Case study of General Electric Co

General Electric can follow its roots to the initiation of the Edison Electric Light Company in 1878. By 1890, Edison had organized his assorted concerns into the Edison General Electric Company. The Thomson-Houston Company and the assorted companies that had merged to organize it were led by Charles A. Coffin. In 1892, these two major companies combined to organize the General Electric Company. GE is a planetary fabrication, engineering, and services pudding stone, formed in 1892. Today, GE is made up of six concerns, each of which includes a figure of units:

GE Commercial Finance provides loans, operating rentals, funding plans, commercial insurance, and an array of other merchandises and services aimed at enabling concern worldwide to turn.

GE Healthcare is a leader in the development of a new paradigm of patient attention dedicated to observing disease earlier and assisting doctors tailor intervention for single patients.

GE Industrial provides a wide scope of merchandises and services throughout the universe, including contraptions and illuming ; plastics and silicones merchandises ; and equipment services.

GE Infrastructure is one of the universe ‘s prima suppliers of cardinal engineerings to developing states, including air power, energy, oil and gas, rail and H2O procedure engineerings.

GE Money, once known as GE Consumer Finance, is a taking supplier of recognition services to consumers, retail merchants and automotive traders around the universe.

NBC Universal is one of the universe ‘s prima media and amusement companies in the development, production and selling of amusement, intelligence and information to a planetary audience.

As per their last one-year study at the terminal of 2008, at the terminal of the twelvemonth they employed in entire globally 323000 employees. $ 797,769 1000000s in assets 182,515 1000000s in grosss.

Stakeholder Relationss

GE is a public company listed on the New York Stock Exchange and incorporated in the State of New York. The company is managed by a 16 member Board of Directors, of which 13 of the managers are independent. Directors are chosen yearly at the one-year meeting of stockholders. Four commissions assist the Board: the Audit Committee, Management Development and Compensation Committee, Nominating and Corporate Governance Committee, and the Public Responsibilities Committee. The Public Responsibilities Committee oversees the company ‘s place on corporate societal duty. GE besides has a squad of Corporate and Business Executives who lead GE ‘s many corporate maps and concerns. GE has really strong just stockholder control. Each portion of the common stock is entitled to one ballot. Stockholders are able to put up and elect campaigners for the Board of Directors through a bulk. Besides, GE ‘s codification of behavior, The Spirit and The Letter enables stockholders to originate a procedure of dismissal of Directors.

Within Organisation




Senior Management


Board Of Directors



Government Representatives

Audit Committee

Non-Governmental Organizations ( NGOs ) ,

Management Development And Compensation Committee

Industry And Financial Analysts

Nominating And Corporate Governance Committee

Environmental Advocacy Groups

Public Responsibilities Committee


Environmental, Health And Safety Committee

Community Leaderships

Citizenship Executive Advisory ( CEA ) Council

Ecomagination Advisory Council



Table Key Stakeholders

GE ‘s Board of Directors and GE ‘s Risk Committee play critical functions in the inadvertence and direction of the Company. From this senior leading they are held with great answerability. The primary function of GE ‘s Board of Directors is to supervise how direction serves the involvements of stockholders and other stakeholders. To make this, GE ‘s Directors have adopted corporate administration rules aimed at guaranting that the Board is independent and to the full informed on the cardinal hazards and strategic issues confronting GE. This is dictated by two-thirds of its Board be independent under a rigorous definition of independency. The GE Board held 13 meetings in 2007 and outside Board members visited at least two GE concerns each in 2007 without senior direction nowadays in order to develop their ain position of the Company. The Board besides meets sporadically without direction. The Board and its Committees focal point on the countries that are of import to stockholders scheme, hazard direction, and people and in 2007 received briefings on a assortment of issues, including: controllership and hazard direction, conformity and judicial proceeding tendencies, U.S. and planetary revenue enhancement policy, environmental hazard direction, societal cost tendencies, acquisitions and temperaments, rational belongings and right of first publication protection, planetary tendencies, the reshaping and widening of GE ‘s concerns, and productiveness. At the terminal of the twelvemonth, the Board and each of its commissions conduct a thorough self-evaluation as portion of their normal administration rhythm.

Table Power V Influence MatrixKeep Satisfied



Environmental, Health and Safety Committee

Public Responsibilities Committee

Ecomagination Advisory Council

Manage Closely

Senior Management

Board of Directors

Management Development and Compensation Committee

Audit Committee



Government Representatives

Non-Governmental Organizations

Community Leaderships

Keep Informed



Industry and Financial Analysts

Environmental Advocacy Groups








Senior GE officers, including the Citizenship Executive Advisory ( CEA ) council, are on a regular basis involved in reexamining stakeholder feedback. This group meets at least quarterly and reviews drumhead stakeholder feedback and issues of import to the Company ‘s citizenship attempts to guarantee that the appropriate actions and resources are in topographic point. The CEA is comprised of five senior GE executives. GE makes a committedness to transparence in its citizenship studies where the Vice President of Corporate Citizenship and the General Counsel guarantee transparence of non-financial information. GE provides preparation on transparence to all employees as portion of initiation preparation every bit good as e-learning preparation that trades with conformity to policies and unity. The citizenship studies are widely disseminated and translated to further promote engagement of its stakeholders. GE makes committednesss to prosecuting with external stakeholders in its citizenship studies, which outline the types of battles the company undertakes. They started the studies in 2005 and are now into their 4th. GE is presently developing a company-wide attack to stakeholder battle called, materiality. Stakeholder engagement depends on the functionality of a section, for illustration, with citizenship-related battles ( i.e. NGOs or public policy groups ) the Vice President of Corporate Citizenship over sees external stakeholder battle. GE provides preparation to directors and executives on how to interact with stakeholders as portion of the concern Management and leading categories.

They have formalised battle where they have institutionalized external stakeholders ‘ engagement in corporate determination devising on environmental and societal issues. GE has an Ecomagination Advisory Council comprised of a Board of 6 to 8 industry thought leaders with expertness in energy and environment. The Council guides the company on engineering research and investings, provides new thoughts on its environment scheme, helps bring forth or reexamine white documents, and participates in GE sponsored events. GE ‘s Ecomagination concern scheme guides the company ‘s rating of its environmental impact. The scheme aims to accomplish energy-efficient, less emissive merchandises, and achieves this through the usage of the Ecomagination Product Review score card. The mark card quantifies a merchandise ‘s environmental impact comparative to other merchandises. Ecomagination merchandise grosss increased from $ 12 billion in 2006 to $ 14 billion in 2007, which as a per centum of overall company-wide gross is 23 % in 2007. In the current treatment planetary clime alteration, the environment is a hot subject now and will for the forseeable hereafter for stakeholders. The chief stakeholders that can be linked with this are the ecoimagination, environmental organisations, EHS. They will progressively anticipate policies and schemes with existent consequences and committedness to cut down damaging environment impacts. They will hence hold a great trade of influence presently and will make for some clip. They can progressively use force per unit area on the company to happen its attempts. No uncertainty he GE is already undertaking these issues but with these external stakeholders great power will originate as they influence employees to take duty and increased merchandises on the ecomagination strategy. GE already province they have increasing merchandise line in the pipe line.

This is besides a media craze subject which is reported on daily, environmental issues can see a hole host on stakeholders chiefly external influence the the senior direction and BOD, these include the media, authorities representatives, which will act upon the community and therefore single stockholders and investors. Not merely will they act upon the internal operations of the company but in tern the GE will steer its providers so no struggle of involvement if they are non making all they can to relieve environmental issues and are seen to be responsible.

GE besides has the Environment, Health and Safety ( EHS ) Policy, which ensures consistent planetary criterions for rating methods. GE provides preparation to operations leaders on the overview on EHS policy through Plant Manager Training. Of the Ecomagination and EHS policy are both widely circulated, but Merely Ecomagination stuff is translated. However of the mechanisms to ease the sharing of lessons learnt from ratings is non in topographic point and therefore contradicts the attack of external stakeholders to take the environmental issues.

GE has the Statement on Principles of Human Rights, which commits the company to supervising its providers ‘ attachment to EHS criterions in emerging markets, prohibitions against forced and child labour, local pay and hr Torahs ; measuring human rights issues ; and measuring the impact of major substructure undertaking financing on local communities. The Vice President of Corporate Citizenship oversees the coverage and rating of GE ‘s societal impact while different leaders have changing duties depending on the issue. For illustration, the General Counsel has the duty for conformity, administration, and ombudsperson. GE does non supply developing to staff on rating of societal impacts of their activities. Companies like GE with planetary supply ironss face important challenges in order to guarantee that their providers make safe and quality merchandises, and that they are produced on clip and at competitory monetary values. In add-on, stakeholders progressively expect companies and their concern spouses to esteem and implement national and international labor and environmental criterions in their workplaces. This challenge becomes even greater when companies beginning providers from states without equal authorities enforcement. While the patroling theoretical account of the yesteryear has made some positive betterments, it has been comparatively unsuccessful at placing the nucleus issues. This has created a duplicate of attempts, contributed to a proliferation of codifications of behavior that create confusion, and has mostly been an uneffective usage of resources. Adding to the quandary are some unreciprocated inquiries, including: How will viing companies in the turning economic systems of Brazil, Russia, India, and China manage their supply ironss in relation to international labor criterions? Do consumers see the value of puting in supply ironss and, if so, are they willing to potentially pay more? Today ‘s prima companies and multi-stakeholder enterprises are altering tack and get downing to concentrate their attempts on five countries:

Bettering direction systems

Developing effectual ailment mechanisms and workplace redress platforms

Measuring internal buying to find how their ain actions may negatively impact the workplace

Increase supply concatenation transparence

Making inducements for their purchasers and providers based on societal and environmental public presentation standards

This displacement in attack requires coaction from a wide set of stakeholders because no 1 sector can efficaciously accomplish this entirely. Companies should larn from the difficult lessons of the yesteryear, avoid the booby traps that others have experienced, and see aiming resources on edifice internal capacity to work in partnership with NGOs, trade brotherhoods, multilaterals, equal companies, and industry and trade associations to undertake these complex issues together. Furthermore, companies and their stakeholders should jointly prosecute authoritiess and promote them to implement their Torahs in order to do nice work a world and to make a flat playing field for transnational companies and for those providers viing for their concern.

GE has the codification of behavior called The Spirit and The Letter, which guides the handling of internal ailments. GE besides has a Global Ombudsperson system where ombudspersons are placed in every concern and state where GE operates to ease conformity and the ailments procedure. The Spirit and The Letter have the committedness to guarantee compulsory subject for anyone found to hold retaliated against a whistle blower. The Corporate Ombudsperson has the overall duty to supervise conformity with the codification. GE provides all ombudspersons with preparation on having concerns, originating probes, and supervising instance advancement and closing. Employees receive conformity preparation through the intranet. This besides encompasses ailment and response process for external ailments. GE ‘s 2007 proxy statement high spots a mechanism that exists for external stakeholders to lodge ailments straight to the Board of Directors. The Corporate Ombudsman besides oversees conformity with committednesss made in the proxy statement, and will go through any concerns to the Audit Committee of the Board of Directors. Ombudspersons are trained on receiving and managing concerns from external stakeholders. GE ‘s codification enables any stakeholder to describe concerns of corporate policies and schemes straight to the Board of Directors.

With the many committednesss and plans and commissions in topographic point GE maintain their stakeholders chiefly employees informed with studies. They have proxy statements, citizen studies, one-year studies which are widely disseminated and translated. They besides have cardinal policies that are made easier accessible such as human rights statements. Not all enterprises are translated and circulated but the bulk are. Environmental and societal facets are reported on and besides compensation of the senior direction and executive directores, CEOs are all transparent. If this was non the instance this could easy estrange lower degree employees and other stakeholders. With the information available stakeholder board have besides been issued the undertaking of measuring study composing on one-year and citizenship studies. They concluded in the 2008 citezen study that

GE utilized a Stakeholder Review Panel to measure and notice on study quality. Ongoing stakeholder battles have enabled the Company to find the impact and influence of its corporate citizenship attempts. The Panel ‘s commentary is intended to inform and steer study readers, every bit good as GE. Six people were invited by GE to fall in the Panel, identified in

treatment with AccountAbility, the latter playing as the Panel

Convener. Panel members were selected for their involvements

and concerns, their expertness and their cognition of GE.

Panels members were asked to take part as persons, non

as representatives of their organisations, Environment & A ; Social Development

Department at the International Finance Corporation, HSBC Climate Change Centre of Excellence. The Panel provided feedback to GE based on a bill of exchange study, and

the commentary based on its position of the concluding study. The Panel

focused on the quality of the study, although members raised

some public presentation issues in treatment with GE. The Panel ‘s

commentary, presented here, is intended to inform and steer

the study readers, every bit good as GE. Use was made of the AA1000

Assurance Standard, but the Panel ‘s work is non a formal

confidence exercising.

Background to the 2008 Conventions

This twelvemonth we sought to reflect on our advancement refering the

execution of our Statement of Principles on Human Rights

every bit good as our broader ecomagination and development attempts,

and further explore the links between GE ‘s operations and

the broader human rights docket. In peculiar, we convened

experts and stakeholders in three parts to discourse:

oˆ?z How can GE farther advance the execution of the

Company ‘s planetary Human Rights Policy, and in peculiar in

relation to our function as a planetary Olympics patron at the 2008

Beijing Olympic Games ; in other words, “ What does it intend

to be a good planetary citizen? ” ( Geneva )

oˆ?z How can GE farther embed its environmental stewardship

work within the nucleus of its scheme and pattern, spread outing

its attempts outside the United States and besides linking its

attempts to the broader development docket? ( Washington, D.C. )

oˆ?z How can GE progress an effectual attack to functioning

communities in the underdeveloped universe in visible radiation of the Company ‘s

alone place in supplying substructure solutions to the

private and public sectors? ( Delhi )

To larn more about GE and stakeholder participants for these

conventions, delight visit

Penetrations from the 2008 conventions

GE greatly appreciated the honest and unfastened treatments at the

three conventions. Valuing the advocate and advice we received,

we would wish to portion a sum-up of the cardinal chances and

challenges the conventions helped us place and research.

We discuss many of these chances and challenges within

this twelvemonth ‘s study and are looking frontward to further battle

over the coming twelvemonth to assist us inform and steer our citizenship

attack and attempts. To supply the reader with a spirit of the

treatments at the conventions, this study besides features a figure

of ( unedited ) expert positions authored by participants of

the conventions. Penetrations include:

Climate change public policy

Clear and consistent communicating, including recommendation

and elucidation of effectual and believable planetary policy

models, prosecuting in national and local arguments on trade

policies, and client battle on clean engineering

( Washington, D.C. ) .

Company-to-country investing

Leveraging invention and merchandise version driven by local

civilization and context ( Delhi ) .

Customer product-use issues

Clarification of GE ‘s attack to client duty of GE

merchandises, including increased battle with society

on cardinal concerns such as dual-use engineering and post-sale

direction ( Geneva, Delhi, Washington, D.C. ) .

Expanding boundaries

Prosecuting experts as GE continues to operationalize its Statement

of Principles on Human Rights and see a life-cycle attack

for GE ‘s merchandises as GE applies its attempts to assist cut down CO2

emanations within its supply concatenation ( Geneva, Washington, D.C. ) .

Human rights

Increased public placement on concern issues associated with

the emerging and ongoing human rights treatments and

proactive battle as they arise, for example, 2008 Beijing Olympic

Games ( Geneva ) .

Placing battle

Greater apprehension of the deductions originating from GE ‘s

alone place as a business-to-business company supplying

substructure solutions to states ( from engineering

development to local execution ) ( Delhi, Washington, D.C. ) .

Strategic coactions and partnerships

Leveraging of GE ‘s nucleus competences and strengths

( committedness to invention and ability to scale undertakings and

plans ) in strategic coactions and partnerships to

guarantee credence and sustainability ( Delhi ) .

The Panel encourages GE to go on introducing in its coverage,

and we challenge it to endeavor for leading in advancing meaningful

transparence across the planetary concern community.

oˆ?z Injecting sustainability into fiscal coverage: This twelvemonth ‘s

Citizenship Report has demonstrated the strategic relevancy

of GE ‘s plans for its long-run concern public presentation.

These material facets of sustainability direction and

invention should be incorporated into regular investor

revelation, including quarterly and one-year studies as good

as in proxy statements.

oˆ?z Embedding citizenship within operations: We would welcome

transparence on how sustainability public presentation is brought

to life for single GE employees through public presentation rating

and compensation.

oˆ?z Matching planetary coverage with national degree informations: Utilize GE ‘s

Web site to supply country-level public presentation informations and information

for planetary stakeholders, including penetrations and results from

cardinal stakeholder and concern battles, particularly in high

growing parts such as Asia.

oˆ?z Discussing populace policy battle: Further beef uping

of revelation on GE ‘s public policy activity and lobbying on

cardinal citizenship issues at the planetary and national degree, including

rank organisations that represent GE. See doing

all entries to authoritiess available on the Web site.

oˆ?z Exploring human rights: Reflect a brighter limelight on GE ‘s

human rights attack and pattern, and exemplify its contemplation

in nearing disputing quandary. As operationalizing

GE ‘s human rights policy around the Earth is peculiarly

complex, this country does non impart itself to quantitative ends, but

to instance surveies and an active treatment of the quandary and

niceties cardinal to the human rights challenges the Company

faces. For illustration, the illegal usage of GE ‘s ultrasound equipment

for sex-selection by practicians in India or application of GE ‘s

planetary labor rights criterions within its supply concatenation in disputing

environments like China. Further information on stairss the

Company has taken to aline its public presentation with its homo

rights policies would enrich the Report.

oˆ?z Progressing the “ Energy and Climate Change ” Agenda:

Intensifying of describing on the Company ‘s part to the U.S.

Climate Action Partnership ‘s committedness to 60-80 % decrease

in U.S. emanations by 2050 – how, on a practical degree, GE plans to

aid accomplish these ends via engineering version or enlargement

of ecomagination.

oˆ?z User-focused coverage: Experiment and research how best to

range and communicate with the company ‘s diverse scope

of stakeholders, particularly those with peculiar, set involvements

or those who may hold limited entree to the Web.


Public duties

Companies confront many quandary when conducting

concern, in rich or hapless states likewise, when specifying their

function in communities: understanding the proper function of authoritiess

and the “ right ” degree and quality of influence from

companies that are sometimes larger than authoritiess

themselves ; the demand to esteem different civilizations but still

do certain that the same values are applied all around the

universe ; the demand to hold an educated work force that fits in the

company ‘s procedures while seeking non to alter local

civilizations ; outlooks that companies will supply for all ; and

letdown when companies need to shut workss or

leave communities.

Much has been written and discussed about the impact of

multinationals on communities. Stakeholders have many

different positions and perceptual experiences, and there is small understanding

about how to mensurate impacts, both positive and negative.

I think, nevertheless, that there are two basic inquiries that

companies need to reply:

1. Are we truly listening to the stakeholders who are really

impacted at every measure of the value concatenation of our concern?

2. What are communities traveling to be like when our company


Many stakeholder duologues are traveling on around the universe,

and it is surely a singular and great measure to hold

companies like GE – whose sheer size allows them to hold

important positive impacts when specifying their class of

work – hearing to diverse positions and interchanging thoughts with

non-business spouses. They are, nevertheless, largely focused on

stakeholders who speak English or belong to form

groups with some international association. Maybe it could be

good to really interchange thoughts with the wedged communities

themselves to organize a more complete image.

Companies should come into communities be aftering for the

clip when they leave, be it two old ages or 70. Hopefully, that

manner one can avoid making dependence and promote

ownership from twenty-four hours one. It is likely more complex to get down

and carry concern with this position, but it is certainly better to

prevent hazards than to pull off crises.

Public Policy

GE has progressively focused on intensifying and bettering its ability

to work efficaciously with authoritiess throughout the universe. We

steadfastly believe that a better apprehension of GE ‘s vision and concern

activities – and authorities ‘s impact on those chases – will function

both parties good. Furthermore, we have made a conjunct attempt to

heighten our working relationships with authorities functionaries.

The regulations regulating governmental minutess and protagonism

activities differ from state to state, and can be varied and

composite. Our entire committedness to unity has led us to

continuously educate GE leaders on alterations in the regulations and

ordinances regulating interactions with authorities functionaries.

The Public Responsibilities and Audit Committees of the Board

are briefed on a regular basis on our authorities dealingss and conformity


I spend much of my clip going internationally and

run intoing people at every degree within and outside GE.

Our strong committedness to corporate citizenship makes

GE a really attractive topographic point for attorneies to work. My ability

to pull the best attorneies and maintain the legal squad ‘s

strong internal sense of community is greatly assisted by

the fact that the Company is committed to advancing the

Rule of Law and is actively working with authoritiess and

communities to advance ethical behavior. GE attorneies

are inspired and motivated cognizing that such a strong

committedness runs through the venas of the Company.

Global Initiative to Battle

Nuclear Terrorism

In 2006, the U.S. and Russian authoritiess launched the

Global Initiative to Combat Nuclear Terrorism. As a planetary

citizen, GE is profoundly concerned that every precaution be

taken to guarantee that legitimate commercialism in atomic

stuffs is non exploited by terrorist organisations. As a

planetary manufacturer of atomic power workss, atomic fuels,

radioactive isotopes for health care applications, and

radiation sensing equipment, GE has the experience and

expertness to do a significant part to this end.

In 2007, GE worked with the U.S. Department of State to

express support for the Global Initiative, and in 2008,

we will take part actively in several undertakings, including

the development of a exemplary national atomic sensing

architecture papers ; international cooperation in

developing proficient attacks to remotely observe

radiological stuffs ; and minimising the usage of extremely

enriched U in the production of medical radioisotopes.

States of concern

GE devotes important resources to guaranting that concern

activities are in conformity with all applicable Torahs, that

they are conducted with unity and accomplish value for

our stockholders worldwide. While our policy has ever

required that our concerns follow U.S. countenances and other

applicable Torahs, in 2008 we adopted a policy that goes

beyond what current Torahs require. In visible radiation of reputational

and concern hazards associated with making concern with

states designated as State Sponsors of Terrorism by the

U.S. Department of State ( Cuba, Iran, North Korea, Sudan,

and Syria ) , the Company will non accept concern in these

states except activity that is authorized by the U.S.

Government for human-centered or public policy intents.

This attack augments a policy adopted in 2005, when

GE and its board decided it would no longer do concern

in Iran because of developing conditions in that state.

The exclusions were to run down bing committednesss

and human-centered activity authorized by U.S. Government

licences. Since so, GE has done everything it said it would

make in 2005. As of the terminal of June 2008, the preexisting

committednesss with Iran have been completed. At all times

GE ‘s policy was to the full compliant with U.S. and all applicable

Torahs. In fact, GE ‘s policies have been more restrictive than

U.S. jurisprudence.

Recent gross revenues to Syria have been really little, affecting

health care merchandises every bit good as non-U.S. beginning power,

oil and gas, and illuming. In recent old ages, GE has had really

small activity in the Sudan, about all affecting the sale of

health care merchandises. GE has non had any gross revenues to North

Korea in the past three old ages. Since 1996, GE has non

recognized concern in Myanmar ( Burma ) .


GE is a good established company and so is invariably undertaking unfastened, ongoing duologue with a diverse set of planetary stakeholders. It is hard to put any recommendations for the largest company in the universe and has been in operation for 130 old ages. They have systems in topographic point that have been tried and tested. Outlined in the in their citizen studies they engage with their stakeholders in a mode of ways. Employees are their first easiest port of call, outlooks and sentiments can be captured with anon. all-employee studies, focal point groups, town hall-type meetings with the president and other senior officers, and roundtable treatments with assorted sections of GE ‘s diverse employee population.

In 2005, they progressed to associate their internal procedures to acquire client positions inside the Company. They have created formal ways to listen to their clients. They have penned it “ dreaming Sessionss ” which involves taking alone client groupings and holding them assist determine their scheme. In recent old ages they have hosted meetings with up 20 CEOs of major public-service corporations to give input into the hereafter of atomic and coal engineering. This sort of interaction they call “ City Swings, ” where they visit retail investors. They besides implement merchandise Scorecards and other “ At the Customer ” quality enterprises. In the instance of ecomagination merchandises these are rated on the environmental impact decrease. They conduct “ metropolis swings ” peculiarly with retail Investors and GE has long had a systematic communications procedure to run into the information demands of investors. GE conducts more than 350 analyst and investor meetings every twelvemonth and disseminates monthly e-mail updates and quarterly booklets covering all concern sections, citizenship high spots, and cardinal events. Supplier ‘s involvements are met with preparation plans, appraisals, and preparation plans called “ train-the-trainer ” Sessionss on cardinal issues. Best pattern sharing Sessionss, and supplier conferences are all held. Other stakeholders are addressed at the same time sometimes through Multi-stakeholder duologues ; these include investors, non-governmental organisations, community organisations, and other of import external stakeholders.