Former New York Governor Eliot Spitzer spoke with FOX Business Network’s (FBN) Liz Claman about the news that JPMorgan Chase Chairman and CEO James Dimon won shareholder approval to keep his chairman title. Spitzer said, “Jamie Dimon is a superb CEO,” but “this is not about James, this is about understanding too much power aggregated in the CEO position permits the CEO to dominate the Board and the Board of Directors is the only check we have on the CEO.” Spitzer also said that splitting the chairman and CEO roles “helps a company” and that while a split won’t necessarily eliminate all problems, he believes that “having all that power in one position in one person is more likely to lead to problems.”
Excerpts from the interview are below.
“James Dimon is a superb CEO. I will credit him with that, I respect the job he has done. I disagree with him about some fundamental decisions he’s made, but put that aside, this is not about James Dimon, this is about understanding too much power aggregated in the CEO position permits the CEO to dominate the Board and the Board of Directors is the only check we have on the CEO. Shareholder votes really are meaningless in corporate democracy these days and the metaphor I use is that if Thomas Jefferson were acknowledged to be the best president we have, we still would not eliminate the Supreme Court and Congress. Checks and balances is structurally important. We need somebody there as an alternative set of eyes. The Board of Directors and the Chairman of the Board, or Chairwoman, should be there because their primary responsibility is to look at the CEO and say are you doing the right thing?”
On why he is in favor of splitting the chairman and CEO roles within companies:
“My view is it helps a company. This is a governance issue…don’t understand me to be saying if you have that necessarily there will not be problems, not at all. What I’m saying is that having all that power in one position in one person is more likely to lead to problems and hence as a governance matter that’s why we have checks and balances in the Constitution, that’s why we have checks and balances in corporate governance. We should divide the positions.”