GE Won't Try to Claw Back Jeff Immelt's Pay
05 Januar 2021 - 9:49PM
Dow Jones News
By Thomas Gryta
General Electric Co.'s board won't claw back compensation from
former CEO Jeff Immelt and other executives over GE's accounting
issues or Mr. Immelt's use of a backup corporate jet, ending a
three-year probe into allegations of misconduct at the
conglomerate.
The investigation didn't find evidence to support shareholders'
claims of fraud and abuse, and pursuing litigation against former
leaders wasn't in the company's interest, according to the law firm
that GE's board hired to run the process.
"The company does not have a sound legal claim to bring against
any current or former officer, director or employee of the company,
or against KPMG," lawyers at Cravath Swaine & Moore LLP said in
a letter dated Dec. 31 and reviewed by The Wall Street Journal.
Since November 2017, GE's board received 11 formal requests from
shareholders with allegations for the board to investigate,
including that executives and directors breached their fiduciary
duties and violated securities laws, according to Cravath's
letter.
A GE spokeswoman confirmed the board's conclusions and said, "We
have significantly enhanced our disclosures and internal controls
and are a stronger company today." A representative for Mr. Immelt
declined to comment. Lawyers representing some of the shareholders
didn't immediately respond to requests for comment.
It is relatively rare for corporate boards to claw back
compensation from former executives. Wells Fargo & Co.'s board
took back $69 million from former CEO John Stumpf because of a
sales scandal during his tenure. McDonald's Corp. sued to claw back
severance paid to former CEO Steve Easterbrook, who left after a
probe into sexual relationships with employees. Mr. Easterbrook is
fighting in court, saying the company knew about his relationships
when it negotiated his severance.
Ted Mann contributed to this article.
(END) Dow Jones Newswires
January 05, 2021 15:34 ET (20:34 GMT)
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