At J.Crew, CEO and Chairman Millard Drexler waited seven weeks to inform the board of his discussions to sell the company, exposing the often-overlooked issue that many corporate boards do not enforce internal transparency.

By Eleanor Bloxham, contributor

J.Crew CEO and Chairman Millard Drexler

If you run a division, how long do you think you could wait to tell your bosses you were in talks to sell your division to another company and still hold your job?  Would seven weeks be too long?

At J.Crew (JCG), CEO Millard Drexler waited seven weeks to inform his bosses of his discussions to sell the entire company, discussions in which he and his staff provided confidential information to outside parties and plans that included him, as one of the owners, in the deal.

Strengthening transparency and accountability are two issues that have come to the forefront in the wake of the financial crisis.

When we think of corporate transparency, we think of communication to shareholders or other external stakeholders. But strengthening transparency within a company -- so that it can be governed competently -- is at least as important. This transparency includes providing all employees with the information to do their jobs and providing managers with the early warning signals they need. More