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O O N MY AGENDAFor Lise Kngo, who leads on HR for NovoNordsk, reinforoing oorporate cu ltu reand a oommitment to business eth ics andenvironmental responsibility are essentialto underpin the Danish pharm aceutica lgiant's expanding g lobal reaohWords: Tim Smedley Photography: Richard Gleed

ITEM 1Culture is crucialStaying close to core values as the company growsrapidly matters - to alLsiakeholdersver the past 10 years Novo Nordisk has tri-pled in size, both in terms of personnel andsales. With 30,000 employees in 81 countriesand half the worldwide market for insulin,the pharmaceutical firm has certainly earnedits global creden tials. Yet, despite such rapidgrovrth, the company remains firmly com-mitted to its local heritage. As Lise Kingoputs it. Novo Nordisk is "a global company,

with very strong Danish roots".Kingo is executive vice-president, corporate relations, a position that

encompasses a variety of responsibilities including HR, corporate commu-nications, public affairs and CSR. She's part of an intimate, five-strong and100-per-cent-Danish executive management team. And having been withthe company for 23 years, she has personally seen it grow from nationalprominence to international dominance. Today only just under half of thecompany's employees are based in Denmark, where "Nordisk Insulinlabo-ratorium " was founded in 1923.

Such growth brings an acu te awareness that, "this special culture w ehave needs to be developed and maintained", says Kingo. "In ano ther 10years, we expect to have 45,000 employees with one-third of themlocated in Denmark, two-thirds outside. It 's something employees arevery concerned about too."

In 2010, this led CEO Lars Rebein Sorensen to e mbark on a global tourof the company, talking to employees, which included 350 separate face-to-face interviews. "He had a dialogue with employees about how theywould like the company to be in the next 10 years, what they liked, whatshould be changed. He also met with stakeholders, patients, key opinionformers and people in the public healthcare sector to update what we callthe 'Novo Nordisk Way'".

The Novo Nordisk Way is a short document distributed to all employees.The company's vision is stated, followed by 10 essentials that all employeeshave to live by, says Kingo. It includes statements such as "our businessphilosophy is one of balancing financial, social and environm ental consid-erations" (see Item 3, The 'triple bottom line', overleaf), and people managment commitments such as, "we focus on personal performance anddevelopm ent". An internal team even audits every unit in Novo Nordisk ona three-yearly basis for how they ad here to the Novo Nordisk Way, a proc-ess Kingo's unit has just been th rough .

"First, you undertake a self-assessment with your management team,and then two facilitators do a group session with the management team,interview a number of employees and custom ers and then give afinaleval-uation," she says. "Every qu arter, the head of facilitators repor ts on all thereviews that have been done that quarter, to say where we have becomeweaker or stronger on particular essentials."

It's an exhaustive process, but one that underlines to employees andcustomers how important the culture is to the company. And it will beNovo's most used tool to keep a unified culture as it continues to grow.'Tou could say that we handle company culture just as concretely as wehandle financial performance," says Kingo. "It's a very soft area tha t we aretrying to make manageable. Because you know you can only manage wh atyou can measure." ^->

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Business ethicsHaving had its tingers burnt in the past, now Novodoes business ethically or no tiita IL __ingo arrived at the People Managementinterview carrying a recent copy of the mag-azine. One article in particular, on the intro-duction of the Bribery Act (see Links andNotes), had caught her eye. It 's an issue thatthe com pany takes very seriously, althoughKingo admits that it 's been quite a journeyto get to where they are today.

In 200 5, Novo acknowledged responsibilityfor improper p ayments to the former Iraqi government of Saddam Hussein,between 2001 and 2003, to obtain contracts to provide insulin and othermedicines. Aswell as a hefty fine impo sed by the US Departmen t of Justice,it proved to be a necessary wake-up call. "We thoug ht we did [business inIraq] in a prof)er way. That was apparently not the case," says Kingo. "It wasan important learning experien ce for us, and as management we said; 'Nowwe draw a line in the sand - we will never experience this again."'

It would be wrong to think the company w as acting without regard forethics before the Iraq scandal. Its commitme nt to the triple bottom lineapproach to corporate responsihility dates back to the early 1990s. But,following 2005, Novo Nordisk developed specific procedures to apply toall employees across the company covering issues such as bribery andfacilitation payments.A universal training programm e was established, implementing a fun-

damental shift away from following local norms and procedures toadhering to one com pany-determined way. "It was a tough job, particu-larly for our colleagu es in coun tries like China and Ru ssia," admits Kingo."Suddenly we gave them instructions tha t they had to work according toour business ethics guidelines, which they felt made us the only com-pany in their cou ntries told to act in this way. We had some turbulenceuntil our CEO stood up and said, on several occasions, that we only wantbusiness when it lives up to our business ethics guidelines - otherwiseforget about it. That was very powerful."

Five years on, she feels, such resistance has all but disappe ared. A com-bination of engagement, training and strict enforcement has made sure ofthat. A whistle-blower system, including a 24-hour helpline for people toanonymously report abuses, was also introduced in 2005. Kingo feels azero-tolerance approach gives the company global advantages that far out-weigh any regional disadvantages. "As I see it, American requ iremen ts onbusiness ethics are slowly going to spread to the rest of the world. So welook to our American compliance organisation for the very highest leveland we take those same elements to the rest of the organisation."

The latest stage in this process has seen the creation of a global businessethics board, headed by Kingo, with five senior representatives from globalregions of the business as well as the SVP for legal and business assurance.Bykeeping the whole company in line with the highest tidemark of eth-

ical standard s, Kingo believes it's easier to both spot u pcom ing trends andbe prepared for the unforeseen. "It's much easier if you start when youhave the time, then you can set your own pace," she says, adding that ithelps that "more and more international companies have business ethicsthinking in their veins".

ITEM 3The ^triple bottom line'Financial, social and environmental re.spnnsibilitie.s

ovo Nordisk "strives to conduct its activi-ties in a financially, environmentally andsocially responsible way". This is knownas the triple bottom line (TBL), anapproacb to responsible business prac-tices first popularised in the 1990s by pio-neers of corporate responsibility such asJohn Elkington, co-founder of consul-tancy SustainAbility. Indeed, it was with

Novo that Elkington originally formulated many of these ideas.When Kingo joined the company in the late 1980s, genetic engineering

and animal testing were top of the agenda of environmental activism. As apharmaceutical company. Novo dealt in both - and still does. "We had NGOsfix)m across the world writing letters to us. There were some campaignsagainst the company," says Kingo. One of herfirst obs was to improve Novo'sreputation. She asked Elkington to con duct a full en vironmental review. In

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Pharmaceutical f irmNovo Nordisk,headquartered inBagsvsBrd, anorth-west suburb ofCopenhagen{pictured, top), isone of the w orld'sleading companiesin diabetes care

addition, the co mpany invited NGOs in to see for themselves h ow it oper-ated and it also began environmental reporting. "We began to developwhat turned into the triple bottom line," says Kingo.

By the mid-1990s. Novo was already ahead of where many UK compa-nies are now with co rporate responsibility; in 2011, it's a fundamental partof the business, so much so that Kingo has even advised The Prince ofWales on sustainability. In 2009-10, Novo reduced energy consum ption by0.5 per cent, water usage by 5 per cent and consumption of raw materialsby 18 per cen t - yet the com pany grew by 1,154 staff, and net profit by 33.8per cent, over the same period. Novo has educated more than one millionhealthcare professionals in diabetes care since 2002, and has a beneficialpricing policy for insulin for the 50 poores t countries in the world.

"We are optimising business opportunities by balancing being financiallyresponsible with social and environmental responsibility," says Kingo, whofinds the argument that businesses should exist purely for profit very out-dated. "All of our huge shareholders have applauded the TBL at ourAGMs," she adds. "They can see how it makes this business thrive."

But do employees unde rstand what "triple bottom line" means? Kingolaughs: "I guarantee you could not find one that doesn't know. It's one ofour essentials: everyone has to live up to the TBL. We measure it in ourannual survey, and being a TBL company is consistently among the threehighest ra ted eng agem ent factors of all - an d it's no different if it's peoplein China, India or Denmark, in the factory or top management."

When the company signed up to the UN's "global compact" sustaina-bility charter, it was one of only 50; now there are 8,000 signatories andrising. Yet, despite be ing a front-run ner in this field. Novo is operating inan increasingly competitive environment. "We have to be on our toes,because there are lots of companies that have seen that this is a veryhealthy business approach," Kingo says. "Employees today w ant to workfor a company that they can be proud of, a company that has an attitudetowards hu man rights or climate change."

ITEM 4Innovation through cultureCreativity sbouid no toiiiy be tbe preserven 2009 Novoworked with an American consultancy, Doblin, toincrease innovation in the company. "Doblin found that Novocould be stronger on articulating what an innovation culture is,and explaining to all employees what it is we want," explainsKingo. That began with the leade rship team, who, the reviewfound, weren 't too sure of what it was either. The top 30 lead-ers entered a period of self-analysis from which they onlyrecently emerged, having agreed on five innovation pilotprojects, including a project to design the future workplace.Kingo now leads an innovation culture steering group, with five senior

VPs leading one programm e each. "We have a pool of money that peoplecan apply for - wherever you are in the business." Whether internationalfactory employees will feel intimidated by the prospect of taking an ideadirect to the organisation's senior leadership team is yet to be seen. But,says Kingo, "The five projects we have now would not have survived inour previous development system. We've created a greenhouse wherethey have slightly different con ditions for growing. ^

nnn T. Appointed executive vice U U L . president, corporate relations,assuming global responsibil i ty forquality, HR, business assurance,corporate comm unications, corporatebranding, public affairs and corporatesocial responsibility

, Appointed corporate vice president, stakeholder relations

B , Joined Novo Nordisk's Enzymes1 Promotion, and worked onimplementing the triple bottom line, Began career In a Copenhagen advertising

agency

Novo Nordisk 's 2010 companyreport annualrepor t2010.novonordisk.com Novo Nordisk and the tr iplebottom l ineblt. iy/NovoTBL UN global comp actbi t . ly /UNcompact> PM features The Bribery Actbi tJy /Br iberyActPM> US Department of Just icebrief ingI.usa.gov/Novo9m

How prac tical is 'one cultu ref i ts al l ' for a compan y wi thglobal operations? Share yourviews on PM's new Linkedingroup at peoplemanagement.co.uk/l inkedin

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