Ge Case Study Essay

1458 Words Jul 22nd, 2013 6 Pages
1. Corporate social responsibility is defined in Chapter 5 as the corporate duty to create wealth by using means that avoid harm to, protect, or enhance societal assets. Did GE in the Welch era fulfill this duty? Could it have done better? What should it have done?
I believe that Welch only fulfilled one portion of his corporate social responsibility duty. Financial results for GE show that Welch was very effective in directing a highly profitable company, but he did so at the expense of many of the employees of the business. Over the years, employees were assigned a ranking system comprised of 1’s, 2’s, and 3’s. Each year, the bottom ten percent of workers (ranked 3’s) were relieved of their duties at the company. In a few
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Addressing the pollution issues at GE could have been handled differently as well. Instead of dumping waste into the Hudson River, the company could have acquired a biohazard company to remove and safely store the waste to keep the humans and animals in the plant communities safe. With a couple of changes, Welch could have made GE even more comfortable than it was at the end of his management era. 2. Does GE under Welch illustrate a narrower view of corporate social responsibility closer to Friedman’s view that the only social responsibility is to increase profits while obeying the law?
Under Welch, GE lacked a large amount of social responsibility in my opinion. Friedman’s view that social responsibility is exhibited by obeying the law while increasing profits seems to be a similar idea to the rigid beliefs that Welch held for GE during his management. Many times in his time as the CEO of GE, Welch made questionable decisions about ethical dilemmas that the company faced. Often, the company was overfunding the pension fund and using the money to generate profits on the balance sheet (as interest income.) GE executives profited from the pension fund overfunding because their bonuses were tied to corporate profits, and the business was also able to

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