As an international corporate group, we have a duty to respect human rights worldwide within our sphere of influence and to ensure that our business activities do not infringe upon them. By fulfilling our human rights due diligence obligations, we meet the increasing expectations of our shareholders. This enables us to remain competitive over the long term.
Our approach to human rights due diligence
We are committed to upholding human rights, which is why we became a signatory to the UN Global Compact back in 2005. We endeavor to prevent the risk of human rights violations, not only at our own sites but also along our entire supply chain. That is why we integrate human rights due diligence into our business processes. Our approach to human rights due diligence encompasses six main components.
We view our human rights due diligence as a continuous process, which we constantly adapt and improve. This also prompts us to continually review our approach. We closely monitor regulatory developments – for example, the German Supply Chain Due Diligence Act and the planned EU directive on human rights due diligence.
Roles and responsibilities
Our Executive Board has ultimate responsibility for human rights within our sphere of influence. The Executive Board exercises this responsibility by requiring our Managing Directors to comply with human rights.
Our Group Corporate Sustainability unit is responsible for coordinating all human rights due diligence activities. The persons responsible for these issues in the respective Group functions, business sectors and local units implement the specific measures, for instance by integrating human rights due diligence into existing processes.
The interdisciplinary human rights working group (HRWG) is developing cross-functional measures that we are using to meet our responsibility to respect human rights. In addition, it discusses activities and current developments regarding business and human rights. The HRWG meets three to four times per year.
Within the German Global Compact Network, we are a member of the Business & Human Rights Peer Learning Group, a working group in which we engage in dialogue with other companies to discuss challenges, current issues, experiences and successful approaches in exercising human rights due diligence.
Our commitment: Guiding principles, charters and laws
Our Human Rights Charter aligns with the UN Guiding Principles on Business and Human Rights. It is our overarching human rights directive and defines the relevant requirements for our company. We expect our employees as well as our suppliers and business partners to comply with this charter.
The charter interlinks and complements our existing rules and regulations pertaining to human rights, including our Code of Conduct, Social and Labor Standards Policy, EHS Policy (Corporate Environment, Health and Safety Policy), Responsible Sourcing Principles, Responsible Minerals Sourcing Charter, and the Charter on Access to Health in Developing Countries. Our standards cover a broad range of topics related to human rights. These include, for instance, product safety, occupational health and safety, equal opportunity, fair pay, freedom of association and collective bargaining as well as the exclusion of child and forced labor.
Identifying actual and potential impacts on human rights
We perform risk assessments to understand the potential impacts our operations and business relationships could have on human rights. For instance, we investigate human rights risks at our sites as well as risks related to product and service sourcing. These risk assessments enable us to derive the corresponding strategies and measures.
Furthermore, we also track human rights risks through our strategic supplier risk process. More information on how we engage with suppliers can be found under Sustainable supply chain management.
We also meet our human rights due diligence obligations when deploying new technologies. In 2021, we adopted the Code of Digital Ethics. This defines digital ethics principles and forms the basis for the work of the Digital Ethics Advisory Panel. More information can be found under Digital ethics.
In the reporting period, we analyzed our activities designed to implement human rights due diligence in order to identify potential for improvement. We took both stakeholder and regulatory requirements into consideration. The analysis showed that we need a uniform, Group-wide process in order to better evaluate the effectiveness of our human rights due diligence. Above and beyond this, we want to further strengthen the HRWG, for instance by involving our business sectors more intensively.
Measures to protect human rights
Auditing our suppliers and sites
We use internal audits to check whether the workplace requirements of our Human Rights Charter are being observed at our sites. More information on internal audits can be found under Compliance management.
In addition, we review human rights aspects at our sites through site security risk assessments. In 2021, we formalized the assessments as security audits, which will be implemented at regular intervals in line with the audit plan in the future. The audits are one control mechanism of our security governance framework. Increased risk transparency and centralized CAPA tracking allows us to ensure that out sites meet security-relevant human rights aspects.
Through the Together for Sustainability (TfS) initiative, we determine whether our strategic suppliers comply with human rights standards.
Human rights and investment decisions
When projects exceed a certain cost threshold, our Investment Committee must approve the expenditure. In its decision, the committee considers various aspects related to the project, including environmental impact and health and safety. Furthermore, our Code of Conduct is binding where investment decisions are concerned. In 2021, we integrated human rights topics into the decision-making process for mergers and acquisitions.
Creating awareness among our employees
To embed respect for human rights even more strongly throughout the company, we are continuously expanding our internal communication and awareness training on human rights and modern slavery.
To train our Managing Directors and senior leaders reporting directly to the Executive Board, we offer an e-learning course on the requirements of our Human Rights Charter and our Social and Labor Standards Policy and the implementation thereof in their areas of responsibility. In addition, the onboarding course for all new EHS managers covers the topics of human rights and modern slavery. Furthermore, during the reporting period the regional Security Academy meetings elaborated on current developments in the areas of human rights and modern slavery. The Security Academy is a training platform for our local, national and regional Security functions. It addresses security-relevant topics and is coordinated by our Corporate Security Group function.
Training courses for our suppliers
As part of our membership of TfS, in 2021 we helped develop a concept for a sustainability management training platform, which is scheduled for rollout in 2022. It will be available globally, in multiple languages to all buyers and suppliers of the 31 TfS member companies.
We also participated in the #TfSTalks by sharing our conflict minerals approach, among other things. This new, interactive webinar format allows companies to exchange and discuss best practice approaches.
Our reporting practices
We inform the public about our approaches, measures and results of human rights due diligence. We provide information on this annually in our Sustainability Report. Additionally, legislation in Australia and the United Kingdom requires us to publish the steps we are taking to counter forced labor and human trafficking. Apart from the UK Modern Slavery Statement we also published our first Merck Australia Modern Slavery Statement in 2021. Both have been signed by our Executive Board Chair.
Our complaint mechanisms
Our compliance hotline is the most important channel for reporting complaints about potential human rights violations. Our employees as well as external stakeholders can report suspected cases in their respective national language, free of charge and anonymously, either by telephone or a web-based application through our compliance hotline, our Group-wide whistleblowing system. We thoroughly investigate all complaints that we receive and take countermeasures if necessary. In 2021, we noted no violations, either with respect to child or forced labor or with respect to the right to collective bargaining or freedom of association. More information on the compliance hotline can be found under Compliance Management.