Climate Change Data

Merck & Co., Inc.

Climate Impact & Sustainability Data (2018, 2019-2020, 2020-2021, 2021-2022, 2022-01 to 2022-12, 2023-2024)

Reporting Period: 2018

Environmental Metrics

Total Carbon Emissions:1,173,200 tCO2e (Scope 1 and market-based Scope 2) + 6,231,700 tCO2e (Scope 3)
Scope 1 Emissions:783,500 tCO2e/year
Scope 2 Emissions:389,700 tCO2e/year
Scope 3 Emissions:6,231,700 tCO2e/year
Renewable Energy Share:14.1%
Total Energy Consumption:19,113,300 GJ/year
Water Consumption:20.5 million m3/year
Waste Generated:38,413 tons/year
Carbon Intensity:0.0000277 MT CO2e/revenue in 2018

ESG Focus Areas

  • Access to Health
  • Employees
  • Environmental Sustainability
  • Ethics & Values

Environmental Achievements

  • 14% of purchased electricity from renewables by 2018
  • 15% reduction of water use since 2015

Social Achievements

  • MSD for Mothers reached more than 9 million women in 48 countries
  • 41% of management roles held by women in 2018
  • $2.8B total giving in 2018

Governance Achievements

  • TIME magazine named Ken Frazier to the 2018 TIME100
  • FTSE4Good index constituent since 2008
  • Enhanced global ethics program including improved reporting tool

Climate Goals & Targets

Long-term Goals:
  • By 2040: 100% of purchased electricity from renewable sources
Medium-term Goals:
  • By 2030: Protect one billion more lives
Short-term Goals:
  • By 2020: Develop water conservation plans for sites in high water risk locations; Engage with strategic suppliers to identify GHG emission reduction opportunities; 90% of new human health active pharmaceutical ingredient processes meet internal sustainability targets at launch
  • By 2025: Maintain global water use at or below 2015 levels; Reduce global Scope 1 and market-based Scope 2 GHG emissions by at least 40 percent from 2015 levels; No more than 20 percent of global operational waste sent to landfills and incinerators; At least 90 percent of strategic suppliers with highest environmental impacts set their own GHG emission reduction targets; 50 percent of sites send zero waste to landfill

Environmental Challenges

  • Health care and drug pricing reforms
  • High health care costs
  • Climate change risks to clean air and water, food supplies, and disease spread
Mitigation Strategies
  • Working with stakeholders and being transparent about pricing efforts
  • Pledge not to increase average net prices by more than inflation annually
  • Investing in pipeline and manufacturing to protect one billion more lives by 2030
  • Reducing energy demand and GHG generation
  • Implementing energy-efficiency and demand-reduction projects

Supply Chain Management

Supplier Audits: Over 90 Labor & Human Rights Audits in 2018

Responsible Procurement
  • Business Partner Code of Conduct
  • Supplier Self-Assessment Questionnaire (SAQ) for Ethics & Compliance
  • Conflict Minerals Policy
  • Pharmaceutical Industry Principles for Responsible Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks
  • Threats to clean air and water, insufficient food supplies, and the spread of disease
Transition Risks
  • Future climate change requirements
Opportunities
  • Energy-efficiency and demand-reduction projects

Reporting Standards

Frameworks Used: GRI, SASB, UN Global Compact

Certifications: ISO 14001 (some facilities)

Third-party Assurance: WSP (limited assurance for greenhouse gas and water inventories)

UN Sustainable Development Goals

  • SDG 3 (Good Health and Well-being)
  • SDG 5 (Gender Equality)
  • SDG 6 (Clean Water and Sanitation)
  • SDG 7 (Affordable and Clean Energy)
  • SDG 13 (Climate Action)
  • SDG 15 (Life on Land)

Various initiatives described throughout the report contribute to these goals.

Sustainable Products & Innovation

  • Not disclosed

Awards & Recognition

  • CDP A- leadership rating for climate change disclosure (2017 & 2018)

Reporting Period: 2019-2020

Environmental Metrics

Total Carbon Emissions:755,340 + 316,630 + 6,965,600 tCO2e/year (Scope 1, 2, 3)
Scope 1 Emissions:755,340 tCO2e/year
Scope 2 Emissions:316,630 tCO2e/year
Scope 3 Emissions:6,965,600 tCO2e/year
Renewable Energy Share:25.4%
Total Energy Consumption:Not disclosed
Water Consumption:20.3 million m3/year
Waste Generated:75,500 tons/year
Carbon Intensity:Not disclosed

ESG Focus Areas

  • Access to Health
  • Employees
  • Environmental Sustainability
  • Ethics & Values

Environmental Achievements

  • Reduced water use by 15% since 2015
  • 25.4% of purchased electricity from renewable sources by 2020 (goal is 100% by 2040)
  • 100% of new human health product packaging reviewed for environmental impact and improvement in 2019

Social Achievements

  • Zero employees laid off in 2020 due to the pandemic
  • $2.4B spend with minority-, women-, veteran-, LGBT- and disability-owned suppliers
  • 43% of management roles held by women

Governance Achievements

  • Increased Board of Directors diversity to 46% women (up from 33% at the end of 2019)
  • Implemented an improved reporting tool (Speak Up) operated by an independent third party

Climate Goals & Targets

Long-term Goals:
  • 100 percent of purchased electricity from renewable sources by 2040
Medium-term Goals:
  • At least 50 percent of purchased electricity from renewable sources by 2025
Short-term Goals:
  • Reduce global Scope 1 and market-based Scope 2 GHG emissions by at least 40 percent from 2015 levels by 2025
  • Maintain global water use at or below 2015 levels by 2025
  • No more than 20 percent of global operational waste sent to landfills and incinerators (without energy recovery) by 2025

Environmental Challenges

  • Potential impacts of climate change including increased operating costs, physical risks to facilities, water limitations, and supply chain disruptions
  • Access to and funding for healthcare can be limited in low- and middle-income countries
  • Counterfeit products pose risks to patient safety
Mitigation Strategies
  • Integrated potential climate change risks into business planning, including investments in reducing energy, water use, and greenhouse gas emissions
  • Developed various sustainable strategies to improve access in low- and middle-income countries, including differential pricing and partnerships
  • Collaborated with government agencies, other pharmaceutical manufacturers, and organizations to combat counterfeit products and educate the public

Supply Chain Management

Supplier Audits: 234 onsite audits in high-risk countries since 2015

Responsible Procurement
  • Pharmaceutical Industry Principles for Responsible Supply Chain Management
  • UN Global Compact
  • Supplier Self-Assessment Questionnaire (SAQ)

Climate-Related Risks & Opportunities

Physical Risks
  • Increased operating costs
  • Physical risks to facilities
  • Water limitations
  • Supply chain disruptions
Transition Risks
  • Additional regulatory requirements
Opportunities
  • Transition to more energy-efficient technology

Reporting Standards

Frameworks Used: GRI, SASB, UN Global Compact

Certifications: ISO 50001:2018 (some facilities), LEED (some facilities), Responsible Care® Management System

Third-party Assurance: WSP (limited assurance for GHG and water inventories)

UN Sustainable Development Goals

  • SDG 3 (Good Health and Well-being)
  • SDG 6 (Clean Water and Sanitation)
  • SDG 13 (Climate Action)
  • SDG 5 (Gender Equality)

Initiatives aligned with these goals through various programs and partnerships

Sustainable Products & Innovation

  • Health literate patient labels

Awards & Recognition

  • ENERGY STAR Certified Building label (multiple buildings)
  • ENERGY STAR Pharma Energy Performance Indicator (Puerto Rico facility)
  • EPA Sustained Excellence Award

Reporting Period: 2020-2021

Environmental Metrics

Total Carbon Emissions:993,800 tCO2e/year (Scope 1 & 2 market-based)
Scope 1 Emissions:738,400 tCO2e/year
Scope 2 Emissions:255,400 tCO2e/year
Scope 3 Emissions:7,103,450 tCO2e/year
Renewable Energy Share:37.7%
Total Energy Consumption:18,033,385 GJ/year
Water Consumption:20.5 million m3/year
Waste Generated:77,578 tons/year
Carbon Intensity:13.4 tCO2e per employee (2020)

ESG Focus Areas

  • Expanding access to health
  • Developing and rewarding a diverse, inclusive and healthy workforce
  • Protecting the environment
  • Operating with the highest standards of ethics and values

Environmental Achievements

  • Achieved all 2020 environmental goals
  • Reduced water use by 14 percent from 2015 baseline
  • 48% of sites sent ZERO waste to landfill
  • 57% of hazardous waste beneficially reused in 2020
  • 80% of non-hazardous waste beneficially reused in 2020
  • 38% purchased electricity from renewable sources

Social Achievements

  • 46 percent of our company’s board of directors are women and 23 percent are from underrepresented groups
  • $3 billion cash grants, in-kind donations and product donations
  • 285 million people reached through investment in partnerships, programs and impact investment that support health care capacity-building and address underlying barriers to access to health
  • More than 78 million people reached through improved access to quality facilities since launch of Merck for Mothers
  • 13 million women reached with healthier pregnancies and safer deliveries in more than 50 countries since 2012
  • >99% of employees trained on our ethical expectations and principles found in our Code of Conduct

Governance Achievements

  • Established the ESG Strategy Management Team
  • Maintained 100% compliance to regulatory requirements for active incident monitoring, risk/harm analysis and on-time notification of data breaches
  • Shareholder support of the advisory vote on executive compensation 91%

Climate Goals & Targets

Long-term Goals:
  • Not disclosed
Medium-term Goals:
  • Reduce our operational greenhouse gas (GHG) emissions (Scopes 1 & 2) 46% by 2030
  • Work with our suppliers to achieve a 30% reduction in Scope 3 GHG emissions by 2030
  • Further advance health equity by reaching 30 million people in low- and middle-income countries and in U.S. underserved populations with our social investments, by 2025
Short-term Goals:
  • Achieve carbon neutrality across our operations by 2025 (Scopes 1 & 2 emissions)
  • Source 100% of our purchased electricity from renewables by 2025
  • Increase representation in senior management roles by 2024

Environmental Challenges

  • COVID-19 pandemic impact on global health and economies
  • Supply chain disruptions
  • Affordability challenges for critical illness treatments
  • Water-related risks in operations and supply chain
  • Climate change risks (increased operating costs, physical risks to facilities, water limitations, supply chain disruptions)
Mitigation Strategies
  • Granted voluntary licenses to accelerate availability of molnupiravir in low- and middle-income countries
  • Collaborated with Johnson & Johnson to scale up production of its pandemic vaccine
  • Developed water conservation plans for sites in high water risk locations
  • Engaged with suppliers to reduce their emissions and water use
  • Invested in reducing energy, water use and greenhouse gas emissions
  • Established internal policies and practices focused on reducing energy use and minimizing greenhouse gas generation
  • Collaborated with reinsurers and insurance companies to develop accessible health insurance products

Supply Chain Management

Supplier Audits: 547 Supplier Self-Assessment Questionnaires, 47 Supplier LHR audits (2020)

Responsible Procurement
  • Business Partner Code of Conduct
  • Supplier Performance Expectations
  • GREEN Supplier Program
  • PSCI Pharmaceutical Industry Principles for Responsible Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks
  • Extreme weather
  • Water limitations
Transition Risks
  • Regulatory changes
Opportunities
  • Development of energy-efficient products

Reporting Standards

Frameworks Used: GRI, SASB, UN Global Compact, UN Sustainable Development Goals (SDGs)

Certifications: Science-Based Targets certification

Third-party Assurance: ERM (limited assurance for greenhouse gas and water inventories)

UN Sustainable Development Goals

  • SDG 3 (Good Health and Well-being)
  • SDG 6 (Clean Water and Sanitation)
  • SDG 15 (Life on Land)

Initiatives related to access to health, water stewardship, and environmental sustainability

Sustainable Products & Innovation

  • Green and sustainable science initiatives for API synthesis

Awards & Recognition

  • Newsweek America’s Most Responsible Companies
  • Human Rights Campaign Foundation Best Place to Work for LGBTQ Equality
  • Barron’s 100 Most Sustainable Companies
  • Fortune World’s Most Admired Companies
  • Forbes America’s Best Employers for New Graduates
  • Energy Star Partner of the Year
  • Disability:IN® Best Places to Work for Disability Inclusion
  • Fast Company Top 50 Most Innovative Companies
  • Just Capital Just 100 List

Reporting Period: 2021-2022

Environmental Metrics

Total Carbon Emissions:7,654,600 tCO2e/year
Scope 1 Emissions:695,700 tCO2e/year
Scope 2 Emissions:230,000 tCO2e/year
Scope 3 Emissions:6,958,900 tCO2e/year
Renewable Energy Share:41%
Water Consumption:19.4 million m3/year
Waste Generated:82,000 tons/year
Carbon Intensity:13.61 tCO2e per employee

ESG Focus Areas

  • Expanding access to health
  • Developing and rewarding a diverse, inclusive and healthy workforce
  • Protecting the environment
  • Operating with the highest standards of ethics and values

Environmental Achievements

  • 9% reduction in Scope 1 and 2 emissions from 2019 baseline
  • 41% of purchased electricity sourced from renewables in 2021

Social Achievements

  • Five percent increase in senior management UEG representation in the U.S. from 2020 to 2021
  • Reached 31.5 million people in low- and middle-income countries and in U.S. underserved populations with social investments

Governance Achievements

  • Maintained 100% compliance to regulatory requirements for active incident monitoring, risk/harm analysis and on-time notification of data breaches
  • Issued inaugural $1 billion sustainability bond

Climate Goals & Targets

Long-term Goals:
  • Achieve carbon neutrality across our operations by 2025 (Scopes 1 & 2 emissions)
Medium-term Goals:
  • Reduce operational GHG emissions (Scopes 1 & 2) 46% by 2030 from a 2019 baseline
  • Reduce value chain (Scope 3) GHG emissions by 30% by 2030 from a 2019 baseline
  • Source 100% of purchased electricity from renewables by 2025
Short-term Goals:
  • Maintain global water use at or below 2015 levels by 2025
  • No more than 20% of global operational waste sent to landfills and incinerators (without energy recovery) by 2025
  • At least 50% of sites send zero waste to landfills by 2025

Environmental Challenges

  • 9% increase in Scope 3 emissions from 2019 baseline
  • Increased turnover (2.6% from 2020)
Mitigation Strategies
  • Launched Merck’s Low Carbon Transition Playbook
  • Expanded outreach to HBCUs and partnerships with organizations to build diverse talent pipeline
  • Expanded flexible work arrangements and wellbeing programs

Supply Chain Management

Supplier Audits: 10 supplier Labor and Human Rights audits conducted in 2021; 127 supplier self-assessments

Responsible Procurement
  • Business Partner Code of Conduct
  • Supplier Performance Expectations
  • GREEN Supplier Program
  • PSCI Principles for Responsible Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks
  • Extreme weather events
  • Sea-level rise
  • Reduced access to water
  • Loss of biodiversity
Transition Risks
  • Regulatory changes
  • Carbon pricing
  • Changes in technology
  • Market shifts
Opportunities
  • Development of energy-efficient products and processes
  • Increased use of renewable energy

Reporting Standards

Frameworks Used: GRI, SASB, UNGC, TCFD

Certifications: ISO 50001:2018 (some facilities), LEED (various certifications across facilities)

Third-party Assurance: ERM CVS (limited assurance for GHG and water inventories)

UN Sustainable Development Goals

  • SDG 3 (Good Health and Well-being)
  • SDG 6 (Clean Water and Sanitation)
  • SDG 13 (Climate Action)
  • SDG 5 (Gender equality)
  • SDG 8 (Decent work and economic growth)
  • SDG 10 (Reduced inequalities)

Initiatives aligned with SDGs are detailed throughout the report.

Awards & Recognition

  • Just Capital / Forbes Just 100 List (ranked #1 in Pharmaceuticals & Biotech)
  • 3BL Media 100 Best Corporate Citizens
  • Human Rights Campaign Foundation Best Places to Work for LGBTQ+ Equality
  • Fortune World’s Most Admired Companies
  • Newsweek America's Most Responsible Companies
  • Bloomberg Gender-Equality Index
  • Barron's 100 Most Sustainable Companies
  • Forbes America’s Best Employers
  • Disability:IN® Best Places to Work for Disability Inclusion
  • ENERGY STAR awards
  • EPA Sustained Excellence Award
  • ACS Green Chemistry Challenge Awards
  • ACS Peter J. Dunn Award for Green Chemistry & Engineering Impact

Reporting Period: 2022-01 to 2022-12

Environmental Metrics

Total Carbon Emissions:8,528,500 tCO2e/year (market-based)
Scope 1 Emissions:712,400 tCO2e/year
Scope 2 Emissions:218,800 tCO2e/year (market-based)
Scope 3 Emissions:6,787,100 tCO2e/year
Renewable Energy Share:45%
Total Energy Consumption:17,516,000 GJ/year
Water Consumption:19.1 million m3/year
Waste Generated:83,333 tons/year
Carbon Intensity:13.69 MT CO2e per employee (Scopes 1 & 2 market-based)

ESG Focus Areas

  • Access to Health
  • Employees
  • Environmental Sustainability
  • Ethics & Values

Environmental Achievements

  • 9% reduction in Scope 1 & 2 GHG emissions from 2019 baseline.
  • 45% of purchased electricity from renewable sources in 2022.
  • 17 percent reduction in water use compared to 2015 baseline.

Social Achievements

  • Enabled access for more than 189 million people to access our innovative portfolio.
  • Achieved greater than 99 percent pay equity in the U.S. for female and male employees, as well as for non-white and white employees.
  • 47% of new hires in the U.S. in 2022 were members of underrepresented ethnic groups.

Governance Achievements

  • Maintained 100% compliance to regulatory requirements for active incident monitoring, risk/harm analysis and on-time notification of data breaches.
  • More than 99 percent of employees completed Code of Conduct training.

Climate Goals & Targets

Long-term Goals:
  • Net-zero emissions across global operations (Scopes 1, 2, and 3) by a target year to be determined.
Medium-term Goals:
  • Reduce our operational greenhouse gas (GHG) emissions (i.e., Scopes 1 & 2) 46% by 2030, from a 2019 baseline.
  • Reduce our value chain (Scope 3) GHG emissions 30% by 2030, from a 2019 baseline.
  • Source 100% of our purchased electricity from renewable sources by 2025.
Short-term Goals:
  • Achieve carbon neutrality across our operations by 2025 (Scopes 1 & 2 emissions).
  • Maintain global water use at or below 2015 levels by 2025.
  • By 2025, no more than 20% of our global operational waste will be sent to landfills and incinerators (without energy recovery).

Environmental Challenges

  • Supply chain disruptions due to global economic pressures, rising inflation, geopolitical insecurity and climate-related disasters.
  • Increased Scope 3 GHG emissions (6% increase from 2019 baseline).
Mitigation Strategies
  • Investing in supply chain innovations, including digital capabilities and agile distribution models.
  • Engaging strategic suppliers to reduce environmental impacts within the supply chain.
  • Implementing a Waste Diversion Playbook to help sites contribute to waste reduction goals.

Supply Chain Management

Supplier Audits: 12 LHR audits conducted in 2022

Responsible Procurement
  • Business Partner Code of Conduct
  • Supplier Performance Expectations
  • PSCI Principles for Responsible Supply Chain Management
  • Supplier Self-Assessments
  • Economic Inclusion & Supplier Diversity program

Climate-Related Risks & Opportunities

Physical Risks
  • Extreme weather events, rising sea levels
Transition Risks
  • Regulatory changes, market shifts, carbon pricing
Opportunities
  • Development of energy-efficient products and processes

Reporting Standards

Frameworks Used: GRI, SASB, TCFD, UNGC

Certifications: LEED

Third-party Assurance: ERM CVS (limited assurance on select GHG and water data)

UN Sustainable Development Goals

  • SDG 3 (Good Health and Well-being)
  • SDG 6 (Clean Water and Sanitation)
  • SDG 7 (Affordable and Clean Energy)
  • SDG 8 (Decent Work and Economic Growth)
  • SDG 10 (Reduced Inequalities)
  • SDG 13 (Climate Action)
  • SDG 15 (Life on Land)

Initiatives described throughout the report contribute to these goals.

Sustainable Products & Innovation

  • Greener manufacturing processes for investigational antiviral COVID-19 medicine.

Awards & Recognition

  • Green Chemistry Challenge Awards (multiple)
  • Peter J. Dunn Award for Green Chemistry and Engineering Impact (multiple)
  • ENERGY STAR awards (multiple)
  • Barron's Top 100 Most Sustainable U.S. Companies
  • Newsweek & Statista America's Most Responsible Companies
  • Investor's Business Daily 100 Best ESG Companies
  • 3BL Media 100 Best Corporate Citizens
  • Fortune Change the World list
  • JUST Capital America’s Most JUST Companies
  • Human Rights Campaign Best Places to Work for LGBTQ+ Equality
  • Latino Leaders Magazine Best Companies for Latinos to Work
  • Seramount Top Companies for Executive Women

Reporting Period: 2023-2024

Environmental Metrics

Renewable Energy Share:57%

ESG Focus Areas

  • Ethics & Values
  • Employees
  • Access to Health
  • Environmental Sustainability

Environmental Achievements

  • 91% below baseline reduction in Scope 1 and 2 operational GHG emissions by 2023 (from a 2019 baseline)
  • 4% below baseline reduction in value chain (Scope 3) GHG emissions by 2023 (from a 2019 baseline)
  • 57% of purchased electricity from renewable sources by 2023

Social Achievements

  • 240 million people enabled to access innovative medicines and vaccines through access solutions in 2023
  • >99% parity indicated in global pay equity study for female employees compared to male colleagues
  • Maintained >99% pay equity by race and gender in the U.S. for the third consecutive year
  • Reached 79% of countries around the world annually with products in 2023
  • Reached 21.2 million people in low- and middle-income countries (LMICs) and underserved populations in high-income countries with social investments in 2023 (cumulative 54.8 million from 2021-2023)

Governance Achievements

  • 100% compliance maintained to privacy and data protection regulatory requirements for active incident monitoring, risk/harm analysis and on-time notification of data breaches in 2023

Climate Goals & Targets

Long-term Goals:
  • Achieve net-zero GHG emissions (Scopes 1, 2 & 3) by 2045
Medium-term Goals:
  • Reduce Scope 1 and 2 operational GHG emissions by 46% by 2030 (from a 2019 baseline)
  • Reduce value chain (Scope 3) GHG emissions by 30% by 2030 (from a 2019 baseline)
  • Enable 350 million more people to access innovative medicines and vaccines globally through access solutions by 2025
  • Further advance health equity by reaching 50 million people in LMICs and underserved populations in high-income countries with social investments by 2025
Short-term Goals:
  • Source 100% of purchased electricity from renewable sources by 2025
  • Maintain or exceed current inclusion index score by 2025
  • Maintain or exceed current employee engagement index score by 2025
  • Foster a “Speak Up” culture by maintaining or exceeding current percentage of global employees responding favorably to the “Willingness to report” question in an internal survey as an annual average by 2025

Supply Chain Management

Responsible Procurement
  • $3.6 billion spending with small and diverse Tier 1 and 2 suppliers globally in 2023

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: SBTi

Awards & Recognition

  • Barron’s 100 Most Sustainable U.S. Companies — #38 overall and #1 in the biopharmaceutical industry (2024)
  • Newsweek America’s Most Responsible Companies — #1 overall and #1 in the sector (2024)
  • JUST Capital America’s Most JUST Companies — #25 overall and #1 in the sector (2024)
  • Fortune #62 on the 100 Best Companies to Work For® list (2024)
  • Seramount One of the 75 companies on the Top Companies for Executive Women list (2023)
  • TIME #28 on the World’s Most Sustainable Companies list (2024)