Just days after US Conglomerate General Electric Co. announced John L. Flannery as the new CEO succeeding Jeff Immelt who departed on August 1, 2017, the management shakeup continues after the top vice chairs are leaving earlier than expected.
Jeff Bornstein To Step Down As The Chief Financial Officer of GE
On Friday, GE announced the current CFO Jeff Bornstein, who worked closely with Immelt would be resigning and leaving by the end of the year. Along with him, two top executives including Beth Comstock and John Rice are also taking an early retirement.
Bornstein, 51, has served over 28 years in GR accumulating $20.1 million in retirement benefits at the end of last year.
Mr. Jeff Bornstein was considered a top contender for replacing Immelt. However, when John was announced as the new CEO, GE stated the two would work together closely.
On his departure, he said,
As John evaluates the strategy for GE and puts his leadership team in place, he and I have concluded that this is the right time to bring in a new CFO with a fresh perspective.
Jamie Miller Announced As the New CFO of GE Starting November 1
This new perspective belongs to Jamie Miller who has been serving as the CEO of GE Transportation since the past two years. She is the second lady to lead in GE and it has been succeeding under her leadership with a new factory in India.
Jamie’s deep experience in finance, digital technology, and business operations make her the right person for this role as GE continues to transform into a digital industrial company.
Under Miller’s guidance and expertise, the transportation company announced its biggest deal selling 1,000 locomotives to India at $2.5 billion.
Flannery To Cut $2 Billion in Costs By The End Of Next Year
GE has fallen less than 1 percent to $24.28 after the closing of the regular trading market in New York. Flannery has tightened his grip on senior management holding people accountable and making tangible changes in efforts to cut $2 billion in costs by the end of next year.
The patience level of investors is obviously waning a little bit and I think he feels compelled to move and show tangible results.
– Todd Lowenstein, the Fund Manager of Highmark Capital Management stated.
New CEO Flannery is showing he is serious about the new changes. He has been reviewing the GE portfolio and cutting costs by selling a fleet of corporate jets and cutting corporate staff. Despite company’s financial struggle, Flannery has promised to keep the dividends as before.
The Top Lieutenants are Leaving General Electric
A few days after new CEO was named, three top lieutenants under former CEO Immelt are leaving including CFO Bornstein, 51, who served GE for 28 years and two other vice chairs. Other persons are Beth Comstock who is the leading Female Executive in GE with 27 years of service. Currently, she is the Business Innovations Unit Head.
Comstock has retirement benefits worth $16.9 Million and she would be retiring on Dec 31 as well. According to GE policy, the executives hired before 2005 need to leave at the age of 60 to reap the Pension and equity benefits. How Bornstein and Comstock will be rewarded has not been revealed by the company yet.
Rice, 60, has spent 30 years in GE and is currently responsible for managing GE’s Overseas business. He has accumulated benefits worth $60.8 in retirement, $7.24 in restricted stock and $38.8 million in outstanding options. He would be leaving along with Bornstein and Comstock by the end of this year.