GE’s environmental concerns

Jeff Immelt has pushed GE to devote more of its research resources into environmental technologies, looking for business possibilities linked to increasing concern about the environment.

This 'Ecomagination' project has undoubtedly given GE a greener tinge than the company of Jack Welch's day.

Immelt's explanation was that in early 2004 during a review of a series of businesses across the company, it emerged that many were making investments in such areas as lower emissions, more energy efficiency and renewable energy.

"We said: 'this really seems to be a theme'. The company then embarked on market research and discussions with customers, non-governmental organisations and studies of global warming.

"At that time," Immelt added, "oil was $20 a barrel". Today the price of oil is around $70 a barrel.

Immelt said: "Being a proponent of making money solving technologies around the environment is a good thing not a bad thing."

Immelt said that his philosophy across the company was to make it more innovative, more global and closer to the customer.

But investors have not backed GE as in the past. The current share-price of around €33 is close to its 12-month low and down on five years ago.

Immelt said he trusted to the financial results of the company, which he said were very good.

"We are at a very specific point of time. Large-cap companies are less in favour than they were in the late 1990s. You have to believe when you run a company like GE or Microsoft or Citigroup or WalMart that performance dictates what happens in capital markets."

Jeff Immelt has pushed GE to devote more of its research resources into environmental technologies, looking for business possibilities linked to increasing concern about the environment.