AFL-CIO's Throw-the-Bum-Out Call Gets Cool Reception

Kenneth Langone may be an unpopular figure because of his defense of the massive pay package handed out to former New York Stock Exchange chairman Richard Grasso. But that doesn't mean all investors and governance experts are ready to blackball the NYSE board member.

The AFL-CIO on Friday called on the Big Board, GE and four other public companies to drop Langone from their boards of directors. But the labor group's recommendation received a muted reaction -- not only from the companies themselves, but from some governance experts and prominent investors.

California State Treasurer Paul Angelides, whose call for Grasso's resignation precipitated his departure from the NYSE, reiterated on Friday his belief that it is too early to force any more changes on the exchange.

Angelides "wants an audit [of the exchange] to be conducted and complete before he would get involved in discussing the fate or future of individual staff members or directors of the stock exchange," said Mitchel Benson, a spokesman for the treasurer. While Langone may have been part of the problem that led to Grasso's compensation package, that should come out in the audit report, Benson said.

"The proof will be in the pudding."

Langone and the NYSE had no comment on the AFL-CIO's letter.

Langone has been in the spotlight since this spring when the National Association of Securities Dealers said that it was investigating Invemed, the small investment bank that Langone heads. About the same time, the NYSE began revealing details of Grasso's pay package.

Amid these revelations, governance experts began to raise questions about the relationship between Grasso and Langone. Grasso sits on the board of directors and compensation committee at Home Depot, where Langone serves as lead director. Meanwhile, Langone serves on the NYSE board, and until June, served as the head of the exchange's compensation committee.