Jeffrey R. Immelt succeeded the legendary John F. "Jack" Welch Jr. as General Electric Co.'s chairman and CEO on Sept. 7, 2001. In less than four years, 49-year-old Immelt has put his own stamp on $152.4 billion GE, with particular emphasis on innovation, notably the company's Ecomagination initiative announced May 9. That program, which reflects the diversity of GE's businesses and is designed to incorporate GE's manufacturing, technology, energy and infrastructure expertise, includes the planned development of solar energy, hybrid locomotives, fuel cells, lower-emission aircraft engines, lighter and stronger materials, efficient lighting and water purification technology. Not insignificantly, GE pledges to cut its own greenhouse gas emissions 1% by 2012 and to reduce the intensity of those emissions 30% by 2008, compared to 2004. GE figures its greenhouse gas emissions would have risen 40% by 2012 without further action.
IW: What is the scope of the Ecomagination program?
Immelt: Ecomagination consists of four distinct, measurable behaviors. First, doubling investment in R&D. GE will invest $1.5 billion annually into cleaner technologies by 2010, up from $700 million in 2004. Second, introducing more Ecomagination products. GE will double the amount of products and services it offers that provide significant and measurable environmental performance advantages to its customers -- from $10 billion in 2004 to at least $20 billion in 2010. Third, reducing greenhouse gas emissions. GE is committed to offering products and services to help its customers reduce their greenhouse gas emissions and decrease the intensity of the company's own facilities' emission. Fourth, keeping the public informed. GE pledges to publicly report on its progress in meeting Ecomagination goals in measurable and transparent terms on an annual basis.
IW: Why launch it now?
Immelt: Our known reserves of oil and natural gas are expected to be depleted by 2045; the global climate is changing; and more than a billion people lack access to clean water. Increases in population, consumption, and urbanization, increased regulation in many economies, as well as an increased emphasis on corporate social responsibility all combine to create increased demand for cleaner, more efficient solutions. GE's research finds that helping its customers meet their environmental challenges constitutes an important business opportunity for the company, its shareholders and its interested constituents.
IW: What's in it for GE?
Immelt: This is not just good for society, its good for GE investors -- we can solve tough global problems and make money doing it. GE aims to be the partner of choice for our customers around the world -- whether homeowners, business leaders or government officials -- by offering advanced technology to improve efficiency and reduce pollution in cost-effective ways. We intend to put our global capabilities, technology leadership and market knowledge to work to take on some of the world's toughest problems -- and we think we can make money doing it. This is good business.