Climate Change Data

Environmental Metrics

ESG Focus Areas

• Health
• Environment
• Culture and Education

Environmental Achievements

• Developed SA-VA (self-aligned vertical alignment) liquid crystal technology, requiring less energy and creating less waste during display manufacture.
• Opened a new production facility for liquid crystal window modules, aiming to cut energy use in buildings by up to 40%.
• Developed PFOS-free antireflective and photoresists for the semiconductor industry.
• Expanded the Design for Sustainability (DfS) program to encompass all portfolio offerings.
• Recycled more than 1,300 tons of customers’ products from 2015 to 2017.

Social Achievements

• Ranked among the world’s best employers, receiving the “Global Top Employer 2017” distinction.
• Launched the Curiosity Cube™ tour across the United States, reaching over 38,000 students.
• Supported the “Jugend forscht” (Young Researchers) competition.
• Organized the state-level competition for the German Federal State of Hesse.
• Launched a continuing education program for teachers in India.
• Spent €34 million on community engagement activities.

Governance Achievements

• Maintained good standing in major sustainability indices (FTSE 4Good, STOXX Global ESG Leaders, Euronext Vigeo Eurozone 120, Ethibel Sustainability Index Excellence Europe).
• Received gold status from EcoVadis for sustainability performance.
• Implemented a comprehensive framework of indicators to manage performance, with EBITDA pre as the most important KPI.
• Established a Bioethics Advisory Panel to provide guidance on research activities.

Climate Goals & Targets

Environmental Challenges

• Increased competition for liquid crystal materials in China.
• Difficult foreign exchange environment.
• Continued rise in research and development costs in Healthcare.
• Challenging market environment in Liquid Crystals.
• Declining sales of Rebif® and Erbitux®.

Mitigation Strategies

• Driving the launch of new liquid crystal products and capturing new application fields.
• Focusing on innovation-driven, organic growth.
• Targeted acquisitions to complement or boost strengths.
• Reducing acquisition-related net financial debt.
• Investing further in the development and launch of new medicines.
• Divesting the Biosimilars business.
• Analyzing strategic options for the Consumer Health business.

Supply Chain Management

Supplier Audits: 730 suppliers assessed through TfS

Responsible Procurement

• Group Procurement Policy and Responsible Sourcing Principles
• Adherence to ILO core labor standards, UN Global Compact, and BME Code of Conduct.

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: UN Global Compact, Responsible Care Global Charter

Certifications: ISO 14001, OHSAS 18001

Sustainable Products & Innovation

• SA-VA liquid crystal technology
• Liquid crystal window modules
• PFOS-free antireflective and photoresists
• Cyrene™ solvent

Awards & Recognition

• Technology Innovation Award 2017 (liquid crystal window technology)
• Innovation Award Architecture + Building at BAU 2017 (organic photovoltaic modules)
• Bio-based Chemical Innovation of 2017 (Cyrene™)

Environmental Metrics

ESG Focus Areas

• Global Health
• Sustainable Solutions
• Broad Minds

Environmental Achievements

• Reduced total direct and indirect greenhouse gas emissions by around 15% compared with 2006, despite business growth.
• Lowered water consumption at relevant sites by 21% compared with 2014.
• Recycled 1,500 metric tons of customer products in 2019.

Social Achievements

• Launched the Medical Innovation Program (MIP) for human reproduction.
• Expanded SPARK volunteer program, with nearly 2,300 employees volunteering nearly 19,400 hours.
• Maintained Gold status from EcoVadis for sustainability engagement.

Governance Achievements

• Continued to rank fourth in the Access to Medicine Index.
• Maintained good position in sustainability evaluations (FTSE4Good, STOXX Global ESG Leaders, etc.).
• Implemented a new structure in Surface Solutions to better serve customer needs.

Climate Goals & Targets

Environmental Challenges

• Increased competitive pressure in the pharmaceutical, chemical, and life science sectors.
• Stricter regulations for drug pricing and reimbursement.
• Weakening global economic growth.
• Brexit uncertainties.
• Trade conflicts between the US and China.
• Declining demand from the automotive industry.

Mitigation Strategies

• Risk diversification strategy across three business sectors.
• Close communication with health and regulatory authorities.
• Product, industry, and regional diversification.
• Cost-base and process streamlining (Bright Future program).
• Alternative sourcing strategies.
• Inventory build-up of critical products.
• Relocation of marketing authorization holder for drugs.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Responsible Sourcing Principles (based on ILO core labor standards and UN Global Compact).

Climate-Related Risks & Opportunities

Physical Risks

• Natural disasters (floods, earthquakes)

Transition Risks

• Stricter regulations for manufacturing, testing, and marketing of products.

Opportunities

• Development of energy-efficient products (e.g., liquid crystal windows).

Reporting Standards

Frameworks Used: UN Global Compact, Responsible Care Global Charter

Certifications: ISO 14001

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Goal 3: Good Health and Well-being
• Goal 7: Affordable and Clean Energy
• Goal 9: Industry, Innovation and Infrastructure
• Goal 13: Climate Action

Company initiatives contribute to these goals through various programs and activities.

Sustainable Products & Innovation

• Bio-based solvent Cyrene™.
• Liquid crystal windows (LCWs).
• Cosmetic fillers that eliminate microplastic particles.

Awards & Recognition

• BioInformatics LLC’s 2018 Life Science Industry Award®
• INTERPHEX Exhibitor Award for Best New Product
• 2019 Pittcon Heritage Award
• R&D 100 Award for Eshmuno® CP-FT Chromatography Resin

Environmental Metrics

ESG Focus Areas

• Good Health and Well-being
• Responsible Consumption and Production
• Decent work and economic growth
• Industry, innovation and infrastructure
• Partnerships for the goals

Environmental Achievements

• Reduced greenhouse gas emissions of legacy business (excluding Versum) by roughly 25% from 2006 baseline.
• Sourced 27% of purchased electricity from renewables (2019: 19%).
• Avoided the emission of 75 metric tons of CO2eq per year by 2025 by optimizing shipping properties of ZooMAb® antibodies.

Social Achievements

• Launched "Future Ways of Working" program to improve future cooperation, applying new technologies and expanding flexible working models.
• Donated 1.3 billion tablets to the World Health Organization to fight schistosomiasis since 2007.
• Completed the implementation of our compliance program at legacy Versum Materials.

Governance Achievements

• Formulated new, strategic sustainability goals and embedded them into the overall strategy.
• Developed Sustainable Business Value (SBV) tool to evaluate positive and negative impacts on society.
• Planning to link long-term variable compensation of the Executive Board from 2022 onward with progress toward achieving sustainability goals.

Climate Goals & Targets

Environmental Challenges

• Climate impact mitigation
• Resource scarcity
• Growing global population and demographic change
• Insufficient access to medicines for people in low- and middle-income countries
• Supply chain disruptions due to Covid-19 pandemic.

Mitigation Strategies

• Developed new strategic sustainability goals.
• Developed Sustainable Business Value (SBV) method.
• Implemented "Future Ways of Working" program.
• Secured supply of raw materials, services, and finished goods during Covid-19 pandemic.
• Developed remote auditing concepts.

Supply Chain Management

Supplier Audits: 717 suppliers participated in a new assessment or reassessment in 2020 through TfS; additional audits conducted based on business requirements.

Responsible Procurement

• Responsible Sourcing Principles
• Human Rights Charter
• Code of Conduct
• BME Code of Conduct
• Responsible Minerals Sourcing Charter

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI, German CSR Directive Implementation Act

Certifications: ISO 14001, ISO 9001, ISO 45001

UN Sustainable Development Goals

• SDG 3
• SDG 8
• SDG 9
• SDG 12
• SDG 17

Contributions through products, respect for human rights, sustainable products and processes, resource efficiency, and partnerships.

Sustainable Products & Innovation

• Cyrene™ solvent from waste cellulose
• ZooMAb® antibodies with ambient temperature shipping
• Milli-Q®IQ 7000 lab water purification system
• Stericup®E sterile filtration system
• GenElute™-E kits
• Next-generation colloidal silica products
• NMP-free removers
• eyrise® liquid crystal window technology
• RonaFlair® functional fillers

Awards & Recognition

• Stericup®E recognized as "New Product of the Year" at the 2020 BIG Awards for Business

Environmental Metrics

ESG Focus Areas

• Climate Change

Climate Goals & Targets

Environmental Challenges

• Data limitations in several Scope 3 categories (e.g., incomplete raw data, inaccurate distance calculations in transportation, lack of data from smaller affiliates).
• Difficulty in tracking GHG emissions from the processing of sold intermediate products due to diverse applications and customer structure.
• Inaccurate data due to technical reasons in newly implemented calculation tool (2020 data slightly over-reported).

Mitigation Strategies

• Working on improving data accuracy in categories 4 and 9 (transportation and distribution) by improving data collection and calculation methods.
• Implementing a weight-based approach for purchased goods and services to increase accuracy.
• Aiming to use supplier-specific data for purchased goods and services calculations.
• Not reporting Scope 3, category 10 emissions (processing of sold products) due to difficulty in obtaining reliable figures.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: Greenhouse Gas Protocol

Third-party Assurance: 3rd party verified (for most categories)

Environmental Metrics

ESG Focus Areas

• Environmental protection
• Climate action
• Resource efficiency
• Water management
• Waste & recycling
• Plant, process & transport safety
• Biodiversity

Environmental Achievements

• Reduced greenhouse gas emissions by nearly 10% in 2022 (approximately 1,667,000 metric tons of CO2 equivalents compared to 1,843,000 in 2021).
• Pilot exhaust gas abatement unit achieved 99% efficiency in reducing process-related NF3 emissions.
• Replaced several emission-intensive production lines, resulting in a CO2eq reduction of 40,000 metric tons between 2021 and 2022.
• Reduced water intensity score by 8.6% compared to the 2020 baseline (2025 target: 10% reduction).
• Recycled a total of 20.7 million m3 of water in 2022.
• Reduced total Waste Score by 8.8% relative to 2016.

Social Achievements

• Not disclosed
• Not disclosed

Governance Achievements

• Established a robust reporting procedure for critical situations, near misses, and environmental incidents.
• Implemented standardized third-party warehouse audits by EHS managers.

Climate Goals & Targets

Environmental Challenges

• Process-related emissions increased sharply with the acquisition of Versum Materials in 2019.
• Increasingly scarce water resources globally.
• Need to reduce potentially harmful residues in wastewater.
• Managing waste and its environmental impact.
• Ensuring plant, process, and transport safety, especially with hazardous materials.

Mitigation Strategies

• Investing in additional exhaust gas abatement units to reduce NF3 emissions.
• Developing methods to eliminate remaining PFC emissions.
• Implementing sustainable water management standards and practices.
• Improving water efficiency through various projects and initiatives.
• Implementing a waste scoring system to track and reduce waste.
• Promoting a circular economy through initiatives like ProMec.
• Shifting from landfill to waste-to-energy recovery.
• Implementing robust safety management systems and regular audits.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Supplier Code of Conduct (formerly Responsible Sourcing Principles)
• Contractor EHS Management Standard

Climate-Related Risks & Opportunities

Physical Risks

• Flooding

Transition Risks

• Regulatory changes
• Market shifts

Opportunities

• Development of energy-efficient products

Reporting Standards

Frameworks Used: Responsible Care® Global Charter, ISO 14001, Greenhouse Gas Protocol, EU Energy Efficiency Directive (2012/27/EU), EU Emissions Trading Directive (2003/87/EC), Science Based Targets initiative (SBTi), Task Force on Climate-related Financial Disclosures (TCFD), CDP

Certifications: ISO 14001, ISO 50001 (13 sites)

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Climate change and emissions
• Water and resource intensity
• Sustainable innovation and technologies for our customers
• Impact of our products on health and wellbeing
• Sustainability in our ways of working & decision-making
• Our people and communities; providing a diverse and inclusive environment
• Sustainable and transparent supply chain

Environmental Achievements

• Reduced direct (scope 1) and indirect (scope 2) greenhouse gas emissions by nearly 17% compared with the previous year.
• Obtained more than half of our electricity purchased worldwide from renewable sources for the first time.
• Added 637 Greener Alternative Products to our portfolio.

Social Achievements

• Increased the percentage of women in leadership positions worldwide to a record high of 39%.
• Served more than 57 million patients in low- and middle-income countries with our healthcare portfolio.
• Reached 84 million patients with praziquantel tablets in the fight against schistosomiasis.

Governance Achievements

• Implemented a new workflow-based process for third-party risk management.
• Launched a new Whistleblowing and Investigations Standard.
• Tied 15% of variable employee compensation to sustainability parameters.

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions
• Climate change
• International conflicts and economic crises
• Data breaches
• Compliance-related risks
• Human rights risks in the supply chain
• Animal welfare concerns related to necessary testing

Mitigation Strategies

• Supplier decarbonization program
• Renewable energy sourcing
• Sustainable packaging initiatives (Mpact, SMASH)
• Third-party risk management process
• Compliance training and programs
• Human rights due diligence program
• 4Rs for animal-based research (replacement, reduction, refinement, and responsibility), and efforts to phase out animal use.

Supply Chain Management

Supplier Audits: 66% of relevant suppliers covered by a valid sustainability assessment (2023)

Responsible Procurement

• Supplier Code of Conduct
• Responsible Minerals Sourcing Charter
• Together for Sustainability (TfS) network
• Pharmaceutical Supply Chain Initiative (PSCI)
• Supplier Decarbonization Program

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events

Transition Risks

• Regulatory changes
• Market shifts

Opportunities

• Development of energy-efficient products and processes

Reporting Standards

Frameworks Used: GRI, SASB, TCFD

Certifications: ISO 14001, ISO 9001

Third-party Assurance: Deloitte GmbH Wirtschaftsprüfungsgesellschaft (limited assurance)

UN Sustainable Development Goals

• SDG 3
• SDG 5
• SDG 8
• SDG 9
• SDG 12
• SDG 13
• SDG 17

The company's sustainability strategy focuses on these SDGs through various initiatives and projects.

Sustainable Products & Innovation

• Greener Alternative Products
• Cyrene™ solvent
• Millistak+®HC and Millistak+®HC Pro Micro 20 clarification devices
• Molded pulp packaging components
• Next-generation colloidal silica products
• NMP-free removers
• Alternatives to PFAS
• Dynamic liquid crystal glazing (eyrise®)

Awards & Recognition

• Bioethics International Gold Badge for Diversity, Equity and Inclusion in clinical trials