Within the scope of our double materiality assessment, we have identified material impacts, risks and opportunities and manage these through our strategies, processes and actions. We report extensively on our corporate governance structures, the recommendations of the German Corporate Governance Code and the composition and procedures of the Board of Management and the Supervisory Board.
Our material impacts lie in our ethical standards, which can also have positive market effects. Our Code of Conduct defines the fundamentals of our ethical standards, and our management includes training measures on compliance issues (including corruption prevention) and a Speak Up Channel. As a global company, we also have a positive impact on suppliers to improve social and ecological standards. Furthermore, through active participation in public debates, we promote science- and fact-based decision-making in politics and society. We make a positive contribution to society and environmental protection through our political lobbying for issues with a particular focus on social matters such as access to healthcare in low-income countries and climate change mitigation or adaptation.
At the same time, we are exposed to potential risks such as unethical competition, antitrust violations, corruption and data protection infringements. Any potential failure to comprehensively integrate the principles of business ethics could lead to reputational damage and financial consequences. Furthermore, failure to comply with our Human Rights Policy can lead to human rights violations, which presents a risk for our license to operate. The findings of our risk identification and assessment are taken into account in our governance strategies and help us to make sustainable and responsible business decisions.
Corporate culture and business conduct policies [G1-1]
We have various business conduct and corporate culture policies, thereby taking account of corresponding impacts and risks.
Integrity and compliance through our business conduct policies and corporate culture
Integrity is anchored in our corporate culture and guides our actions. We do not tolerate illegal or unethical actions. We investigate and thoroughly clarify any potential violations. Confirmed violations are sanctioned in accordance with our sanction regulations. Our Code of Conduct serves as a guidance document for our company and our employees and ensures that we act according to all applicable legal requirements.
We strive to continuously increase transparency, both in our political lobbying work and in the focus areas of our efforts. To achieve this, we make our political positions on the most important issues associated with our activities publicly available. Through our lobbying, we make a positive contribution to society and the environment by increasing the visibility of socially and environmentally related issues. Our binding Code of Conduct for Responsible Lobbying specifies, for example, that our lobbyists communicate our messages and positions to political decision-makers transparently, fairly, with integrity and in a fact-based way.
We introduced the Bayer Societal Engagement (BASE) principles in 2019 to ensure that we meet the expectations society has of our company. The BASE principles 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. This is how we want to live up to our social responsibility as a transparent company that acts sustainably and is respected for its contribution to progress in healthcare and agriculture. We want to listen, understand, take concerns seriously and conduct a respectful dialogue. Our mission “Health for all, Hunger for none” forms the foundation for the BASE principles.
Furthermore, our employees should be aware of the most significant risks in their business activity and proactively identify and address them in order to protect our company. We have established an effective risk and compliance management system to promote and strengthen legally compliant conduct and a positive risk culture. Training measures on the elements of this system are compulsory and must be completed by our employees in a timely manner. The elements of this system promote a positive compliance culture throughout our organization and help to ensure integrity in each employee’s daily business activity. We use regulations, procedures, training courses and controls to integrate preventive measures into daily business activities. Our compliance approach is supported by a global compliance organization headed up by our General Counsel in their role as the Group Compliance Officer. In this function, the Group Compliance Officer reports directly to the Chief Financial Officer (CFO) and the Supervisory Board’s Audit Committee. The CFO is responsible for the compliance organization, while the Audit Committee of the Supervisory Board oversees the effectiveness and further development of compliance within the Group.
We additionally regularly review our human-rights-related risk management approach by both proactively identifying and also addressing human rights risks to avoid noncompliance. Those responsible monitor the implementation of our commitments along the entire value chain, determine the effectiveness of the implemented measures for managing human rights risks, and develop improvement measures as and when necessary. We are always mindful of the individual right to privacy, which is a fundamental human right guaranteed and protected by data protection laws. We also endeavor to create a work environment in which discrimination, harassment and unjustified punitive actions are not tolerated. We treat one another with fairness and respect, and act in Bayer’s best interests.
We cultivate a culture of openness and transparency in our company. We encourage employees and third parties to raise their concerns with regard to compliance and therefore promote an environment in which everyone feels able to speak up. When questions are posed and concerns raised, this helps us to maintain a strong compliance culture. We also provide information, sufficient resources and guidance to prevent violations of the law or company rules.
Employees can use our global Speak Up Channel in numerous languages. This is a secure channel that gives everyone (including the public) the opportunity to report alleged compliance violations confidentially (and anonymously, wherever permitted by local law). Employees and outside parties can also directly contact our compliance department via the email address Speak.Up@Bayer.com. If employees believe an activity or behavior could represent a material compliance violation, they have an obligation to report this.
Depending on the severity of the compliance violation, it can have disciplinary, civil or criminal consequences for those responsible. Proven misconduct can also have an effect on relevant individuals’ compensation. Failure to report, properly investigate and rectify a suspected material compliance violation can also have serious ramifications, including labor law consequences, criminal sanctions for the company and liability for individual employees, as well as fines and reputational damage.
We help all employees to act with integrity and proactively avoid potential violations by implementing Bayer-wide training measures and communication campaigns that are tailored to target groups and based on identified needs. Our Code of Conduct forms the basis for our compliance communication and training activities. Both supervisors and compliance managers are available to answer employees’ questions about lawful behavior.
Training measures on anti-corruption, the importance of openly expressing concerns (Speak Up), antitrust law, conflicts of interest, fairness and respect at work, foreign trade law compliance and data privacy are also elements of our compliance management system.
Each year, a new compulsory training course on compliance is published for all our employees. In 2025, we offered a web-based training course on the new Code of Conduct in 92 countries. The course is available in 15 languages.
Our annual, company-wide Speak Up campaign to foster an open reporting culture communicates the various options for reporting compliance violations. This is designed to create an environment in which compliance violations can be addressed without reservations.
Within our general anti-corruption training course, we offer further-reaching learning paths with additional information for high-risk functions and departments that are most affected by corruption and bribery issues due to their fields of activity. These learning paths are specially geared toward employees who have contact with healthcare professionals and public officials. High-risk functions generally include procurement, distribution and marketing, as well as our departments that participate in tender processes.
Management of relationships with suppliers [G1-2]
The procurement organization supplies our company with raw materials, goods and services all around the world. It acts on behalf of all business areas and enabling functions by leveraging synergies through the pooling of expertise and procurement spending. The Procurement function reports to the Chief Financial Officer.
We have an impact on society and the environment through our procurement activities and supplier relationships. Economic, ethical, social and environmental principles are therefore anchored in the Bayer Supplier Code of Conduct and the Sustainability for Procurement guidance document that is globally binding for all procurement employees worldwide.
We want to promote sustainable partnerships with our suppliers that are based on compliance, sustainability, fairness and integrity in each purchasing decision. Our procurement employees make well-founded make-or-buy decisions, taking into account fairness, cost efficiency, supply security, legal compliance, sustainability, quality and antitrust regulations. We also give external business partners clear orientation aids, such as our Bayer Supplier Code of Conduct guidance document or supplier training measures, and set expectations regarding mutually beneficial collaborations.
Furthermore, we operate according to established processes in procurement and supplier management. As the market and supply chain management are very dynamic and constantly evolving, long-term contracts and active supplier management for strategically important goods and services are essential elements here. They serve to minimize procurement-specific risks such as supply bottlenecks or significant price fluctuations, safeguard the company’s competitiveness and ensure smooth production processes.
We utilize a contractual clause to articulate our sustainability requirements and insist on their inclusion in contracts with our suppliers. This clause is supplemented by supplier evaluations with regard to their sustainability performance and by development activities to improve sustainability practices in the supply chain. The contractual clause on sustainability has two key underlying points:
The supplier agrees to accept our Bayer Supplier Code of Conduct and organize its business in accordance with the principles described.
We reserve the right to assess or review the supplier’s compliance with our Bayer Supplier Code of Conduct. This marks the beginning of our evaluation process based on the Bayer Supplier Code of Conduct, respect for human rights and the greenhouse gas emissions emitted by the suppliers.
The Bayer Supplier Code of Conduct establishes important social, environmental and ethical standards that we expect our suppliers and subcontractors to comply with. It is therefore made available to our suppliers in several languages to strengthen understanding of how these principles should be implemented in daily business (including promoting efforts to improve human health and protect the environment). In addition, our comprehensive Bayer Supplier Code of Conduct guidance document aims to provide specific examples for proven practices and benchmarks that suppliers can use, as well as references such as the regulatory framework and standards for our sustainability efforts.
Among other aspects, the Bayer Supplier Code of Conduct guidance document offers suppliers:
Important information on how they can improve their ethical, social, environmental and other general organizational and economic endeavors
Support in preparing for a performance evaluation or re-evaluation
References to generally acknowledged standards and regulatory frameworks
When selecting suppliers, we take into account all types of suppliers. We work continuously to strategically advance sustainability issues in procurement, particularly as regards environmental and human rights questions. Sustainability-oriented criteria and standards apply to our supply chain at both the global and regional levels.
We have established a four-step management process throughout the Group so that we can assess sustainability practices in the supply chain and improve them over the long term. This risk-based approach helps us to assess sustainability-related risks and monitor them in our supply chain. Through the sustainability assessments we can identify sustainability-related risks among selected suppliers and focus on any need for improvement. This process is centrally steered by the sustainability team in the Procurement function.
Step 1 – Awareness among suppliers about sustainability: The Bayer Supplier Code of Conduct establishes principles on ethics, people and work, health, safety and environmental protection, quality and governance, as well as on the established management systems. It is made available to our suppliers. We expect our suppliers also to apply these principles in the downstream stages of their supply chain.
Step 2 – Nomination of suppliers to be assessed: Suppliers are selected for sustainability assessments based on a combination of country and sustainability risk categories, as well as their strategic importance for us.
Step 3 – Assessment of suppliers’ sustainability performance: Suppliers selected for assessment are assessed either on site through an audit conducted by external auditors or using an online assessment by EcoVadis (an external provider of sustainability assessments).
Step 4 – (Further) development of suppliers: The audit and assessment results are internally analyzed and documented. If deficiencies are found when assessing suppliers, we develop corrective measures together with the respective suppliers to improve their future sustainability assessments.
In addition to our Bayer Supplier Code of Conduct, our strategy for managing relations with regard to our suppliers includes our Sustainability for Procurement guidance document. This offers internal stakeholders general instructions for integrating sustainability aspects into procurement activities. The document also contains the description of the four-step management process.
To effectively address the manifold challenges of a sustainable supply chain and to leverage synergies, we are a member of various industry initiatives – most importantly the PSCI and TfS, a chemical industry initiative of which we are a co-founder. Both initiatives are focused not just on conducting supplier audits or sustainability assessments, but also on building supplier expertise through measures such as training courses and events. The objective here is to help suppliers act in accordance with industry expectations with regard to sustainability, which is commensurate with our supplier development goals. Many of the training courses offered are available not only in English, but also in other languages such as German, Spanish, Portuguese and Chinese.
Supplier management with regard to sustainability is embedded into the entire supplier life cycle. It aims to establish an overarching approach to our supplier relations through appropriate management until the end of the relationship.
Prevention and detection of corruption and bribery [G1-3]
We do not tolerate corruption and we reject any business opportunity that involves bribery or the unlawful exertion of influence on third parties. We offer gifts or extend invitations only within ethical and legal limits. We comply with the highest ethical standards, especially when it comes to gifts or invitations for healthcare professionals or public officials, as this is completely prohibited in some cases. These standards include our Code of Conduct, which sets the standard for how our employees should conduct themselves in compliance with laws and internal rules as well as, for example, the codes of the International Federation of Pharmaceutical Manufacturers & Associations (IFPMA) and the European Federation of Pharmaceutical Industries and Associations (EFPIA). Even when the payment of a contribution is permitted, public reporting or disclosure may be necessary. We comply with all applicable laws to prevent money laundering.
Our Code of Conduct contains binding stipulations on the issue of anti-corruption. This is supplemented by policies valid throughout the Group that refer to numerous additional information documents on fighting corruption. These include a policy from the legal and compliance organization with references to provisions on how to deal with gifts, as well as on event management, charitable giving by the company and divisional giving by the divisions, and third-party audits. The Code of Conduct and our policies are enacted using a special process. Enactment involves the formal and legal recognition of the Code of Conduct or the policies by the management of the relevant Bayer company. This makes a policy subject to the legal provisions of the company that must be complied with. The enactment is continuously monitored to ensure that the rules are fully implemented. Bayer supports the implementation of these rules through training and/or target-group-specific communication. We monitor compliance with the binding anti-corruption requirements using our Integrated Compliance Management system, for example by conducting spot checks or making inquiries in certain areas.
The Speak Up Office, which is part of the global legal and compliance organization, decides, following a plausibility check, on the appropriate referral of compliance audit cases and ensures that the audit is undertaken by independent experts. Depending on the circumstances of the case, multifunctional investigation teams from different units (e.g. Legal, Internal Audit, Human Resources) are entrusted with processing the cases. These investigation teams operate largely independently.
In the event of compliance violations that are of significant regulatory and/or financial importance due to their nature and impact, or that pertain to a member of the global leadership team, a Compliance Committee that meets on an ad hoc basis decides on possible sanctions. Decisions on sanctions require a majority vote. Our General Counsel has a right of veto when a decision is made. If this right is exercised, the matter is passed on to the Board of Management for a final decision.
Every newly hired person, including members of the Board of Management or Supervisory Board, must complete a 30-minute anti-corruption training session that covers the most important risks as well as case studies and test questions to deepen their understanding of this issue. Our employees were also assigned a compulsory web-based Code-of-Conduct training course, most recently in 2024, aimed at systematically preventing and creating awareness about compliance risks, including corruption risks. This training also extends to all our functions that we have classified internally as high-risk functions (100%). Our compliance training courses are regularly updated and correspondingly assigned to our employees.