Written by Jeffrey Immelt, Chairman and CEO, General Electric
General Electric is deeply honored to participate in Ethisphere’s first-ever Trust Isssue. We are honored because a vital asset for good companies is the trust of customers, investors, governments and employees. Simply put, trust is to GE as air is to breathing.
In the wake of the financial crisis and at a time when people all over the world are still adjusting to a volatile economy, trust in large institutions, both governments and businesses, has suffered. So the task is a challenging one. We must “earn the right to be big.” And when you are a global, publicly traded company like GE, you have to work even harder to maintain that trust. Being big means that we must never let a tough environment be an excuse for failing to live up to our high standards of performance, governance and compliance. We recognize that the burden is with us to earn trust.
Still, recognizing the importance of trust is easy. Maintaining trust over the long term is hard work. We start with strong operating rigor, where risk and regulatory are embedded and ingrained in the way that we run the Company. Even so, we know we aren’t perfect. Trust has to be earned every day… and over the long term. That is why we work hard to sustain a culture that is the foundation for earning and keeping trust. GE’s operational rigor and culture of trust play an important role in our relationships with three of our most important stakeholders – customers, governments and employees.
Earning Customers’ Trust
GE has dedicated itself to the mission of putting people, ideas and technology to work to solve the world’s toughest challenges. GE works because we are committed to making things that make the world better, and that build, power, move and help cure the world.
We recognize, though, that solving tough problems can’t be done without the trust of our stakeholders. Making the world better requires deep and lasting relationships. It requires long-term investment. Making the world better requires trust.
A great example is Ecomagination, GE’s clean energy business strategy. While clean energy ebbs and flows as a priority for governments and consumers, GE is steadfast in our commitment to helping customers manage natural resources efficiently and operate productively. In 2011 – the 6th year of this initiative – GE had $21 billion of clean energy revenue, growing twice as fast as the company average. Like Ethisphere’s motto – “Good. Smart. Business. Profit.” – GE is working to demonstrate every day that we can meet societal needs and do it profitably. Our customers trust us to help them achieve that goal. They know we’re committed for the long term.
Earning Governments’ Trust
Earning and maintaining trust also requires unswerving steadfast commitment to compliance with regulatory and legal requirements. We honor that commitment through a deep and continuing investment in rigorous compliance programs and systems. But, here too, the mission can’t be achieved in a vacuum. We rely also on compliance processes that are fused with the business operating rigor and a culture that promotes the trust of governments in our compliance program. We also know that we make mistakes and that we have to respond to those mistakes in a trustworthy and forthright manner. Our GE-wide “Regulatory Excellence” initiative, for example, developed from the recognition that to operate successfully in an increasingly regulated world we must go beyond simply following the rules. The result was a new regulatory process that builds stronger relationships and trust with our regulators. An element of that process –“Relate”– calls upon business leaders, lawyers and compliance professionals to work together proactively to build trust with regulators. The goal is to earn the trust of regulators while the sun is shining – not after a problem has arisen.
GE’s improper payments compliance program is another example of our processes. GE’s policy against improper payments has been a key part of GE’s Spirit & Letter policies and procedures for more than 17 years. But our compliance efforts have not been limited to building an internal program. We recognized early on that the commitment to a corruption-free playing field for business required going beyond having an internal compliance program to demonstrate our commitment to transparency and integrity in the international marketplace.
Earning Employees’ Trust
Employees’ commitment to a compliance program depends upon their trust that the company and its leaders embrace integrity as a value. Nowhere is this trust dynamic more important than in GE’s open reporting system. All GE employees and leaders have the responsibility to promptly report concerns about potential violations of law or policy, if necessary, anonymously. The open reporting system is a vital control that allows us to identify and address issues early.
No compliance program is perfect, but if the open reporting system is healthy, employees will step forward to report when mistakes occur. We have invested significantly in our open reporting, including providing nearly 800 trained Ombudspersons who can intake concerns, including on an anonymous basis. We provide numerous channels to report concerns, including to our Board of Directors, senior leaders at every level of the Company, Legal, Human Resources and many others. We track every concern, no matter how it is raised within the Company. We train and survey employees and managers alike to assure the effectiveness of the program and learn along the way. In a recent global survey of our employees 94% indicated that they would report misconduct. As proud as we are of those results, we know we can’t stop working to improve our processes and programs.
In summary, trust – that of our customers, investors, regulators and employees – is something that requires vigilance, deeply ingrained operational rigor and hard work. It is something we can never take for granted. At GE, we are committed to earning that trust every single day.