Struggling GE nominates 3 directors to smaller board

General Electric on Monday announced three nominees for its streamlined board of directors as the embattled U.S. conglomerate pursues a corporate turnaround.

The company announcement said the new board to be elected in April will have 12 members, down from 18, fulfilling CEO John Flannery’s previously announced plan to reduce the panel’s size.

The new directors include former Danaher chief executive H. Lawrence Culp, former American Airlines chairman and chief executive officer Thomas Horton, and Leslie Seidman, a former chairman of the Financial Accounting Standards Board, the organization responsible for establishing the U.S. generally accepted accounting principles.

Nine current board members, including Flannery, will stand for reelection to new terms, the company said. Jack Brennan, the board’s current lead director, will stay on to facilitate the transition to a new board and will not seek re-election in 2019, the company said.

“The 2018 board slate aligns the board with the future of the company,” Brennan said in a statement issued with the announcement. “We are adding proven world-class expertise in capital allocation, aviation, accounting and financial reporting.”

Plans for the new board came after GE on Friday provided additional information about its previously announced intention to restate earnings for 2016 and 2017, a plan reflecting a shift to new accounting standard.

The change means the restated earnings per share will be cut by approximately 13 cents and 16 cents, respectively, before any impact from the federal tax overhaul enacted in December, GE said.

The company has been a familiar household name to generations of Americans for products from home appliances to insurance, health care and more.

But GE has been in a financial slump that has seen shares of the Dow component lose more than half their value since this time last year.

General Electric shares were down nearly 3.4% at $14 in morning trading.

Flannery announced in January that GE is weighing a range of possibilities, including a corporate breakup that could result in separately traded assets for some of the company’s divisions.

He also disclosed that the company would take a $6.2 billion after-tax charge to address problems with its insurance subsidiary. The insurance charge stems from billions of dollars in higher-than-expected costs for coverage of long-term care policies.

The Securities and Exchange Commission is investigating details of the insurance charge, along with GE’s revenue recognition and controls for longterm service agreements, the company disclosed in January.

In a letter to shareholders, Flannery said some recent depictions of the company and its struggles have been “overwrought.”

“For our investors and many others, this is a ‘show me’ moment,” he wrote. “There are things we need to fix. But we can. We know how to. And we will.”

If elected, the new board members will share the task of overseeing Flannery’s plan to focus GE on its power, aviation and health care businesses.