In the wake of Wells Fargo’s fake account scandal, which led to the bank being fined $185 million and other significant changes at the bank, some blamed the bank’s executive structure for allowing the millions of fake accounts to go unnoticed for so long.
The scandal occurred under the watch of John Stumpf, who served as Wells Fargo’s chairman of the board and chief executive officer before resigning both roles as the fallout from the scandal unfolded.
But moving forward, one person will not be allowed to serve as both chairman and CEO of the bank, as the bank’s board of directors announced this week that it is splitting the roles.
According to an announcement from the bank, Wells Fargo’s board amended the company’s bylaws to require the separation of the chairman and CEO roles.
The bank also will now require both the chairman and vice chairman of the board to be independent directors.
The bank said the changes took effect on November 29.
“The board previously acted to elect an independent chairman to lead the board and we believe formalizing this structure is the right decision at this time for the company and its investors, customers, and team members,” said Stephen Sanger, Wells Fargo’s chairman of the board.
“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,” Sanger continued.
“While the investigation of these practices and related matters by the independent directors continues in earnest, we believe this action will enhance the board’s independence and its oversight of the company’s management, and we appreciate the feedback that we received from our investors on this matter,” Sanger concluded.