J&J CEO Resigns

After a turbulent few years, J&J's CEO William Weldon is resigning from his position, says CNN. Alex Gorsky will take over in Weldon's place.

February 22, 2012

2 Min Read
J&J CEO Resigns

Weldon has taken serious criticism for the company's missteps, and was called out for complacency by Sydney Finkelstein, just a few months ago in the New York Times. Weldon was with the company for more than 40 years. He was one of the most respected executives in the industry for a long time.

The company’s recent successes have been primarily attributed to Gorsky and Sheri McCoy, who were seen as front runners to take over the company upon Weldon's anticipated retire. “The company is giving the reins to a coleadership that promises to make fearless decisions,” Richard Lincoff told me during an interview I had with him about J&J. To my mind, Weldon's resignation is one that company has been anticipating and trying to plan for for at least a few years.

It has become clear that more was going on with the company than big purchases. Last April, the Securities and Exchange Commission (SEC) charged Johnson & Johnson with bribing doctors in several countries to prescribe its drugs and medical devices, CNN reports.

"J&J chose profit margins over compliance with the law by acquiring a private company for the purpose of paying bribes, and using sham contracts, off-shore companies, and slush funds to cover its tracks," Robert Khuzami, director of the SEC's enforcement division, said at the time.

I'm hoping that Gorsky's new leadership will be able to rediscover and recuperate Weldon's legacy. Getting back on track will be a challenge. Gorsky has a fairly trusted reputation in industry as a tough leader.

The New York Times questions whether Gorsky will be able to pull the company out of its ethical tailspin. Erik Gordon, who teaches business at the University of Michigan told the paper that Gorsky's insider status indicated that J&J is not ready to change the corporate culture that had created so many of its problems.

In the next few weeks, we'll provide some analysis comparing the leadership styles of Gorsky and Weldon.

Heather Thompson

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