The firm’s board is expected to approve a series of proposals designed to enhance corporate-governance policies, including:
- the company will expense its stock options
- the board will have to convene at least twice a year without management
- any nonauditing services from the bank’s auditor will have to be approved by the audit committee
- the organization, compensation and nominating committee will review corporate-governance policies and evaluate the continuing independence of directors.
A Bank One spokeswoman said the board already has some meetings without management present, but the practice hadn’t been a formal policy. The new proposal will effectively only bar chief executive officer Jamie Dimon, as the bank’s only director who is also part of management, from the two meetings.
Even before the recent corporate scandals surfaced, Bank One had issued a requirement last year that top executives own a minimum of 45,000 shares of the company’s stock that cannot be sold as long as they are with the company.
Dimon must own 300,000 shares. Under that requirement, executives must also hold at least 75% of any shares above the minimum amount.
Part of many of the recent Wall Street controversies centered around executives amassing huge amount of company stock shares and then selling the shares – often before their prices evaporated due to the company’s underlying financial problems.