity and technology, including an update on the Firm's cybersecurity modernization strategy and cyber threats landscape;
•diversity, equity and inclusion ("DEI");
•ESG matters, including the Firm's climate risk management framework;
•significant and emerging risks; and
•key laws, regulations and supervisory requirements applicable to the Firm.
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3. Board oversight
The Board is responsible for oversight of the business and affairs of the Firm on behalf of shareholders. It is also responsible for setting the cultural “tone at the top.” Among its core responsibilities, the Board oversees:
Strategy
The Board of Directors oversees the formulation and implementation of the Firm's strategic initiatives and reviews and approves the Firm’s annual strategic plan. Annual strategic plans include evaluation of performance against the prior year’s initiatives, assessment of the current operating environment, refinement of existing strategies and development of new strategic initiatives. Throughout the year, the CEO and CFO provide updates on the Firm’s overall strategic direction, and senior management provides updates on the strategic opportunities and performance, priorities and implementation of strategies in their respective LOBs and Corporate functions. These management presentations and financial plans are the foundation of active dialogue with, and feedback from, the Board about the strategic risks and opportunities facing the Firm and its businesses.
Executive performance and talent management
The CMDC reviews the Firm’s performance periodically during the course of the year, and formally, at least annually. The CMDC’s review of the CEO’s performance is presented to the Board in connection with the Board’s review of executive officer annual compensation. In addition, the CMDC provides individual OC members with opportunities on a recurring basis to discuss top and diverse talent within their respective LOBs and Corporate functions.
Succession planning for the CEO and other members of the OC is considered at least annually. The CMDC also discusses at least annually the talent pipeline for specific critical roles. The Board has numerous opportunities to meet with, and assess development plans for, members of the OC and other high-potential senior management leaders. This occurs through various means, including informal meetings, presentations to the Board and its committees, and Board dinners. For further information, see Compensation discussion and analysis (“CD&A”) on page 39.
Financial performance and condition
Throughout the year, the Board reviews the Firm’s financial performance and condition, including overseeing management’s execution against the Firm’s capital, liquidity, strategic and financial operating plans.
Reports on the Firm’s financial performance and condition are presented at each regularly scheduled Board meeting. The Firm’s annual Comprehensive Capital Analysis and Review (“CCAR”) submission, which contains the Firm’s proposed plans to make capital distributions, such as dividend payments, stock repurchases and other capital actions, is reviewed and approved prior to its submission to the Federal Reserve. In addition, the Audit Committee assists the Board in the oversight of the Firm’s financial statements and internal control framework. The Audit Committee also assists the Board in the appointment, retention, compensation, evaluation and oversight of the Firm’s independent registered public accounting firm. For further information, see “Risk management and internal control framework” below.
Risk management and internal
control framework
control framework
Risk is an inherent part of JPMorgan Chase’s business activities. When the Firm extends a consumer or wholesale loan, advises customers and clients on their investment decisions, makes markets in securities or offers other products or services, the Firm takes on some degree of risk. The Firm’s overall objective is to manage its businesses, and the associated risks, in a manner that balances serving the interests of its clients, customers and investors and protects the safety and soundness of the Firm.
The key risk areas of the Firm are managed on a Firmwide basis. Certain risks, such as strategic risk, are overseen by the full Board. Cybersecurity risk is overseen by the full Board, with additional oversight of the relevant risk framework and controls provided by the Audit and Risk Committees. Board committees support the Board’s oversight responsibility by overseeing the risk categories related to such committee’s specific area of focus.
Committee chairs report significant matters discussed at committee meetings to the full Board. Issues escalated to the full Board may be dealt with in several ways, as appropriate, for example: oversight of risk may remain with the particular principal standing committee of the Board, the Board may establish or direct a Specific Purpose Committee to oversee such matters, or the Board may ask management to present more frequently to the full Board on the issue.
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Environmental, social and
governance matters
governance matters
As noted throughout this Proxy, oversight of ESG matters is an important part of the Board's work in setting the policies and principles that govern our business, including:
•the Firm’s governance-related policies and practices;
•our systems of risk management and controls;
•our investment in our employees;
•the manner in which we serve our customers and support our communities; and
•how we advance sustainability in our business and operations.
In particular, the Board’s PRC provides oversight of the Firm’s positions and practices on public responsibility matters such as community investment, fair lending, consumer practices, sustainability and other public policy issues that reflect the Firm’s values and impact its reputation among all of its stakeholders. Other Board committees consider ESG matters within their scope of responsibility. For instance, the CMDC oversees the Firm's culture, including reviewing employee diversity, equity and inclusion programs; the Risk Committee considers climate risk; the Governance Committee reviews board diversity; and the Audit Committee provides oversight of compliance with the Firm's ethical standards, policies, plans and procedures, and with laws and regulations. In the past year, in addition to the work of the committees, all directors participated in full Board discussion regarding the Firm's approach to COVID-19, racial equity and climate change.
The Firm is committed to being transparent about our approach to and performance on ESG topics. One way we do this is by publishing an annual ESG Report, which provides information on how we are addressing the ESG matters that we and our stakeholders view as important to our business. We monitor the evolving disclosure landscape and evaluate which frameworks address our stakeholders' interest. As of 2021, our ESG disclosures are informed by the Global Reporting Initiative, Sustainability Accounting Standards Board and the Task Force on Climate-related Financial Disclosures ("TCFD"). The ESG information page on our website provides links to numerous JPMorgan Chase publications, documents, policies and other sources of information about various ESG topics, which are available at jpmorganchase.com/about/governance/esg.
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4. Board engagement
Our directors meet periodically throughout the year with the Firm’s shareholders, employees, regulators, community and business leaders, and other persons interested in our strategy, business practices, governance, culture and performance. For more information, see the CD&A on pages 39-72.
Shareholders and other interested parties
We have an active and ongoing approach to engagement on a wide variety of topics (e.g., strategy, performance, competitive environment, governance) throughout the year. We interact with and receive feedback from our shareholders and other interested parties. Our shareholder engagement efforts are outlined below.
How we communicate: | Who we engage: | How we engage: | ||||||||||||||||||
•Annual Report •Proxy Statement •SEC filings •Press releases •Firm website •ESG Report and other related publications | •Institutional shareholders •Retail shareholders •Investors •Proxy advisory firms •ESG rating firms •Industry thought leaders •Community and business leaders •Non-governmental organizations | •Quarterly earnings calls •Investor meetings and conferences •Shareholder Outreach Program •Annual Shareholder Meeting •Shareholder queries to Investor Relations | ||||||||||||||||||
 | ||||||||||||||||||||
Semiannual Shareholder Outreach Program: •Twice a year, we conduct a comprehensive formal Shareholder Outreach Program focused on topics including corporate governance, shareholder rights, executive compensation as well as the Firm's approach to managing environmental and social matters, such as climate change and diversity, equity and inclusion. •We reach out to over 100 of our largest shareholders as well as proxy advisory firms. In these meetings, management shares information and provides updates on the aforementioned topics, addresses questions and solicits shareholders' perspectives and feedback. Directors participate in these meetings as appropriate. •Following each Shareholder Outreach Program, shareholders' areas of focus and feedback are provided to the Board. | ||||||||||||||||||||
2021 Engagements | ||||||||||||||||||||
•Senior Management ◦Hosted approximately 25 investor meetings ◦Presented at approximately 15 investor conferences ◦Met with shareholders and other interested parties around the world •Shareholder Outreach Program ◦Approximately 90 engagements with nearly 70 shareholders representing approximately 46% of the Firm's outstanding common stock ◦Directors participated as appropriate ◦Frequently discussed topics included: ▪The Firm's strategy, financial and operating performance and risk management in light of COVID-19 ▪Board composition ▪Board and management succession planning ▪Enhancements to the executive compensation program and disclosures ▪The Firm's climate and sustainability efforts ▪The Firm's efforts to advance racial equity, including its $30 billion commitment | ||||||||||||||||||||
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Employees
Our Board is committed to maintaining a strong corporate culture that, based on our core values of respect, integrity and inclusion, instills and enhances a sense of personal accountability on the part of all of the Firm’s employees.
In addition to discussions at Board meetings with senior management about these efforts, our directors participate in events outside of the Boardroom including meetings with employees that emphasize this commitment. These meetings include employee town halls, LOB and leadership team events such as our MD Workshop, annual senior leaders’ meetings and informal sessions with members of the OC and other senior leaders. In 2021, members of our Board also participated in Business Resource Groups' ("BRG") events including Women on the Move, Leading Women Defined conference, Annual Women Leadership Day, and Asset Wealth Management and Black Organization for Leadership Development ("BOLD").
Regulators
Our Board and senior leaders commit significant time to meeting with regulators. These interactions help us learn first-hand from regulators about matters of importance to them and their expectations of us. It also gives the Board and management a forum for keeping our regulators well-informed about the Firm’s performance and business practices.
Stakeholders
As we strive to deliver value, management engages with our stakeholders, including our customers, suppliers and communities in which we work, on a range of issues in a variety of ways. These may include participation in consumer advisory panels, town halls and meetings with policy advocacy groups and nonprofit organizations. We actively seek feedback on key topics to help us better understand what is important to our stakeholders and find ways to deliver value while also navigating financial, legal and regulatory considerations. In recent years, we have engaged in extensive stakeholder outreach pertaining to, among other topics, human capital management including diversity, equity and inclusion, climate change risk and ESG-related disclosures.
Management shares insights and feedback from these relationships and engagements with the Board, providing the Board with valuable insights. Board members are also provided opportunities to engage with stakeholders through client events, town halls, BRG, and shareholder discussions.
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Table of Contents
DIRECTOR COMPENSATION | CORPORATE GOVERNANCE | ||||||||
Director compensation
The Governance Committee is responsible for reviewing director compensation and making recommendations to the Board. In making its recommendations, the Governance Committee annually reviews the Board’s responsibilities and the compensation practices of peer firms, which include the same group of peer firms referenced with respect to the compensation of our NEOs. For more information see “Evaluating market practices” on page 45.
The Board believes a best practice is to link director compensation to the Firm’s performance; therefore, a significant portion of director compensation is paid in common stock.
Annual compensation
For each calendar year of service on the Board, each non-employee director receives an annual cash retainer of $100,000 and if the non-employee director is on the Board at the time when annual performance year equity awards are granted, an annual grant of deferred stock units valued at $250,000. Compensation paid during 2021, including additional cash compensation paid for certain committee and other service, is described in the following tables.
Each deferred stock unit included in the annual grant to directors represents the right to receive one share of the Firm’s common stock and dividend equivalents payable in deferred stock units for any dividends paid. Deferred stock units have no voting rights. In January of the year immediately following a director’s termination of service, deferred stock units are distributed in shares of the Firm’s common stock in either a lump sum or in annual installments for up to 15 years as elected by the director.
The following table summarizes the 2021 annual compensation for non-employee directors for service on the Boards of the Firm, the Bank and J.P. Morgan Securities plc. There is no additional compensation paid for service on the Board of IHC.
| Compensation | Amount ($) | |||||||
| Board retainer | $ | 100,000 | ||||||
| Lead Independent Director retainer | 30,000 | |||||||
| Audit and Risk Committee chair retainer | 25,000 | |||||||
| Audit and Risk Committee member retainer | 15,000 | |||||||
| All other committees chair retainer | 15,000 | |||||||
| Deferred stock unit grant | 250,000 | |||||||
| Bank Board retainer | 15,000 | |||||||
| Bank Board’s chair retainer | 25,000 | |||||||
| J.P. Morgan Securities plc Board retainer | 110,000 | |||||||
The Board may periodically ask directors to serve on one or more Specific Purpose Committees or other committees that are not one of the Board’s principal standing committees or to serve on the board of directors of a subsidiary of the Firm. Any compensation for such service is included in the “2021 Director compensation table” on the next page.
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Table of Contents
CORPORATE GOVERNANCE | DIRECTOR COMPENSATION | ||||||||
2021 Director compensation table
The following table shows the compensation for each non-employee director in 2021.
| Director | Fees earned or paid in cash ($)1 | 2021 Stock award ($)2 | Other fees earned or paid in cash ($)3 | Total ($) | ||||||||||||||||||||||
| Stephen B. Burke | $ | 145,000 | $ | 250,000 | $ | 57,500 | $ | 452,500 | ||||||||||||||||||
| Linda B. Bammann | 140,000 | 250,000 | 15,000 | 405,000 | ||||||||||||||||||||||
| Todd A. Combs | 114,755 | 250,000 | 30,000 | 394,755 | ||||||||||||||||||||||
| James S. Crown | 130,000 | 250,000 | 15,000 | 395,000 | ||||||||||||||||||||||
| Timothy P. Flynn | 140,000 | 250,000 | 125,000 | 515,000 | ||||||||||||||||||||||
| Mellody Hobson | 115,000 | 250,000 | 32,500 | 397,500 | ||||||||||||||||||||||
| Michael A. Neal | 115,000 | 250,000 | 15,000 | 380,000 | ||||||||||||||||||||||
| Phebe N. Novakovic | 115,000 | 250,000 | 15,000 | 380,000 | ||||||||||||||||||||||
| Virginia M. Rometty | 100,000 | 250,000 | 30,000 | 380,000 | ||||||||||||||||||||||
1Includes fees earned, whether paid in cash or deferred, for service on the Board of Directors. For additional information on each director’s service on committees of JPMorgan Chase, see “Committees of the Board” on pages 24-26.
2On January 19, 2021, each non-employee director who was on the Board at the time when annual performance year equity awards were granted, received an annual grant of deferred stock units valued at $250,000, based on a grant date fair market value of the Firm’s common stock of $139.26 per share. The aggregate number of stock and option awards outstanding at December 31, 2021, for each current director is included in the “Security ownership of directors and executive officers” table on page 83 under the columns “SARs/Options exercisable within 60 days” and “Additional underlying stock units,” respectively. All such awards are vested.
3Includes fees paid to the non-employee directors for their service on the Board of Directors of the Bank or who are members of one or more Specific Purpose Committees. A fee of $2,500 is paid for each Specific Purpose Committee meeting attended (with the exception of the Omnibus Committee). Also includes for Mr. Flynn, $110,000 in compensation during 2021 in consideration of his service as a director of J.P. Morgan Securities plc, the Firm’s principal operating subsidiary outside the U.S. and a subsidiary of the Bank.
Stock ownership: no sales, no hedging, no pledging
As stated in the Governance Principles and further described in “Anti-hedging/anti-pledging provisions” on page 50, each director agrees to retain all shares of the Firm’s common stock he or she purchased on the open market or received pursuant to his or her service as a Board member for as long as he or she serves on our Board.
Shares held personally by a director may not be held in margin accounts or otherwise pledged as collateral, nor may the economic risk of such shares be hedged.
As detailed on page 83 under “Security ownership of directors and executive officers,” Mr. Crown has ownership of certain shares attributed to him that arise from the business of Henry Crown and Company, an investment company where Mr. Crown serves as Chairman and CEO, and trusts of which Mr. Crown serves as trustee (the “Attributed Shares”). Mr. Crown disclaims beneficial ownership of such Attributed Shares, except to the extent of his pecuniary interest. The Attributed Shares are distinct from shares Mr. Crown or his spouse own individually, or shares held in trusts for the benefit of his children (the “Crown Personally Held Shares”). The Firm has reviewed the potential pledging of the Attributed Shares with Mr. Crown, recognizes Mr. Crown’s distinct obligations with respect to Henry Crown and Company and the trusts, and believes such Attributed Shares may be prudently pledged or held in margin loan accounts. Crown Personally Held Shares are not and may not be held in margin accounts or otherwise pledged as collateral, nor may the economic risk of such shares be hedged.
Deferred compensation
Each year, non-employee directors may elect to defer all or part of their cash compensation. A director’s right to receive future payments under any deferred compensation arrangement is an unsecured claim against JPMorgan Chase’s general assets. Cash amounts may be deferred into various investment equivalents, including deferred stock units. Upon retirement from the Board, compensation deferred into stock units will be distributed in stock; all other deferred cash compensation will be distributed in cash. Deferred compensation will be distributed in either a lump sum or in annual installments for up to 15 years as elected by the director commencing in January of the year following the director’s retirement from the Board.
Reimbursements and insurance
The Firm reimburses directors for their expenses in connection with their Board service or pays such expenses directly. The Firm also pays the premiums on directors’ and officers’ liability insurance policies and on travel accident insurance policies covering directors as well as employees of the Firm.
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OTHER CORPORATE GOVERNANCE POLICIES AND PRACTICES | CORPORATE GOVERNANCE | ||
Other corporate governance policies and practices
Shareholder rights
The Firm’s Certificate of Incorporation and By-laws provide shareholders with important rights, including:
•Proxy access, which enables eligible shareholders to include their nominees for election as directors in the Firm’s proxy statement. For further information, see page 109, “Shareholder proposals and nominations for the 2023 annual meeting.”
•The ability to call a special meeting by shareholders holding at least 20% of the outstanding shares of our common stock (net of hedges)
•The ability of shareholders holding at least 20% of the outstanding shares of our common stock (net of hedges) to seek a corporate action by written consent without a meeting on terms substantially similar to the terms applicable to call special meetings
•Majority election of directors
•No “poison pill” in effect
•No super-majority vote requirements in our Certificate of Incorporation or By-laws
The Firm’s Certificate of Incorporation and By-laws are available on our website at jpmorganchase.com/about/governance.
Policies and procedures for approval of related party transactions
The Firm has adopted a written Transactions with Related Persons Policy (“Policy”), which sets forth the Firm’s policies and procedures for reviewing and approving transactions with related persons – our directors, executive officers, their respective immediate family members and 5% shareholders. The transactions covered by the Policy include any financial transaction, arrangement or relationship in which the Firm is a participant, and the related person has or will have a direct or indirect material interest.
After becoming aware of any transaction which may be subject to the Policy, the director or executive officer involved in such transaction is required to report all relevant facts with respect to the transaction to the General Counsel of the Firm. Upon determination by the General Counsel that a transaction requires review under the Policy, the material facts of the transaction and the related person’s interest in the transaction are provided to the Governance Committee. The transaction is then reviewed by the disinterested members of the Governance Committee, who determine whether approval or ratification of the transaction shall be granted. In reviewing a transaction, the Governance Committee considers facts and circumstances that it deems relevant to its determination, such as: management’s assessment of the commercial reasonableness of the transaction; the
materiality of the related person’s direct or indirect interest in the transaction; whether the transaction may involve an actual, or the appearance of, a conflict of interest; and, if the transaction involves a director, the impact of the transaction on the director’s independence.
Certain types of transactions are pre-approved in accordance with the terms of the Policy. These include transactions in the ordinary course of business involving financial products and services provided by, or to, the Firm, including loans, provided such transactions are in compliance with the Sarbanes-Oxley Act of 2002, Federal Reserve Board Regulation O and other applicable laws and regulations.
Transactions with directors, executive officers and 5% shareholders
Our directors and executive officers, and some of their immediate family members and affiliated entities, and BlackRock, Inc. and affiliated entities ("BlackRock") and The Vanguard Group and affiliated entities ("Vanguard"), beneficial owners of more than 5% of our outstanding common stock, were customers of, or had transactions with or involving, JPMorgan Chase or our banking or other subsidiaries in the ordinary course of business during 2021. Additional transactions may be expected to take place in the future.
Any outstanding loans to the foregoing persons and entities and any other transactions involving the Firm’s financial products and services (such as banking, brokerage, investment, investment banking, and financial advisory products and services) provided to such persons and entities: (i) were made in the ordinary course of business, (ii) were made on substantially the same terms (including interest rates and collateral (where applicable), as those prevailing at the time for comparable transactions with persons and entities not related to the Firm (or, where eligible with respect to executive officers, immediate family members and affiliated entities, on such terms as are available under our employee benefits or compensation programs) and (iii) did not involve more than the normal risk of collectibility or present other unfavorable features.
The fiduciary committees for the JPMorgan Chase Retirement Plan and for the JPMorgan Chase 401(k) Savings Plan (each, a “Plan”) entered into agreements with BlackRock giving it discretionary authority to manage certain assets on behalf of each Plan. Pursuant to these agreements, fees of approximately $5.1 million were paid by the Plans to BlackRock in 2021. JPMorgan Chase UK Retirement Plan paid BlackRock approximately £515,000 (approximately $679,000) for the portfolio management services provided to its Trustee, JPMorgan Pension Trustees Limited. Subsidiaries of the Firm have subscribed to information services and received consulting services from BlackRock,
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CORPORATE GOVERNANCE | OTHER CORPORATE GOVERNANCE POLICIES AND PRACTICES | ||
including and related to select market data, analytics and modeling, and paid BlackRock approximately $3.1 million in 2021 for the services. JPMorgan Chase paid BlackRock approximately $4.6 million in 2021 to access its Aladdin® platform.
Certain J.P. Morgan mutual funds and subsidiaries entered into a sub-transfer agency agreement with Vanguard and paid Vanguard approximately $465,000 in 2021 for services rendered, primarily accounting, recordkeeping and administrative services.
In January 2019, the Firm entered into agreements for the sale and redevelopment of a retail bank branch property in California to modernize the branch and monetize excess development rights. Following a solicitation and review of proposals from several major real estate developers, a company not affiliated with the Firm or its directors or executive officers was selected to lead the project. The development company is expected to make the purchase through an existing legal entity as a result of which Director James Crown and members of his immediate family are expected to hold indirect equity interests in the property which in the aggregate would exceed 10%. The purchase price will depend upon the development rights attained and is anticipated to exceed $32 million. The transaction has not been consummated and closing is subject to completion of the development entitlements process and satisfaction of other contractual conditions precedent. The transaction is not material to the overall investment holdings of Mr. Crown and members of his immediate family, and it was negotiated with the unaffiliated development company in the ordinary course of business.
In December 2020, as part of the Firm’s plan to invest $30 billion to advance racial equity, the Firm approved co-investment of up to $200 million on a deal-by-deal basis in Black, Hispanic or Latino-owned businesses alongside Project Black (the “Co-Invest Program”). Project Black is a private equity initiative of Ariel Alternatives, LLC, an affiliate of Ariel Investments, LLC, of which Director Mellody Hobson is Co-CEO and President. The purpose of the Co-Invest Program is to facilitate co-investments by the Firm in businesses that (i) are Black, Hispanic or Latino-owned prior to any investment by Project Black or the Firm, or (ii) will become Black, Hispanic or Latino-owned by virtue of the investment by Project Black and that will be managed so as to increase diversity into the acquired company’s leadership and management. In connection with the Co-Invest Program, the Firm will neither receive fees from nor pay fees to Ariel Investments, LLC or any of its affiliates. The Co-Invest Program is not material to Mellody Hobson or Ariel Investments, LLC.
Compensation & Management Development Committee interlocks and insider participation
The members of the CMDC are listed on page 26. No member of the CMDC is or ever was a JPMorgan Chase officer or
employee, other than Linda B. Bammann, who previously served as an officer of JPMorgan Chase 15 years before joining the CMDC and 8 years before joining the Board. No JPMorgan Chase executive officer is, or was during 2021, a member of the board of directors or compensation committee (or other committee serving an equivalent function) of another company that has, or had during 2021, an executive officer serving as a member of our Board or the CMDC. All of the members of the CMDC, and/or some of their immediate family members and affiliated entities, were customers of, or had transactions with or involving, JPMorgan Chase or our banking or other subsidiaries in the ordinary course of business during 2021. Additional transactions may be expected to take place in the future. Any outstanding loans to the directors serving on the CMDC and their immediate family members and affiliated entities, and any transactions involving other financial products and services provided by the Firm to such persons and entities, were made in accordance with the standards stated above for transactions with directors, executive officers and 5% shareholders.
Political activities and lobbying
JPMorgan Chase believes that responsible corporate citizenship demands a commitment to a healthy and informed democracy through civic and community involvement. Our business is subject to extensive laws and regulations at the international, federal, state and local levels, and changes to such laws can significantly affect how we operate, our revenues and the costs we incur. Because of the potential impact public policy can have on our businesses, employees, communities and customers, we engage with policymakers in order to advance and protect the long-term interests of the Firm.
The PRC oversees the Firm’s significant policies and practices regarding political contributions, major lobbying priorities and principal trade association memberships that relate to the Firm’s public policy objectives.
The Firm’s policies and practices related to political activities:
•Prohibit the use of corporate funds to support candidates, political party committees and political action committees ("PACs")
•Provide that the Firm restrict U.S. trade organizations and groups organized under Section 501(c)(4) of the Internal Revenue Code of which it is a member from using the Firm’s dues payments for any election-related activity
•Prohibit corporate funds from being used to make contributions to SuperPACs and political committees organized under Section 527 of the Internal Revenue Code to promote the election or defeat of candidates for office
•Prohibit the use of corporate funds to make independent political expenditures, as defined by the rules of the Federal Election Commission, including electioneering communications
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OTHER CORPORATE GOVERNANCE POLICIES AND PRACTICES | CORPORATE GOVERNANCE | ||
The Firm discloses on its website contributions made by the Firm’s PACs and contributions of corporate funds made in connection with ballot initiatives.
In January 2021, violence at the U.S. Capitol prompted a six month pause of all contributions from our PAC. The pause offered an opportunity to examine the PAC's mission, strategy and governance framework. The JPMorgan Chase PAC resumed political giving in Q3 2021 and will continue to reevaluate these policies annually.
For further information regarding the Firm’s policy engagement, political contributions and lobbying activity, view our Political Engagement and Public Policy Statement on our website.
Code of Conduct
The Code of Conduct is a collection of principles designed to assist employees and directors in making decisions about their conduct in relation to the Firm’s business.
Employees and directors are trained on the principles of the Code of Conduct. They must annually affirm that they have read, understand, and are in compliance with the Code of Conduct. They are required to raise concerns about misconduct and report any potential or actual violations of the Code of Conduct, any internal Firm policy, or any law or regulation applicable to the Firm’s business. The Code of Conduct prohibits intimidation or retaliation against anyone who raises an issue or concern in good faith or assists with an investigation.
Employees and directors can report potential or actual violations of the Code of Conduct to management, Human Resources, Global Security, the Office of the General Counsel, or via the JPMorgan Chase Conduct Hotline ("Hotline"), either by phone, online or mobile. The Hotline is anonymous, except in certain non-U.S. jurisdictions where anonymous reporting is prohibited. It is available 24/7 globally, with translation services. The Hotline is maintained by a third party service provider.
Employees in Human Resources and Global Security follow specific procedures when handling employee-initiated complaints. Suspected violations of the Code of Conduct, Firm policy, or the law are investigated by the Firm and may result in an employee being cleared of the suspected violation or in an escalating range of actions, including termination of employment, depending upon the facts and circumstances. Compliance and Human Resources report periodically to the Audit Committee on the Code of Conduct program. The CMDC periodically reviews reports from management regarding significant conduct issues and any related employee actions.
Code of Ethics for Finance Professionals
The Code of Ethics for Finance Professionals, a supplement to the Code of Conduct, applies to the Chair, CEO, CFO, Controller, and all other professionals of the Firm worldwide serving in a finance, accounting, treasury, tax or investor relations role. The purpose of our Code of Ethics is to promote honest and ethical conduct and adherence with the law in connection with the maintenance of the Firm’s financial books and records and the preparation of our External Financial Reporting. It also addresses the reporting of actual or apparent conflicts of interest and actual or potential violations or other matters that would compromise the integrity of the Firm’s External Financial Reporting.
Supplier Code of Conduct
The Supplier Code of Conduct outlines the Firm’s expectation that suppliers demonstrate the highest standards of business conduct, integrity, and adherence to the law. The Supplier Code of Conduct applies to our suppliers, vendors, consultants, contractors and other third parties working on behalf of the Firm, as well as to the owners, officers, directors, employees and contractors of these supplier organizations and entities. The Supplier Code of Conduct provides specific guidance regarding suppliers’ responsibility to comply with all applicable laws and regulations and to have policies ensuring such compliance, their duty to escalate concerns, handle information properly and maintain accurate records, address potential conflicts of interest, and operate responsibly with respect to laws governing competition, corruption, political activities, as well as environmental, human rights, and other matters.
How to contact our Board
The Board actively manages its information flow through a variety of means and requires management to provide the Board with the appropriate information to assist the Board in meeting its core responsibilities, as described in this Corporate Governance section.
To contact our Board of Directors, any Board member, including the Lead Independent Director, any committee chair, or the independent directors as a group, email correspondence to the Office of the Secretary at corporate.secretary@jpmchase.com, or mail to: JPMorgan Chase & Co., Attention (name of Board member(s)), Office of the Secretary, 4 New York Plaza, New York, NY 10004-2413.
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Executive Compensation
Proposal 2: Advisory resolution to approve executive compensation
Approve the Firm’s compensation practices and principles and their implementation for 2021 for the compensation of the Firm’s Named Executive Officers as discussed and disclosed in the Compensation Discussion and Analysis, the compensation tables, and any related material contained in this proxy statement. | | RECOMMENDATION: Vote FOR approval of this advisory resolution to approve executive compensation | ||||||
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| OVERVIEW | ||
We believe our compensation philosophy promotes an equitable and well-governed, long-term approach to compensation, including pay-for-performance practices that attract and retain top and diverse talent, are responsive to and aligned with shareholders, and encourage a shared success culture in support of our Business Principles and strategic framework.
OUR LONG- TERM APPROACH TO EXECUTIVE COMPENSATION: DISCIPLINED PERFORMANCE ASSESSMENT TO DETERMINE PAY | The Firm’s Board of Directors believes that JPMorgan Chase’s long-term success as a premier financial services firm depends in large measure on the talents of our employees and a proper alignment of their compensation with performance and sustained shareholder value. The Firm’s compensation programs play a significant role in our ability to attract, retain and properly motivate the highest quality workforce. The foundations of our compensation practices are a focus on performance within a controlled environment, alignment with the interests of shareholders, sensitivity to the relevant marketplace and a long-term view consistent with our Business Principles and strategic framework. The Compensation Discussion and Analysis that follows describes our compensation philosophy and pay-for-performance framework, and discusses how compensation for the Firm’s Named Executive Officers is aligned with the Firm’s long-term performance and with our shareholders’ interests. | ||||
PROPOSAL 2 – ADVISORY RESOLUTION TO APPROVE EXECUTIVE COMPENSATION
As required by Section 14A of the Securities Exchange Act of 1934, as amended, this proposal seeks a shareholder advisory vote to approve the compensation of our Named Executive Officers as disclosed pursuant to Item 402 of Regulation S-K through the following resolution:
“Resolved, that shareholders approve the Firm’s compensation practices and principles and their implementation for 2021 for the compensation of the Firm’s Named Executive Officers as discussed and disclosed in the Compensation Discussion and Analysis, the compensation tables, and any related material contained in this proxy statement.”
This advisory vote will not be binding upon the Board of Directors. However, the Compensation & Management Development Committee will take into account the outcome of the vote when considering future executive compensation arrangements.
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EXECUTIVE COMPENSATION | COMPENSATION DISCUSSION AND ANALYSIS | ||
Compensation Discussion and Analysis
The following CD&A is organized around three key factors for shareholders to consider:
| 1 | HOW WE THINK ABOUT PAY DECISIONS The Firm’s Business Principles and strategic framework form the basis of our OC members’ strategic priorities. The CMDC references those strategic priorities and the Firm’s compensation philosophy to assess OC members’ performance and to determine their respective total compensation levels and pay mix | ||||||||||
 | |||||||||||
Performance Assessment Cycle The Firm's disciplined pay-for-performance cycle starts with OC members establishing strategic plans, budgets and priorities at the Firm-wide, business/function, and individual levels. These are reviewed by the Board, approved by the CMDC, and priorities are communicated internally and externally. One of the key factors that the CMDC considers in assessing OC members' performance is their progress toward goals related to the Firm's diversity, equity and inclusion priorities | |||||||||||
Pay Determination The CMDC uses informed judgement to determine OC members’ pay based on four broad performance dimensions over the long-term (see section 2 below), and after considering competitive market practices | PSU Payout The PSU calculation links the ultimate payout of awards to pre-established absolute and relative ROTCE goals, subject to risk and control features | ||||||||||
Pages 40-52 | |||||||||||
| 2 | HOW WE PERFORMED AGAINST OUR BUSINESS STRATEGY | |||||||||||||||||||
2021 Business Results Throughout 2021, the Firm continued to build upon its strong momentum from prior years amid the continued challenges of COVID-19, while driving higher customer satisfaction scores and greater market share across our businesses | Risk, Controls & Conduct •Continued to invest in our cyber defense capabilities, training and partnerships •Reinforced expectations of integrity, transparency and ethical conduct through periodic trainings, senior leadership communication and employee engagement Client/Customer/Stakeholder •Examples of external recognition3 we received in 2021 include: •CCB: #1 in U.S. retail deposit market share •CIB: #1 in Markets revenue and Investment Banking fees •CB: #1 multifamily and U.S. middle market syndicated lender •AWM: Best Private Bank in the World •Continued to invest in enhancing client/customer experience through new and expanded digital capabilities, and to promote inclusive, sustainable growth and opportunity in communities where we operate Teamwork & Leadership •Continued to invest in succession planning; diversity, equity and inclusion; leadership and employee growth; and benefits & wellness best practices, including COVID-19 support •Dedicated to a culture that enables leaders and their teams to grow and succeed •Continued execution of long-term succession planning strategy on the Operating Committee | |||||||||||||||||||
$48.3B NET INCOME | $15.36 EPS | |||||||||||||||||||
19% | 23% ROE ROTCE1 | $28.5B NET CAPITAL DISTRIBUTIONS2 | |||||||||||||||||||
Pages 53-64 | ||||||||||||||||||||
| 3 | HOW PERFORMANCE DETERMINED CEO PAY IN 2021 | |||||||||||||
Consistently Strong Absolute Performance After considering the Firm’s consistently strong 2021 and multi-year performance against its business strategy under Mr. Dimon’s stewardship, the Board awarded him $34.5 million in total annual compensation for 20214 | Consistently Strong Relative Pay for Performance Alignment On a trailing average basis, the Firm's average percentage of net income paid to Mr. Dimon continues to rank among the lowest of our peers, demonstrating our strong pay-for-performance alignment, and a more efficient CEO pay allocation ratio | |||||||||||||
 | Prior 3-Year Average % of Profits Paid to CEOs (2018-2020)5 | |||||||||||||
Pages 65-72 | ||||||||||||||
1ROTCE is a non-GAAP financial measure; refer to Note 1 on page 110 for a further discussion of this measure.
2Reflects common dividends and common stock repurchases, net of common stock issued to employees.
3For recognition sources for CCB, CIB and AWM, refer to pages 68-71; CB recognition from S&P Global Market Intelligence and Refinitiv, respectively, as of December 31, 2021.
4The Board granted Mr. Dimon a special award in 2021 that is not part of his regular annual compensation and will not be awarded on a recurring basis. Refer to page 66 for further information.
5Total compensation is comprised of base salary, cash bonus paid and long-term incentive compensation (target value) in connection with the performance year, which may be different from amounts reported in the Summary Compensation Table. Refer to Note 1 on page 66 for further information.
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COMPENSATION DISCUSSION AND ANALYSIS | EXECUTIVE COMPENSATION | ||
| 1 | How we think about pay decisions The Firm’s Business Principles and strategic framework form the basis of our OC members’ strategic priorities. The CMDC references those strategic priorities and the Firm’s compensation philosophy to assess OC members’ performance and to determine their respective total compensation levels and pay mix. | |||||||
| Business Principles | |||||||||||||||||||||||||||||
| The Firm’s Business Principles and culture are fundamental to our success in the way we do business over the long-term. | |||||||||||||||||||||||||||||
| Exceptional Client Service | A Commitment to Integrity, Fairness and Responsibility | Operational Excellence | Great Team and Winning Culture | ||||||||||||||||||||||||||
| Strategic Framework | |||||||||||||||||||||||||||||
Guided by our Business Principles, our strategic framework provides holistic direction for the Firm and focuses on four primary strategic tenets: •Operating exceptional client franchises; •Maintaining our unwavering principles; •Adding long-term shareholder value; and •Promoting sustainable business practices Each year, the Operating Committee reviews the strategic framework to consider enhancements to the framework and its underlying tenets and priorities, and to adapt to changes in the competitive and market landscape if necessary, by considering the Firm’s strengths and challenges and the Firm’s performance over the prior year. In 2021, the CMDC approved the Firm’s updated strategic framework, which added a Sustainable Business Practices tenet and expanded the Unwavering Principles tenet, as the priorities of the CEO, including the 15 strategic priorities listed in the chart below. | |||||||||||||||||||||||||||||
| Exceptional Client Franchises | •Customer centric and easy to do business with •Comprehensive set of products and services | •Focus on safety and security •Powerful brands |  |  | |||||||||||||||||||||||||
| Unwavering Principles | •Fortress balance sheet •Risk governance and controls | •Culture and conduct •Operational resilience | |||||||||||||||||||||||||||
| Long-Term Shareholder Value | •Continuously investing in the future while maintaining expense discipline •Focus on customer experience and innovation | •Employer of choice for top and diverse talent | |||||||||||||||||||||||||||
| Sustainable Business Practices | •Investing in and supporting our communities •Integrating environmental sustainability into business and operating decisions | •Serving a diverse customer base •Promoting sound governance | |||||||||||||||||||||||||||
| Businesses develop strategic initiatives that map to the strategic framework and are designed to reinforce the Firm’s operating principles to be complete, global, diversified, and at scale. | |||||||||||||||||||||||||||||
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