Abercrombie In Trouble Again (This Time, Not For Nude Models)

Last Updated Apr 16, 2010 4:04 PM EDT

Abercrombie & Fitch (ANF) -- no stranger to controversy -- makes headlines again for all of the wrong reasons. This time its missteps are more of a corporate nature than allegations of pornographic advertising and catalogs, suggesting the retailer might have bigger problems than merely a perception of being too "edgy."
The apparel seller faces two public humiliations right now. An recent SEC filing revealed that CEO Mike Jeffries will get paid $4 million by the company to curb his use of personal travel on Abercrombie's jet. And on top of that, the retailer is on Corporate Responsibility Magazine's newly released "Black List" of companies that lack transparency.

The airplane issue is especially disconcerting. Jeffries was one of the 10 highest-paid chief executives in 2008, making $72 million, when the 1,000-store Abercrombie suffered greatly in a terrible recession. Sure, that's a lot of stores to visit, but paying him $4 million on top of his current salary is ludicrous -- especially when the company is in a rut. The retailer only recorded a net income of $300,000 dollars last year, and stores open at least a year saw sales plunge 23 percent.

Jeffries, who reportedly says "dude" a lot, made waves last year when he refused to start discounting, saying it would dumb down the brand, even though its competitors were posting better numbers by doing so. Abercrombie has since rescinded that strategy.

The "Black List" is a collection of 30 Russell 1000 companies that Corporate Citizen says have disclosure issues. Among the areas they don't reportedly offer information on are: philanthropic efforts, governance and finance, as well as policies on the environment, climate change and human rights.

Usually a pretty tight-lipped company, it's doubtful that Abercrombie will do a whole lot to defend itself against these allegations.

A financial turnaround could speak for itself. The retailer's sales so far this year are trending up. It will need that trend to continue, along with some hefty profits, to offset these latest miscues -- and Jeffries's oversized compensation package.

Billboard image by Flickr user guille 78.