General Electric Social Responsibility

General Electric did not fulfill corporate social responsibility in the Welch era. Although Welch created tremendous wealth for the company during his time in office, his means did not enhance the assets of the society and neither did they protect the society. During his time in office, ninety one thousand employees lost their jobs and joined the unemployed population (p.148). General Electric is responsible for more than a hundred thousand pounds of polychlorinated biphenyls lying on the Hudson River bed (p. 150). Additionally, he was not a satisfactory model of diversity to the society. All the top thirty one executed were whites apart from one. The organization offered forty million dollars in grants to nonprofit groups, universities and colleges globally through the GE Foundation. However, the organization “pressured cities, counties, and states to lower taxes by threatening to relocate operations,” (p.152). This had a negative impact on the schools as it lowered their budgets. The organization could do better than it did. A reputable organization incorporates people from all races and backgrounds as long as they have the qualifications for a position. If this case applied to GE, the organizations had incorporated whites, blacks and people of other races. Welch was capable of promoting as many women and people of other races as he employed the whites. Additionally, the organization was capable of using more research to find new ways of disposing PCBs.

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Unfortunately, Welch illustrated, through a narrower path, Friedman’s view. Moreover, the organization did not accomplish fulfill the law to the maximum. GE committed “a long string of civil and criminal transgressions,” (p.151) during Welch’s tenure in office. In the 1990s, the organization recorded thirty-nine law violations, fines and court-ordered remedies. Although this may be termed as part of business since an organization comprises of diverse people with different characters and personalities, its role in the society was questionable. As stated earlier, they offered one grants to different learning institutions and nonprofit organizations while they pressured the bodies that supported these learning institutions to lower the tax rates in their areas. Whereas they recruited many in a society, they fired as many. Most explanations given by Welch describe the society as something other than a community of people. For example, when terminating the workers’ employment, he explains that employees are like plants which should be cut in order to have a beautiful garden. He offered the needed benefits and pensions to the retired or removed employees. This was good. The act of viewing the society (inclusive of the employees) in terms of assets and not people with feelings showed his quest to make profits and abide by the law.

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Nevertheless, one should give credit where it is due. The organization created employment for hundreds of thousands of employees. By the end of his tenure, the employees amounted to 313,000 people (p.148). The society was 313,000 people free from unemployment. Additionally, it provided grants that helped learning institutions to offer scholarships to many students. The grants offered to the nonprofit organizations helped in diverse worthy courses. Many employees and retirees do not have these benefits, pensions and other funds that come with employment, laid off or retiring. GE ensured that its employees had these funds. Although the retirees did not get the increase requested since the pension fund kitty was twenty one billion dollars in surplus, they were happy to have these pensions. The organization was responsible for the pollution of Hudson River due to the PCB deposits at the river bed. This also included other water bodies it drained. However, the organization stopped throwing these wastes after receiving an order to stop doing so. The organization stopped in order to abide by the law. In addition, it also stopped because it has a sense of social responsibility. From a different perspective, the organization provided motivated many young people in the society. Many people knew that only the best survived in GE. In order to show that they are as capable as the best, many people in colleges and other professional areas worked hard to gain employment in GE.

It is clear that GE prioritized shareholders over its employees. This step has advantages and disadvantages. The main advantage is that the stakeholders are investors. Thus, more stakeholders called for more investments. Pleasing the stakeholders with accumulation of wealth encouraged them to increase their investments. In addition, it would attract other stakeholders who would bring significant change to the organization. Employees play a crucial role, if not the main, in accumulating the wealth a company displays. Placing the employees below the stakeholders brings lack of motivation which results to poor productivity or high employee turnover. These outcomes place a risk in the success of an organization. GE should have rebalanced its priorities. Welch showed that he valued the decision-making potential in the employer. This is the reason he removed the bureaucratic measures and systems. However, he viewed the employees as costs of production instead of seeing them as people. The best approach was to minimize the cuts. Instead of removing the employees, demoting them was another alternative. Doing away with loyalty was not a brilliant idea. Loyalty motivates employees to work or keep company secrets. One way to cover their weaknesses would be increasing the pension fund. Employees give gratitude to such actions.

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