GE and GE in China

March 2004Ellen L.W. ProctorDirector & Counsel, Environment, Health & Safety, AsiaGE Corporate Environmental Programs

A Company with an Outstanding Heritage

• Founded by Thomas Edison in 1878 as the Edison Electric Co.

• The only company listed in the Dow Jones Industrial Index today that was also included in the original index in 1896

• 11 global businesses operating in more than 100 countries

• 315,000+ employees worldwide

• $134 billion in revenue in 2003

• $52.9 billion in international revenue

A tradition of leadership

History of GE in China

China is a Big Part of GE’s Future

Product sales of electric fans, refrigerators and steam locomotives; manufacturing of light bulbs; investment in power plants.

Acquisition of Anderson/Meyer Trading Company, providing installation and services for the electrical industry in China.

Invested in the Shanghai Electrical Power Company, the largest foreign venture in China at that time.

Re-established GE’s business contact with China through the opening of a representative office (1981) in Beijing.

GE Hangwei Medical Systems was established in Beijing - the first JV of GE in China.

GE (China) Co. Ltd. was established in China,acting as an investment vehicle for GE’s projects in China, and provides services to GE’s JVs and affiliates.

JV/ WFOE/Investment Projects: 36+ Employees: 12,000Now

1910

1925

1929

1981

1991

1994

2003 revenues of US$2.6 billlion

Businesses include:

Energy

Transportation

Infrastructure

NBC Universal

Healthcare

Advanced Materials

Consumer & Industrial

Global Business Processes

GE in China

GE’s Integrity Commitment

• Comply with applicable EHS laws and regulations

• Prevent workplace injuries and illnesses, and provide a safe and healthy working environment

• Assess EHS impacts of new activities and products

• Reduce use and release of toxic and hazardous materials

• Ensure EHS systems and performance are an integral part of overall operational strategy

One set of rules . . . everywhere we do business . . . from Schnectady to Shanghai

GE’s EHS Policy

Why Have An EHS Policy?

EPA Enforcement > $3.2 Billion in 2002

Solutia Stock Drops 65%Due to PCB Dumping

Company Reputation

Employee Satisfaction Customer Requirements

Liability Avoidance

GE’s EHS MetricsGlobal EHS Performance Evaluation

2003 Quarter 4 - YTD

CONFIDENTIAL-NOT FOR DISTRIBUTION OUTSIDE THE GENERAL ELECTRIC COMPANY

GE GEA GEAE GECS GEIS GEL

Fatalities (GE Employees)

VPP/Global Star Status 1

Recordable Injury & Illness Rates

V% from same period last year

Lost Time Injury & Illness Rates

V% from same period last year

Wastewater (WW) Exceedances 2

Sites w/ WW Exceedances 2

Air Exceedances 2

Sites w/ Air Exceedances 2

Reportable Spills and Releases

Sites w/ Reportable Spills & Releases

Training Units Required in 2001

Percent Trained YTD

Compliance Findings (12 mos)

Percent Closed w/in 60 Days 4

Compliance Findings Open > 1 Year

Repeat Audit Findings

Agency Inspections

Env'l NON 3

Health and Safety NON 3

Fines Proposed (US$)

Fines Resolved (US$)

Fines Pending or Open (US$)

GE’s Global EHS Framework• Outlines company wide expectations for 21 Health

& Safety and 6 Environmental Topic Areas• Resources & Guidance provided for all questions• Updated Annually by GE EHS Media Experts• Provides a status assessment system to track

implementation• Available in Chinese

Standardized e-enabled EHS expectations communicated and tracked across all GE sites

PPE

Chem. Storage

• Checklists in local language• Regulatory Based Auditing Resources• Regulatory Citations and Guidenotes• Comprehensive Content across all EHS Media• Updated Annually by EHS Consultant Experts• Directly Integrated with Finding Closure Tracking System

Enabling Business Audits and Annual Compliance Assessments by GE Sites

China

GE’s Digital Audit Protocols

GE’s China EHS Council

• Composed of all GE EHS professionals in China

• Quarterly Meetings

• Focus on China EHS Law Tracking with monthly newsletters & digitized database [with more than 1000 China regulatory req’ts]

• Focus on cross-auditing

• Best practice sharing

GE’s EHS Training

• All plant managers must participate in 2-day in-person class on EHS expectations

• Curriculum for EHS professionals includes courses on EHS audit skills, H&S management system auditing, industrial hygiene, ergonomics (many in local language)

• In process of rolling out 36 e-enabled courses for EHS & non-EHS professionals on key topics:

• Available in Mandarin• Customized, where appropriate, to local law requirements• Material can also be delivered in classroom setting

What is the MRT Process?

Minimizes environmental and employee exposures from mercury wastes at Fluorescent Manufacturing Plants.

Crush and Sieve Technology separates glass, metal and phosphor powder in closed loop system (95% volume reduction) allowing glass and metal recycling.

Distiller Technology removes mercury from glass and phosphor substantially reducing volume of haz. waste.

What Are the Results?

Global implementation complete in 2004 with total capital investment of $10MM (13 sites)

$3 MM annual global cost savings

16,000 tons less haz. waste generated globally

Case Study – Pollution Prevention in China

GE the ONLY major lighting manufacturing using Hg recycle/reduction technology for process wastes

GE Energy

Most efficient, least polluting gas turbines in the world

IGCC technology can significantly reduce CO₂ emissions from coal plants

A leading manufacturer of renewable energy sources from around the world

Investing in fuel cell technology

GE Consumer & Industrial

Appliances and Lighting are the US EPA Energy Star product leaders in their sectors

Energy saving consulting services and products to commercial and industrial customers

About Our Products & Services . . .

GE Transportation

Leader in low-noise & low-pollution engines

GE Advanced Materials

Lightweight & durable products for the auto industry making vehicles more efficient

GE Infrastructure

Working with customers to optmize wastewater treatment processes, resulting in water conservation, energy savings & reduced pollution.

Helped Yunnan facility improve cooling system performance, conserving 933,000m3 of water per year with net annual savings of US$360,000.

GE will only do business with suppliers that:• Comply with local laws• Don’t use child or prison labor• Meet minimum wage and hour provisions, and• Have acceptable environmental, health and safety practices

We verify through:• Certification of virtually all suppliers• Site assessments of suppliers in the developing world

Experience:• We conducted more than 1400 assessments in 2002• Most are willing to make the corrective actions • Suppliers are mostly unaware of the legal requirements, not willfully

non-compliant

GE’s Supplier Guidelines

Contains Information about institutes not easily accessible (contact details, technical strengths)

Support for project from SEPA, MOH,

State Safe Production Supervision Bureau & Public Security Bureau - Fire Safety Division

China Design Institute Database ProjectGE’s Supplier Guidelines – Improving Supplier EHS Capabilities

User-friendly CD database in Chinese & English for 60 E, H, S & Fire Protection design institutes at national/provincial levels. Also includes basic hazard recognition training material.

Before… Inadequate Wiring

After … Improved Wiring & Explosion Proof Lighting

GE’s EHS Supplier Guidelines – Improved EHS Results

GE China EHS Outreach Initiatives:

Networkingwith

Stakeholders

• Shanghai EHS Forum• AICM

• Communications w/local agencies

GEFoundation

• WRI China Bell Program• Proactive search for other

opportunities

• China BELL Project

World Resources Institutes (WRI) Business Environment Learning & Leadership (BELL) Project

• Support By

- GE Fund

- Alcoa Foundation

- Citigroup

- Dutch Ministry of Foreign Affairs

• Goal – Integrate sustainable development concepts and skills into Chinese business management curriculums

Sharing with Communities

Climate Change & GE

2003 Activities• First GHG Inventory (2002 baseline)• Committed to GHG Intensity Reductions as Part

of US Business Roundtable Initiative• External Website on Climate Change & Product

Portfolio • Marketplace Leader in Energy Efficient

Products • Corporate Initiative on Reducing Energy Costs

Next Steps• Plan and Identify reduction targets• Identify and evaluate potential GHG reduction

projects• Continue corporate initiative on reducing

energy costs• Conduct 2004 GHG inventory

Carbon Disclosure Project

(February 2003)

“GE stands out as being especially well-placed with respect to providing low-carbon solutions to a number of key greenhouse gas emitting markets.”

GE’s EHS Report

                      

Excellence Sites

& Training

Injuries,

Releases,

& Exceedances

So What’s GE’s EHS Story . . . ?

• Unyielding Commitment to Compliance Everywhere We do Business

•World-class EHS Systems, Tools … a Competitive Advantage

•Six Sigma & Waste Emission Reduction Bringing EHS to the Bottom-Line

•GE Supplier and Climate Change initiatives, and the E and H&S Frameworks taking us beyond compliance

• But we can always do better . . . and the job’s never done