GE Should Have Gone a Step Further
In naming Larry Culp both chairman and CEO, the board missed a chance at better governance.
Enough change at the top?
Photographer: Goh Seng Chong/Bloomberg
“We need to hold teams accountable for the results,” John Flannery said last year on his first earnings call as GE’s CEO. On Monday, GE proved it’s doing just that, and it was Flannery who took the fall for the company’s ongoing struggles, with ex-Danaher Corp. CEO Larry Culp named as his immediate replacement. GE should have gone one step further.
Culp will also be GE’s chairman, extending a dual-role setup enjoyed by both Flannery and his predecessor Jeff Immelt. This is curious and seems like a missed opportunity to set the tone for future generations of leaders not only at GE but elsewhere. Culp is the first outsider CEO in GE’s 126-year history, and clearly this board is more awakened to its responsibilities than the one that allowed Immelt to sit in his seat for 16 long years. All the same, with GE embarking on an aggressive breakup plan and still grappling with how to resuscitate its power unit, this company is still complex and challenged enough to warrant extra eyes.