Bay Point, CA. 94565

October 22, 2015

Secretary

JPMorgan Chase & Co. 

Office of the Secretary

270 Park Avenue

New York, NY 10017

(post mail & email corporate.secretary@jpmchase.com)

Re: Shareholder Proposal on Executive Compensation Philosophy

Dear Secretary:

Enclosed please find my shareholder proposal for inclusion in our proxy materials for the 2016 annual meeting of shareholders and a letter confirming my JPM shares.  I will continuously hold these 40 shares until the 2016 annual meeting of shareholders. 

Should you have any questions, please contact me at 1-925-643-**** or zhao.cpri@gmail.com.

Yours truly,

    Jing Zhao

Enclosure: Shareholder proposal

          Letter of JPM shares

Shareholder Proposal on Executive Compensation Philosophy

Resolved: shareholders recommend that JPMorgan Chase & Co. (the Firm) adopt a balanced executive compensation philosophy with social factors to improve the Firm’s ethical conduct and public reputation.

Supporting Statement

According to 2015 Proxy Statement, the Compensation & Management Development Committee (“CMDC”) “assists the Board in its oversight of the Firm’s compensation programs and reviews and approves the Firm’s overall compensation philosophy and practices” (p.27).  “The CMDC reviews and approves the Firm’s compensation philosophy, which guides how the Firm’s compensation plans and programs are designed for both the Operating Committee,…” “The CMDC uses a disciplined pay-for-performance framework to make executive compensation decisions commensurate with Firm, line of business, and individual performance, while considering other relevant factors, including market practices” (p.38).  As a result, for example, such a philosophy, without consideration of social factors, guided the CMDC to award our CEO a total compensation $27,701,709 in 2014, a 135% jump from 2013 (p.58).

Meanwhile, “[t]wo fifths of the population of developed countries have gained little over recent decades” (OECD Says Rise in Inequality Is Hurting Growth, Wall Street Journal May 22-24, 2015).  Professor Thomas Piketty stated, “there is absolutely no doubt that the increase of inequality in the United States contributed to the nation’s financial instability.” (Capital in the Twenty-First Century. The Belknap Press of Harvard University Press, 2014. p.297)  “Let me return now to the cause of rising inequality in the United States. The increase was largely the result of an unprecedented increase in wage inequality and in particular the emergence of extremely high remunerations at the summit of the wage hierarchy, particularly among top managers of large firms.”(p.298)  “[T]he financial professions are about twice as common in the very high income groups as in the economy overall.” (p.303)  “Because it is objectively difficult to measure individual contributions to a firm’s output, top managers found it relatively easy to persuade boards and stockholders that they were worth the money, especially since the members of compensation committees were often chosen in a rather incestuous manner.” (p.510)

According to Senator Bernie Sanders: “Wall Street cannot continue to be an island unto itself, gambling trillions in risky financial instruments while expecting the public to bail it out.” “The six largest financial institutions in this country today hold assets equal to about 60% of the nation’s gross domestic product. These six banks issue more than two-thirds of all credit cards and over 35 percent of all mortgages. They control 95 percent of all derivatives and hold more than 40 percent of all bank deposits in the United States.” “Our banking system must be part of the productive, job-creating productive economy.” “If a bank is too big to fail, it is too big to exist. These institutions have acquired too much economic and political power, endangering our economy and our political process.” (https://berniesanders.com/issues/reforming-wall-street/)

For the purpose of this proposal, the Board or the CMDC has the flexibility to select social factors, such economic condition, unemployment and average income.