Harvey Pitt, the former SEC chairman, has decided to raise his profile. That’s not hard to do when you invite a bunch of reporters to dinner, then weigh in with criticisms of: Eliot Spitzer (“He’s not concerned about investors.”), the SEC, Sarbanes-Oxley legislation (“drafted hastily, written poorly”) the business community, executive compensation, hedge funds, and the board of Disney. One sensed he was just getting warmed up.

And why should Mr. Pitt, who had a tumultuous 19-month tenure as head of the SEC, wish to revive his public persona? Because he is now the CEO of a strategic consulting company called Kalorama Partners, which according to his partner, John Sampson, offers practical advice to corporations about legal and accounting issues. Sarbox legislation has thrown the fear of God into managers, accountants, and lawyers, and the hope is that they will come to Kalorama for help navigating increasingly choppy compliance channels.

However, judging from one suggestion put forth by Mr. Pitt, the firm may be seeking a decidedly maverick clientele (but perhaps that shouldn’t surprise us?). This advice had to do with determining “fair” executive compensation. Normally, according to Mr. Pitt, a company hires a human resources consulting firm, which works up a peer group of like enterprises, and then establishes a compensation benchmark used to derive a pay package for the client CEO.

Mr. Pitt has a different approach. He recommends that directors draw up a list of expectations for the CEO, which might include targets for market share or profitability (though he disdains earnings per share as a “fictitious number”) and then tie pay to those goals. In his example, if a board wants to pay the CEO $5 million a year for five years, it would only actually give him $2 million each year until the end of the term, and then, depending on whether he had met his goals, they would give him the balance of his compensation. Most CEOs would probably rather undertake dental surgery.

This is not to say that Mr. Pitt thinks executive compensation is too high. That, he argues, is not his concern. Rather, he feels that businesses have “badly botched” the method of determining pay. Similarly, he charges that inertia and negativity on the part of the business community opened the door for Sarbanes-Oxley legislation. Rather than stepping up to shape the debate on corporate practices, managements and directors closed their eyes to misdeeds. Since, in his words, “regulators abhor a vacuum,” that lack of leadership cost dearly.

Mr. Pitt has a solution for fixing the excesses of Sarbanes-Oxley. Most observers would agree that some lightening of the load is desirable, but that Congress is extremely wary of being accused of turning “soft” on business malpractice. He proposes that the legislation should be incorporated into the existing Securities Exchange Act of 1934, which among other things established the SEC. The result would be a more flexible application of the rules, with the SEC, not Congress, interpreting and modifying the bill’s impact.

Mr. Pitt also considers the new rules governing hedge funds profoundly flawed. In his view, the law of unintended consequences has now led to the common practice of hedge funds imposing three-year “lock-ups” on their clients’ money in order to evade registration. The loophole in the law, which was meant to exempt private equity firms,has now encouraged hedge funds to move to the longer lock-ups, arguably making hedge fund investing riskier than it was previously.

This is not Mr. Pitt’s only concern about hedge funds. He thinks that the next major business scandal will concern hedge funds. He is unhappy that these organizations are increasingly accepting money from individuals who, according to Mr. Pitt, have neither the wealth nor the sophistication to understand hedge fund investing. (Mr. Pitt actually calls this group “the great unwashed.”)

Also, he is convinced that high returns are harder to come by, and consequently hedge fund managers will pursue ever more exotic investment vehicles to compete. These opportunities will inevitably lead to untested strategies and markets, and, ultimately, to disaster.

At the same time, more pension fund money is flowing into these funds, exposing ever greater numbers of individuals to probable calamity.This practice and the “retailization” of the industry, which accepts ever-smaller participations from individual investors, are unsuitable, in Mr. Pitt’s view.

At the same time, Mr. Pitt defended the common hedge fund tactic of short selling, to take advantage of a possible decline in a stock’s price.This topic has been much in the news because of a flap over the SEC’s issuance of subpoenas to two reporters accused of helping to bring down the stock price ofOverstock.com. Mr. Pitt’s take on this controversy is that the SEC staff made a mistake by not telling its chairman, Christopher Cox, of its intentions, and by not anticipating the outrage from the press.

The SEC is a large organization of some 4,000 employees, and Mr. Pitt was quick to agree that under his tenure, similar issues arose. (In other words, his memory is intact.) He defended his tenure as SEC chairman, however, and argued that Attorney General (or AG, for Aspiring Governor) Eliot Spitzer had overstepped his bounds. Mr. Pitt charges that Mr. Spitzer was more interested in garnering good press than in helping investors recoup losses due to, for example, the conflicted advice from analysts. He buttressed this accusation by pointing out that the $100 million extracted form Merrill Lynch in a settlement of the analyst scandal did not go to investors, but rather to the government.

Mr. Pitt gives Mr. Spitzer credit for “finding the e-mail” that ultimately brought the issue of analysts’ conflicts of interest to light, but criticizes the attorney general for pursuing the issue as the Lone Ranger, instead of coordinating his office’s efforts with the SEC.

Mr. Pitt has a great many other opinions, and solutions, to offer on modern day issues. But now, his clients will have to pay for them.