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Adviser recommends JPMorgan shareholders vote against Crandall Bowles

A shareholder advisory firm is recommending JPMorgan Chase & Co. shareholders vote against re-electing Charlotte-area businesswoman Crandall Bowles to its board of directors.

In a report, Glass, Lewis & Co. points out Bowles’ membership on the bank’s audit committee, which is tasked with ensuring the bank has adequate risk controls. Corporate governance experts have criticized the committee’s lack of action to prevent last year’s $6 billion trading loss from positions taken by the so-called “London Whale.”

Bowles is one of six directors the firm recommends voting against.

The advisory firm also cites a potential conflict of interest because a company Bowles chairs, Springs Industries Inc., is using the New York bank to advise on the sale of a Springs subsidiary.

“To some extent, it represents another question mark in terms of taking governance seriously,” said Eleanor Bloxham, CEO of the Value Alliance, a corporate board advisory firm. The bank is already under pressure to strip CEO Jamie Dimon of his board chairmanship and install an independent chairman.

Neither Bowles nor JPMorgan Chase responded to requests for comment.

In 1998 Bowles became CEO and chairwoman of Springs Industries Inc., the textile maker founded in Fort Mill in the 1800s. She retired from the company in 2007 after most of its operations merged into a Brazilian company to become Springs Global.

Bowles remains chairwoman of the pieces of the company that remained independent, including a window products maker. She will be inducted into the S.C. Business Hall of Fame later this month.

The potential conflict became apparent in April, when a subsidiary called Springs Window Fashions announced it had reached an agreement to sell the company to private equity firm Golden Gate Capital. JPMorgan advised Springs on the deal, which is expected to close in June.

Bowles and her family have a 48 percent stake in Springs Industries.

Glass, Lewis wrote that the company’s dealings with JPMorgan could “lead to conflicts between her duties to shareholders and her personal interests.” The firm also said they no longer consider her “independent of management.”

Another shareholder advisory firm, Institutional Shareholder Services, also noted the business relationship, but recommended her re-election.

Bowles was paid $270,000 for her service on the JPMorgan Chase board last year, according to securities filings. She also is a board member of Deere & Co., the Illinois-based maker of agricultural equipment. She previously was on the boards of Wachovia Corp. and of consumer products company Sara Lee Corp.

Bowles is also the wife of well-known Charlotte businessman Erskine Bowles, who has served as White House chief of staff under President Bill Clinton and as president of the UNC System.

Dunn: 704-358-5235 Twitter: @andrew_dunn
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