General Electric (NYSE: GE) is one of the world's largest and most respected companies. From appliances to energy, aviation to finance, this appropriately named conglomerate is one whose reach you might have trouble escaping. The deep-rooted company is the only member of the Dow Jones Industrial Average index that remains from the original 12 in 1896, and it's practically become a symbol for American ingenuity. While many think of it as a diverse manufacturer of all sorts of products, it has constantly adapted to an evolving marketplace, and it now derives more than half of its revenue from its financial services arm.

GE has acquired its fair share of corporate accolades recently, ranking sixth on Interbrand's list of Best Global Brands and 24th on the list of Best Global Green Brands, as well as making Ethisphere's 2011 list of the world's most ethical companies. But does the company's storied history qualify it to be a socially responsible company? And how does a socially responsible investor reconcile the company's extensive history of pollution, weapons manufacture, and controversial nuclear power with a growing commitment to alternative energy?

Let's break GE down.

From an environmental perspective, evaluating GE is a complicated task. GE's Citizenship page asserts that as a 130-year-old company, sustainability is a key principle entrenched in the business' past and future, although GE's commitment to sustainability has expanded considerably in recent years. Notably, the company touts its Ecomagination program, a broad commitment to environmental sustainability through improved product efficiency, investment in technology of the future including alternative energy, and more rigorous internal environmental standards.

As a part of this rebranding effort in 2005, CEO Jeff Immelt publicly asserted that GE will press forward on many alternative energy and other "green" technologies, not as a public relations stint, but as a business opportunity. Joel Makower, a consultant for GreenOrder who worked with GE to develop the Ecomagination campaign, believes that GE's transformation accurately represents the company's pioneering commitment to a more sustainable future for a number of reasons, including the significant level of funds pledged, commitment of corporate leadership, and treatment of environmental products as a profitable business opportunity. Specifically, the company has been developing many products, from turbines and solar panels to light bulbs and plane engines that run on biogas, that meet its Ecomagination standards developed with GreenOrder. The primary focus is on meeting the growing demand for renewable energy, and GE now employs nearly 5,000 people globally in its renewable energy businesses.

GE has grown to be a dominant player in the alternative energy industry. The company projected it will install about 40% of the wind turbines in the U.S. in 2012. The company considers the transformation a success after realizing $53 billion in revenue from Ecomagination-certified products and services in the campaign's first three years, with annual revenue hovering around $150 billion in that same time. Similarly, the company's renewable energy revenue, $21 billion in 2011, grew twice as fast as the company average, as stated in the 2011 annual report.

However, not everybody believes in GE's sudden swing toward sustainability. As stated in a New York Times editorial, many see GE's Ecomagination campaign as a rebranding attempt to cover up a history of environmental disasters and lingering liabilities. Specifically, the authors discuss the company's responsibility for PCB contamination in the Hudson River, a potential $500 million responsibility on top of the company's recent $250 million settlement for PCB contamination in New England's Housatonic River. While publicizing its "ecoimaginative" future and assuring shareholders that neither will affect its financial condition, GE has finally begun overdue cleanup efforts in both rivers. To be sure, no company as large or old as GE has a spotless record, and several other smaller incidents mar the company's green image.

So, is Ecomagination legitimate? Some critics contend that Ecomagination is a textbook example of greenwashing, but mostly because the company hasn't resolved its lingering environmental liabilities. Ecomagination has grown to be a significant portion of GE's revenue and often takes center stage in GE's advertising. Still, fully concluding its past disputes would make Ecomagination more genuine and protect shareholders of further liabilities. Looking forward, GE's new direction does represent a real commitment to an environmental future, even if it has chosen to ignore its past environmental crimes.

As a conglomerate involved in many industries, GE hardly has a clean record, but the company has also given back to the communities it operates in. Historically, GE's nuclear weapons production provoked considerable protest from the public. At its height, GE produced more components for more nuclear bombs than any other American company and operated the heavily contaminated Hanford nuclear reservation in central Washington (a liability estimated by the government to be in the tens of billions), making it an easy target for anti-nuclear war protestors. Consequently, an NGO-organized boycott of GE consumer products began in 1986 to protest nuclear weapons involvement and unresolved nuclear liabilities, successfully pushing GE out of the industry in 1993. Overall, the boycott cost the business more than $100 million in sales.

Unfortunately for the company, GE's nuclear woes don't end there. In the Fukushima Daiichi disaster of 2011, GE designed the nuclear reactors, and the insufficient containment vessels, that didn't withstand the tsunami. While the earthquake and resulting tsunami were obviously unforeseen events, experts had previously criticized GE's Mark 1 design for unacceptable safety risks. While it may be argued that no design could have prevailed through such a catastrophe, GE's theoretical responsibility could still emerge as a future burden for investors. Many critics condemn GE's involvement in nuclear energy, even filing a shareholder resolution this year calling for a withdrawal from the industry, but the company stands by its nuclear energy activity, saying the technology represents a profitable path away from carbon energy and citing the company's strong safety record.

GE's fiscal and political activity may also raise red flags for the socially responsible investor. The company is one of the largest in the world and spends more on lobbying than any other company, averaging $20 million a year from 2000 to 2011. All multinational corporations lobby the government, and this level of spending should even be expected for a company of GE's heft. Even so, for those who believe that corporations should play less of a role in politics, this could be reason enough to avoid investing in GE.

The lobbying situation may seem worse when you examine GE's recent tax payments. As exposed by a New York Times piece, GE managed to pay no corporate tax rates in 2010 in addition to surprisingly low rates in other years, all through a (completely legal) mix of aggressive lobbying for tax breaks and clever international accounting. Such strategies have significantly contributed to GE's massive profits and solid returns for investors. Still, paying minimal taxes and even claiming tax breaks while raking in billions in profit and aggressively spending on lobbying makes me question the company's corporate responsibility.

Financially, the sustainability of GE's tax advantage looks uncertain, especially if President Obama backs up his campaign promise to eliminate many corporate tax breaks and tax international companies on foreign income when it is made, rather than when it is brought back into the United States. In addition, the company has reduced its American workforce by one-fifth since 2002, so it may miss future tax credits designed to give companies incentive to retain domestic manufacturing jobs. The GE tax department isn't shy about its goals of complying with the law while also "looking to exploit opportunities to reduce tax," a goal the company backs up with its tremendous lobbying expenses. However, such actions may shine more negatively on what may be considered an inherently corporate-favored political and tax system than any specific problem with GE.

On the other hand, GE has done its part to give back through many social programs. Through the Healthymagination program, GE has committed $6 billion toward innovations that help people around the world access better health care at a lower cost. One part of this program is a five-year, $1 billion commitment to improve screening and diagnosis measures to help fight cancer, as well as helping patients access screenings in underserved areas worldwide. The company website flaunts its investment in training and education programs, having donated $1 billion annually around the world, as well as having founded the John F. Welch Leadership School in Crotonville, N.Y. Many other programs run through the GE Foundation, including $100 million plus programs Developing Health Globally and Developing Futures, which seek to improve communities in areas where employees work and live. Clearly, GE has many generous philanthropic initiatives in addition to its more questionable social aspects.

Immelt has served has GE's CEO and chairman since 2001, expanding the company's global reach and leading its transformation into an environmental leader through the Ecomagination program, although GE's stock has dropped 60% since he took over. Even so, President Obama recognizes Immelt's expertise, having appointed him to lead Obama's Council on Jobs and Competitiveness in 2011. This appointment does seem to create a conflict of interest for Immelt, as his company stands to gain from continued lenient tax treatment.

While the company's governance page publicizes its "independent and fully informed board," socially responsible investors prefer a separation of the roles of chairman of the board and CEO to ensure that the board can objectively evaluate the management team. Instead, the company has an "Independent Presiding Director" to monitor the CEO. Defending its corporate structure from a shareholder resolution calling for a separation of CEO and chairman, GE stated in this year's proxy statement that separating the roles would be likely to result in "an undesirable duplication of work and, in the worst case, lead to a blurring of the clear lines of accountability and responsibility." If GE truly wanted to have an independent director oversee the CEO, separating the roles would be a more logical choice. Having an unchecked CEO mismanage the business, however unlikely, also seems like a much worse "worst case" than confusion regarding accountability and responsibility.

In terms of CEO pay, Immelt's base salary of $7.6 million hasn't grown since 2005. Over time, more of his salary has been tied to performance-based measures such as industrial cash from operating activities, aligning his interests with those of the company. As fellow Fool Alyce Lomax discusses in a recent article on CEO pay, GE has notably helped clarify the often-confused distinction between realized pay and take-home pay, as Immelt's salary often gets reported as $21.6 million while his actual pay was $7.6 million.

A labor economist could write a few books on GE's history of employee relations. GE has struggled with workers' attempts to consolidate into unions throughout the 20th century. While 15,000 workers are covered under a new contract extending until 2015, union membership is far less than it used to be (there were 150,000 union workers in 1969), in part because so many jobs have been moved overseas. Under Immelt's predecessor, former CEO Jack Welch, the company strove to make floor-level employees feel like an integral part of the business and had managers interview employees for their input on the production process, making employees more committed to their productivity.

The company has a few other missteps worth noting. In 2009, the SEC fined GE $200 million for some creative accounting -- including misreporting the number of locomotives sold -- that led investors to believe that GE would beat earnings estimates in 2002. In another scandal, the company admitted it had defrauded the U.S. government of $26.5 million intended to purchase fighter jet engines for the Israeli military in 1992, although GE did voluntarily come forward after uncovering evidence of an executive's wrongdoing. Such incidents seem more like isolated controversies than a trend of dishonesty.

It would be hard to argue that GE has a spotless record, but in many ways, GE promises a sustainable future. On one hand, it's almost impossible to find a completely responsible multinational, so perhaps it would be better for socially responsible investors to avoid megacaps like GE altogether. On the other hand, GE offers socially responsible investors a chance to invest in a company committed to alternative energy, but with more stability than smaller companies in the industry.

Besides a questionable past marred by pollution incidents and nuclear weapons production, one enduring negative is the company's extensive -- one might even say exploitative -- involvement in politics. However, a business is free to maneuver as it can within the law to maximize its profit, so many investors will see GE's far-reaching political ties as a positive. This issue is certainly one where every socially responsible investor will have his own opinion. As for me, I wouldn't invest in GE because of how much it spends on lobbying for tax advantages, rather than investing in products that help the business profit by their own virtue, in addition to its dirty past.

In times of economic uncertainty, investors often look to larger, dividend-bearing companies such as GE for stability. However, industrials depend heavily on the overall health of the economy, so further stagnation leading up to the fiscal cliff could hurt companies such as GE or fellow Dow conglomerates United Technologies (NYSE: UTX) and 3M (NYSE: MMM). Legendary investor Warren Buffet seems wary of GE's future, given his recent move to sell of almost all Berkshire Hathaway's (NYSE: BRK-B) stake in the company. However, if you're looking for a solid, blue chip sure to weather any economic storm, GE could be a good choice, although perhaps not for the socially responsible investor.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.