Members are told that meeting details are not to be shared with the press. Traders outside its headquarters turn away when approached by reporters. Board members have at times been told not to take calls from the media.
But the furor over Chairman Richard Grasso’s $140 million payout is threatening to blow this code of silence wide open as members speak out against the exchange and calls for his resignation intensify.
The NYSE, as a not-for-profit corporation, is not subject to the same rules of disclosure as public companies. But investors were shocked last month when the exchange said Grasso was taking home almost $140 million in deferred compensation. Two weeks later it said the 57-year-old Grasso was entitled to an additional $48 million, but would forgo that sum.
Since the revelations there has been a gradual buildup in publicly expressed anger at Grasso and the exchange from regulators, investors and members of the exchange.
On Tuesday, for example, California’s massive public pension funds called on Grasso to quit, saying the payout has shocked investors and shaken faith in the financial system. In media reports, NYSE directors are claiming to not have fully understood the package, and lawmakers are expected to question the exchange about Grasso’s compensation in coming days.
This is a long way from the usual control that Grasso, who began working at the exchange on the trading floor in 1968 and got promoted through the ranks, and his officials had been able to maintain at the exchange.
“It certainly has been the goal of management to reinforce with the membership that they should keep everything within house, and it should not be brought out to the press or brought out to the outside,” said Francis Maglio, a long-time NYSE member.