Senior Federal Reserve official William J. McDonough's denunciation of exorbitant executive compensation at a Sept. 11 memorial service on Wall Street must have come as a jolt to his audience. Fed Chairman Alan Greenspan has already attacked excessive compensation unrelated to company performance as part of the "infectious greed" that seized Wall Street in the last decade. But McDonough went a step further in declaring that "any notion of moral balance" requires that business leaders curb their financial appetites. Those appetites appear more insatiable almost every day.
L. Dennis Kozlowski, former chief executive of Tyco International, and his second-in-command, Mark H. Swartz, are under New York state grand jury indictments alleging stock fraud, bribery and the use of improper loans for goodies ranging from a Park Avenue apartment to Tiffany's jewelry. The company's former general counsel, Mark A. Belnick, was also indicted for allegedly concealing improper loans to himself. John Rigas, former CEO of Adelphia Communications, which is under bankruptcy protection, allegedly used company funds to pay for everything from an African safari to luxury apartments.
