“Yet another layer of anxiety inside the company stemmed from Mr. Charney’s management style. Current and former executives described him as relentlessly controlling and pointed to a power vacuum growing in the retailer’s upper ranks.
Analysts said the company had developed a reputation as a place where talented people did not want to work. And during the past year, Mr. Charney forced out important company executives, including the general counsel, Glenn A. Weinman. A company with about 10,000 employees was left with only one lawyer in the United States.”
The composition of the board of directors was another problem. The New York Times article described the board as “handpicked” by Charney. That in itself isn’t uncommon in corporate America, but good governance principles require that the board of directors have a degree of independence, and the ability (and willingness) to properly oversee management’s performance. Far too many corporate boards fall short in this regard. Also troubling was this:
“Few if any board members had experience in retailing or major public companies, things that helped enable Mr. Charney to keep them at a distance and to keep board meetings infrequent.”