The race to succeed Jamie Dimon as the next head of JPMorgan Chase may not necessarily be won by a woman after all.
JPMorgan boasts the longest running chairman and chief executive of any major U.S. lender, and the question of who will take over for the 65-year-old Dimon has been hotly debated for months—if not years.
German business daily Handelsblatt waded into the issue in an interview published Monday, which it concluded by probing Dimon for any information about whether the likely winner would possess a double set of X chromosomes.
In May, the bank seemed to signal that Marianne Lake and Jennifer Piepszak had passed Daniel Pinto and Gordon Smith to become the frontrunners for the coveted post when it elevated the female duo to key roles at the bank, the world’s most valuable by market cap.
Dimon told Handelsblatt, however, that the question of his successor was a matter for the bank’s board of directors to answer, arguing it would pick the best candidate independent of criteria such as background, sex, religion or sexual orientation.
“We have people that could take over the reins of this bank tomorrow, including both men and women,” replied the JPMorgan boss. The board “won’t install a woman as CEO simply to appoint a woman.”
According to the bank’s governance statutes, the four non-executives directors on the compensation and management development committee would be tasked with proposing a nominee to the full board of directors. Chaired by lead independent director Stephen Burke, that committee is evenly divided by sex and includes ex-IBM CEO Gini Rometty as well as former JPMorgan exec Linda Bammann as members.
The issue of women in the C-suite remains a sore spot for Wall Street, as men continue to control the upper echelons of finance years after General Motors named in December 2013 Mary Barra as the first female CEO in the male-dominated auto industry.
Faced with a panel of seven white male bank CEOs at a House Financial Services Committee hearing in April 2019 to discuss what steps they’ve taken 10 years after the financial crisis, Rep. Al Green of Texas famously questioned the lack of diversity in their ranks. Some analysts suggest that this uniformity of background (and therefor thinking) might be partly to blame for the industry unwittingly sparking the 2008 meltdown that peaked with the collapse of Lehman Brothers.
A year after Green’s remarks, Citigroup appointed Jane Fraser to replace Michael Corbat (who appeared at the 2019 hearing) as CEO, earning praise from the Democratic Congressman for breaking the glass ceiling.
Dimon’s comments could of course be a tactic to keep the competition for his succession as open as possible and not give the appearance that male candidates like Pinto or Smith no longer have reason to believe they stand a true chance.
Inflation a “good problem” to have
Separately, the JPMorgan CEO told Handelsblatt he did not believe the soaring rates of inflation would prove just to be transitory, implicitly disagreeing with the prevailing orthodoxy of the Federal Reserve.
“I speak to customers every day about it. Actually it’s a good problem,” Dimon told the German business daily, citing how the high growth rates came just over a year after the pandemic saw unemployment shooting up to 15%.
“So it’s a good thing that wages are growing and people are looking for new jobs. I agree with U.S. President Joe Biden that some professions need to be paid better,” he explained.
Prices for U.S. consumers jumped 6.2% in October compared with a year earlier as surging costs for food, gas and housing left Americans grappling with the highest inflation rate since 1990.
The Federal Reserve has come under heavy fire for keeping the monetary floodgates broadly open and therefore contributing to the spiralling cost of key raw materials, in particular a 50% increase in the cost of gasoline. President Biden effectively gave a thumbs-up to the Fed’s performance on inflation, however, by nominating on Monday Jerome Powell for another term as chair.
Following its most recent meeting at the start of this month, the Fed signalled that while it would slowly dial back its unconventional policy of quantitative easing by the middle of next year, it would not hike rates from their current 0% until their was enough evidence that full employment had been reached.
Mohammed El-Erian, former head of Allianz’s money manager PIMCO, recently hammered the U.S. central bank’s “increasingly discredited” mantra that upward pressures on consumers were only transitory as “one of the worst inflation calls in decades”.
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