Vas Narasimhan has been running the pharmaceutical company Novartis for six and a half years. But the American still doesn’t seem to have really settled in in Switzerland.
Novartis CEO Vas Narasimhan prefers giving interviews in New York rather than in Switzerland.
Things couldn’t be going better for Vas Narasimhan, the head of the Basel-based pharmaceutical multinational Novartis. The share price has risen to over 100 francs, and on Monday it closed at 102.70 francs, the highest level in the company’s almost 30-year history.
In the past first half of the year, Novartis managed to increase sales in local currencies by 11 percent to 24.3 billion dollars. The company thus clearly outperformed the growth of the overall market. Narasimhan can be more than satisfied with his performance at the Swiss SMI company.
At the same time, there are voices from within and close to the company who are increasingly asking how closely its boss still feels connected to Switzerland. These people do not want to be named, but they point out that, unlike a few years ago, Narasimhan hardly appears in public in Switzerland anymore. In addition, the company’s communications are now almost exclusively determined from the USA. Under Narasimhan, Novartis is being increasingly transformed into an American company, say the insiders.
Cult status among younger employees
Narasimhan took over as CEO of Novartis in February 2018, at the young age of 42 for a CEO at the time. The American caused a stir at the company’s headquarters in Basel early on.
He raised high expectations with his announcement that he would introduce a strategy called “unbossed” and thereby give each individual employee more responsibility in the traditionally hierarchical pharmaceutical group. “Here comes someone who will finally get rid of rigid structures,” many people said.
It wasn’t long before Narasimhan achieved almost cult status, especially among younger members of the workforce. Some employees raved that he was really “cool”. But the spark of enthusiasm didn’t spread to the financial market at the time. The business figures in the new CEO’s first years in office were too mediocre for that.
Star on Linkedin
But on social networks, particularly on Linkedin, Narasimhan scored points with his new ideas. Thousands of followers were fascinated by the posts he and his communications team wrote on the topic of “unbossed”. Today, over 380,000 users follow him.
During the pandemic, the manager was also a highly respected voice in his role as a former doctor and former head of the development department at Novartis. This was not changed by the fact that, unlike its local rivals Roche or Pfizer, the company was unable to make a significant contribution to the treatment of Covid-19 with its drugs. Attempts to use older therapies from the company’s portfolio to combat the virus failed due to their lack of effectiveness.
Narasimhan, married and father of two teenagers, occasionally shares personal information on social networks in addition to his professional life.
In the Swiss jersey
This summer, on August 1, the Novartis boss posted a picture of himself and his family on Linkedin. The red and white vests with the Swiss cross that all four family members wear are eye-catching. Narasimhan wrote: “Switzerland is not just the headquarters of Novartis, it is our home.”
Several sources who are very familiar with Novartis’ communication strategy and who the NZZ spoke to are surprised by this: Narasimhan’s affection for Switzerland, they say, is very limited. Some even believe that he has finished with the country.
Tired of financial media conferences
In fact, Narasimhan never seems to have warmed to Switzerland and especially to its media. He is said to have repeatedly complained to his communications team that the Swiss press was far too critical and did not sufficiently appreciate his achievements.
The anger has now apparently reached such a level that Narasimhan no longer even speaks to the media when presenting the annual figures. As he has done for some time with the half-year results, in January he left this task to Harry Kirsch, a dual German-Swiss citizen who, as CFO, is only number two in Novartis’ management.
Former advisors pleaded with Narasimhan not to miss his one annual appearance at the annual press conference. He owed this to the Swiss public. But since Michelle Weese, an American, took over overall responsibility for communications, the Novartis boss himself no longer seems to feel obliged to do so.
Weese, who is a member of the extended executive board, works from the USA. Insiders report that she is currently busy relocating almost the entire communications department from Basel to the Novartis branch in East Hanover in the state of New Jersey. Even long-standing employees would have to reapply because the department is to be significantly downsized at the same time. When asked by the NZZ about these reports, a company spokesperson only confirmed that the communications department was being reorganized. The company did not wish to comment further.
Outcry over top wages
In America, Narasimhan seems to feel less exposed to critical questions from the public. The discussion about his salary is likely to play an important role in this. At the beginning of this year, Narasimhan provoked an outcry with the 16.2 million francs he received for 2023. No other manager in Switzerland earned more. In the United States, however, such salaries are common for top executives, especially in the financially strong pharmaceutical industry.
In view of the estrangement between Narasimhan and the Swiss environment, market observers are asking themselves how much longer the Novartis boss will want to lead the company. Like many experienced managers, one thinks, Narasimhan might also say to himself that the best time to leave is when the stock market is doing well.
However, Novartis will probably wait at least for the designated new Chairman of the Board of Directors, Giovanni Caforio, to take office next spring. Companies usually do not fill the presidency and the position of CEO all at once, but prefer to proceed in stages. And for the time being, the sporting success of his older son could also keep Narasimhan in Switzerland. As the Novartis boss also announced in his post on the national holiday, the junior has made it into the Swiss U18 national basketball team.
