Former chairman and CEO of industrial giant General Electric (GE) Jack Welch has died at the age of 84. His wife Suzy announced his death on Monday, according to CNBC.
Welch, at the peak of his career, ran GE, one of America’s most well-known companies, ruling over a global empire that had its hand in a plethora of industries from jet engines to healthcare.
Humble beginnings
Welch was born in Peabody, Massachusetts in 1935. He was the only child of a railroad conductor and a stay-at-home mother. He studied chemical engineering and graduated with a bachelor’s from the University of Massachusetts Amherst, and a master’s and a PhD in the subject from the University of Illinois at Urbana Champaign.
Welch joined GE’s Pittsfield branch in 1960, as a chemical engineer for its plastics division. His salary then was $10,400, he told the “Freakonomics” in 2018.
He slowly rose through the ranks, and became the company’s youngest chairman and CEO in 1981, and remained in that position until he retired in 2001.
According to Yahoo Finance historical data, during Welch’s tenure, GE’s stock rose more than 4,000% from April 27, 1981, when it was trading as low as $1.31 a share to the $30s and $40s in September 2001.
‘Tiger Woods of management’
Under Welch’s reign, GE grew rapidly thanks to his cutting costs and jobs and making big acquisitions, and building up the company’s financial arm.
Welch’s style was admired by many — even the Oracle of Omaha. In a blurb prefacing Welch’s book, billionaire Warren Buffett wrote: “Jack is the Tiger Woods of management. All CEOs want to emulate him. They won't be able to, but they'll come closer if they listen carefully to what he has to say.”
Welch was celebrated by Fortune magazine as the “manager of the century” in 1999.
When he retired from GE, he received a severance package of $417 million, the largest in history at that point.
After retiring, Welch wrote several books, including a few with his wife, Suzy. They also founded the Jack Welch Management Institute, an online MBA program. He listed himself as the “Executive Chairman” on his LinkedIn page.
Questions over GE’s accounting practices
Analysts often called out the company’s accounting techniques, calling them “opaque” and even “challenging.”
GE even paid a $50 million fine to the Securities and Exchange Commission in 2009 over its alleged use of improper accounting methods to inflate its earnings or revenues.
While those allegations were brushed off by GE over the years, an explosive new report that came out in August 2019 by forensic account Harry Markopolos set off alarm bells.
“Only GE’s accountants know where the skeletons are buried. We dug up several, $38 billion worth,” Markopolos said in an interview on Yahoo Finance’s The Final Round. “There’s probably a lot more.”
GE has neither admitted nor denied these allegations. But former and current employers have strongly defended the company.
Welch is survived by his children Katherine, John, Anne, and Mark and his wife, Suzy.
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Aarthi is a writer for Yahoo Finance. Follow her on Twitter @aarthiswami.
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