As a global company, Novartis recognizes that its responsibilities are not limited to the development of innovative products. Accordingly three years ago we signed the Global Compact, an initiative launched by the UN Secretary General Kofi Annan to protect human rights, labor standards and the environment. These social and environmental values, together with our mission to provide innovative medicines represent the basis for our Corporate Citizenship approach. We also firmly believe that this gives us substantial competitive advantage in the long term.

We have established a comprehensive set of policies and guidelines defining all important areas of Corporate Citizenship. This includes our Policy on Corporate Citizenship based on the obligations we endorsed by signing the United Nations Global Compact, our Code of Conduct, and our five Corporate Citizenship Guidelines. These Guidelines address: Management of Corporate Citizenship, Fair Working Conditions, Business Ethics, Human Rights, and Third-Party Management (see detailed sections and the table on page 52 of our Annual Report 2003). Each of these policies and guidelines has been, or is currently being rolled out, supported by training and test programs.

After establishing a global management framework in the last years, the focus for the next years is clearly on implementing the management processes, including targets. An update on our Corporate Citizenship approach is included in our Annual Report 2003 on pages 45-75 (http://www.novartis.com/downloads_new/cc/cc.pdf , http://www.novartis.com/news/en/corporate_inter_cc.shtml ).

Corporate citizenship reporting is done according to the Global Reporting Initiative (GRI) Guidelines and the company''s corporate citizenship performance is measured against GRI indicators.

Readers (shareholders, employees etc) react positively to the fact that these topics are integrated into the Annual Report. SRI analysts also value this transparent information and normally rank Novartis among the leading companies. The main focus of the past 12 months was on "Business and Human Rights" - the "right to health" being of particular importance.

For the next year reporting we plan to further integrate Corporate Citizenship reporting on the internet and Annual Report (with summaries and stories in the printed report and detailed GRI-reporting on the internet).