We believe that ethical conduct results from a culture of integrity. Ours is built around a Code of Conduct, which is a fundamental part of the terms of employment for all associates of Novartis Group companies.
The Code contains our principles and expectations for ethical business conduct. This is important because our associates may encounter ethical dilemmas and conflicts while doing their jobs. The Code supports associates and guides them to make the right decisions when they face potential conflicts.
The values that build the foundation for our ethical culture underpin our management processes, including the annual performance reviews of associates, to incentivize ethical behavior.
The Global Integrity & Compliance (I&C) function designs and implements compliance programs associated with the Novartis Code of Conduct, Anti-Bribery Policy, Professional Practices Policies, and Conflicts of Interest Policy. Each Novartis division has a Global Integrity and Compliance Officer who drives the implementation of these programs, with the goal of ensuring ethical business practices by all associates.
Ensuring ethical and lawful outcomes starts with clearly defining and articulating our expectations towards the ethical behavior of our associates, embodied in our Code of Conduct.
The five core principles in the Code of Conduct are:
Patient benefit and safety is at the heart of everything we do
We treat our associates fairly and respectfully
We are committed to outstanding and sustainable performance with integrity
We strive to be a trusted healthcare partner
We aspire to be a good corporate citizen
The Code of Conduct is organized around our commitment to meet the expectations of our five key stakeholder groups: our patients, associates, shareholders, healthcare partners and society at large.
We have written our Code of Conduct in simple, clear language that provides short, practical tools to help associates make decisions when in doubt. The Code clearly states the process for reporting misconduct. All associates receive copies when they join Novartis Group companies, and regular training helps to continually emphasize the importance of adhering to these policies.
The Code of Conduct has been translated into 18 languages and is required to be adopted by local boards, to ensure that all Novartis associates worldwide are held accountable to its contents.
Embedding integrity standards
We embed the five principles of our Code of Conduct in our work in a variety of ways. Most importantly, Novartis expects our managers to lead by example. This means for managers personally reflecting ethical considerations in business planning and decisions, training associates to make responsible decisions, and encouraging associates to speak up when ethical issues arise.
In addition to the ethical leadership that we expect from our managers, and to skills and awareness training, we encourage and incentivize ethical behavior by assessing the adherence of every employee to our values and behaviors in our annual performance appraisal. Achieving business objectives is equally weighted to adherence to our values when it comes to annual salary increases.
Training and guiding associates
Awareness and training programs are offered in a range of formats, including awareness building communication, e-training, face-to-face programs, games and workshops. We provide extensive communication toolkits each year to support our local communication efforts; activities as part of our Corporate Leadership Learning program; as well as extensive training for our Integrity and Compliance Officers.
All Novartis Group company associates are required to complete integrity and compliance training. Training and communication help to maintain a culture of ethics and improve compliance, particularly when supported by an infrastructure that provides guidance and advice.
Since 2012, Group Integrity & Compliance has successfully coordinated training for all associates worldwide. The compliance curriculum is intended to address identified and relevant company risks, help communicate new or upgraded policies and guidelines within the organization and harmonize and align curricula between different divisions and geographies. The result is reduced complexity, increased transparency, better planning and reporting – and ultimately, improved training effectiveness.
A global, cross-divisional compliance training curriculum is developed yearly. Divisions, functions or countries must add any specific training to this global list for their respective associates as required.
All e-training courses are custom made and are built on our own polices and our own cases. It takes more than nine months to develop an e-training course, with many functions and reviewers involved to provide and to approve the content before it is released to associates worldwide.
To ensure maximum penetration and understanding, we develop all courses in minimum 17 languages and we plan on adding Arabic in 2016. We regularly review and refine our course rollout process so that we can ensure that e-training courses are assigned to the most relevant associates.
The Compliance e-training curriculum provides relevant information to enable associates to make the right choices within their role and to perform with integrity. In 2014, four 20-minute or longer courses were available:
The annual Code of Conduct course reflects on our Values & Behaviors, takes the associate through a number of short reflective dilemmas and challenges their knowledge using a business case on compliant behavior. This course requires certification for successful completion.
Our Anti-Bribery course explores the principles outlined in the Anti-Bribery Policy and provides associates with the tools to navigate through challenging business dilemmas, helping them to make responsible business decisions.
The Conflict of Interest course summarizes the Policy’s key definitions and principles with a number of short, reflective conflict of interest scenarios. The course, aimed at associates and managers, challenges knowledge using interactive exercises.
The shorter Adverse Events annual refresher course delivered in 2015 covers key definitions and special cases, and advises on when events should be reported.
In addition, all newly hired associates worldwide are required to complete a mandatory onboarding e-Training called “[email protected]”. This comprehensive course covers 17 subject areas and is sent to all new hires four weeks after employment.
E-Training completion rates
Simply delivering compliance training, electronically or otherwise, is not enough – we want to ensure associates complete the training and are embedding the lessons learned into their daily work.
The completion rates for our 2015 e-training courses were as follows:
Code of Conduct: 99% * Anti-Bribery: 96%** Conflict of Interest 93%** Adverse events refresher: 96% New hire course: 95%
*Target completion rates are 100% for Code of Conduct, 95% for all other courses six months after launch.
**These courses are still within their six-month open period
Since 2012, branding our policies and guidelines has ensured consistency of messages, visual identity and global reach. Every year global communication toolkits are rolled out to support the launch or update of policies and guidelines, as well as to reinforce ethical behavior among associates.
Our communication toolkits consist of a range of awareness raising and educational materials including: posters, videos, letters to internal stakeholder groups, Frequently Asked Questions, training presentations and case materials.
Examples of some of our branded policies:
Enforcing integrity standards
We have designed an integrated control framework including compliance risk assessment, continuous monitoring and regular reporting to ensure our standards of ethical business conduct are put into practice effectively.
Our Group and divisional Integrity and Compliance (I&C) functions are charged together with business leaders to monitor compliance with the Novartis Code of Conduct, Anti-Bribery Policy and Professional Practices Policies by conducting risk assessments, as well as control self-assessment and testing. They also report Key Performance Indicators (KPIs) to the management team.
Business leaders across the organization have ultimate responsibility for compliance, and it is their responsibility to put in place, with the support of the I&C function, the necessary resources and control systems to ensure adherence to policies, laws and industry regulations.
Our I&C team uses monitoring tools to ensure adherence to integrity standards, including:
I&C Company Level Controls (CLC) are part of the Novartis Financial Controls Manual (NFCM) framework. CLCs are mandatory for all Novartis units. Results are reported to the I&C function, at divisional and Group levels, which follows up on remediation activities, if necessary.
Compliance risk assessments are conducted in all countries in order to identify and prioritize key compliance risks and monitor them. Together with the local compliance officer and relevant business functions, units identify risks and put monitoring and mitigation plans in place to address them.
Periodical reviews and tests are conducted to ensure we follow our Professional Practices Policies and Anti-Bribery Policy, as well as local laws and industry codes.
These activities are supported by Internal Audit, which provides assurance on the establishment of management processes and adherence to integrity standards. The Audit and Compliance Committee of the Board of Directors holds final authority for all ethical matters at Novartis.
Novartis requires associates to report actual or suspected violations of our Code of Conduct. But fear of retaliation can make it hard for people to do this, so we enforce clear policies to protect them from any retaliation that comes from doing the right thing.
The Business Practices Office (BPO) offers employees and people outside of Novartis a channel to report misconduct. The BPO manages investigations into all complaints, and escalates any substantiated cases of misconduct to management for appropriate action.
In 2015, the BPO investigated 1299 cases, with 775 substantiated and 343 dismissals and resignations related to misconduct. The majority of cases investigated by the BPO involve Code of Conduct violations, such as fraudulent expense reporting or professional practices violations.