To the name of a bank's CEO.
To atone for this trade,
He merely was paid
A paltry ten million or so.
What do you take from the man who has everything? That was the question faced by the board of JPMorgan Chase, which had to determine the consequences for CEO Jamie Dimon of the $6.2 billion loss from the "London Whale" trades. The answer was a 50% reduction in Mr. Dimon's total compensation, from $23 million in 2011 to "only" $11.5 million for 2012. (To be fair, the compensation package reflects a record year for the bank's profits, in spite of the outsized trading losses.) The New York Times' Dealbook page, no doubt attempting to wrap its head around the fact that $11.5 million is only half of someone's compensation, believes that, in the face of such a striking management lapse, more radical changes are called for. Suggests columnist Agnes Crane:
One could be to split the roles of chairman and chief executive. A well-chosen chairman provides a check on a chief executive’s powers. In one indication that this can work, GMI Ratings last year concluded that an executive pulling double duty can earn 50 percent more than the total pay of two people performing the top jobs separately.It sounds as though, if governance is strong, compensation finds a more appropriate level as a matter of course.