Management and Governance

Sustainability Management

As part of Bayer’s corporate strategy, sustainability is firmly established at Board level. Responsibility for steering and aligning our Group-wide sustainability strategy lies with the Bayer Board of Management member responsible for Human Resources, Technology and Sustainability in his function as Chief Sustainability Officer of the Bayer Group, and with a Sustainability Council chaired by the Environment & Sustainability corporate function. This Council, which manages the integration of sustainability into business operations, sets targets, draws up initiatives, management systems and Group regulations and is responsible for their implementation.

In order to operationalize the Group strategy and make it measurable, we have set ambitious non-financial targets and indicators all along the value-added chain. Further information about our target program can be found in Targets & Performance Indicators. Internal Group regulations ensure the implementation of our sustainability principles in business operations. These principles are realized through corresponding management systems, regulations and processes.

Materiality

We regularly analyze and evaluate what the major stakeholders expect and require from the Group. This approach enables us to identify early on any opportunities and risks relevant to sustainability, along with key non-financial areas of activity, and to react to them. We document the findings in a materiality matrix. During 2014, we updated our materiality analysis. We used a multi-stage process to identify issues of relevance to us and prioritized these in respect of sales, costs, risk and reputation. We summarized the 24 areas of activity that are relevant to Bayer in a materiality matrix. Internal and external views were then entered into the following matrix.

Materiality Matrix

Materiality Matrix

Areas of activity

In 2015, we once again discussed the results of the materiality analysis at internal workshops and reconciled these with current developments and the Group targets. We also analyzed the results’ relevance for the Bayer value chain and reporting in line with the new GRI G4 guidelines. During this process, the original 24 areas of activity were condensed into 11, presented to the Board of Management and approved by it. Our current Annual Report shows in a graphic the assignment of our areas of activity to the stages of the value chain.
On the basis of the non-financial subject areas identified we adapted our reporting according to the new GRI G4 guidelines in 2015. The following table shows an overview of our current 11 areas of activity and the assigned GRI aspects. We also indicate whether our scope for exercising influence lies within or outside the company.

Key Areas of Activity and GRI Aspects

Key area of activity with definitionGroup targets GRI aspect assignmentGRI aspect limits
G4-19Within
G4-20
Outside
G4-21
Product and process innovation
Innovations that combine customer wishes and social needs; including adaptation to changes in industrial production, influenced by the growing significance of the digital value-added chain and the associated processes
See Innovation Group targets• Economic performance
• Products and services
X                                                                                                                                                                                                   X
Access to health care
Better access to medical products for patients in under-resourced regions, e.g. through research & development, differential pricing, building up own capacities, patent access and collaboration
See Innovation Group targets• Indirect economic impactX
Sustainable food security
Contribution to the sustainable production, supply and availability of food and to the quality of food supplies
See Innovation Group targets• Indirect economic impact
• Customer health and safety
X
Stakeholder commitment / partnerships
Dialogue and collaboration with relevant stakeholders at local, national and international level
See Employees Group targets• Local communitiesXX
Business ethics
Ensuring good corporate governance and compliance; including anti-corruption, fair taxation, transparency, responsible lobbying, ethical clinical studies and Management Board compensation based on ESG criteria
See Compliance Group targets• Compliance (environment category)
• Equality
• Fighting corruption
• Politics
• Anti-competitive behavior
• Compliance (society subcategory)
• Compliance (product stewardship subcategory)
• Complaint mechanisms in terms of working practices, environmental impact, breaches of human rights and social impact
XX
Human capital
Employee development and expanding the position as an attractive employer; includes vocational and advanced training, compensation, employee benefits and recruiting / retaining personnel; creating flexibility with a good work-life balance; ensuring sound diversity
See Employees Group targets• Economic performance
• Market presence
• Employment
• Employee / employer relations
• Vocational and advanced training
• Diversity and equal opportunities
• Equal pay for men and women
• Freedom of association and right to collective agreements
• Child labor
• Forced or compulsory labor
• Safety practices
X
Safety
Ensuring occupational, process, plant and transport safety

See Safety Group targets• Transportation
• Occupational health and safety
• Local communities
XX
Product stewardship
Evaluating and reducing possible health- and environment-relevant product risks along the value-added chain; including REACH, endocrine disruptors, active ingredients in the environment, bee health and responsible use of new technologies (e.g. biotechnology)
See Product Stewardship
Group targets
• Products and services
• Customer health and safety
• Labeling products and services
• Marketing
XX
Environmental protection
Reducing the environmental impact of products and processes on water, air and soil; supporting innovations that help the environment
See Resource Efficiency
Group targets
• Materials
• Energy
• Water
• Biodiversity
• Emissions
• Wastewater / waste
• Products and services
• Transportation
XX
Supplier management
Encouraging fair and constructive relations, influencing sustainable behavior in the supply chain in terms of business ethics; treatment of employees; health protection, safety, environmental protection and quality all the way through to management systems and performance measurement
See Supplier Management Group targets• Procurement
• Evaluating suppliers in terms of
    - environmental aspects
    - working practices
    - human rights
    - social impact
X
Social commitment
Demonstrating social commitment through investment in social projects, donations and volunteering programs
No Group target• Local communitiesX

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Last updated: February 25, 2016 Copyright © Bayer AG
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