If you have a bunch of big banks, and then you have a major financial crisis, basic math dictates that one of those big banks will end up faring substantially better than the others during the crisis. And it’s human nature that whichever bank that is will come off looking really good and its CEO will develop a reputation for intelligence and prudent risk management. That bank, of course, is JP Morgan and the genius banker behind it is Jamie Dimon. But now that JP Morgan’s stumbled a bit we’re getting articles like this great one from Dawn Kopecki and Max Abelson asking who exactly was supposed to be managing risk at Morgan.
Well it turns out that JP Morgan has a Board of Directors and the Board of Directors has a risk committee and sitting on the risk committee are Ellen Futter, James Crown, and David Cote.
David Cote is the CEO of the industrial conglomerate Honeywell , Ellen Futter is the president of the American Museum of Natural History in New York (my favorite museum) which is best known for its gorgeous display of fossil dinosaurs, and James Crown is a guy who “helps manage his family’s privately owned Chicago-based investment firm.” Said firm exists because Crown’s grandfather made a fortune that was passed down to Crown’s dad and now Crown The Next Generation has a hand in steering things. In other words, he’s mega-rich through no particular exertion of his own.
These are all eminently respectable board of directors types. But obviously this is the kind of Risk Committee you put together if your organizational goal is to (a) have a risk committee, (b) have it filled with eminently respectable board of directors types, and (c) have it not actually do anything to manage risk.
Mission accomplished.
