1. N. Mehta, “Novartis to Challenge IPAB’s Patent Decision on Glivec,” The Economic Times of India, July 20, 2009.
2. See Novartis’ corporate citizenship Web site.
3. See D. Baron, “Integrated Strategy: Market and Nonmarket Components,” California Management Review 37, no. 2 (winter 1995): 47-65; D. Baron, “The Nonmarket Strategy System,” Sloan Management Review 37, no. 1 (fall 1995): 73-85; and D. Baron, “Business and Its Environment,” 5th ed. (Upper Saddle River, New Jersey: Pearson, 2006). Our goal in this article is to provide senior executives with a managerial framework for effective nonmarket management.
4. A recent survey by Ernst & Young and Oxford Analytica among analysts across a wide range of industries confirmed that “regulation & compliance” is deemed the number one strategic risk facing companies. See Ernst & Young and Oxford Analytica, “Strategic Business Risk 2008 — the Top 10 Risks for Business.” Similarly, a survey conducted by global insurance giant Aon found that executives consider “damage to the firm’s reputation” the most significant risk they face. See Aon Corp., “Global Risk Management Survey 2007.”
5. In fact, the program was so successful that it was capped at 85,000 permits. Since each permit is attached to a specific vehicle, not its owner, it is possible to determine the value-added of Toyota’s nonmarket efforts quite accurately — a Prius with the permit sells secondhand for as much as $4,000 more than a newer model without the permit. See J.M. Scott, “How Much Would You Pay For This? HOV Sticker May Add up to $4,000 to Hybrid Cost,” Los Angeles Daily News, May 19, 2007, sec. N, p. 1.
6. K.J. O’Brien, “Cap on ‘Roaming Charges’ EU Proposal Would Limit Mobile Calling Costs,” International Herald Tribune, March 28, 2006.
7. Dick Olver as cited in F. Reinhardt, “Global Climate Change and BP Amoco” Harvard Business School case no. 9-700-106 (Boston: Harvard Business School Publishing, 2007).
8. S. Bonini, L. Mendonca and M. Rosenthal, “From Risk to Opportunity: How Global Executives View Sociopolitical Issues,” McKinsey Quarterly, October 2008.
9. After these setbacks, there is now a vibrant debate within BP about whether it makes sense to manage a conventional oil and gas business and a renewable business under the same corporate roof. Even though BP has cut back on new renewable investments, it has not changed its overall positioning, especially when it comes to climate change. See E. Crooks, “Back to Petroleum,” Financial Times, July 8, 2009.
10. A. Rodríguez de Paz, “Hasta 26.000 Restaurantes Ofrecerán Menús Saludables Con Más Verdura, Legumbres, Pescado y Frutas,” La Vanguardia, March 7, 2008.