NEW YORK (CNN/Money) - New York Stock Exchange Chairman Richard Grasso said Tuesday he will forgo $48 million in additional compensation but defended his recently announced $140 million pay package, which had sparked an outcry from critics who claimed it was too hefty.
Grasso also said at a news conference at the NYSE that he has never spoken with the exchange's board or compensation committee on his level of compensation.
Supporters said Grasso has done a great job running the world's largest stock exchange, and his pay package is comparable to other member firms at the NYSE.
"If you look at what the CEOs of Goldman, Bear Stearns, Merrill Lynch make, it's comparable to what Dick Grasso makes. It's probably also comparable to what the CEOs of the top 100 companies listed on the NYSE makes," said Frank Razzano, attorney at Dickstein, Shapiro, Morin and Oshinsky.
Critics, however, said Grasso's compensation should not be compared to Fortune 500 companies, but instead to other regulators, such as Federal Reserve Chairman Alan Greenspan and SEC Chairman William Donaldson. The Fed chairman reportedly made $171,900 last year, while Donaldson earned $142,500.
"He is not the chairman of a public corporation. He doesn't create shareholder value. He is essentially a regulator, and he is running an unregulated monopoly in a way," said Nell Minow, Corporate Governance expert.
Carl McCall, chairman of the NYSE's compensation committee, said the NYSE board stands behind past decisions on Grasso's compensation. In addition, he said, the committee reviewing the NYSE's governance will have a final report submitted to the NYSE at its next board meeting Oct. 2.
Last week, Donaldson sent a tersely worded letter to the exchange saying Grasso's pay package "raises serious questions regarding the effectiveness of the NYSE's current governance structure."
Donaldson asked that by Sept. 9 the exchange's compensation committee answer questions and provide details of Grasso's pay package and his extended employment contract.
Grasso, 57, joined the exchange in 1968 and became chairman in 1995. Late last month, the NYSE said it extended his contract by two years, until 2007, and distributed to Grasso his savings account balance of $40 million, his accrued retirement benefit of $51.6 million, and his account balance of $47.9 million from prior incentive awards.
-- Reuters contributed to this story.