Becton Dickinson: Ethics and Business Practices.

Becton Dickinson: Ethics and Business Practices

Executive Summary: Becton Dickinson and Company, a medical device manufacturing company, was making an ambitious push for improved performance, by expanding into new markets and moving away from distributor-based sales of its medical products. At the same time, it was becoming increasingly difficult for employees working in these markets to distinguish between acceptable and unlawful requests and they were looking for guidance from top management. The policy-making group at BD – Global One Company Operations Group – was tasked to review the situation and come up with the suitable recommendation to address the issue.

Organization: Becton Dickinson and Company was founded by two friends – Maxwell W. Becton and Fairleigh S. Dickinson in 1897. By 1996, it was the world’s largest producer of medical syringes, needles and tissue collection devices. The company was doing well and generating stellar returns on shareholder equity, but given the worldwide growth of the industry, its performance was considered sub-optimal.

BD shifted its focus on improving its financial performance through meaningful growth and ethical means. To achieve this, the management identified 7 core product lines with the aim of holding leading position in global markets, meeting customer needs and lowering healthcare costs. There was a strong emphasis on changing the company culture. Employees were given more autonomy to be innovative and make decisions. They were also involved in defining the mission and core values of the company. The company focused on building a culture of righteousness and accountability.

The establishment of the Ethics and Business Practices program also shows the increased efforts taken to promote compliance into all the company’s practices and performance objectives. The program satisfied 2 key objectives –

1. Educating employees around the world of the basic conduct expected. Also, encourage communication among employees at all levels through regional meetings and a confidential Help Line. This gave power to the employees to raise their voices when faced with such a situation.
2. Minimize legal risk to the company and its board of directors by reducing the penalties in case of employee non-compliance.

However, despite these efforts to establish a universal code of conduct, there were still questions due to the regional differences in the way business was conducted. The vague nature or grey areas of exchanging gifts confused employees. The company needs to put more effort to address the concerns of its employees on field.

Business Environment:

The pros and cons of the business environment has a big impact on the stand the company has taken.

Pros -

1. Strong focus on relationship building with distributors and third-party vendors.
2. Changing and converging global views on corruption and ethical business practices, with stronger penalties for bribes.  

Cons-

1. Dynamic nature and strong competition in the industry
2. Growing worldwide market with several emerging markets such as India and China and strong prospects of future growth.
3. Lack of standardized ethical practices in emerging markets.

Recommendations:

The Ethics and Business Practices program is a great initiative by the organization to formalize the code of conduct of its employees worldwide and encourage its employees to reach out in case of any concerns, but the program needs to be modified to address the regional differences in business practices and the political environment. I recommend that BD take a “Glocal” approach to defining ethical norms i.e. being a global policy but localized enough to meet the needs of the employees on a country/ regional level.