Wells Fargo changed its bylaws to require a separate chairman and chief executive officer, breaking with most of its U.S. peers after years of sales abuses in its branches spiraled into a national scandal.
Bloomberg News reports that move is significant in an industry that has long fought off pressure from corporate governance activists and shareholders including pension managers, but it won’t change Wells Fargo’s current leadership. John Stumpf had held both roles at Wells Fargo until he stepped down in October under pressure from lawmakers. Tim Sloan was promoted that month to CEO, while Stephen Sanger became non-executive chairman.
“Formalizing this structure is the right decision at this time,” Sanger said in a statement. “Efforts to restore the trust of our customers and team members are well underway and will continue until we have fully addressed the issues surrounding retail banking sales practices.”
The approach differs from almost all of Wells Fargo’s biggest competitors, including Bank of America and JPMorgan, which have persuaded shareholders not to divide the jobs in recent years. Citigroup is the only other bank among the nation’s top six that hasn’t granted both titles to its current leader.
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