This Is How We Protect the Climate
- At a Glance
- Strategy & Targets
- ESG Ratings and Rankings
- Climate, Environment and Safety
Management & Governance
- Bayer Sustainability Council
- Bayer Bioethics Council
- Stakeholder Dialogue
- UN Global Compact
- Group Regulations
- Protection of Biodiversity
- Modern Slavery Act Statement
- Position on Global Product Strategy
- Position on Responsible Care
- Position on Deforestation and Forest Degradation
- Position on Insect Decline
- Raising the Bar on Crop Protection Safety Standards
- UN Sustainable Development Goals
- Position on Sustainable Beef Production
- Supplier Management
- Commitment & Overview
- Political Engagement
- Code of Conduct for Responsible Lobbying
- Transfers of Values to Healthcare Professionals
- Science Collaborations
- Product Stewardship
- Transparency Reporting
- Societal Engagement
Without suitable countermeasures, global temperature will rise by well over 2 degrees Celsius. This will threaten our planet’s ecosystems, jeopardize the health of people, animals, and plants, and place the food supply for a growing world population at risk.
Our Climate Objectives and Initiatives
As a science-based company, Bayer has recognized the risks posed by global climate change. We aim to continuously reduce GHG emissions within our company and along our entire value chain in accordance with the UN SDGs and the Paris Agreement to limit global warming to 1.5 degrees Celsius.
We have joined the world's leading Science Based Targets initiative, which reviews our reduction targets. This initiative was founded by the CDP, the UN Global Compact, the World Resources Institute (WRI) and the World Wide Fund For Nature (WWF). More than 1.000 companies have committed themselves to actively address the challenge of climate change and setting transparent targets for reducing their emissions in line with the Paris Agreement.
Our Net Zero Target
We have set ourselves the target to achieve net zero GHG emissions including our entire value chain1 by 2050 or sooner and signed the Business Ambition for 1.5°C.
Our Mid-term Climate Targets until 2030:
- We will reduce our Scope 1 & 22 emissions by 42% until end of 2029 compared to our 2019 baseline. This target has been approved by the Science Based Target initiative as aligned with a 1.5°C pathway. To accomplish this, we will combine measures, such as more efficient inward and outward ventilation systems, a move to climate-neutral technologies, such as geothermal energy for heating and cooling and a switch to 100% purchased electricity from renewable sources.
Bayer has set out specific criteria for its own procurement of green energy. These criteria include the proximity of energy production facilities to Bayer sites, the use of new sources of generation and a focus on wind and solar power. They are based on the “next generation green power” guidelines from the WWF (World Wide Fund For Nature).
- Bayer is on a path to become climate neutral by 2030 in its own operations. The remaining emissions after reduction will be offset by purchasing certificates from climate protection projects with recognized quality standards. The offset projects are related to our business. Based on our business purpose we focus on Natural Climate Solutions relating to forest and agriculture. Additionally, we invest in innovative projects and foster development of voluntary carbon markets.
- Holistic integration of Sustainability into Investment process: Includes Environmental requirements like CO2 as well as human rights
- Internal Carbon Price of 100€/t
- 100 % purchased electricity from renewable sources: “Physical” green energy through PPA if possible
- Integration of climate targets into management remuneration
- Compensation projects with connection to our business: Agriculture or Forest (AFOLU projects)
- We aim to reduce greenhouse gas emissions along the up- and downstream value chain (Scope 33) through cooperation with suppliers and customers by at least 12.3% in 2029 compared to 2019. This target has been approved by the Science Based Target initiative. As such a target cannot be achieved by acting alone, Bayer has joined with other ambitious companies to drive progress as part of the chemical industry’s “Together for Sustainability” initiative. We are also a member of the CDP Supply Chain Initiative and are in direct contact with key suppliers.
Carbon-neutral operations2 at own sites and achievement of a Science Based Target (SBT)4
- In addition, Bayer is working with farmers to reduce the ecological footprint of agriculture, which currently accounts for about 25 percent of greenhouse gas emissions worldwide. We want to help reduce greenhouse gas emissions in major agricultural markets – per kilogram of crop yield – by 30 percent by 2030. This applies to the most emitting cropping systems in regions Bayer operates. This includes Bayer helping farmers to use climate-friendly methods, such as reducing plowing and using digital solutions, to reduce CO2 emissions.
- Bayer is also engaging in further climate-related and environmental efforts – such as reducing the environmental impact of crop protection products by 30 percent by 2030 – , supporting projects to preserve (rain) forests and using more environmentally friendly packaging materials.
- By 2024 we want to reduce our Scope 1&22 emissions by 20% and our Scope 33 emissions by 6% along our Science Based Target commitments (base year 2019)
Capital Alignment and Internal Carbon Price
- Bayer is committed to phasing out, all capital expenditure in new unabated carbon intensive assets or products.
- We align our capex spending with our ambition to achieve net zero GHG emissions by 2050, in line with the global goal to limit global warming to 1.5C. Bayer plans to invest EUR 500 million in energy efficiency and climate-friendly measures until 2030.
- To anticipate climate-related business risks and opportunities and drive internal change, we have set ourselves an internal carbon price of €100 per metric ton when calculating our capital expenditure projects.
- This incentive applies to all CO2 emission reduction initiatives with the exception of emissions from purchased electricity, which are to become zero with the 2030 target of 100% purchased electricity from renewable sources. Reduction of electricity consumption nevertheless continues as part of the company’s improvement and cost management measures.
- When fixing the internal price at EUR 100 per ton, Bayer took into consideration cost abatement curves for emission reduction, costs for high-quality energy attribute certificates for renewable gas, and energy taxation trends. The price and the framework of the incentive scheme will be reviewed after two years to ensure effectiveness and revalidate market assumptions. This shadow pricing approach improves the net present value (NPV) of climate-friendly projects and gives them a higher priority.
- Additionally, we conduct ecological assessments of relevant investments.
- Sustainability is of outmost importance to Bayer with our CEO being also our Chief Sustainability Officer overseeing all sustainability activities including our climate program. The importance of climate topic is also underpinned by our CEO’s participation in the Alliance of CEO Climate Leaders within the World Economic Forum. The Board of Management holds the overall responsibility for an effective risk management system that also accounts for climate-related risks; our CFO chairs the Bayer Assurance Committee as the relevant committee within the Board. The Board member responsible for Crop Science manages respective climate related activities of this highly affected division that can contribute to emission reduction, removal, and resilience in agriculture.
- The Supervisory Board endeavors to ensure that its members collectively possess the necessary expertise, skills and professional experience to properly perform their duties. Sustainability including climate change is part of this knowledge. Expertise and experience of shareholder and employee representatives on the Supervisory Board are stated in the Annual Report (chapter 4.1, section "Supervisory Board"). For the assessment, the Supervisory Board primarily considers its members to possess expertise and experience in the corresponding areas if they have completed professional training in that field or have amassed many years of professional experience. The ESG committee of the Supervisory Board discusses the Bayer Sustainability Council’s focal topics with the Co-Chairs of that body, including the status of the sustainability targets, benchmarks and strategies, and Bayer’s contribution to climate protection.
- 20% of long-term incentive (LTI) of all managers incl. the Board of Management is linked to the group sustainability targets which include climate protection targets. Short-term sustainability targets including climate targets are also a fixed component of annual variable remuneration.
Climate Policy Positions and Engagement
Bayer is dedicated to a climate policy that is in harmony with our ambitious climate targets. Therefore, we advocate for decarbonization measures in line with the Paris Agreement and specifically with the goal to limit global warming to 1.5 degrees Celsius above pre-industrial levels as outlined in our Global Climate Policy Position. Our further climate policy positions and engagement activities related to specific policy initiatives in countries are guided by this global position.
To ensure transparency in our climate policy engagement, we annually publish an overview of our engagement activities on climate policy. Additionally, we regularly examine critically our memberships in relevant industrial associations and their positions and actions affecting climate policy both internally and externally in accordance with our ambitions.
Consequently, Bayer started publishing its Industry Association Climate Review on a yearly basis in 2021. The review assesses the alignment of our industry associations’ climate positions with our own commitments on climate change. Our industry associations represent us in the public debate, so we need to be transparent about where our climate-change goals are aligned with their actions and where we have different views. In compiling the analysis, we have engaged with Climate Action 100+, an investor-led initiative working with the world’s largest corporation on climate change. Further details on the review approach are provided in the 2021 Report.
The 2021 review is the first step and forms the basis for Bayer’s continued commitment to advocacy for science-based policies addressing climate change through its member associations. Where we find misalignment between our climate ambitions and those of our industry associations, we will take measures to bridge that gap. To disclose our successes and the work that still lies ahead, please see our Industry Association Climate Review – Engagement Update 2022.
- Global Policy Position on Climate Mitigation in Industry and Agriculture
- Overview of Our Engagement Activities on Climate Policy in 2021
- Overview of Our Engagement Activities on Climate Policy in 2022
- Industry Association Climate Review 2021
- Industry Association Climate Review – Engagement Update 2022
- We are committed to a transparent communication on our climate targets, progress and implications climate change has to Bayer
- Through continued participation in CDP we disclose a high level of details on our climate related activities and progress
- We are committed to implement the recommendations of the Taskforce on Climate related Financial Disclosure (TCFD) and use the framework as guidance to disclose climate relevant information. We are using two scenarios incl. one Paris agreement aligned scenario for our quantitative scenario analysis our quantitative scenario analysis (SSP1-2.6 and SSP3-7.0.)
Bayer is committed to a just transition to a sustainable and climate-neutral economy and advocates for a favorable societal and political environment. We are constantly involving our stakeholders in developing just transition plans adjusted to their and our needs, for example, our relationships with our employees and the worker’s council as well as our supplier engagement. Details can be found in our Just Transition Framework.
1 entire Scope 1-3 emissions. Scope 3 includes all categories defined in the GHG protocol
2 Scope 1 and Scope 2 (market-based) emissions of the environmentally relevant sites, i.e. those with annual energy consumption of more than 1.5 terajoules, including emissions from the vehicle fleet and are expected to cover more than 95% of our emissions
3 Scope 3 covers all categories defined in the GHG protocol. The SBTi target covers the most relevant categories which account for 88% of our total Scope 3 inventory
4 Science-based climate target that complies with the goal of the Paris Agreement to limit global warming to 1.5 degrees Celsius, or well below 2 degrees Celsius