“We told you so “ seems to be the key message from the CtW Investment Group to JP Morgan. CtW, a shareholder representing union funds, claims it was concerned over 12 months ago at what it saw as “lax and out dated” risk management controls at JP Morgan. Those concerns were laid out to senior management. But then, oops, a year later, the storied financial institution announced a trading loss of over $2 billion and a market value drop of more than $25 billion.
CtW wins the PR prize. The Executive Director of the group told the NY Times that it had expressed its concerns to a JPM board member and the former Chief Risk Officer. The main complaint? That the three-person board responsible for monitoring overall risk lacked the necessary expertise to oversee the function.
CtW says that ultimately the problem reflected an overall unhealthy deference to CEO Jamie Dimon and his Chief Risk Officer. With this sentiment resonating with pundits, it seems the party is well and truly over for banking’s favorite CEO.
The PR Verdict: “A” (Gold Star!) for CtW, punching above its weight. By saying “we told you so” they look like the smartest ones in the room.
PR Takeaway: Capitalize on every PR opportunity. By coming out with these revelations now, CtW claims the upper hand and grabs the PR advantage. Describing JP Morgan as having an “old fashioned model of governance”, CtW legitimately puts itself at the forefront of the reforms JP Morgan will be announcing. While it’s an uncomfortable place for JP Morgan, it’s a great place for CtW and its public profile.
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