In 2018, when Larry Culp took the helm of General Electric as CEO, marking the first time an outsider was called to lead the venerable institution, GE was in a precarious state. The conglomerate, established by Thomas Edison in 1892, found itself burdened with a staggering $135 billion in debt. The company’s fortunes had waned significantly from its August 2000 peak when it reigned as the world’s most valuable company with a market cap that has since plummeted over half a trillion dollars.
Culp, who was stepping into shoes that had tread through a tumultuous period marked by ill-fated acquisitions and fleeing investors, initially declined the CEO position twice. However, he eventually took the reins after negotiating an incentive package that promised him millions of shares, contingent on the revitalization of GE’s stock price. This contract was lauded by CNBC’s Jim Cramer as “the best performance-oriented contract I’ve ever seen.”
Fast forward to the present, and the fruits of Culp’s labor are evident. With GE’s stock price soaring by 260% since the start of 2023, Culp has achieved the performance milestones necessary to unlock the maximum benefits from his incentive package—1.74 million shares valued at an approximate $300 million in today’s market. While the terms of his package allow for an August retirement with a significant windfall, Culp opts to stay, spearheading GE’s aerospace division, a global leader in aircraft engine manufacturing, as an independent entity. This decision extends the vesting period of his shares to August 2025.
Thanks to this strategic leadership and the sizable stock award, combined with his earnings from a successful tenure as CEO of Danaher, Culp is on track to join the exclusive ranks of billionaire CEOs, as per Forbes’ calculations. This achievement places him among a select group of 15 U.S. chief executives who have carved out 10-figure fortunes through their corporate stewardship.
Culp’s approach to revitalizing GE has been characterized by a hands-on operational focus—a stark contrast to strategies that prioritize shareholder returns at the expense of product quality and customer service, which have ensnared competitors like Boeing in significant challenges. Aerospace industry insiders, including Kevin Michaels, managing director of AeroDynamic Advisory, a firm that has consulted for GE, highlight Culp’s commitment to excellence in product and customer satisfaction as the cornerstone of his philosophy.
Under Culp’s guidance, General Electric is not only navigating out of financial distress but also redefining its legacy as a beacon of industrial innovation and quality. This journey from the brink of collapse to a burgeoning resurgence underscores the impact of visionary leadership and strategic foresight in steering legacy companies toward a new era of success.
