For us, sustainable entrepreneurship and profitable growth go hand in hand. We can ensure our own future competitiveness only by creating value for society. Our ambition is to leverage science and technology so as to achieve progress for mankind. In this report, we present a comprehensive picture of our understanding of sustainable entrepreneurship.
We have a long-standing history of embracing corporate responsibility, which is also reflected in our reporting practices. We have been detailing our efforts to meet our obligations to society since 1993. This initially took the form of environmental reports, evolving in 2003 into the publication of a Corporate Responsibility Report every two years. Since 2016, we have been publishing a report annually. In 2020, we restructured our Sustainability organization, formulated new, strategic sustainability goals and, as a result, renamed our “Corporate Responsibility Report” to “Sustainability Report”.
In this report, we describe the new strategic direction of our sustainable entrepreneurship and the focus areas in which we intend to achieve our sustainability goals.
With transparency as a key goal, we work to keep our stakeholders thoroughly informed about our activities and successes, along with the challenges we face.
With this Sustainability Report for 2020, we meet the legal requirements for a combined, separate non-financial report. The Index to the non-financial report provides an overview of the relevant content.
Moreover, the Sustainability Report also documents the progress we have made in implementing the guidelines of the United Nations Global Compact (“Communication on Progress”).
Reporting framework
This report covers fiscal 2020 and pertains to our entire Group, including our 221 subsidiaries in 66 countries. Any deviations from this reporting framework are indicated on a case-by-case basis.
Acquisitions and divestments
In 2019, we acquired Versum Materials, Inc. and Intermolecular, Inc., achieving two milestones in the transformation of our Performance Materials business sector.
We are currently consolidating the methods, objectives, results, and measures relating to our non-financial topics identified as being material. We expect to fully complete this by the end of 2021. The sections of the non-financial report in which the mentioned acquisitions play a significant role reflect the current consolidation measures as of December 2020. We do not list completed integration measures in this report.
In 2020, we sold our allergy business Allergopharma to Dermapharm Holding SE. We completed the divestment on March 31, 2020, subject to the approval of the relevant regulatory authorities and other customary closing conditions. Allergopharma is a leading supplier in the field of allergen-specific immunotherapy of type 1 allergies. Allergopharma products are currently available in 18 markets worldwide. The transaction encompassed the Allergopharma business in Europe and Asia, with the broad portfolio of therapeutic and diagnostic products and the production site in Reinbek near Hamburg (Germany).
Data collection and consolidation systems
In general, the 2020 Sustainability Report provides non-financial indicators that represent the entire Group, including the recently acquired companies Intermolecular, Inc. and Versum Materials, Inc. The Allergopharma business is not included as it was divested in 2020. The majority of the figures we publish reflect the status as of December 31, 2020. If we deviate from these parameters in individual cases, we will indicate this accordingly.
Since 2005, we have been using a Group-wide electronic data collection system to collect environmental and occupational health and safety data, which are tracked locally at our individual sites and approved following review. To maximize the quality of this data, we support the sites in improving their collection processes and their corresponding quality assurance measures. Moreover, our Group Environment, Health, Safety, Security, Quality (EQ) function takes measures, such as internal EHS audits, to review both the processes and the data provided.
We collect environmental performance indicators across all our production sites. We also record these indicators for the warehouse, research and office locations that are relevant in terms of their environmental impact. This report’s scope of consolidation therefore covers all Group sites that have relevant impacts on the environment.
All employee master data is continually updated in an SAP database. Some employee data is disclosed only for select sites or countries, which is accordingly indicated in the respective text passages.
We use community data management software to track data pertaining to our community outreach activities.
Determining report content
We align the content of our report with the internationally recognized guidelines of the Global Reporting Initiative (GRI) and the principles of completeness and materiality as well as input from our stakeholders. This report has been prepared in accordance with the GRI standards: Comprehensive option. Furthermore, we have taken into consideration the requirements of the capital market for assessing companies’ sustainability performance.
We perform a materiality assessment annually to determine the sustainability topics of relevance to our Group. Experts from our business sectors and relevant Group functions review and validate the findings of this analysis. Moreover, as stipulated by section 289c (2) of the German Commercial Code (HGB), we also check the issues for “double materiality”. We have derived the content of this CR report from the results of the materiality assessment, which can be found together with the materiality matrix under Materiality analysis.
Our Executive Board has reviewed and approved this report. The content of the non-financial report has also been reviewed by the Supervisory Board in accordance with section 111 (2) of the German Stock Corporation Act (AktG).
External audit
KPMG AG Wirtschaftsprüfungsgesellschaft has audited the annual financial statements and management report of our company for the fiscal year spanning January 1 to December 31, 2020 and has issued an unqualified opinion.
Furthermore, after undergoing a limited assurance audit, our company has received an independent audit certificate for the following chapters of this Sustainability Report as well as for the non-financial report.
The additional contents provided on both the company’s websites as well as external web pages that are linked in this report are not part of the information assured by KPMG.
Contact:
We welcome your feedback and are happy to answer any questions.
Merck KGaA
Corporate Affairs
Group Corporate Sustainability
Maria Schaad
Frankfurter Str. 250
64293 Darmstadt
Germany
Tel.: +49 6151 72-0
Fax: +49 6151 72-200
The previous Corporate Responsibility Report was published in April 2020. Our next Sustainability Report is scheduled for publication in April 2022.