| "In the end, integrity is all you've got," this statement | | | | winking, rule-bending or looking the other way." Welch |
| succinctly encapsulates the importance of ethics in | | | | was quoted as saying. His favourite question to GE |
| the corporate scheme of things, and underscores its | | | | employees was: "Can you look in the mirror every |
| role as the corner stone of business practices today. | | | | day and feel proud of what you are doing." According |
| Jack Welch, former chairman of GE is a major | | | | to Welch, "In a global business, you can win without |
| champion of the supremacy of ethics in business. | | | | bribes. But you better have technology. That's why |
| Whenever an employee's actions have put GE on the | | | | we win in business like turbines, because we have |
| wrong side of the law, he has hastened to | | | | the best gas turbine. You have got to be the |
| co-operate with investigators, admit guilt and take | | | | low-priced supplier, but in almost all cases, if you have |
| prompt corrective action. Such corporate mea culpa | | | | quality, price and technology, you win." |
| has served the company well. | | | | Even the comeback kid, Donald Trump has this |
| The time-card scandal in 1985 was the first significant | | | | advice for businessmen: "Be honest, even if there are |
| ethical challenge of Welch's 25year GE career. GE | | | | others around you who are not." In the 1999, he |
| Re-entry Systems, a GE subsidiary, was making a | | | | almost wanted to run as a candidate for the |
| new nose cone for the Air Force's Minuteman missile. | | | | Presidential election but eventually did not. Apparently, |
| Federal prosecutors in Philadelphia charged it with 108 | | | | he had received good support of popular votes in |
| counts of criminal fraud. The indictment alleged that | | | | the unofficial poll on his chances of running for |
| GE managers had altered worker's time cards with | | | | Presidency. You can go bankrupt and fail in your |
| improper charges totaling $800,000. Welch's response | | | | business, but as long as your reputation of strong |
| and damage control were brilliant, thereby winning the | | | | ethics stay intact, people will always remember that |
| trust of government officials. Welch personally called | | | | and you can make a comeback again. |
| on Secretary Orr, presenting a comprehensive | | | | Companies spend a lot of money in selecting its |
| proposal for cleaning up the mess and preventing | | | | candidates. This is normally based on competence |
| such mess from recurring. He created a top-level | | | | and achievements, which are easier to measure. |
| review board within GE to oversee compliance. | | | | However, it is equally important to select candidates |
| In this time-card case and other similar instances, | | | | with high levels of integrity and ethics. Strong ethical |
| candor and a determination to ally GE with the forces | | | | practices should pervade across the whole corporate |
| of law have enabled GE to emerge with more vitality | | | | spectrum. It is important that board members need |
| and systematic approaches to ethics. The | | | | to be more independent. Analysts too need to |
| experiences also underscore the challenge of having | | | | provide independent views and assessments in their |
| to raise employees' awareness of the need for high | | | | reports on companies. Shareholders and investors |
| ethical standards. | | | | need to focus and do their homework rather than |
| "You can't audit integrity into a system any more | | | | merely relying on earnings per share and short term |
| than you can inspect quality into a machine. Where | | | | profits. All of these issues have to do with integrity |
| you can make a difference is by changing the culture, | | | | as it is necessary to do what is right and ethical. |
| by tireless, forceful leadership that won't tolerate | | | | |