Strategy

To provide a comprehensive picture of the company’s sustainability alignment and illustrate how we integrate environmental and social responsibility into our business processes, we share information about our corporate strategy, business models and stakeholder communication.

Strategy, business model and value chain [SBM-1]

The Bayer Group is operated as a life science company consisting of three divisions: Crop Science, Pharmaceuticals and Consumer Health. We contribute innovative healthcare and agriculture products to overcome fundamental challenges facing a growing and aging world population, to prevent diseases and to support the sustainable production of agricultural products according to our mission “Health for all, Hunger for none.”

Group sales totaled €45,575 million in 2025 (2024: €46,606 million. We had 89,237 employees worldwide as of December 31, 2025 (December 31, 2024: 94,081). In 2025, we had 39,258 (2024: 42,334) employees in Europe/Middle East/Africa, 18,710 (2024: 19,205) in North America, 19,265 (2024: 19,548) in Asia/Pacific and 12,004 (2024: 12,994) in Latin America. Calculated in full-time equivalents (FTEs), we employed 88,078 (2024: 92,815) people worldwide. We maintain chemical production activities in our Crop Science Division, posting sales here of €21,622 million in 2025 (2024: €22,259 million).

Our products

Our products help to find solutions for some of the biggest challenges of our time. A growing and aging world population requires an adequate supply of food and ever-improving medical care. Our research and development activities are therefore focused on improving people’s quality of life by preventing, alleviating and treating diseases. We are also making an important contribution to providing a reliable supply of high-quality food, feed and plant-based raw materials. We systematically further developed our product portfolio in 2025. In the Pharmaceuticals Division, we successfully launched the products Lynkuet™ and Beyonttra™. In addition, the marketing of Hyrnuo™ expands our oncology business. Following successful divestments, the Androdur™ and Testoviron™ brands are no longer part of our portfolio. We also further developed our portfolio in the Consumer Health Division, for example with the market launch of MiraFAST™ as part of the MiraLAX™ product range in the United States and through the CanesMeno™ Hub information portal with the associated product line in the United Kingdom. We also acquired Natsana GmbH, an online supplier of natural supplements. In the Crop Science Division, we pressed ahead with the launch of Preceon™, particularly in the United States. On the other hand, Movento™ was taken off the market in the EU.

Most of our finished products, such as pharmaceuticals, crop protection products or some varieties of seeds, are subject to very stringent regulations prescribing specific and extensive approval and registration procedures. As a result, our products cannot be sold on the market until they have been approved by a competent authority, or an official registration has been granted. As a condition of their approval, the prescribed efficacy and safety of the individual products must always be demonstrated as proven. An approval therefore only applies for a particular product with the formulation registered in the marketing authorization. Changes in the product composition (such as new formulations for crop protection products) require an additional authorization or registration.

Regulatory authorities in a country can, in principle, withdraw or substantially restrict the registration for a pharmaceutical or crop protection product and thus prohibit or limit the sale of a product or product group in a market. Some restrictions pertained in the past to the neonicotinoids product group in the European Union, for example. Our approval for this product group in other markets is still valid (such as in the United States and Brazil). In certain cases, we offer crop protection products that are only approved or registered for certain applications in certain countries due, for example, to the conditions prevailing there (including climatic conditions, cultivated crops and the risk of insect pest or fungal infestation). In such cases, it is possible that these products might not or no longer be approved in other markets (such as the European Union). This also applies to our seed business, where we have submitted registration applications for certain varieties with traits in selected markets only (including the United States and Brazil).

In some cases, we have voluntarily discontinued the commercialization of products in previous years and have no longer utilized or pursued the related product registrations (e.g. for carbendazim-based products). In a limited number of cases, we hold product registrations in individual countries even though we do not actively have any products on the market.

Our divisions

Our Crop Science Division operates in the agricultural sector, offering a broad portfolio in the areas of crop protection and seeds & traits that is distributed particularly through wholesalers and retailers, as well as directly to farmers. Our product range comprises high-quality seeds and innovative crop protection solutions, as well as comprehensive services for agriculture.

Our Pharmaceuticals Division focuses on prescription products, especially in the areas of cardiovascular diseases and women’s health, and on specialty therapeutics in the fields of oncology, hematology and ophthalmology. The division also comprises the radiology business, which markets diagnostic imaging equipment together with the necessary contrast agents. We distribute our prescription products in particular through wholesalers, pharmacies and hospitals.

The Consumer Health Division primarily markets nonprescription (OTC = over-the-counter) products in the dermatology, nutritional supplements, pain, digestive health, allergy, and cough and cold categories. These products are distributed particularly through pharmacies, supermarkets and online retailers.

Our value chains

The crop protection value chain encompasses various steps from the extraction of raw materials to the end-customer. The process starts with the research and development of products on the one hand, and with the extraction of raw materials and with the suppliers who provide the necessary raw materials and chemicals on the other. This is followed by the production of the active ingredients. The next step involves the formulation and packaging of crop protection products before these are transported to a country-specific warehouse. The value chain in the area of seeds & traits starts with research and development, more specifically the breeding of seeds and the development and integration of innovative traits, followed by commercial seed production, which serves as the basis for high-quality products. The seed production process is followed by the purification, processing and packaging stages, which ensure that the seeds meet the quality standards and are ready for distribution. The packaged seed is then transported to regional and national warehouses, which ensures efficient logistics and availability in the target markets. The value chain in the area of digital farming ranges from the development of innovative products and software solutions through data management to analysis and provides farmers with precise insights and decision-making tools. Our seed and crop protection products are generally sold to farmers by distributors, wholesalers and retailers. With our seed and crop protection products, as well as with our digital services and the associated value chains, we are at the start of the agricultural production value chain. The focus is on the farmers, who are the ones deciding on the use of the products, which can be supplied by us or other companies. The next links in this value chain are usually distributors, agricultural enterprises (in the case of use as animal feed), food processors and food retailers (as part of the subsequent food value chain), who further process and distribute the products to end-consumers. Agricultural products can also be present in other value chains (such as for fuels).

The value chain in the pharmaceutical sector begins with the research and development of new therapeutics and runs through their preclinical and clinical testing, the approval process, and finally their production (including the upstream value chain) and commercialization. Of significant importance are quality control and the management of clinical data to ensure the safety and efficacy of therapeutics. Drug products are supplied to health facilities, wholesalers and pharmacies with the support of the marketing and distribution functions. From there, they are made available to patients. The value chain in the area of medical diagnostics begins with research and development as the basis for innovative diagnostic solutions aimed at identifying diseases precisely and efficiently. This is followed by production (including the upstream value chain), distribution through a global pharmaceutical diagnostics supply chain, and the use of diagnostic products in medical facilities. Pharmaceutical products are largely marketed and distributed by wholesalers/distributors to pharmacies, to which consumers make a copayment to receive the products.

The value chain of our Consumer Health business starts with the procurement of raw materials, followed by their processing, formulation and packaging, before the finished product is sent from the warehouses to the end-customers through various distribution channels. Wholesalers play a moderate to major role in most regions. Retailers and pharmacy chains are material to the distribution of our Consumer Health products, especially in North America (United States). The importance of distributors varies by market area and is especially pronounced in the Europe/Middle East/Africa and Asia/Pacific regions. Direct deliveries, particularly to hospitals, occur less frequently. In most regions, governments play only a very limited distribution role. For further information on our business model and our value chains, please see Chapter A 1 Fundamental Information about the Group.

Our sustainability targets

In our Crop Science Division, we support smallholder farmers with access to high-quality seed and crop protection products, technologies and services. We want to support a total of 100 million smallholder farmers in low- and middle-income countries (LMICs) by 2030 by improving their access to agricultural products and services, including in collaboration with our partners. For more details, please see the section “Supporting 100 million smallholder farmers in low- and middle-income countries (LMICs)” in Chapter A 4.3.4 Consumers and End-Users.

In our Pharmaceuticals Division, our sales activities with modern contraceptive products support global aid programs (such as the United Nations Population Fund, UNFPA), which we supply with the products on favorable terms. Alongside product sales, we are also engaged in partnerships such as The Challenge Initiative with the Gates Institute at Johns Hopkins University. The partnership programs supported by us help numerous women in Asia and Africa gain access to modern contraception, irrespective of the selected method or manufacturer. We aim to fulfill the need of 100 million women in low- and middle-income countries for modern contraception by 2030. For more details, please see the section “Enabling 100 million women to gain access to modern contraception” in Chapter A 4.3.4 Consumers and End-Users.

In our Consumer Health Division, we expand access to everyday healthcare for people in underserved regions. We want to support 100 million people in economically or medically underserved communities with our self-care interventions in 2030. We leverage our global brands and partnerships to develop and adapt self-care solutions for low-income consumers, bring targeted health education to communities who need it most, establish critical distribution channels, and advocate globally for science-based and accessible self-care. For more details, please see the section “Supporting 100 million people in underserved communities with self-care” in Chapter A 4.3.4 Consumers and End-Users.

Within the scope of our climate strategy, we want to continuously reduce greenhouse gas emissions at our company and across our entire value chain in accordance with the UN SDGs and the Paris Agreement to limit global warming to 1.5° C. Our goal is to achieve net zero greenhouse gas emissions throughout the value chain (Scope 1, 2 and 3) by 2050 at the latest. For more information, please see Chapter A 4.2.2 Climate Change.

Interests and views of stakeholders [SBM-2]

As a company, we are a part of society and public life. We place great importance on maintaining continuous dialogue with our stakeholders, as their expectations and perspectives significantly influence our societal acceptance and, consequently, our business success. Stakeholder dialogue helps us to recognize important trends and developments in society and our markets at an early stage and take this information into account when shaping our business.

We fundamentally distinguish between four stakeholder groups with which we engage in discussions on different issues: partners, financial market participants, societal stakeholders and regulators. We view suppliers, customers and consumers, employees, associations and universities as partners. We regard rating agencies, banks and investors as financial market participants. For us, additional stakeholder groups include societal associations such as nongovernmental organizations, competitors and the public in general. We regard politicians, regulatory authorities and legislators as belonging to the regulators’ stakeholder group.

We assess the expectations and demands of our stakeholders through the double materiality assessment, which includes the viewpoints of external stakeholders and internal company executives through dialogue sessions and surveys, for example. The results reveal the latest developments along with sustainability-related impacts, opportunities and risks. Fields of activity with particularly high relevance are accounted for in the strategic focus area of sustainability, for example in the definition of nonfinancial Group targets.

Our stakeholder dialogue varies based on the specific theme area. A number of themes are addressed globally for the entire company, and thus organized by the Public Affairs, Sustainability & Safety Enabling Function. Local issues (such as with patients, residents or customers) are often organized by our divisions. Our Bayer Societal Engagement (BASE) principles form the basis for our dialogue. These describe how we interact worldwide not just with our employees, but also with patients, customers, consumers, business partners, political stakeholders, scientists, critics and our shareholders.

The results of the stakeholder dialogue are factored into in our decision-making processes in various ways, depending on the respective issue and stakeholder group. For example, we use findings from the discussions with our customers for decision-making processes in connection with research and development. We also use feedback from the societal spectrum, especially for decisions at the local level. Feedback from financial market participants and regulators is essential for our business and is therefore integrated into our business strategy.

The Sustainability Council informs the Board of Management, the CSO, the Public Affairs, Sustainability & Safety Enabling Function and other relevant functions about the societal stakeholders’ interests. Relevant human rights issues are taken directly to the Board of Management by our Human Rights Officer. This occurred once in 2025 (2024: three times). The duties of the ESG Committee of the Supervisory Board relate to sustainable business conduct in the areas of environmental protection, social issues and good governance. This includes the integration of sustainability into the business strategy, the establishment of sustainability targets and the monitoring of nonmandatory ESG reporting. Its tasks include advising the Board of Management in its field of competence and preparing possible Supervisory Board resolutions that need to be made with respect to these questions.

In 2025, we engaged in intensive discussions with our stakeholders on numerous sustainability topics, in particular regenerative agriculture, healthcare, nutrition, climate change, biodiversity and water, taxes, political lobbying, poverty alleviation and family planning. Examples include our contributions to the COP 30 in Belém, Brazil; the World Economic Forum (WEF) Annual Meeting in Davos, Switzerland (Zero Hunger Pledge and the Biodiversity Credit Coalition); our participation in the London Climate Week in the United Kingdom and the Climate Week in New York, United States; the annual OECD Global Forum on Agriculture for an international exchange on agrarian policy with political decision-makers and experts; and numerous events on the topic of regenerative agriculture.

The feedback from our customers and consumers impacts the business strategy of our divisions and thus also the prioritization of research and development projects. The responses from the societal stakeholder groups and financial market participants were relevant in the preparation of our sustainability strategy, such as when defining the focus on areas such as climate protection. We want to more intensively address the issues of biodiversity and resource scarcity, particularly in agriculture. Against the background of widely varying challenges across the different regions (e.g. due to cultivated field crops, climatic conditions, mechanization or water availability), we want to further expand our concept of regenerative agriculture over the long term. In this connection, we engaged with farmers, associations and food industry players in various ways again in 2025. We want to remain in dialogue with our stakeholders on the basis of our BASE principles.

Interests and views of stakeholders as regards own workforce [S1.SBM-2]

Employee interests are of central importance to us and are taken into account in decision-making processes. We ensure this through various formats. Examples include the global employee survey (Ownership Pulse) or surveys on the understanding and application of our Dynamic Shared Ownership (DSO) operating model. We also maintain dialogue formats, such as coffee chats with the Board of Management and area heads, as well as town hall meetings to obtain opinions and questions from Bayer’s own workforce and factored them into impending decisions. We also ensure that our employees’ voices are heard at all times through regular communication and transparent channels for voicing concerns about possible compliance violations (Speak Up Channel). Furthermore, in Germany, for example, our own employees elect their representatives in works council elections held every four years. The same applies to the election of the Managerial Employees’ Committee and of the disabled employees’ representatives. Our works council members also engage in regular discourse with personnel liaison officers and union representatives to voice their interests and communicate them to the employer. The legally required employee assemblies also serve the purpose of informing the company’s own workforce about current topics, obtaining feedback and correspondingly taking this feedback into account.

Within the scope of our due diligence, we ensure that the interests and perspectives of our workforce are identified in order to incorporate their opinions and concerns into our strategic decisions. In various countries (such as Germany, where we have the greatest number of employees) there is a right of information or codetermination for various issues that is exercised through works councils. We additionally factor in the employees’ perspectives and interests through dialogue formats and other measures. The findings are also integrated into our double materiality assessment process through the responsible topic experts.

Both our Board of Management and our Supervisory Board are continuously notified about the perspectives and interests of our workforce, for which Heike Prinz is responsible on the Board of Management as Chief Talent Officer and Labor Director. On the Supervisory Board, 10 employee representatives also represent these perspectives and interests. Various dialogue formats between representatives of the Board of Management and the workforce are also in place to gather employees’ perspectives and consider them in our decision-making processes.

Interests and views of stakeholders related to workers in the value chain [S2.SBM-2]

It is very important to us to take into account the interests of those affected by our activities. We want to perform our due diligence for constructive stakeholder involvement and are working on a concept that incorporates the interests of those affected. For more on our current efforts, please see the section “Processes for engaging with value chain workers about impacts [S2-2]” in Chapter A 4.3.2 Workers in the Value Chain.

We also require our suppliers to adhere to our ethical and social principles, including respect for human rights. This is supported by the implementation of risk analyses with regard to human rights and risk-based oversight measures for suppliers, focusing especially on high-risk countries.

We strive to comprehensively understand the interests and perspectives of workers in our value chain. Our direct dialogue with suppliers and other stakeholders helps us to develop our stakeholder engagement concept. In addition, we actively participate in committees and initiatives such as the corresponding working groups of econsense, where we have overseen the topics of human rights and industry since 2022, and participate in the Business for Social Responsibility (BSR) initiative. The findings obtained are integrated into our double materiality assessment process through the responsible topic experts and were also accounted for in our human rights risk assessment conducted in 2022.

Both our Human Rights Officer and the members of our Sustainability Council can inform the Board of Management about the perspectives and interests of workers in the value chain. Our Human Rights Officer also regularly notifies the Board of Management and the ESG Committee of the Supervisory Board about the perspectives and interests of the impacted stakeholders, including workers in the value chain. The Human Rights Officer is responsible for overseeing human rights risk management and regularly engages in discourse with the Board of Management, reports on human-rights-related activities and informs the Board at least once per year and on an ad hoc basis about current developments.

Interests and views of stakeholders related to affected communities [S3.SBM-2]

We analyze the impacts of our own operations on affected communities according to ESRS and implement suitable protective measures where necessary to minimize any negative consequences and foster stakeholder trust. We focus on communities that are located near our operating sites or affected along our value chain. Through risk management and by accounting for their needs, we strive to establish positive long-term relationships and respect human rights. Bayer does not currently pursue a generally applicable approach for the involvement of affected communities.

We strive to comprehensively understand the interests and perspectives of affected communities through risk management at our sites. The findings obtained are integrated into our double materiality assessment process through the responsible topic experts and were also factored into our human rights risk assessment conducted in 2022.

Both our Human Rights Officer and the members of our Sustainability Council can inform the Board of Management about the perspectives and interests of affected communities according to ESRS. Our Human Rights Officer also regularly notifies the Board of Management and the ESG Committee of the Supervisory Board about the perspectives and interests of the impacted stakeholders, including affected communities according to ESRS. The Human Rights Officer is responsible for overseeing human rights risk management and regularly engages in discourse with the Board of Management, reports on human-rights-related activities and informs the Board at least once per year and on an ad hoc basis about current developments.

Interests and views of stakeholders related to consumers and end-users [S4.SBM-2]

We systematically integrate the interests and perspectives of our consumers and end-users into our strategy and business model. Our activities focus on product stewardship, whereby we ensure that our products meet the highest quality standards and are safe for people and the environment when used as intended. We identify the social impacts on consumers, particularly in relation to their health and safety, and actively manage these impacts as early as during the research and development stage of our products. Our healthcare and agriculture innovations have positive impacts on society, for example in feeding a growing world population and strengthening women’s independence.

We maintain direct contact with our consumers and end-users. For example, the global network of Bayer ForwardFarming comprises 16 farms on four continents that aim to exchange agricultural practices and to promote regenerative agriculture in communities through targeted support. Another important element of our work is trustful dialogue with patient organizations. Such collaborations help us to understand the needs of our patients as they deal with their illness. This allows us to align our research and development with these needs and continue to work on new and improved medicines and therapies. We cooperate with patient organizations in a wide range of therapeutic areas, and we place tremendous value on transparency and respect the independence of our cooperation partners.

By introducing a new operating model (Dynamic Shared Ownership) that also focuses on the interests of our customers during internal decision-making processes, we strive to react even more quickly to the needs and expectations of our end-users.

Material impacts, risks and opportunities and their interaction with strategy and business model [SBM-3]

Through our double materiality assessment, we have identified several material impacts, risks and opportunities in our own operations and in the upstream and downstream value chains. These impacts, risks and opportunities comprise, for example, possible environmental and health risks, social challenges in the workplace and the potential for innovation and sustainable development in the value chain. They are explained in the respective thematic sections.

The revision of our double materiality assessment in 2025 resulted in changes with regard to the material impacts, risks and opportunities. These changes were attributable particularly to the revised aggregation of the impacts, risks and opportunities. For example, we revised and combined a number of impacts, risks and opportunities regarding the area of own workforce. Despite the modified aggregation level, the scope of the identified sustainability matters according to ESRS has not changed. Certain impacts, risks and opportunities were assessed differently in the revised double materiality assessment than they were in the previous year. For example, the positive impact with regard to waste reduction through the recycling and reuse of materials from production processes was now assessed as nonmaterial. Other impacts, risks and opportunities were newly included in the double materiality assessment and classified as material, such as the favorable impact of Bayer’s positive influence on suppliers in terms of improving social and ecological standards. All identified material impacts, risks and opportunities fall under the disclosure requirements of the ESRS.

In particular, the challenges posed by climate change and the associated financial risks for us and our agricultural customers, as well as the opportunities and potentially positive impacts we can have with our products, have prompted us to adapt our business strategies in recent years. We therefore promote a concept of regenerative agriculture that is defined as an outcome-driven cropping system aimed at strengthening the resilience of agricultural production. This concept is based on two interconnected objectives: helping farmers maintain or increase yields with reduced application of agricultural inputs for improved social and economic wellbeing outcomes; and regeneration, which prioritizes a positive impact on nature. This second aspect includes efforts such as striving to improve soil health, preserving and restoring biodiversity in areas devoted to agriculture, conserving water resources, and reducing field-level greenhouse gas emissions and increasing carbon sequestration. While many of our products help enable farmers to implement practices that contribute to regenerative agriculture, some of the innovations and applications we have developed have the potential to shape the future of regenerative farming through changes in the current production system (e.g. short-stature corn, hybrid wheat and direct seeded rice).

For the 2025 reporting year, there were no material current financial effects according to ESRS due to material risks and opportunities related to sustainability matters. While sustainability-related risks and opportunities could essentially impact companies’ financial positions, results of operations or cash flows, we currently do not see any indications of material risks and opportunities that could lead in the next reporting period to a substantial risk of a material adjustment of the carrying amounts.

The material impacts resulting from our own operations and activities in our value chain pertain to environmental, social and governance matters. In terms of the environment, it is climate protection and adaptation to climate change that are of substantial importance to us. We see negative environmental impacts, particularly due to greenhouse gas emissions from our supply chain, our own production processes and our downstream value chain. The emission of greenhouse gases can lead to financial risks stemming from the physical effects of climate change and from transition risks. Opportunities for our innovations also result from the need for products and technologies to reduce the greenhouse gas emissions associated with farming and to adapt to the effects of climate change, both in agriculture and healthcare. Products containing substances of (very high) concern according to ESRS also harbor several potentially negative effects. These include possible impacts on the environment through uncontrolled release into the air, water and soil that could be caused, for example, by environmental incidents, improper use of products or improper disposal of waste. Furthermore, water is an integral factor in agriculture. Both we and our suppliers, but especially our customers, depend on water as a resource. However, we also see potential positive impacts on water use through our product innovations and the application of modern agronomic practices such as the transition to direct seeded rice (DSR).

In connection with social aspects, the focus is particularly on respecting human rights. We have a large workforce at many sites, which is associated with several potential social impacts. These include potential impacts on personal freedoms and human rights, and the impacts on the communities in which we operate. Our products’ positive contributions are also material, as they can favorably affect the health and nutrition of patients, end-users and consumers who in most cases are not our direct customers. These positive effects are a significant component of our business model and are ideal in helping to improve the quality of life of a very large number of people. There are potential impacts in connection with business conduct due to the large workforce, the global business and the dependency on partners in the value chain.

Our business models are also based on contributions from the upstream value chain, which can also be associated with potential impacts on the human rights of workers in the value chain, such as seed producers. With the help of our concepts and measures explained in this report, we are committed to promoting ethical standards and responsible practices in all areas of our business model.

There are different time horizons in which the identified impacts, risks and opportunities can be realized. We estimate that short-term impacts such as possible regulatory changes and market adjustments can be realized over a short- to medium-term period of one to five years. We expect long-term impacts pertaining to the environment and social aspects, such as the physical effects of climate change, biodiversity loss and the development of human rights in our supply chains, over a long-term period of 5 to 10 years or longer.

We currently believe that our strategy and business model – particularly with regard to focusing our agricultural products and innovations toward the concept of regenerative agriculture – enable us to manage material impacts and risks, as well as leverage opportunities.