Corporate Governance in GE – IS IT A MODEL TO IMITATE…???

ANAND SARAFFARNAB MUKHERJEEDEBAYAN ROYGARIMA SHROFFVIVEK AGARWAL

Under The Guidance Of:

Prof. SUDEV DAS

“Corporate Governance is the system by which companies are directed and controlled…” -Cadbury Report (UK), 1992

“…fundamental objective of corporate governance is the ‘enhancement of the long-term shareholder value while at the same time protecting the interests of other stakeholders.”

- SEBI (Kumar Mangalam Birla) Report on Corporate Governance, January, 2000

Some Definitions

Corporate Governance

•The Manner in which a Corporation is RunAchieving its ObjectivesTransparency of its OperationsAccountability & ReportingGood Corporate Citizenship

•The Processes & Operating Relationships that Best Achieve Organizational Goals

MAIN ISSUES IN CORPORATE GOVERNANCE

Role of Board of Directors

Composition of the Board

Audit Committee

Shareholder’s Committee

Greater emphasis on leadership by example

Boards are returning to basic value systems

• Each culture should look back to its roots for value systems

• India’s centuries old principles of “Dharma”

Strengthening the moral fiber

of the corporation

Value systems are helping build corporate governance framework for companies

Boards are redefining value creation

• Not merely increase in stock prices

What is the Current Status on Corporate Governance Practices?

History of GE

• CEO : Jack Welch • Year Est. : 1878• Nationality : United States

• Industry : Electron products

Innovation=Imagination

Vision of GE

Innovative changing

Estimated as blue chip company

Consistent excellence in leadership

Giving ideas a quick try

GE International

"As one of the world’s most diverse and best performing global enterprises - recognized repeatedly for leadership and innovation - they offer our employees an environment where what we imagine we can make happen, developing new technologies and services to grow our businesses.

BIBLE OF GE ‘THE SPIRIT AND THE LETTER’ Former CEO Jack Welch (now retired), introduced this concept at

GE. During his work period GE was prized most deal-making, cost-cutting and efficient organization. Every day, everyone at GE has the power to influence company’s reputation — everywhere they do business. The Spirit & the Letter helps to ensure that, after more than 125 years, we still conduct our affairs with unyielding integrity. For well over a century, GE employees have worked hard to uphold the highest standards of ethical business conduct. They seek to go beyond simply obeying the law — they embrace the spirit of integrity. GE’s Code of Conduct articulates that spirit by setting out general principles of conduct everywhere, every day and by every GE employee.

GE’s code of conduct The laws and regulations governing the business conduct world wide Be honest, fair and trustworthy in all your GE activities and relationships. Avoid all conflict of interest between work and personal affairs. Foster an atmosphere in which fair employment practices extend to every

member of the diverse GE community. Strive to create a safe work place and to protect the environment. Through leadership at all levels, sustain a culture where ethical conduct is

recognized, valued and exemplified by all the employees. It also provides other information regarding the rules and regulations of

the business like hoe to deal with the government; customers etc. Employees and leaders who violate the spirit or letter of GE’s policies are subject to disciplinary action up to and including termination of employment.

Other Important Principle

Six sigma Fair practices Base employment decisions Provide a work environment Respect the privacy rights Take lawful affirmative actions

Working Environment

Operating with Integrity Work and Life Balance Quality of work life

Organizational Behavior At GE Leadership at GE Corporate Leadership Development Communication GE Board of Directors GE corporate ombudsperson Within the business Measuring Performance Stress Management Organizational Culture Women’s network Competitive pay and a great job  Providing security for family

Employee Programs  United Way Parenting assistance Elder care assistance Financial assistance GE star scholarships for children of GE

employees Legal advice Work advice

OTHER SERVICES PROVIDED BY GETO ITS EMPLOYEES

CORPORATE SOCIAL RESPONSIBILITY (CSR)

•Donation to Disabled American Veterans•Donations to Memorials and Museums•Special Programs•Recruiting from the Military•African American Forum•Asian Pacific American Forum•Hispanic Forum•GLBT Forum•Disaster Relief Fund•Planet Paint Fest•E-Community in Asia•Entrepreneurship and Employment Training for Youth in Indonesia•Rebuilding Efforts in South Asia

FAILURE

Defense Contracting Fraud History of GE Labor Relations Other Pollution Issues

Why we choose GE GE and its employees are committed to being a good corporate citizen

through high ethical standards, leadership in corporate governance, environmental compliance and community engagement.

GE continues to earn the respect of the business world. Once again, GE topped Fortune magazine’s top 500 companies. It holds 6th position consecutively for the second time.

GE is recognized as being among the world's best-run companies and was named the World's Most Respected Company for 2003 for the sixth consecutive year by the "Financial Times". GE was also presented with the Catalyst Award 2004 for its innovative, effective and measurable initiatives to advance women employees. GE was honored as one of the 100 Best Companies for Working Mothers

GE has a long and proud history of supporting the communities where its employees live and work. Contributing more than $140 million and over one million volunteer hours worldwide in 2003, GE is making an impact in local communities, educational standards and the environment in its communities all over the world.

THANK YOU…!!!