Merck KGaA · XETR:MRK
Merck KGaA — ESG Presentation (February 2020)
33 slides from Merck KGaA's sustainability presentation, February 2020
Slide 1: Our Corporate Responsibility: General Overview
ouR coRPorate Responsibility General Overview as of February 2020
Slide 2: Successful business with a conscience
successful Business Conscience with a 2 Our Corporate Responsibility
Slide 3: Science is at the heart of everything we do
Science is at the heart “Merck has been operating for more than 350 years. Our long of everything we do. history has taught us that sustainable business success is We want to develop products that always the result of responsible create conduct.” Stefan Oschmann, sustainable value Chairman of the Ex
Slide 4: View from the outside 1/2
View from the outside 1/2 External stakeholders valuate our engagement Since 2008, Merck Merck was confirmed as In 2018, the Merck Since 2015 Merck In 2018, Sustainalytics shares have been a constituent of the share was once again has been a member of awarded us 79 out of included in the Ethibel Sus
Slide 5: View from the outside 2/2
View from the outside 2/2 Proof points for our leading position In 2018, Oekom Merck received Gold In the 2018 Access to Participation in CDP Merck ranks on fourth research AG gave Merck status in 2019, Medicine Index Merck (formerly Carbon place among its peer a “B-” rating which among the top 1% r
Slide 6: Fulfilling our corporate responsibility strategy
Fulfilling our corporate responsibility strategy … We seek to create added We conduct our business in value both for Merck as a responsible manner: well as for the By doing so, we secure CR community… our social license to operate Strategy … focusing our strength on and enhance the those areas where
Slide 7: Strategic sphere Global Health: Improving care globally
Strategic sphere Global Health Improving care globally We provide people with access to adequate high-quality healthcare, for example Transparency on patents to insure public health needs: Pat-INFORMED #4 We improved access to better initiative recognized as a best practice in the therapies in dia
Slide 8: Global Health: Our engagement in Africa
Strategic sphere Global Health Our engagement in Africa Preventing and treating infectious diseases • We aim to eliminate the worm disease schistosomiasis − Since 2007, we have donated over 900 million praziquantel tablets to Number of praziquantel tablets WHO for distribution across 46 nations in A
Slide 9: Sustainable Solutions: More sustainable products
Strategic sphere Sustainable Solutions More sustainable products throughout their life-cycle Continuously improving the sustainability performance of our products and helping our customers to reach their sustainability targets: Our in-house-developed web- We develop display technologies With the Des
Slide 10: Broad Minds: Foster creativity and curiosity
Strategic sphere Broad Minds Foster creativity and curiosity By making education on all levels and culture accessible, we nurture characteristics that are essential to us as a high-tech company, namely creativity, enthusiasm for new discoveries and curiosity: We inspire a love of science Deutsche Ph
Slide 11: How do we secure our social license to operate?
How do we secure our social license to operate? Looking, listening and doing better 1 2 Governance: Responsible Our products and conduct as central pillar of our technologies help to company culture and integrated in solve global problems: When it comes our corporate governance. to safety, environme
Slide 12: Social license to operate: Governance
Our social license to operate: Governance Integrating responsible behavior into our governance 1 2 3 Company values, along with the Group-wide guidelines such as the Derived from the charters, principles external regulations and our Corporate Environment, Health and and policies, our internal standa
Slide 13: Corporate Governance at Merck: Board compensation transparency
Corporate Governance at Merck Reaching a new level of transparency in board compensation and CG Improvements underway: • Intense dialogue with national and • Last voting of AGM on the compensation international investors to discuss state of system (not mandatory for Merck as a the art compensation s
Slide 14: Family-owned and publicly listed
Corporate Governance at Merck The best of both worlds –family-owned and publicly listed Share capital of limited liability Equity interest of General Partner shareholders E. Merck KG € 168,014,927.60 (129,242,252 shares) € 397,196,314.35 • Around 30% of the total capital of • General partner, holds
Slide 15: Profile of skills, expertise and diversity of Supervisory Board
Corporate Governance at Merck Profile of skills, expertise and diversity of Supervisory Board In their entirety, the Nominees for the election of the The Profile of Skills, Supervisory Board in 2019 fulfill the profile of Expertise and Diversity skills, expertise and diversity (see Merck’s for Merck
Slide 16: Boards and Committees
Corporate Governance at Merck Boards and Committees Shareholders of Merck KGaA E. Merck KG: Partners‘ Meeting & Family Board ▪ Shareholders hold ~30% of the total capital of Merck KGaA ▪ E. Merck KG holds ~70% of the total capital of Merck KGaA (99.9% Merck Family) ▪ This capital is divided into bea
Slide 17: Remuneration System
Last AGM approval on Corporate Governance at Merck remuneration system: Remuneration System 2018 Improved remuneration system since 2018 ▪ Share plan based on virtual shares Increasing criteria (bonus) ▪ Share ownership Merck LTIP ▪ KPIs: 50% MRK share price vs. DAX, 25% EBTDA pre margin, + Successf
Slide 18: Anticipatory resolutions on capital measures
Corporate Governance at Merck Anticipatory resolutions on capital measures 1 Authorized Capital 2 Contingent Capital • valid until April 2022 • valid until April 2023 • 56.521.124,19 € • 16.801.491,20 € • 33,6% of base capital • 10% of base capital • Exclusion of subscription rights of 20% • Exclusi
Slide 19: Products with sustainable impact
Our social license to operate: Products & technologies Products with sustainable impact 10% 2 million expanded polystyrene Increased of medicines energy efficiency with OLED in developing and molded foam components displays emerging countries replaced are counterfeit in 2018 Fighting counterfeit med
Slide 20: Social license to operate: People (1/3)
Our social license to operate: People (1/3) Engagement is key 98% 61% More than 30 of employees participated in the Performance and of employees feel Potential engaged at work different part time Management working models Realizing people‘s full potential Employee engagement Better work-life balance
Slide 21: Social license to operate: People (2/3)
Our social license to operate: People (2/3) Well on track for our goals Our goal: Lower the LTIR to 1.5 by 2020 1.8 1.4 1.3 1.5 1.3 12.1% 11.0% 10.4% 9.1% 9.1% 1 2 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 Health & Safety for our people Turnover rate The lost time injury rate (LTIR)* is the
Slide 22: Social license to operate: People (3/3)
Our social license to operate: People (3/3) Well on track for our goals Our goal: 30% women in leadership roles 81% 84% 87% by 2021 74% 70% 29% 30% 32% 26% 27% 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 Diversity Rich leadership pipeline Focus on women in leadership and We identify and advanc
Slide 23: Supporting our communities
Our social license to operate: Supporting our communities Charitable activities together with our employees 2018 We mainly support social projects that align with our strategic focus areas, namely Global Health, Sustainable Spending a Solutions and Broad Minds and happen total of around in the vic
Slide 24: Environmental stewardship: Reducing our footprint
Our social license to operate: Environmental stewardship Reducing our environmental footprint We meet a strict set of environmental We strive to conserve water regulations at all our sites Goal We minimize the amount of Since 2009, our company has held a Group pharmaceutical active ingredient fo
Slide 25: Goals summary
Goals summary 25 Our Corporate Responsibility
Slide 26: ESG goals
ESG goals We are working on ambitious goals Environment Social Governance Climate Product safety Growth & Profit sharing We endeavor to reduce Product safety is one of our Our growth results from innovations and direct and indirect top priorities: From safe acquisitions strengthening our position in
Slide 27: ESG goals: Emissions, water, waste reduced
ESG goals Emissions, water, waste reduced despite growing business Emission target: Water target: Waste target: • Growth-independent reduction of • At 24 sites with relevant water use • We reduce waste and recycle Merck‘s greenhouse gas emissions in areas of high water stress we as much as possible
Slide 28: Selected figures
Selected figures 28 Our Corporate Responsibility
Slide 29: Employees by hierarchical level
Employees Number of employees by hierarchical level Total employees % of women % of men 49,613 50,414 52,941 51,749 59 57 57 56 41 43 43 44 2015 2016 2017 2018 2015 2016 2017 2018 2015 2016 2017 2018 Number of employees 2015* 2016* 2017* 2018* 2015 2016 2017 2018 2015 2016 2017 2018 Senior managemen
Slide 30: Employees by region
Employees Number of employees by region Total employees North America Europe 2015* 2016 2017 2018 2015* 2016 2017 2018 52,941 52.941 Tolal 9,794 10,037 10,520 10,978 51,749 Total 23,429 24,438 25,980 25,792 50,414 Women 4,183 4,308 4,518 4,742 49,613 Women 10,316 10,884 11,627 11,464 Women (%) 43 43
Slide 31: Society: Spending on community involvement
Society Spending Spending on community Focus of our local involvement community involvement in % in € million 100 Based on number of projects 2014 2015 2016*,** 2017 2018* Global Health 33 33 35 38 34 51 Broad Minds 38 33 36 43 42 43 36 Sustainable 34 solutions: Environment 10 7 5 4 2 Disaster relie
Slide 32: Environment: Total greenhouse gas emissions
Environment Total Greenhouse Gas Emissions Total greenhouse gas emissions in metric kilotons Scope 1* Goal emissions that we produce ourselves, for instance by burning fossil fuels to 786 722 689 704 698 for 2020: generate power. 0 Reduce our 13 13 greenhouse Scope 2* 13 gas emissions 14 by 20% emis
Slide 33: Environment: Energy consumption and waste
Environment Moderate energy consumption and less waste Goal Energy consumption for 2020: in terajoules Full integration of the purchase 7,708 7,621 7,898 8,035 of electricity from renewable sources 4,835 4,788 4,748 4,759 2,873 2,833 3,150 3,276 2015 2016 2017 2018 Indirect energy Direct energy cons