But these behaviors have started with the earliest-career professionals—and Jamie Dimon doesn’t like it. Dimon, the illustrious CEO of JPMorgan Chase, spoke of his disdain for private equity’s poaching practices during a talk last week at Georgetown University’s Psaros Center for Financial Markets and Policy.
“I know a lot of you work at JPMorgan, you take a job at a private equity shop before you even start with us,” Dimon told a crowd of undergraduate business school students. “I’m going to say something a little different, okay, because I didn’t talk about character. The most important thing about people’s character, I think that’s unethical. I don’t like it.”
Dimon is referring to the wonky practice in which private equity firms begin aggressively recruiting newly minted junior bankers right at the beginning of their career—and even sometimes before. But the peculiarity of private equity’s recruiting practices is that the jobs they’re wooing recent college grads with often don’t start until a date far into the future, usually around two years.
The college students watching Dimon’s interview knew exactly what he was talking about, with the crowd responding in laughter. But Dimon wasn’t entertained by this response, pushing the severity of the situation.
And JPMorgan has been on the case for a while.
“We understand that the practice of interviewing and accepting a role at another firm has accelerated and is happening even earlier in your career with us,” JPMorgan wrote to new bankers in a communication that was shared by the Litquidity account on Instagram, according to Business Insider. The post is no longer visible.
Getting rid of competition
Not only does Dimon dislike private equity poaching, but he’s spearheading an effort to do away with it all together.
“I may eliminate it, regardless of what the private equity guys say or the people in the company first, I won’t pay for it,” Dimon said. “It’s not mercenaries. And I think it’s wrong to put you in the position.”
Dimon doesn’t like it because many of these junior bankers who are getting poached have already gone through some job training and have had access to confidential information right before taking the leap into private equity.
“It puts us in a bad position, and it puts us in a conflicted position,” Dimon said. “You are already working for somewhere else, and you’re dealing with highly confidential information from JPMorgan, and I just don’t like it.”
Plus, Dimon says it’s an unfair position for new college graduates who have to undergo rigorous interviewing rounds and complete projects for jobs that won’t start for years.
“It puts the kid in a terrible position,” Dimon said. “I think that’s wrong.”
But Reena Aggarwal, the founding director of the Psaros Center and Dimon’s interviewer, pointed out that banks are also starting to interview undergrad students much earlier on. The banks used to hire students for internships after their junior year, but it just keeps moving earlier and earlier, she said, even before they declare a major.
“You’re right. You know what? You guys should get together some schools and some of the banks…and we come up with policies,” Dimon said. “We have to put procedures in place to stop that from happening.
But at the end of the day, Dimon still puts the onus of choice on the young professionals themselves to make the right decision.
“You’re going to be facing ethical decisions like that. Think for yourself,” Dimon said. “How would you feel if you’re on the other side of that thing? Or do you want to be treated that way? Is it fair?”
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