a British CFO, and a Swiss general counsel and a German human resource head. Its six businesses were led by four Americans, one Swiss and one Brit.

a British CFO, and a Swiss general counsel and a German human resource head. Its six businesses were led by four Americans, one Swiss and one Brit.

The Novartis board, once comprised of 12 Swiss members, one American and one German, had also globalized, and now included five Swiss, two Germans, two Americans, a Chinese woman, and one member each born in India and Lebanon. (See Exhibit 8 for 2012 board composition.)

Leadership Challenges

In terms of developing global leaders, Vasella noted, “Hard skills are easier to transmit, while soft skills are much more difficult to teach. You can teach concepts, but you can’t teach experiences. To be a good leader, you need to be intelligent, a conceptual thinker, ambitious, and take pleasure in building organizations.” He continued:

Those qualities need to be balanced by skepticism—recognition that not everyone wants you to succeed and that bad things will happen. If I look at the reasons leaders fail, it’s usually the soft factors, such as failing to resist seduction. I talk to my team about the temptations that come with leadership—sexual enticement, money, or praise. You need to be aware of your vulnerabilities in order to resist seduction and keep your integrity.24

“Today’s leaders must understand what society needs, values and will pay for,” Vasella continued, “and have the courage to stand up for it even if unpopular. They need courage to make mistakes and not think their heads will be cut off. Leaders need to avoid taking shortsighted actions. I worry most about pressures people feel from the stock market to take short-term actions like portfolio management and restructuring to pull the white rabbit out of the hat.”

Breu added, “New leaders should not imitate the past. They have to think very differently about the next ten years. How do you anticipate what will happen and place your bets? There will be changes to the way business units operate, to the portfolio and the company’s global footprint. In my time the challenge was getting larger in the U.S. Now the opportunities are in Asia, Brazil and potentially in Africa. Novartis’ culture has become very international. From two Swiss companies we became a global healthcare leader. In 1996 people would have said: ‘As an American, I have no chance of being CEO of Novartis.’ That has changed.”

When Vasella concluded his 14 years as CEO, he said he left the company with strong leadership, excellent financial results, a diversified set of healthy businesses, and a full pipeline of new products. That year 910 million people benefited from Novartis products. He noted:

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