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Strategic Sustainability Focus Areas
Bayer works continuously to strategically evolve sustainability topics in procurement. In the coming years, increasing importance will be placed on environmental and human rights requirements throughout the supply chain and on the Supplier Inclusion & Diversity Program.
Improving Sustainability Practices in the Supply Chain
Already in 2020, we stipulated that all strategically important suppliers must present an EcoVadis assessment of at least 45 of 100 points (“green” assessment) or a comparable audit result. Beginning in 2021, all potential new suppliers with a procurement spend of more than €250,000 will be additionally examined in advance with regard to sustainability aspects. There are also plans to monitor the progress of the various sustainability focus areas using indicators and to define appropriate targets. More information on this see here.
Climate Protection in the Supply Chain
Climate protection is a key element of Bayer’s strategy and is supported by our Supplier Code of Conduct. In 2020 we joined the Science-based Targets initiative and have set ourselves targets to significantly reduce our absolute greenhouse gas emissions – those from our own operations (scope 1 and 2) as well as those that we inherit via our supply chain (scope 3).
As part of our Science-based Targets commitment, we will reduce absolute scope 3 GHG emissions from purchased goods and services, capital goods, fuel and energy related activities, upstream transportation and distribution, and business travel 12.3% by 2029 from a 2019 base year.
Sustainable Palm and Soy Supply Chains
In the areas of palm (kernel)oil and soy we support the certified sustainable production of these raw materials as a purchaser of plant oil derivatives, which is especially important in Southeast Asia and South America. We are member of the “Roundtable on Sustainable Palm Oil” (RSPO) and “Round Table on Responsible Soy” (RTRS), and buy RSPO- and RTRS-credits according to the quantities we use. The purchase of these credits rewards farmer who grow palm oil and soy in a legal and ecologically, socially and economically sustainable way and who demonstrate this as part of an audited certification process.
Crop Science also cooperates with the RTRS to provide mutual support in the certification of Brazilian soybean producers according to the high ecological, social and economic criteria of the RTRS.
At our Pharmaceuticals division, hormones are synthesized based on sterols that result during the production of plant oils from soybeans, for example, as well as during wood processing. We also purchase steroids that are manufactured from diosgenin or its intermediate stages. This substance is usually obtained from yam grown in countries such as China.
Our Consumer Health division uses extracts of plants to manufacture plant-based pharmaceuticals. We take great care in the cultivation and extraction of raw materials, which are performed according to local or international standards, e.g. the GACP (Good Agricultural and Collection Practice) guidelines.
Promoting Human Rights in the Supply Chain
We unequivocally promote the realization of human rights. We firmly believe that respect for people is essential to achieving lasting business excellence. The main areas we address are: 'Employees and working conditions', 'Harassment and discrimination', 'Freedom of association and collective bargaining', 'Child labor', and 'Health and safety'.
For further information on Bayer’s management approach regarding Human Rights, please visit Human Rights Website.
The focus in 2020 was on developing the strategic approach for respecting human rights in the supply chain. Starting in 2021, we plan to expand our measures with respect to the fulfillment of corporate due diligence in the area of human rights in the supply chain and more intensively integrate them into our procurement processes.
As the procurement of minerals originating from unstable regions of the world can contribute to the financing of conflicts and the violation of human rights, we work to ensure that so-called conflict materials are procured responsibly.
As such, additional verification processes were established for the fulfillment of further international regulations such as those requesting companies to disclose the origin of certain raw materials. This concerns, for example, so-called conflict minerals from regions such as the Democratic Republic of the Congo or neighboring countries. We use the Conflict Minerals Reporting Template to survey our relevant suppliers in order to identify the use, sources and origins of certain minerals in our supply chain. From regular exchanges of information with other companies, we derive measures for timely initiation of process improvements. Thereby, we support our customers in fulfilling the due diligence requirements regarding the origin of certain raw materials in their supply chain. Suppliers who do not meet these requirements are immediately notified that these standards must be complied with and suitable measures initiated.
Explicit expectations of our suppliers are spelled out in our Supplier Code of Conduct. Suppliers shall ensure that products supplied to Bayer do not contain metals whose raw materials originate from conflict regions that directly or indirectly help to finance or support armed groups and cause or foster human rights abuses.
Diversity in Our Supply Base
Bayer is committed to inclusion and diversity, which is reflected in the ambitious goals that were announced in early 2021. It recognizes that its employees and supply base should reflect the diversity of its customer base and foster an environment where differences are valued and celebrated. Bayer’s commitment to economic development through its Supplier Inclusion & Diversity Program is one of the ways in which it supports its mission, “health for all, hunger for none.”. Bayer’s Supplier Inclusion & Diversity Program advocates for small and diverse suppliers and provides opportunities for their growth and development.
The Bayer Supplier Code of Conduct encourages suppliers to engage with diverse owned business and to support Bayer’s I&D goals.