“The just making money approach to business does not work anymore”

Guest speaker Anthony McQuillan, Vice President Legal & Compliance EMEA at Medtronic

Our guest speaker Anthony McQuillan, Vice President Legal & Compliance EMEA at Medtronic, is not a typical lawyer. He points out that being a Compliance Officer has more to do with psychology and politics than with law. And that is why he is the perfect speaker for the session on “How to manage ethics in a corporation” in our course in “Business Ethics and Negotiation”.

Being an ethical company seems to be easy for a company like Medtronic. They have great products (like pace makers or defibrillators) which save lives. A company purpose like this almost automatically gives you an advantage in business ethics.

And they are known to have a very positive corporate culture that does not sacrifice ethics for profits. I can confirm this from experience: I once spent a day in a workshop with Medtronic employees at their headquarters and the good atmosphere was clearly noticeable.

Even Medtronic’s mission statement is full of ethical references:

“To contribute to human welfare by application of biomedical engineering in the research, design, manufacture, and sale of instruments or appliances that alleviate pain, restore health, and extend life.

  • To direct our growth in the areas of biomedical engineering…
  • To strive without reserve for the greatest possible reliability…
  • To make a fair profit…
  • To recognize the personal worth of employees…
  • To maintain good citizenship…”

I am particularly impressed with the fair profit. You rarely find this in companies’ mission statements.

So when Anthony claims, that the just making money approach in business does not work anymore, he is very authentic.

Nevertheless, a company that operates in over 160 countries and has over 85.000 employees also has to make a profit and will inevitably have its ethical challenges.

The “classical” ethics problem in the medtech business in corruption. It comes with the product if you will. Since medtech companies develop and produce medical devices, they need to train doctors in how to use the product properly. So the question comes up where these product training should take place. Here it has historically been  a practice in some parts of the medtech and pharma industry to organize these events in posh hotels in very attractive locations like the South of France, spoil the potential clients with gala dinners and other goodies and even invite the participating physicians’ partners along … for free, of course. This clearly is an unethical strategy because it creates a conflict of interest and a sense of obligation for the participating physicians. They will no longer choose the medtech product because it is beneficial for their patients, but because they benefitted from a lavish hotel stay and feel obliged to return the favour by ordering the product. Because of this questionable dynamic, Medtronic is championing  medtech industry-wide compliance  initiatives to ensure  physicians receive appropriate training and education on the safe and effective use of medical devices, such as by offering training at companies’  own facilities, rather than by inviting them to conferences  in luxury hotels.

One other core ethics problem that comes with the industry is product responsibility. What to do if you find out that one of your devices has a tiny flaw that might cause problems in extremely rare cases? This happened with the one of Medtronic’s implantable cardiac devices.  They disclosed the problem and withdrew the product from the market. Since de-implanting such a device is also risky, they recommended patients to seek independent medical advice. They did the right thing: they put their customers’ health first.

Medtronic knows only too well, that if they would just put making money first, they would lose their business. So actually, the just making money approach is just bad business for a company like Medtronic.

Anthony’s talk gave our student of thought for thought by illustrating them the complexities and headaches of real-life business ethics. There is nothing more effective for doing this then confronting students with a “messy” real life case that shows that in international business the ethical and legal issues are sometimes not so easy to identify and even more tricky to resolve.

Dr. Bettina Palazzo, Professor at BSL

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