Merck & Co.
Anti-corruption
Initiative
In the late 1990s Merck
& Co. faced a growing challenge to win its fair share
of pharmaceutical business in developing markets around the
world, because of endemic bribery and other corrupt practices
in which it refused to engage. Its company foundation, meanwhile,
was seeking ways to mitigate the corrosive effect of corruption,
such as sub-par health care and productivity, on developing
societies where it did business. To address both challenges,
the company launched an initiative to promote ethical workplace
standards in government and businesses in the United Arab
Emirates, through funding of the Gulf Centre for Excellence
in Ethics, a non-profit educational institute. The Centre
was managed by the Washington, D.C.-based Ethics Resource
Center, and initially sponsored by the UAE Ministry of Health.
The program later provided a model for similar Merck initiatives
in South Africa, Colombia and Turkey.
After five years and a $3 million investment, Merck engaged
Jonathan Levine to assess the UAE program on several levels:
- to document benefits for UAE society
and Merck's commercial interests;
- to provide evidence of the business case
for the program;
- to generate motivation for other global
Merck subsidiaries to undertake similar initiatives;
- to understand program elements that worked well and which
didn't, and thus
- to prescribe recommendations for improving
the strategy's effectiveness.
Through interviews with ministry officials and health professionals,
institute managers and members, and business and government
executives across the country, the research identified the
institute's major accomplishments and shortcomings.
It identified key startup lessons, organizational
strengths and weaknesses, and success factors
for organizational adoption of ethics standards in the UAE
culture. The analysis defined, for example, the business,
cultural and legal causes of resistance by the private sector
to commit employees to ethics training. It also uncovered
qualitative and quantitative evidence of behavioral
change within the health ministry due in whole or
part to the institut's ethics program.
"Jon's study provided us some of the first evidence
of the impact of our efforts," says Brenda Colatrella,
senior director of Merck's office of contributions. "For
the first time we could make a linkage between our attempt
to help build the institutions of a civil society and the
long-term advantages to Merck's business strategy. We now
have a basis for analyzing the business case,
which will be of immeasurable benefit as we refine our future
strategy."
Read the Executive
Summary and a full Case
Study (published by the Boston College Center for Corporate
Citizenship).
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