Business

McCall heads NYSE

"We’re trying to pull the pig from the trough. The next thing is to try to find out who filled the trough."

"We in the house. We flyin’ high," is what many celebrity-minded African Americans say now that H. Carl McCall has become the first Black to lead the 211-year-old New York Stock Exchange (NYSE). With Richard Grasso’s resignation from the NYSE’s chairmanship, McCall has been serving as lead director "in the House" – the world’s number one stock exchange.

"We’re trying to pull the pig from the trough. The next thing is to try to find out who filled the trough."

"We in the house. We flyin’ high," is what many celebrity-minded African Americans say now that H. Carl McCall has become the first Black to lead the 211-year-old New York Stock Exchange (NYSE). With Richard Grasso’s resignation from the NYSE’s chairmanship, McCall has been serving as lead director "in the House" – the world’s number one stock exchange.

But, McCall’s ascension through "going along to get along" has got him to the top of the tea pot in the tempest raging throughout the NYSE and financial markets. McCall’s actions in approving a $140 million compensation for Grasso have cast doubt on him, and the 26-member board of directors. The board approved the pay plan and McCall’s signed it.

McCall’s appointment to the prestigious NYSE board in 1999 put him square in the mainstream. The problem is that McCall is chairman of the 13-member human resources and compensation committee responsible for the pay plan. If Carl McCall’s boardroom actions toward the African American community were are strong as they were for Chairman Grasso, concerns and considerations for major urban development projects would be at the top of the NYSE’s agenda.

Most among Blacks and corporate executives say that African American representation on corporate boards of directors should be increased. Less than 200 African Americans represent 30 million Black consumers are represented on 500 total seats among Fortune 1000 corporate boards. Like McCall, most Blacks on boards hold multiple seats on numerous corporate boards. What they do toward African-American communities’ cultural, economic and social needs is up for question. Many Blacks on boards have formed cozy relationships they don’t want to conflict with "Black causes." Most lend their energies more to their corporate identities than to their African-Americans identities.

McCall’s days heading the NYSE, as well as his board tenure, may be limited. He initially defended Grasso’s payout; claiming he hadn’t realized the full sum. He signed off on it without knowing its actual size. Actions many market watches as "unusual". "Malfeasance" is a word that has been used regarding McCall belying him having been the Democrats’ candidate for Governor of New York in 2002, former state comptroller, and stints as a United Nations ambassador, various high-level New York government appointments and as a Citicorp banker.

Grasso ouster only came after leaders of the nation’s most influential public pension funds branded the pay package "an obvious conflict of interest" and "danger to corporate governance reform". "My view of this thing is that there was no malfeasance," says McCall. "It just didn’t add up for me," he said. "I got different pieces of the contract at different times. It wasn’t clear, and it should have been clear." A product of New York’s Democratic machine, McCall’s mainstream jobs put him in the six-figure, not seven-figure, income level.

An aspiring political figure, McCall’s network of financial supporters was thin before he hit Wall Street. The NYSE board is made up of many of the nation’s top financial and corporate executives. Comprised of 2,800 public companies, the NYSE was a potential rich vein of financial support for McCall the politician. McCall never accepted director pay while he was comptroller, but he could be criticized for taking political donations from companies that his pension fund invested in. As New York State Comptroller, McCall was responsible for managing the state’s $120 billion pension fund; the second largest in the country.

After building built up a solid political résumé through more than

November 28, 2003
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