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After Cohen payment scandal, Novartis unveils new ethics chief

New 'risk and compliance' leader has increased powers

Moosmayer

Klaus Moosmayer has been appointed Novartis' chief ethics, risk and compliance officer, a new more powerful position created after the scandal surrounding multi-million dollar payments to Michael Cohen.

Earlier this year Novartis found itself in a storm of controversy after its then-CEO Joe Jimenez was revealed to have signed off payments to Donald Trump’s then lawyer and ‘fixer’ Michael Cohen.

The payments amounted to $100,000 a month for one year in return for advice on the Trump administration - even though it quickly transpired that Cohen wasn't able to provide any relevant insights.

Novartis was one of several companies caught in the spotlight when payments were exposed, and the company struggled to explain why the fees hadn't been declared in its accounts, suggesting the company had been engaged in dubious 'back channel' engagements in the all-important US market.

New chief executive Vas Narasimhan quickly moved to tighten the reins on Novartis’ ethics and compliance functions, while the company’s head of legal Felix Ehrat claimed responsibility for the scandal by resigning.

Ehrat (pictured below) resigned after it was discovered that he was co-signatory, along with Jimenez, on the contract to hire Cohen’s firm, which provided the consultancy services.

Ehrat

However, now attempting to “win and maintain the trust of society and stakeholders”, Novartis has hired Moosmayer in the chief ethics role, and will join the executive committee of Novartis, its most senior board of leaders. Shannon Thyme Klinger was recently appointed group general counsel, and has been in charge of the chief ethics position in the interim period.

Commenting on his new role, Moosmayer said he aims to build a “world class risk and compliance function” at Novartis.

He added: “Society has high expectations of the pharmaceutical industry and rightfully so. I am pleased to see that there is already a strong focus on driving personal accountability for behaviours, and generating learnings that can be applied across the organisation with Novartis.”

Moosmayer joins Novartis from multi-industry company Siemens, where he has served as chief compliance officer since January 2014 and prior to that, he served as chief counsel compliance at the company for four years.

His career history has seen him practise law in Germany, specialising in 'white collar crime', litigation and business law. He has also been chair of the anti-corruption task force of the business and industry advisory committee at the Organisation for Economic Co-operation and Development (OECD).

Novartis chief executive Vas Narasimhan, said: “Klaus has extensive experience in leading compliance for large global organisations and is internationally recognised in his field. As part of my executive leadership team, I am very confident that he will play a significant role in helping us to further define and shape our approach to ethics, risk and compliance in the coming years."

Article by
Gemma Jones

14th August 2018

From: Sales

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