It’s been known that Jack Welch is worth $900 million and that he draws a $9 million annual pension from General Electric. But it turns out that GE also pays for Welch’s car and driver, his floor seats to Knicks games, VIP seating at Wimbledon, his box at the Metropolitan Opera, his boxes at Red Sox games and at Yankee games, fees to his four country clubs, satellite television at his four homes and more. And to think Welch’s employment contract used to be praised as simple, clear and good corporate governance. That myth was dispelled on September 5 when Welch’s wife, Jane, filed divorce papers. “It is appalling to me that Jack Welch’s flowers are being paid for by retired firemen and teachers who are the GE shareholders and don’t know this is going on,” Nell Minow, an expert on corporate governance, told the New York Times. Imagine how appalled we’ll all be if it turns out that the rest of GE is run this way.
AL QAEDA–BOON TO BUSINESS
Thank God for the war on terrorism, ExxonMobil’s lawyers must be thinking regarding a case in which the oil company is being sued by villagers in Aceh province in Indonesia. In a lawsuit filed under the Alien Tort Claims Act, the villagers charged that Indonesian military troops, allegedly paid by the company and guarding an ExxonMobil facility committed human rights abuses, including murder, torture, sexual crimes and kidnapping [see David Corn, “Corporate Human Rights,” July 15]. As part of its legal strategy, ExxonMobil requested that the Bush State Department declare whether the lawsuit would impede the war on terrorism–and the department complied. At the end of July, State notified the federal judge in the case that “adjudication of this lawsuit at this time would in fact risk a potentially serious adverse impact on significant interests related directly to the ongoing struggle against terrorism.” How? State said the Indonesian government, which maintains a partnership with ExxonMobil, might respond to the lawsuit by curtailing cooperation with the United States. So here’s an easy way for corporations to get off the hook: Raise the prospect that holding a business accountable will ruffle the feathers of a potential ally in the war on terrorism. (Remember, Al Qaeda has a presence in an estimated sixty nations.) Days after State weighed in, Unocal, facing a similar suit for its actions in Burma, asked a California court to seek a similar letter from State, and the judge agreed. The plaintiffs in the ExxonMobil case have filed a motion challenging the State Department letter, asserting it presents no legal grounds for dismissal, and the judge has not ruled on the matter. Will a consequence of the war on terrorism be a get-out-of-lawsuits-free card for US corporations accused of abuses overseas?