Novartis - ethical corporation?

Novartis owns the baby food company Gerber. We have been campaigning for many years for Gerber to abide by the World Health Assembly marketing requirements for baby foods. Recently we welcomed the fact that Gerber had indicated its intention to comply to gain admission to the FTSE4Good ethical investment listing, while noting that Gerber continues to violate the requirements in a systematic way.

We are taking a 'wait and see' approach. 5 months after being admitted to the list after changing policies, it seems that practices have still not changed. The malpractice we exposed in our Campaign for Ethical Marketing action sheet in September 2006 is still there to see on the Gerber website.

But Novartis is already making much of its inclusion in the FTSE4Good listing. It has just posted a report on its website with the title: "Corporate Citizenship Review". See
http://www.novartis.com/about-novartis/corporate-citizenship/index.shtml

This includes the following:

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As a further recognition [of Novartis's Corporate Citizenship], Novartis was included in the 2006 FTSE4Good Global Index. The move identifies Novartis as a socially responsible business and increases our visibility and attractiveness to individuals and asset managers looking to invest in sustainable companies.
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Now, we asked FTSE to clarify what the listing signifies and were told:

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The FTSE4Good Breastmilk Substitutes criteria are based on the WHA Code with the added requirement for companies to clearly demonstrate the presence and application of management systems and to report on external verification. This can take time to implement. Companies in the Index are reviewed every 6 months and are subject to deletion if they are considered not to be continuing to make sufficient progress in all the criteria areas.
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So Novartis may lose the visibility and associated attractiveness to individuals and asset managers if it doesn't put the systems into operation pretty soon. That, I guess, is how the system is supposed to work. It's a safe bet though that if Novartis does lose its listing, it won't appear in its next Corporate Citizenship report!

Gerber is one of the companies in the Pharmaceutical and Health Care Association of the Philippines (PHAP) which is taking action against the Ministry of Health for introducing regulations for the marketing of baby foods. See blog entries, such as:
http://boycottnestle.blogspot.com/2006/12/action-at-philippines-supreme-court-on.html

I am not against pharmaceutical companies, being grateful for the medicines that they produce, but being part of a legal action against these regulations does not seem to fit with the Novartis claim in its report that:

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It is important to note that being a socially responsible company isn’t an exercise where ‘one size fits all.’ Rather, we try to meet each community’s individual needs, engaging in an active dialogue via community panels, patient groups, healthcare professionals and international agencies such as the World Health Organization (WHO).
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It seems that all of those stakeholders are in favour of the Ministry of Health regulations, so why isn't Novartis speaking out and condemning the legal action? Something to ponder.

Something else to ponder is this boast in the report:

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In 2000, Novartis was among the first pharmaceutical companies to sign the United Nations Global Compact, a set of 10 principles covering environmental issues, human rights, labor standards and anti-corruption efforts. In 2005, former UN Secretary General, Kofi Annan, appointed Prof. Dr. Klaus M. Leisinger of the Novartis Foundation for Sustainable Development as his Special Advisor on the Global Compact.
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The Global Compact is a voluntary Corporate Social Responsibility initiative introduced in response to calls for regulatory systems. It has no monitoring or enforcement mechanism, relying instead on corporations reporting their good works.

That Novartis is so closely associated with the Global Compact does it no credit. As it stands the Compact is little more than something else for corporations to boast about in their Public Relations materials. We would rather see the Global Compact scrapped and a system that hold corporations to account introduced.