In 2005, CEO Jeffery Immelt of GE announced a new and ambitious strategy designed to demonstrate that an ecologically conscious conglomerate could cultivate the bottom line while doing its duty toward the global environment. GE surprised both investors and industrial customers who had long seen GE as an ally in the struggle against environmental activists. The initiative, called Ecomagination, focused on several areas, including a commitment to plans to reduce greenhouse emissions, improve the energy efficiency of operations, and reduce its global use of water. With half of its markets located outside the United States, GE is already under the jurisdiction of foreign governments that are more active than the United States in addressing environmental issues. GE feels that markets exist for cleaner technology and that it can not only help the environment but also strengthen its strategic position with major profit opportunities. The plan has been met with mixed reactions and the big question is: What happens, for example, if the markets it’s betting on don’t materialize fast enough (or at all)?

Questions

1. What are the major challenges GE faces in adopting a green strategy while keeping all of its stakeholders happy?

2. From the standpoint of environmental impact, do you think it is more important for GE to reduce its carbon footprint or to develop products that fit their Ecomagination strategy of being energy efficient?