NEW YORK — John Reed, interim NYSE chairman, said the exchange might not separate its regulatory and market functions, contrary to what many institutional investors — including some of the largest public pension funds — have recommended. "Our position is, we want to keep the regulatory structure here," Mr. Reed said Oct. 2 following a meeting of the NYSE's board of directors. "We want to keep it tightly coupled."
He also said the board received a 27-point proposal for reforming the exchange's corporate governance structure, developed by the exchange's special committee on governance led by former director H. Carl McCall and Leon Panetta, former White House chief of staff. Mr. Reed said he will review all of the ideas and create a corporate governance plan that the board will vote on at its Dec. 2 meeting.
Two top public pension fund investors are reserving judgment on Mr. Reed's recommendation. "One of our ideas was to split those functions, and I still favor that," said Kentucky state Treasurer Jonathan Miller. He and other state treasurers are willing to hear Mr. Reed's ideas for keeping the exchange's two key functions together. "Until we find out what that way is, it's hard to judge," he said.
John Chartier, spokesman for Alan Hevesi, New York state comptroller, concurred. "The big picture is that we'd like to see better corporate governance at the New York Stock Exchange, period," Mr. Chartier said. "What shape that takes, let's see."
Messrs. Miller and Hevesi, along with other state treasurers and public fund executives, met with several NYSE board members on Sept. 24 to discuss reforming the exchange in the aftermath of Richard Grasso's resignation as chairman and CEO.