William McDonough, who was named chairman of the Public Company Accounting Oversight Board earlier this year and has railed against excessive compensation before, launched a new broadside in a speech last week to the National Association of Corporate Directors.

"Americans are telling their elected representatives that they are angry, and the thing they are angriest about is executive compensation," he said. "If the pay should be rightfully reduced, what is the worst that can happen? An insulted CEO resigns or takes early retirement. He or she has the burden of finding new work.

"You, as directors and fiduciaries of your corporation, have the satisfaction of having said to investors, to the public, to the world, that this is what the job is worth."

Accounting debacles at Enron, Adelphia, WorldCom, HealthSouth and others touched off an investor furor that lingers today, he said. Much of that is linked to exorbitant chief executive salary levels that were set in the late 1990s and stayed in force through the bear market and accounting scandals that followed.

Those levels no longer are appropriate, McDonough said.

Some critics have complained that McDonough's salary of $556,000 is overly generous. CEOs of large public companies earn an average of $1.8 million to $2 million annually, according to David Aboody, associate professor of accounting at the University of California-Los Angeles. Some pull in considerably more when long-term incentives, such as stock options and perks are added into the equation.

In his speech, McDonough said that losing a CEO may be unsettling, but "we have to start somewhere and we have to start soon."

"As corporate directors," he said, "you should think long and hard about the compensation of the executives who head the corporation you are sworn to protect."

The message was well received by some compensation experts and shareholders.

Frank Shoring, a Hartford, Conn.-based retiree, said it was time that someone in power spoke out about excessive pay. Shoring has been waging a personal war by writing missives on each of the two-dozen proxy statements he gets as a shareholder, urging compensation committees to link CEO pay with the pay of the average worker.

"The CEO shouldn't get 150 times what the line worker gets," said Shoring, who used to be an insurance company executive. "The line worker is putting out the Coca-Cola or the tires or whatever. The guy on the top is coasting on the work of the people underneath."

Les Greenberg, chairman of the Committee of concerned Shareholders in Los Angeles, said McDonough's comments were not what some in the country wanted to hear. "But to restore investor confidence in the stock market, that needs to become a reality, not just empty talk," he said.

In some cases, a CEO's pay may seem out of whack when it is actually appropriate, but is poorly explained, both internally and externally, said Don Sagolla, principal at Mercer Human Resources Consulting in Los Angeles.

Sagolla, who helps design CEO pay plans, added that McDonough was challenging corporate boards to adopt pay packages that make sense in good times and bad. That means doing away with "guaranteed" bonuses and incentives.