Amid increasing pressure from many fronts to resign, New York Stock Exchange Chairman Richard Grasso told the Board Wednesday night that he is calling it quits.
Richard Grasso's compensation package was severely criticized after it was recently made public as part of an effort to add transparency to the activities of the New York Stock Exchange. Grasso extended his contract through to 2007 and took a $140 million payout as a lump sum payment to cover deferred compensation from the prior eight years. Critics felt that his compensation was out of line, and some saw it as a conflict of interest in his role as a reformer of Wall Street.
Grasso, a 36-year veteran of the NYSE and the person who gained national notoriety by re-opening the markets just days after the September 11 attacks two years ago, indicated that "with the deepest reluctance and if the board so desired, I would submit my resignation as chairman and chief executive officer."
Grasso is not accused of committing any improprieties, and Board members - who initially approved his compensation - are the very ones who now have asked for his resignation.
"Dick offered to submit his resignation if the board requested, and the board did so and accepted that resignation," said H. Carl McCall. "Dick called a special meeting of the board this afternoon in light of the recent discussion surrounding the Exchange and his compensation." Mr. McCall chaired the meeting and served as the lead director.
Pressure to resign was mounting from a number of fronts. Most recently, the nation's top three pension fund administrators called for his resignation, citing their belief that his recent $140 million package shattered his credibility as a corporate reformer.
"Today we're trying to pull the pig from the trough," Harrigan said at the press conference in Sacramento, California. "The next thing is to try to find out who filled the trough."
Joining the calls for Grasso's resignation were New York State Comptroller Alan Hevesi, the sole trustee of the New York state pension fund, as well as the state pension managers in Iowa and North Carolina, which combined oversee $71 billion in assets.