Novartis seeks to clean image by linking employee bonuses to their ethics scorecard

By PharmaCompass

2018-09-20

Impressions: 71 Article

Novartis has faced several bribery-related scandals, the most recent being the one involving US President Donald Trump’s ex-attorney, Michael Cohen. But the Swiss drugmaker is clearly seeking to address the damage caused to its reputation by shortcomings in the past.

Novartis has said its employees will only get a bonus if they meet or exceed expectations for ethical behavior. Novartis said it began the scoring system in 2016, but details have not been widely reported. Company officials outlined the system this week on a call about its ethics efforts with analysts and journalists.

Its employees will now receive a 1, 2 or a 3 score on their values and behavior. Receiving a 2, which Novartis said denotes meeting expectations, or a 3, for “role model” behavior, would make them eligible for a bonus of up to 35 percent of their total compensation.

“Unless the sales representative scores a two or a three, they will not be eligible for their variable compensation,” Samir Shah, Novartis’s head of investor relations, said.

“That’s how we’ve tried to make sure we’ve got the right balance between pay for performance and having the right behavior,” he added.

Novartis recently hired a new ethics chief, Klaus Moosmayer (49), from Siemens. Moosmayer has spent more than a decade helping oversee the German engineering company’s efforts to build its compliance system.

Back in 2016, Novartis was contending with a bribery probe in South Korea. Its practices in America, Turkey and China had also come up for questioning.

Novartis paid US$ 25 million to settle a US Securities and Exchange Commission (SEC) case that claimed the Swiss drug maker paid bribes to health professionals in China to increase sales during 2009 and 2013.

In February this year, PharmaCompass had reported how Novartis had got embroiled in a controversy regarding industrial scale bribery of senior politicians in Greece.

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