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December 10, 2009
Jeffery Immelt's Convenient Religion
General Electric’s CEO Jeffrey Immelt has called other U.S. business leaders greedy and mean. So from whence cometh his recent conversion?
Financial Times (FT) reports:
Jeffrey Immelt, General Electric’s chief executive, said on Wednesday his generation of business leaders had succumbed to “meanness and greed” that had harmed the US economy and increased the gap between the rich and the poor…
“We are at the end of a difficult generation of business leadership ... tough-mindedness, a good trait, was replaced by meanness and greed, both terrible traits,” said Mr. Immelt, who succeeded Jack Welch, one of the toughest leaders of his generation, at the helm of the US conglomerate. “Rewards became perverted. The richest people made the most mistakes with the least accountability.”
Back in 2007, Jeff was doing alright making over $12 million. Over that and the previous four years he’d pocketed about $74.5 mil.
Then, in 2008, he got religion. According to Daily Finance:
No one asked General Electric (GE) CEO Jeffrey Immelt to give up his $12 million bonus -- at least as far as anyone knows. But he did.
According to Reuters, "Jeff Immelt has waived his right to a bonus and performance-based pay that would have netted him more than $12 million in cash."
The GE board approved that action. Immelt's salary will stay where it is at $3.3 million.
The move is a smart one, at least from the standpoint of public relations and shareholder sentiment. GE's shares have dropped from a 52-week high of $38.52 to under $11, near a period low. Investors are concerned that the company will lose its "AAA" rating or have to cut its dividend. Immelt has said he will fight to keep both intact.
Mr. Immelt also issued a mea culpa over his inability to foresee the financial turmoil, which slashed GE’s profits and put its financial arm, GE Capital, under pressure, saying he should have been a better listener.
“I felt like I should have done more to anticipate the radical changes that occurred,” he said.
That translates into “I messed up.”
An NFL coach with Immelt’s winning record over the last several years would likely have already been made available to the industry. Translation: fired.
But then, Immelt’s the darling CEO of the Obama administration, pushing Green just as hard as he can for the good of...the nation?…GE? Or, JI?