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“If you put the shareholder first, you compromise everything else,” Bill Weldon, CEO of Johnson & Johnson, told students in a Kellogg CEO Series speech.

Bill Weldon

The importance of being earnest

‘Good guys finish first,’ says CEO Bill Weldon in his candid lecture about the values of Johnson & Johnson

By Rachel Farrell

2/2/2009 - A trailblazer in the health care and pharmaceuticals industry, Johnson & Johnson has been consistently ranked as one of the top companies in the world. So what’s behind this company’s success?

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Bill Weldon
Johnson & Johnson CEO Bill Weldon interacts with students after his Kellogg CEO Series speech.
Photo © Chris Guillen
“The center of J&J is ‘do the right thing,’” said Bill Weldon, chairman of the board and chief executive officer of Johnson & Johnson, addressing an overflow audience of Kellogg students at the James L. Allen Center on Jan. 25. “I truly believe that good guys finish first in the long run.”

The latest executive featured in the Kellogg CEO Series, Weldon used this opportunity to explain the foundation of Johnson & Johnson’s “Our Credo” mission statement.

Established 60 years ago, the statement outlines Johnson & Johnson’s operational model and business priorities, which still drive the company’s decision-making processes today.

“It says that we put our patients first and employees second, and treat people with respect,” said Weldon. The impact of that philosophy, he says, can be seen in a letter that the company received from an employee who was recently laid off after eight years of service. “In the letter, she said, ‘Thank you for letting me work for this company,’” Weldon said. “We get more of these good letters than the bad ones, and I think it’s because of how we treat people.”

Weldon also stressed the importance of a decentralized management approach, which he says allows people to make mistakes, and then learn and grow from their missteps. He also prioritizes philanthropy over shareholders, because “if you put the shareholder first, you compromise everything else,” he said.

Investing $8 billion each year in research and development ensures that Johnson & Johnson builds sustainability in the long term, Weldon added. The company is invested in developing drugs that both treat disease and prevent disease, with an emphasis growing increasingly on the latter. “We need to focus on keeping people healthy versus letting them get sick and then treating them,” Weldon said.

Since joining Johnson & Johnson in 1971, Weldon has held several sales, marketing and international management positions and was named president of Ethicon Endo-Surgery in 1992 and company group chairman in 1995. In 2001, he was elected vice chairman of the board of directors and, within one year, was appointed to his current responsibilities. Weldon also serves as chairman of the CEO Roundtable on Cancer.

“What you do is not nearly as important as how you do it,” Weldon concluded. “You have to do it with integrity.”