July 20, 2024

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William H. Donaldson, Wall St. Lion Who Led the S.E.C., Dies at 93

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William H. Donaldson, who made an early fortune as a co-founder of the innovative securities firm Donaldson, Lufkin & Jenrette and later pushed for tighter financial regulation as chairman of the Securities and Exchange Commission in the wake of the Enron and WorldCom accounting scandals, died on Wednesday at his home in Westchester County, N.Y. He was 93.

The cause was leukemia, his son Adam said.

Mr. Donaldson also served briefly as an under secretary of state under Henry A. Kissinger, headed the New York Stock Exchange and was chief executive of the insurer Aetna Inc.

In 1975, he was named the founding dean of Yale University’s School of Organization and Management, now known as the School of Management, whose mission of training leaders for both business and government was exemplified by his own zigzagging career.

Mr. Donaldson was only 28 and a year out of Harvard Business School in 1959 when he joined two friends, Dan Lufkin and Richard Jenrette, to found a securities firm bearing their names and known as D.L.J.

The three young men noticed that mutual funds and other institutional investors were accounting for a larger share of stock market trading. They believed that these professional investors would welcome more sophisticated research than was typically produced on Wall Street. D.L.J. focused on the stocks of smaller, up-and-coming firms rather than slower-growing blue chips.

Mr. Donaldson served as chief executive as the firm expanded rapidly and diversified into fund management during the “go-go” stock market boom of the 1960s. In 1970, D.L.J. upended a Wall Street tradition by offering its own shares to the public. Other securities firms soon followed, opening up a badly needed new source of capital for the private partnerships that had long dominated Wall Street.

In 1973, The New York Times called Mr. Donaldson “one of Wall Street’s best-known whiz kids.”

That same year, feeling restless, he whizzed off to Washington to work for Mr. Kissinger in…

James R. Hagerty

2024-06-18 00:19:30

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