Bellwether JNJ -- A Welcome Good News Story
Global Leader is a Corporate ‘Good Guy’ That Reigns on Top
Apr 19, 2009
Personal care supplier Johnson & Johnson is a story of success and responsibility amidst a persistent deluge of corporate red ink as the world awaits a recovery from the worst recession since the Great Depression. From a tiny niche market supplier of surgical dressings 120 years ago in New Brunswick, New Jersey, the company has become a leading international supplier of health care products with revenues in 2008 of more than $63.7 billion and net income of $13.1 billion.
Top Rating
In April, 2009, Moody’s Investor Service startled the financial community when it cut the rating of Warren Buffett’s much-storied Berkshire Hathaway two grades, from Aaa to Aa2. That left only four companies with the top Aaa rating: Johnson & Johnson, Microsoft Corp., Exxon Mobile Corp and Automatic Data Processing Inc. Johnson & Johnson’s growth into a global corporate superstar has been driven by a focus on quality products, exemplary corporate leadership, and significantly, by a commitment to higher moral principles.
Moral Compass
The company’s awards for Corporate Social Responsibility (SCR) read like a wish list for advocates of ethical investing. For years, it has consistently been:
• among the top 10 best places to work,
• one of the top most admired companies,
• among the top employers for diversity
• among the best employers for working mothers,
• praised for workplace safety,
• recognized for public diplomacy,
• given awards for corporate citizenship, and
• consistently recognized as a corporate environmental leader.
Not surprising, the company’s corporate conscience has played a significant role in its success over the years. In 1906, when the company was still quite tiny, it sent trainloads of products to San Francisco to help survivors of that city’s devastating earthquake.
Medical Pioneer
Johnson & Johnson was founded in 1886 by brothers Robert Wood Johnson and James Wood Johnson, to sell sterile bandages to the medical community, a revolutionary idea in an era when the local barbershop often pulled teeth and performed minor surgery. From its beginning to the present, Johnson & Johnson has pioneered a host of products: sterile surgical dressings, baby powder, Band-Aids©, dental floss, birth control pills, sterile mouthwash, sanitary napkins for women, sterile sutures, among others. The rest of its product line numbers in the thousands and includes dozens of high-profile personal care products.
The company’s international growth started with operations in Canada in 1919 and in England in 1924. In 1944, after expanding into nine more countries, the company listed its stock on the New York Stock Exchange, using the symbol JNJ. That was just the beginning. Today, the company consists of more than 250 self-sustaining operating companies in 57 countries that employ about 120,000 people.
People Strength
In addition to its well-developed sense of social responsibility, other key sources of Johnson & Johnson’s strength are its commitment to fostering the entrepreneurship of its individual operating companies while providing them access to the resources of the larger corporation, and its deep respect for its workforce.
Those principles, enshrined in the company’s mission statement called “Our Credo” have led it to become what Johnson & Johnson describes as the world’s premier consumer health company, the world’s largest and most diverse medical devices and diagnostics company, the world’s third largest biologics company, and the world’s fifth largest pharmaceutical company.
Little wonder the company is well established as a role model for business school case studies on inspired leadership, smart marketing and corporate social responsibility.
