The fifth principle states that social responsibility

The fifth principle states that social responsibility varies with company characteristics
(i.e., size, industry, products, strategies, marketing methods, locations, internal cultures, and
external demands). Given this statement and taking into account GE’s enormous size, as well as
additional factors, GE would have a large social responsibility. However Welch did not share in
this view and seemed to mainly focus on the first principle of creating profits. It was not until
Jeffrey Immelt took over that social responsibility seemed to come to the forefront and social and
environmental impacts were taken into consideration and acted upon.
The sixth principle of managers meeting legitimate needs of multiple stakeholders is
another principle Welch failed to meet. Stakeholders include employees and Welch seemed to
disregard their needs surrounding job security and a harmonious work environment. He also
disregarded secondary stakeholders, specifically the environment, as noted previously in the
Hudson River example. It seemed as if Welch cared more about himself and the shareholders
than he did the stakeholders and for this he was criticized harshly.
The seventh principle of corporate behavior complying with an underlying social contract
was given little, if any, mention in this case and will be disregarded to discuss the eighth
principle regarding corporations’ transparency and accountability. Many companies today,
including Union Bank, N.A. and Hershey’s release annual or biannual corporate social
responsibility reports, which can easily be found on each company’s website. Union Bank, N.A.
publishes information regarding community commitment, environmental stewardship, and talent
investment (Union Bank, N.A., 2013). Hershey’s released information regarding performance
indicators, engagement priorities, facility efficiencies, and commitment to the environment (The
Hershey Company, 2012). In contrast, GE did not self-report their civil and criminal

transgressions; this was done by the Multinational Monitor . Some of their transgressions were in
reference to pollution hazards and consumer fraud, which most certainly represent issues that
have societal impacts. Overall it seems that GE failed to meet nearly all the principles of
corporate responsibility, save the first principle.
4. Ranking shareholders over employees and over stakeholders seems to have more cons
than pros. The pros certainly included financial success, but this came at a cost to employees’
happiness and well-being, as well as at a cost to the community, consumers, and the
environment. Pros also included Welch being well-respected by those who shared the same
values as he did and by those who were able to perform up to his standards and keep their
positions. However there are a large number of cons. These included harming the environment,
contributing to the unemployment rate, diminishing employees’ levels of job satisfaction,