At a Glance. Sustainability at Bayer

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Fläche wegstanzen

Please send me the following publications:

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This publication is aimed at business partners, employees, stockholders, non-governmental organi-zations, suppliers, authorities and the gener al public. The concerns of our stakeholders form the basis of our reporting and our sustainability strategy , which we updated in 2009 . With this strategy we

set the focus

of our sustainabil-ity commitment on health care, security of food sup-ply and climate and resour ce protection. These are

the areas in which

we can provide the most ef cient and effective approaches as they re ect our  elds of expertise. At the same time they have a high social relevance to our company . We featur e detailed infor-mation on the Bayer sustainability strategy and its new areas of focus in the “Str ategy & Management” section and in the focus issue articles. You can  nd up-to-date information on the subject of water fea-tured as a focus issue last year in the “Ecology” sec-tion. Our Performance Report gives an overview of all other facts and  gur

es that are relevant

to sustain-ability management in the Group, allowing the reader quick and easy access to data on our Group-wide

sus-tainability performance.In this

Sustainable Development Report we have endeavor ed to ensur e maximum transpar ency, clarity of layout and ease of veri  cation. The statements pro-vided here apply

to all sites and

activities of the Bayer Group. All data in the focus issue articles and in the Performance Report wer e subjected to an assur ance process by Ernst

& Young (see page

113). The report is published in German, English and Span-ish. The editorial deadline was April 30, 2010 . Our next Sustainable Development Report is due to be published in 2011 . Designations such as manager and employee refer equally to men and women; the masculine form of personal pronouns is used in such cases solely to

sim-plify the text.

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With our Sustainable Development Report we would like to give o

ur stakeholders a

transpar

ent and compr

ehensive description of the economic, ecological and social

challenges that ar

e linked to our oper

ations and show them the str

ategies and solutions

that we ar

e applying to meet them.

www

Further information on the Internet

The report is supplemented by further information given on our website. The report contains references to enable easier access: at www.sustainability 2009 .bayer .com you will  nd a page entitled “Additional Info Links.

” Here, all refer

ences are listed with a corresponding code number . By clicking on these you will go to the desir ed information. An important orientation for our reporting is provided by the guide-lines of the Global Reporting Ini-tiative (gri) , with which, in this report, we comply fully . The gri has checked and con  rmed that level

a+, the

high-est reporting level, has been maintained. An index at the end of the report lists the pages on which information is provided on the individual gri indi-cators. In the futur

e, Bayer will focus even mor

e str

ongly

on sustainability

. To this end, the company has

launched an extensive pr

ogram involving

light-house pr

ojects focusing on the

 elds of health car

e,

nutrition and climate pr

otection. One of these in the

health

 eld concerns family planning. W

e want to

help women in developing and emer

ging countries

to take contr

ol of their own lives. A fundamental

aspect of family planning is access to contr

acep-tives. W

orking with partners, Bayer aims, thr

ough

the pr

ovision of mor

e health information and

education, to help r

educe the risks associated with

unplanned pr

egnancies and unsafe termination of

pregnancy

. Our pictur

e shows Sister Jane Maenaria,

who is explaining to K

enyan women how to use or

al

contr

aceptives.

Bayer: Science For A Better Life

Sustainable Development Report 2009

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Bayer has supported the United Nations Global Compact since this was founded in 2000. W e play an active part in the endeavors to make globalization more socially and ecologically compatible and to raise standar ds in the  elds of human rights, labor rights and envir onmental protection and in the  ght against corruption. The following table shows the activ-ities and management systems at Bayer that support the 10 principles of the Global Compact and the results which were

achieved in the period under r

eview. Information on the Global Compact can be found at www.un

globalcompact.or g. Systems Measur es 2009 Achievements 2009 Principle 1:

Support of human rights

Human Rights P osition (p. 79) Corpor ate Compliance P olicy (p. b59) Procur ement Community P olicy (p. 22) Procedur

e for selecting and evaluating

suppliers (p.

23, 80)

Supplier Code of Conduct (p.

23)

Strategy development and expansion of the alliances for sustainable health car

e (p.

30-35)

andbpartnerships for good

harvests (p.

36-41)

Training pr

esentation on the theme of

human

rights (p.

79)

Purchaser tr

aining on sustainability and on

the new Supplier Code of Conduct (p.

23)

Roll-out of the Supplier Code of Conduct (p. 23, 80)

Increase in the Gr

oup-wide

training r

ate

for human rights issues (p.

79)

Training r

ate for our pur

chasers

world-wide: almost 100% (p.

23)

First supplier tr

aining sessions for

the code of conduct and

assessments

(p. 23, 80)

Principle 2:

Exclusion of human rights violations

Human Rights P osition (p. 79) Corpor ate Compliance P olicy (p. 59)

Supplier Code of Conduct (p.

23)

Start of an information campaign (br

ochure /

training pr

esentation) in all r

egions (p.

79)

Procurement management: risk analysis

using the Bayer Country Sustainability Risk Index (p.

23)

Principle 3: Observance of the right to fr

eedom

of association

Group works councils (p.

66-67) Bayer Eur opean F orum (p. 67) Human Rights P osition (p. 79)

Supplier Code of Conduct (p.

23) Constitution of union r epresentation at Bayer China (p. 67) First supplier tr

aining sessions for

the code of conduct and

assessments

(p. 23, 80)

Principle 4: Abolition of all forms of

bforced labor Human Rights P osition (p. 79) Corpor ate Compliance or ganization (p. 60)

Supplier Code of Conduct (p.

23)

Purchaser tr

aining on sustainability and on

the new Supplier Code of Conduct (p.

23)

Roll-out of the Supplier Code of Conduct (p. 23, 80)

First supplier tr

aining sessions for

the code of conduct and

assessments

(p. 23, 80)

Principle 5: Abolition of child labor

Human Rights P osition (p. 79) Corpor ate Compliance or ganization (p. 60)

Supplier Code of Conduct (p.

23)

Bayer Child Car

e Program (p.

b80-81)

Expansion of system for countering child labor (p.

81)

Purchaser tr

aining on sustainability and on

the new Supplier Code of Conduct (p.

23)

Roll-out of the Supplier Code of Conduct (p. 23, 80)

Brochure on child labor

published (p.

81)

Renewed con

 rmation by audits that

there is no systematic child labor in the supply chain for

cotton seeds in India

(p. 80-81)

Principle 6: Elimination of discrimination

Human Rights P

osition (p.

79)

Bayer diversity policy (p.

69)

Bayer diversity councils (p.

69)

Corpor

ate Compliance P

olicy (p.

59)

Supplier Code of Conduct (p.

23)

“Power of Diversity” campaign at BHC (p.

69)

Training pr

ojects and establishment of

diversity councils at BCS in the United States (p.

69)

GlobeSmart online database containing information on customs and etiquette in other countries (p.

69)

Continued incr

ease in per

centage of

women in senior management positions (p. 70) SPEED pr ogram to support talented young employees and managerial staff in Asia / Paci c (p. 70)

Quadrupling of pr

oportion of female

employees at BBS in India (p.

70)

Principle 7:

Precautionary environmental protection

HSEQ management systems (p.

22, 51-52)

Risk management system (p.

b62-63)

Global Pr

oduct Str

ategy (p.

102)

Supplier Code of Conduct (p.

23)

e.g. r

egular HSE(Q) audits (p.

22, 52)

“BayRisk” pr

ocedure updated (p.

62)

Analysis of pharmaceuticals in the envir

on-ment (p.

107–108)

Training in methods of sustainable agricul- ture worldwide (p.

39-41)

Biodiversity pr

ojects (p.

91-92)

Pilot pr

ojects for the Bayer Sustainability

Check (p. 23) Successful pr e-registr ation of mor e than

800 substances under REA

CH (p.

103)

Presentation of the CEO Safety Awar

d initiated by BMS (p. 76) Principle 8: Speci c commit-ment to envir on-mental protection Group pr ogram of objectives 2006+ (p. 24) Bayer Sustainability Pr ogram (p. 20) Bayer Climate Pr ogram (p. 42-47)

UNGC “Caring for Climate” (p.

25)

CEO W

ater Mandate of the UN Global Compact (p. 88) Application of the Bayer Climate Check (p. 45) Implementation of the S

TRUCTese

® energy

ef ciency management system (p.

45)

Progress with the CEO W

ater Mandate (p.

88)

Green IT (r

esour

ce ef ciency with servers

and printers, p.

46)

Reduction in gr

eenhouse gas emissions

of 6.5% (p.

92)

100 pr

oduction facilities analyzed with the

Bayer Climate Check (p.

45) STRUC Tese ® successfully installed in 16 plants (p. 45)

Reduction in emissions of carbon monoxide, nitr

ogen oxides, sulfur oxides

and particulates (p.

95)

Reduction in phosphorus dischar

ges into

water (p.

96)

Achievements with r

espect to the CEO

Water Mandate (p.

88)

Principle 9:

Diffusion of environ mentally friendly technolo- gies

Core business of BTS, BMS and Curr

enta (p. 16-17) Development of a new pr ocess to purify acetonitrile (p. 90) Use of non-r

ecyclable solvents to gener

ate

energyb(p. 90)

Planning of an ener

gy-ef

 cient toluene

diiso-cyanate (TDI) pr

oduction plant in Dormagen

(p. 59) Pilot plant for the envir

onmentally

compat-ible utilization of CO

2 (p. 57)

Modernization of the centr

al waste air

inciner

ator in Dormagen (p.

87)

BAYQIK

® (quasi isothermal catalysis) process for the pr

oduction of sulfuric

acid enhances the aspects envir

onmental

protection and ener

gy recovery (p. 57) Principle 10: Measur es to  ght corruption Corpor ate Compliance P olicy (p. 59)

Code of Conduct for Responsible Lobbying (p. 61) Code of the “V

oluntary Self-Monitoring by the

Pharmaceutical Industry” (FSA) association (p.23) Export contr ols (dir

ective and manual, p.

63)

Supplier Code of Conduct (p.

23)

Procurement management: risk analysis

using the Bayer Country Sustainability Risk Index (p.

23) Corpor ate compliance tr aining (p. 59) Entry in lobby r

egister of the E.U. (p.

61)

First supplier tr

aining sessions for the

code of conduct and assessments (p. 23, 80) Use of the Bayer Country Sustainability Risk Index (p.

23) REPORTIN G PROFILE GLO BAL COMPA CT

Sustainable Development Repor

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Material

Science leaves the crisis behind

Bayer incr

eases sales and earnings

in the second quarter

Stockholders’ Newsletter

FIN

ANCIAL REPORT AS OF JUNE 30, 2010

Stockholder

s’

Newsletter

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ANNUAL R EPORT Fi na nc ial C alen da r 2009 Annual Report fe bruary 26, 2010 q1 2010 Interim Report april 29, 2010

Annual Stockholders’ Meeting

2010 april 30, 2010 Payment of Dividend may 3, 2010 q2 2010 Interim Report july 29, 2010 q3 2010 Interim Report october 28, 2010

Annual Stockholders’ Meeting

2011

april 29, 2011

Payment of Dividend

may 2, 2011

Forward-Looking Statements:

This Annual Report contains forward-looking statements based on current assumptions and forecasts made by Bayer Group or subgroup management. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual  nancial position, development or performance of the company and the estimates given here. These factors include those discussed in Bayer’s public reports, which are available on the Bayer website at www.bayer.com. The company assumes no liability whatsoever to update these forward-looking statements or to conform

them to future events or developments.

Important Information:

The names “Bayer Schering Pharma” or “Schering” as used in this publication always refer to Bayer Schering Pharma AG,

Berlin, Germany, or its predecessor, Schering AG, Berlin, Germany, respectively.

MASTHEAD Publisher Bayer A G, 51368 Leverkusen, Germany EditorJörg Schäfer , phone + 49 214 30 39136 email: joer g.schaefer .js@bayer-ag.de English edition Curr

enta GmbH & Co. OHG

Language

ServiceInvestor Relations

Peter Dahlhoff , Tel. + 49 214 30 33022 email: peter .dahlhoff@bayer-ag.de Date of publication Friday , February

26, 2010Bayer on the Internet

www.bayer .com issn 0343 / 1975 BA YER A NNUA L REPOR T 2009 COVER PICTURE

As an inventor company Bayer aims for innovation, supported by its

12,400

-strong

global r

esearch and development team.

One member of that team is Dr

. Xin Ma,

Head of the Global Drug Discovery Innovation Center China in Beijing. The photo shows the scientist pr

eparing an experiment during

drug development.

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Rep or t 20 07 201 0

Foundation Activities

resear

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the Bayer scientific magazine

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Science For A Better LiFe DAS MAgAzin 2/2007

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ience For A Better LiFe the MAgAzine 2/2010

BAYER G ROUP: new c eo p assionate about r esearch HEALTH: the h ea rt of the m atter MATERIALS: nothing b ut s un i n the ta nk NUTRITION: the tom ato king

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Climate-ne utral Mas dar City in the dese rt

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2010/2011 edition • E 910 967 092 Reply Bayer AG c/o Finger Marketing Services Postfach 100 538 41405 Neuss Germany Please fill out in block letters Name First name Street address Postal code/city Country Email Phone Place stamp here nam es | f IguRes | f acts

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Sustainability at Bayer

At a Glance

2009-2010

Reports, information and contact details

Reports

Bayer Sustainable Development Report 2009

Bayer Annual Report 2009

Websites

www.sustainability2009.bayer.com

www.annualreport2009.bayer.com

www.bayer.com

Published by

Bayer AG

Corporate Communications

51368 Leverkusen

Germany

Edited by

Bayer AG

Corporate Communications

Dr. Katrin Schneider

Phone: +49 (0) 214 30-48825

Fax: +49 (0) 214 30-71985

E-mail: katrin.schneider@bayer.com

Bayer AG

Environment & Sustainability

Dagmar Jost

Phone: +49 (0) 214 30-75284

Fax: +49 (0) 214 30-53407

E-mail: dagmar.jost@bayer.com

Date of publication

October 2010

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Stamp

optional

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Subgroups and service companies

Bayer HealthCare is among the world’s foremost innovators

in the field of pharmaceutical and medical products. The

sub-group’s goal is to research, develop, manufacture and market

innovative products that improve the health of humans and

animals throughout the world.

Bayer CropScience, with its highly effective products,

pioneering innovations and keen customer focus, holds global

leadership positions in crop protection and non-agricultural

pest control. The company also has major activities in seeds

and plant traits.

Bayer MaterialScience

is a renowned supplier of high-tech

polymers and develops innovative solutions for a broad range

of applications relevant to everyday life. Products holding

lead-ing positions on the world market account for a large

propor-tion of the company’s sales.

Bayer Business Services

is the Bayer Group’s global

com-petence center for IT and business services. Its portfolio is

focused on services in the core areas of IT infrastructure and

applications, procurement and logistics, human resources and

management services, and finance and accounting.

Bayer Technology Services

is the global technological

backbone and a major innovation driver of the Bayer Group in

terms of the development, planning, construction and

optimi-zation of processes and facilities.

Currenta

offers services for the chemical industry, including

utility supply, waste management, infrastructure, safety and

security, analytics and training.

REPL

Y C

ARD

Bayer A

G

c/o F

inger Marketing Ser

vices

P

ostfach 100 538

41405 Neuss

Germany

Please fill out in block letters

Surname

First name

Str

eet and house number

City with postal code

Country

E-mail

Phone

Sustainability at Bayer

Sustainability at Bayer

2

Sustainability strategy

Subgroups and service companies

15

Actively fulfilling a global responsibility

“For Bayer, being successful means creating

value sustainably. In this context we are

commit-ted to our stakeholders in a number of different

ways – as an innovative partner for our

custom-ers, an attractive employer for our employees, a

professional trustee for our stakeholders and a

responsible company toward our neighbors and

society as a whole.”

Dr. Marijn Dekkers, Chairman of the Board of Management of Bayer AG

Bayer is a global enterprise with core competencies in the

fields of health care, nutrition and high-tech materials. Our

products and services are designed to benefit people and

improve their quality of life. At the same time, we want to

create value through innovation, growth and high earning

power.

Our primary objective is to achieve a successful and

sus-tainable business. For us, this means achieving commercial

success on the basis of solid business models in a way that

is compatible with meeting the needs of our employees and

society and protecting the environment and natural resources.

In this we are committed to the tenets of sustainable

develop-ment and to the 10 principles of the UN Global Compact.

Our mission statement “Bayer: Science For A Better Life”

summarizes the Group’s vision, strategy and values. It serves

as a basis for the day-to-day activities of all employees. We

express our clear commitment to the principles of

sustain-able development, and to our role as a socially and ethically

responsible corporate citizen. Sustainability is a key

compo-nent of our values and leadership principles.

Our values

A will to succeed

A passion for our stakeholders

Integrity, openness and honesty

Respect for people and nature

Sustainability of our actions

Actively fulfi lling a global responsibility

“For Bayer, being successful means creating

value sustainably. In this context we are

commit-ted to our stakeholders in a number of different

ways – as an innovative partner for our

custom-ers, an attractive employer for our employees, a

professional trustee for our stakeholders and a

responsible company toward our neighbors and

society as a whole.”

Dr. Marijn Dekkers, Chairman of the Board of Management of Bayer AG

Bayer is a global enterprise with core competencies in the

fi elds of health care, nutrition and high-tech materials. Our

products and services are designed to benefi t people and

improve their quality of life. At the same time, we want to

create value through innovation, growth and high earning

power.

Our primary objective is to achieve a successful and

sus-tainable business. For us, this means achieving commercial

success on the basis of solid business models in a way that

is compatible with meeting the needs of our employees and

society and protecting the environment and natural resources.

In this we are committed to the tenets of sustainable

develop-ment and to the 10 principles of the UN Global Compact.

Our mission statement “Bayer: Science For A Better Life”

summarizes the Group’s vision, strategy and values. It serves

as a basis for the day-to-day activities of all employees. We

express our clear commitment to the principles of

sustain-able development, and to our role as a socially and ethically

responsible corporate citizen. Sustainability is a key

compo-nent of our values and leadership principles.

Our values

A will to succeed

A passion for our stakeholders

Integrity, openness and honesty

Respect for people and nature

Sustainability of our actions

Sustainability strategy

Sustainability at Bayer

2

Sustainability at Bayer

3

Sustainability strategy

Sustainability brings success

Sustainability at its core means the ability to thrive in the

future and is therefore an integral part of our business

strategy. Trends in sustainability and overarching challenges

show us clearly which solutions must be prioritized in today’s

global society. They also fl ag up key market

opportuni-ties, toward which we channel our innovative strength. The

progress that we make in these areas benefi ts customers and

society and also supports our competitiveness and corporate

success sustainably.

Bayer is committed to sustainable development. We want to

meet this commitment on three levels:

1. Products and innovations   

Innovations are the driver of

sustainability and our products the basis of our value added.

2. Business practices   

Our interaction with stakeholders,

particularly suppliers, employees and customers, is geared

toward sustainable work practices. Core elements include

compliance, product stewardship, responsible HR policies

and sustainable procurement management.

3. Corporate social responsibility   

Through our foundations

and voluntary social initiatives we focus on tasks with a

par-ticular social relevance and with a connection to Bayer.

Society

3.

Corporate

social

responsibility

2. Business

practices

1. Products & innovations

Our sustainability concept

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Sustainability at Bayer

4

Sustainability at Bayer

5

Sustainability management

Sustainability management

Sustainability management

Organization and steering

Responsibility for defining and steering our Group-wide

sustainability strategy lies with the very top levels of

manage-ment. Headed by the member of the Board of Management

responsible for Innovation, Technology and Environment,

a senior executive committee defines goals, adopts

corre-sponding Group regulations and monitors the

implementa-tion of the measures involved.

The members comprise one board of management member

from each of the three subgroups, the managing directors /

exec-utive board chairmen of the three Bayer service companies, and

the heads of six Corporate Center departments. The committee

is supported by the Community Council for Sustainable

Devel-opment chaired by the Head of the Environment & Sustainability

Department. The council networks the managers in the Group

companies responsible for sustainability issues and, among

other duties, ensures coordination with other relevant Group

committees focusing on health, safety, environmental

protec-tion and quality (HSEQ); innovaprotec-tion; industrial operaprotec-tions; and

politics. The global organization is completed by committees at

subgroup and regional level.

Voluntary

commit-ments, including:

Regulations,

such as:

Performance

UN Global

Compact

Responsible Care

World Business

Council for

Sustain able

Develop ment

Corporate

Citizenship

Sustainable

Development

Human Rights

Corporate

Compliance

Process and Plant

Safety

Responsible

Lobbying

Sustainability

Program

Climate Program

Targets, KPIs

Reporting

Our focus on sustainability is underscored not only by the clear

statements in our mission statement but also by our

commit-ment to uphold the 10 principles of the UN Global Compact and

to the Responsible Care

®

initiative of the chemical industry. We

have firmly anchored this commitment in our internal Group

regulations. These provide a clear framework and an

unambigu-ous code of conduct for all organizational units and employees.

To operationalize our sustainability performance, we

formu-lated specific five-year sustainability targets for the first time

in 2006. We shall take stock of our performance with regard to

these and publish new objectives in our Sustainable

Develop-ment Report 2010.

Management systems and standards

The implementation of our internal standards is decisively

supported in all subgroups and service companies by

effi-cient management systems.

To ensure uniformly high health, safety, environmental

pro-tection and quality (HSEQ) standards, Bayer has established

management systems that are aligned to acknowledged

international standards. Every organizational unit ensures

that its systems meet the current requirements by

continu-ally updating the HSE management systems and performing

internal audits.

Around 90 percent of our production sites possess a

Bayer-audited HSE management system. More than one third of

them have been certified to ISO 14001 or validated to the

European environmental management regulation EMAS. A

further 14 percent have a system complying with other

exter-nal standards. Around 15 percent of our production sites are

certified to the international occupational safety management

system standard OHSAS 18001. All subgroups and service

companies have industry-specific quality management

sys-tems meeting, for example, ISO 9001 or GMP (Good

Manu-facturing Practice).

Our Corporate Compliance Policy commits every Bayer

employee to legal compliance and corporate responsibility.

To anchor our absolute commitment to legal compliance

even more strongly in the leadership organization, we have

now included the topic of corporate compliance in the annual

performance assessment of our managerial staff. We

continu-ously develop our corporate compliance activities, a process

which is supported by various internal initiatives.

In the area of procurement management, we have combined

our fundamental sustainability standards and requirements

for our suppliers in a Supplier Code of Conduct, which we

have been introducing step by step since the end of 2009.

The code of conduct comprises the areas of ethics, employee

relations, management systems, and health, safety,

environ-mental protection and quality. It covers, for example, the

prohibition of corruption and child labor, the observation of

human rights, occupational health, and the responsible use

of natural resources.

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Sustainability at Bayer

6

Sustainability at Bayer

7

Sustainability at Bayer

Sustainability starts in

everyday corporate life

Sustainability at Bayer is an integral part of our corporate

policy, which is geared to long-term success and high-quality

solutions. This commitment is based on the conviction that

we can only be commercially successful in the long term if

we take ecological and social needs into account as well as

economic considerations. Although we have to set priorities,

our principles are applied without restriction. The

follow-ing examples show how sustainability is implemented in the

Group’s daily business practices:

Actively encouraging employee commitment

The motivation and commitment of our employees are crucial

to the company’s success. Our goal is to create a working

environment in which every employee can realize their full

potential. That is why we place emphasis on a responsible

human resources policy which promotes opportunities for

training and professional development, a healthy working

environment with key activities in the area of occupational

health and safety, high standards of pension insurance and

health care benefits, employee participation in the company’s

success, and options for harmonizing career and family life.

Our global commitment to respecting the rights of

employ-ees is set out in the Bayer Human Rights Position. We assign

particular importance to maintaining social diversity at our

company and to ensuring that employees have the

opportu-nity to apply their skills and uphold their convictions in an

environment free from discrimination. Bayer promotes equal

opportunities for all – regardless of gender, color, religion or

sexual persuasion.

Responsible use of resources

Bayer has always attached great importance to environmental

protection and the responsible use of resources. We

lever-age our expertise and experience, both in the optimization of

technologies and processes and in the development of

innova-tive products, in order to protect the environment, nature and

the climate. We develop new solutions to optimize resource

utilization, lower emissions and minimize the generation of

waste.

Drinking water is a resource that is in increasingly short

sup-ply in many regions of the world. Bayer specifically develops

and promotes solutions for efficient and responsible water

usage and is doing its utmost to conserve this crucial raw

material. To this end, we support the CEO Water Mandate

initiative of the UN Global Compact. In 2010, as part of the

new CDP Water Disclosure initiative of the Carbon Disclosure

Project, Bayer published comprehensive information on the

use, management and monitoring of water and on the

associ-ated risks and opportunities.

Unfortunately, even our extensive safety precautions and

train-ing procedures cannot entirely prevent environmental incidents

or transport accidents from occurring. To improve the safety of

transport operations still further, we introduced a new Group

regulation on transport safety in 2009. As part of the

continu-ous development of our safety management, we updated our

management approach to process and plant safety in 2009,

which found expression in a new Group regulation. The first

measures, e.g. training, are being implemented in 2010.

8

Promoting sustainable development

Promoting sustainable development

Promoting sustainable development

Sustainable human resources policy

High standards of pension insurance and

health care benefits

Diversity and equal opportunities for all employees

Answers to demographic change

Fostering of occupational health and safety

Bayer Human Rights Position binding on all

employees worldwide

Top priority is given to the safety and compatibility

of our products

Risk assessment based on international standards

and regulations

Well-founded risk analysis in connection with the use of

future-oriented technologies

Comprehensive product information as the basis

for responsible and proper use of our products

Responsible approach to resources

Reduction of emissions into air and water

Use of the Climate Check analysis tool

Reduction in waste volumes

Avoidance of environmental incidents and transport

accidents

Protection of biodiversity

Product stewardship

Bayer assigns maximum priority to meeting its

responsibil-ity for the environment and to maintaining the health and

safety of everyone who comes into contact with our products.

We therefore test and monitor all Bayer products in

applica-tions known to us with regard to health, safety, environmental

protection and quality (HSEQ). For us, product stewardship

involves a comprehensive evaluation of risks to health and the

environment – from the product research and development

stage through to production. It also includes responsible

prac-tice with regard to the marketing, use and disposal of

prod-ucts. In this area we have aligned ourselves since 1994 to the

principles of the voluntary Responsible Care

®

initiative of the

chemical industry and to two recent initiatives, the

Responsi-ble Care Global Charter and the Global Product Strategy (GPS)

of the International Council of Chemical Associations ICCA.

Our commitment to product stewardship applies to all our

products. With respect to future-oriented technologies, we

attach great importance to well-founded scientific risk

analy-sis for the purpose of protecting people and the environment.

Our positions on gene technology and nanotechnology

con-tain clear guidelines that are supplemented by

comprehen-sive product stewardship programs.

Virtually all products manufactured by Bayer are subject to

extensive legal requirements concerning the provision of

information, such as the EU chemicals legislation REACH.

We completed the mandatory pre-registration phase in 2008.

By the end of November 2010, Bayer will have drafted

regis-tration dossiers for all substances that we produce or import

in large volumes.

We bear particular responsibility in countries of the Third

World where, for example, crop protection products may not

always be used correctly. WHO Class I formulations may pose

difficulties here under certain application conditions. Bayer

CropScience will gradually replace these products, for example

by changing the formulation. If suitable alternatives are not

available, the company provides for the safe use of its products

and better user protection. If these measures prove insufficient,

the sale of such products on certain markets is discontinued.

(5)

Sustainability at Bayer

6

Sustainability at Bayer

7

Sustainability at Bayer

Sustainability starts in

everyday corporate life

Sustainability at Bayer is an integral part of our corporate

policy, which is geared to long-term success and high-quality

solutions. This commitment is based on the conviction that

we can only be commercially successful in the long term if

we take ecological and social needs into account as well as

economic considerations. Although we have to set priorities,

our principles are applied without restriction. The

follow-ing examples show how sustainability is implemented in the

Group’s daily business practices:

Actively encouraging employee commitment

The motivation and commitment of our employees are crucial

to the company’s success. Our goal is to create a working

environment in which every employee can realize their full

potential. That is why we place emphasis on a responsible

human resources policy which promotes opportunities for

training and professional development, a healthy working

environment with key activities in the area of occupational

health and safety, high standards of pension insurance and

health care benefits, employee participation in the company’s

success, and options for harmonizing career and family life.

Our global commitment to respecting the rights of

employ-ees is set out in the Bayer Human Rights Position. We assign

particular importance to maintaining social diversity at our

company and to ensuring that employees have the

opportu-nity to apply their skills and uphold their convictions in an

environment free from discrimination. Bayer promotes equal

opportunities for all – regardless of gender, color, religion or

sexual persuasion.

Responsible use of resources

Bayer has always attached great importance to environmental

protection and the responsible use of resources. We

lever-age our expertise and experience, both in the optimization of

technologies and processes and in the development of

innova-tive products, in order to protect the environment, nature and

the climate. We develop new solutions to optimize resource

utilization, lower emissions and minimize the generation of

waste.

Drinking water is a resource that is in increasingly short

sup-ply in many regions of the world. Bayer specifically develops

and promotes solutions for efficient and responsible water

usage and is doing its utmost to conserve this crucial raw

material. To this end, we support the CEO Water Mandate

initiative of the UN Global Compact. In 2010, as part of the

new CDP Water Disclosure initiative of the Carbon Disclosure

Project, Bayer published comprehensive information on the

use, management and monitoring of water and on the

associ-ated risks and opportunities.

Unfortunately, even our extensive safety precautions and

train-ing procedures cannot entirely prevent environmental incidents

or transport accidents from occurring. To improve the safety of

transport operations still further, we introduced a new Group

regulation on transport safety in 2009. As part of the

continu-ous development of our safety management, we updated our

management approach to process and plant safety in 2009,

which found expression in a new Group regulation. The first

measures, e.g. training, are being implemented in 2010.

8

Promoting sustainable development

Promoting sustainable development

Promoting sustainable development

Sustainable human resources policy

High standards of pension insurance and

health care benefits

Diversity and equal opportunities for all employees

Answers to demographic change

Fostering of occupational health and safety

Bayer Human Rights Position binding on all

employees worldwide

Top priority is given to the safety and compatibility

of our products

Risk assessment based on international standards

and regulations

Well-founded risk analysis in connection with the use of

future-oriented technologies

Comprehensive product information as the basis

for responsible and proper use of our products

Responsible approach to resources

Reduction of emissions into air and water

Use of the Climate Check analysis tool

Reduction in waste volumes

Avoidance of environmental incidents and transport

accidents

Protection of biodiversity

Product stewardship

Bayer assigns maximum priority to meeting its

responsibil-ity for the environment and to maintaining the health and

safety of everyone who comes into contact with our products.

We therefore test and monitor all Bayer products in

applica-tions known to us with regard to health, safety, environmental

protection and quality (HSEQ). For us, product stewardship

involves a comprehensive evaluation of risks to health and the

environment – from the product research and development

stage through to production. It also includes responsible

prac-tice with regard to the marketing, use and disposal of

prod-ucts. In this area we have aligned ourselves since 1994 to the

principles of the voluntary Responsible Care

®

initiative of the

chemical industry and to two recent initiatives, the

Responsi-ble Care Global Charter and the Global Product Strategy (GPS)

of the International Council of Chemical Associations ICCA.

Our commitment to product stewardship applies to all our

products. With respect to future-oriented technologies, we

attach great importance to well-founded scientific risk

analy-sis for the purpose of protecting people and the environment.

Our positions on gene technology and nanotechnology

con-tain clear guidelines that are supplemented by

comprehen-sive product stewardship programs.

Virtually all products manufactured by Bayer are subject to

extensive legal requirements concerning the provision of

information, such as the EU chemicals legislation REACH.

We completed the mandatory pre-registration phase in 2008.

By the end of November 2010, Bayer will have drafted

regis-tration dossiers for all substances that we produce or import

in large volumes.

We bear particular responsibility in countries of the Third

World where, for example, crop protection products may not

always be used correctly. WHO Class I formulations may pose

difficulties here under certain application conditions. Bayer

CropScience will gradually replace these products, for example

by changing the formulation. If suitable alternatives are not

available, the company provides for the safe use of its products

and better user protection. If these measures prove insufficient,

the sale of such products on certain markets is discontinued.

Sustainability at Bayer

10

Sustainability at Bayer

11

Sustainability at Bayer

Reporting

Sustainable investment

Corporate social responsibility

9

10

The Dow Jones Sustainability Indices (DJSI) provide a

world-renowned benchmark for sustainable investment. Bayer has been

listed continuously in the DJSI World since 1999.

Notable achievements in: climate protection, risk management,

reporting on sustainability

Transparency and performance in the area of climate protection.

Bayer has been listed continuously in the Carbon Disclosure

Leadership Index (CDLI) for the last six years and is also included

in the Carbon Performance Leadership Index (CPLI), which was

launched in 2010.

Notable achievements in: well-founded reporting on climate

targets and strategy and specific measures and successes in

reducing emissions

The FTSE4Good Index Series provides a global decision-making

tool for investors interested in sustainability. Bayer has been listed

continuously in the FTSE4 Good Global and Europe since they were

launched in 2001.

Notable achievements in: environmental management, climate

protection, risk management

Storebrand is a Norwegian financial services provider that

focuses on sustainable investment. Bayer has met the investment

criteria since 1999 and has been crowned “Best in Class” in the

pharmaceuticals sector since 2010.

Notable achievements in: position on human rights,

environmen-tal management

The Low Carbon Europe 100 Index lists major European

compa-nies with low greenhouse gas emissions. Bayer has been listed in

the Index since it was first drawn up in 2008.

Notable achievements in: low CO

2

intensity in the chemical sector

Guidelines for our reporting

Corporate social responsibility

Corporate social responsibility (CSR) forms an integral

part of Bayer’s corporate philosophy. We consider

our-selves to be a responsible member of society and a good

corporate citizen. We see our activities in this area as a

long-term investment in the future well-being of society

and our company. Our CSR activities are designed to

have an enduring impact. We focus on issues of global

or particular social relevance in countries where Bayer

operates. We endeavor to back-up our employees’

com-mitment by providing technical and economic expertise

in areas which have a link to our business operations.

In 2009, we set aside €44 million worldwide for support

projects in our four key areas.

Focus

Overview of

expenditure in 2009

(in

thousand)

Education & Research

4,879

Environment & Nature

2,659

Health & Social Needs

15,213

Sports & Culture

20,768

Sustainable investment

More and more investors are showing an interest in the extent

to which companies integrate ecological and social aspects

into their strategies and business activities. Sustainability

indices and funds provide a point of reference in this field.

Bayer is represented in various indices and funds. We see this

as a clear acknowledgement of our commitment to sustainable

development within our corporate strategy.

Our reporting

Communication with our stakeholders featuring transparent,

open and targeted dialogue is an indispensable part of our

corporate policy. It helps us view challenges from different

perspectives in order to define relevant focal points for our

activities.

We also base our reporting on dialogue with our

stakehold-ers, who include employees, customstakehold-ers, suppliers and

inves-tors. Of equal importance to Bayer are the interests of our

direct neighbors at our sites and of non-governmental

orga-nizations (NGOs), public administration, politicians and

aca-demic circles. We see it as our duty to critically review our

sustainability performance and the challenges we face, both

in the management report of the Bayer Annual Report and in

our annual Sustainable Development Report

(www.sustain-ability2009.bayer.com). In doing so, we strive to achieve

opti-mal transparency and verifiability. The statements relating to

corporate policy in our Sustainable Development Report and

in this flyer apply to all the sites and activities of the Bayer

Group worldwide.

The data and statements in the focus issue articles and in the

entire performance report of our Sustainable Development

Report have been reviewed and certified by an independent

auditor.

Our Sustainable Development Report complies with the

cur-rent guidelines (G3) of the Global Reporting Initiative (GRI),

achieving level A+, and covers all of the core indicators

recommended by the GRI. In a progress report we annually

outline our activities, management systems and

achieve-ments with respect to the implementation of the 10 principles

of the UN Global Compact.

Bayer Science &

Education Foundation

Bayer foundation

for the promotion of science

and education

Bayer: Science For A Better Life

Bayer Cares

Foundation

Bayer foundation

for social initiatives

Strengthening education and

research:

Improving school education

Promoting talented young

scientists

Honoring outstanding research

achievements

Improving living conditions:

Supporting voluntary

involvement

Providing immediate aid and

supporting reconstruction

projects following disasters

(6)

Sustainability at Bayer

Sustainability at Bayer

Sustainability at Bayer

Sustainability at Bayer

The Bayer Sustainability Program

The Bayer Sustainability Program

The Bayer Sustainability Program

The Bayer Sustainability Program

The “EcoCommercial Building Program” cuts down on greenhouse gas

emissions.

As part of the “Family Planning” lighthouse project, we work with public

institutions and NGOs.

The Food Chain Partnership projects aim to network key players along the

value added chain – from producers to consumers.

The Bayer Sustainability Program

The world is faced with major challenges. Among the

greatest of these is global population growth and the

associated increased criticality of other important factors,

such as sufficient food, access to health care, and

envi-ronmental and climate protection. These global issues are

at the focus of our sustainability strategy.

Bayer sees itself as a member of society – both

glob-ally and also in all the regions and countries in which

we operate. Companies like Bayer have a crucial part to

play in assuming responsibility and developing solutions.

These major global trends have played a key role in

shap-ing our Group strategy, with the aim of safeguardshap-ing the

future of our company. As well as presenting challenges

that we have to accept and overcome, these trends also

offer business opportunities.

We have drawn up a Sustainability Program based on our

sustainability strategy. The program currently comprises

eight “lighthouse projects” that illustrate the focus of our

strategy particularly clearly.

Partnerships for more high-quality food

Farmers are constantly having to meet the increasingly strict

quality requirements that are placed on food. Bayer brings

together farmers, processors, carriers and retailers from

more than 40 countries through its Food Chain Partnership

program with the aim of developing joint solutions. As part of

the “Food Chain Partnership Vegetables” lighthouse project,

experts from the company will be providing support, by 2012,

to a total of 65,000 farmers in India in 125 projects in the

cultivation of vegetables based on the rules of profitable,

sus-tainable agricultural practice. For farmers, this means higher

yields, better quality, larger-scale sales opportunities and an

improved income.

Rice is the most important staple foodstuff in many parts of

Asia. Bayer CropScience launched a program in Indonesia in

2009 aimed at achieving sustainable improvement in the yield

and income situation of rice farmers. The practice of seeding

the rice directly is at the heart of this program. Unlike the

cus-tomary method of sowing individual young plants in flooded

paddies by hand, direct seeding involves the planting of

pre-germinated seeds by machine. This increases yields, saves

enormous quantities of water, reduces the need for fertilizer

and also lowers emissions of the greenhouse gas methane by

around 30 percent.

Solutions for climate protection and resource use

Energy consumption in buildings is responsible for almost

20 percent of global greenhouse emissions. Bayer’s

“Eco-Commercial Building Program” lighthouse project already

makes climate protection in the building sector a viable option

today. Through a partnership network including suppliers,

construction companies, architects and property owners,

Bayer and its partners create customized solutions for the

construction of commercial and public buildings ranging

from energy-optimized concepts to zero-emission buildings.

The key goal of constantly reducing the company’s own

greenhouse gases is being pursued in two other lighthouse

projects focusing on energy efficiency. Oxygen depolarized

cathode technology based on common salt will be used in the

future in chlorine production to reduce energy consumption

by between 30 and 50 percent. Improving energy efficiency

is also at the center of our new measurement and

manage-ment method STRUCTese

®

(Structured Efficiency System

for Energy). This method is to be applied to 60 of our most

energy-intensive production facilities worldwide by 2012.

Another lighthouse project in 2010 will test the Resource

Efficiency Check, a method that is designed to analyze the

use, from all angles, of all production-relevant resources,

such as energy, water and raw materials, in production

pro-cesses and processing procedures.

Alliances for sustainable health care

Bayer’s “Family Planning” lighthouse project supports the

United Nations’ Millennium Development Goals of

reduc-ing child mortality, improvreduc-ing health care for mothers and

strengthening equal opportunities by 2015. The company is

working together with partners to improve knowledge of

sexu-ality, health and contraception in developing countries. These

alliances are also making hormonal contraceptives available

either free of charge or at reduced prices.

More than 3.3 billion people – mainly the poorest of the poor

– are affected by so-called neglected diseases. In cooperation

with the World Health Organization (WHO) Bayer provides

medicines free of charge to treat African sleeping sickness and

Chagas’ disease. Bayer is also working together with partners

on a new tuberculosis therapy that reduces the present

dura-tion of treatment of six months by a third.

More detailed information can be found at

www.sustainabilityprogram.bayer.com

Challenge

Focus

Projects

Global access

to health care

Nutrition

for a growing

population

Climate and

environmental

protection

Alliances for

sustainable

health care

More

high-quality food

Solutions for

climate protection

and resource use

  Family

Plan-ning

  Neglected

Diseases

  Food Chain

Partnership

Vegetables

 

Direct-Seeded Rice

  EcoCommercial

Building

Program

  Energy

Efficiency

  Resource

Efficiency

(7)

Sustainability at Bayer

Sustainability at Bayer

Sustainability at Bayer

Sustainability at Bayer

The Bayer Sustainability Program

The Bayer Sustainability Program

The Bayer Sustainability Program

The Bayer Sustainability Program

The “EcoCommercial Building Program” cuts down on greenhouse gas

emissions.

As part of the “Family Planning” lighthouse project, we work with public

institutions and NGOs.

The Food Chain Partnership projects aim to network key players along the

value added chain – from producers to consumers.

The Bayer Sustainability Program

The world is faced with major challenges. Among the

greatest of these is global population growth and the

associated increased criticality of other important factors,

such as sufficient food, access to health care, and

envi-ronmental and climate protection. These global issues are

at the focus of our sustainability strategy.

Bayer sees itself as a member of society – both

glob-ally and also in all the regions and countries in which

we operate. Companies like Bayer have a crucial part to

play in assuming responsibility and developing solutions.

These major global trends have played a key role in

shap-ing our Group strategy, with the aim of safeguardshap-ing the

future of our company. As well as presenting challenges

that we have to accept and overcome, these trends also

offer business opportunities.

We have drawn up a Sustainability Program based on our

sustainability strategy. The program currently comprises

eight “lighthouse projects” that illustrate the focus of our

strategy particularly clearly.

Partnerships for more high-quality food

Farmers are constantly having to meet the increasingly strict

quality requirements that are placed on food. Bayer brings

together farmers, processors, carriers and retailers from

more than 40 countries through its Food Chain Partnership

program with the aim of developing joint solutions. As part of

the “Food Chain Partnership Vegetables” lighthouse project,

experts from the company will be providing support, by 2012,

to a total of 65,000 farmers in India in 125 projects in the

cultivation of vegetables based on the rules of profitable,

sus-tainable agricultural practice. For farmers, this means higher

yields, better quality, larger-scale sales opportunities and an

improved income.

Rice is the most important staple foodstuff in many parts of

Asia. Bayer CropScience launched a program in Indonesia in

2009 aimed at achieving sustainable improvement in the yield

and income situation of rice farmers. The practice of seeding

the rice directly is at the heart of this program. Unlike the

cus-tomary method of sowing individual young plants in flooded

paddies by hand, direct seeding involves the planting of

pre-germinated seeds by machine. This increases yields, saves

enormous quantities of water, reduces the need for fertilizer

and also lowers emissions of the greenhouse gas methane by

around 30 percent.

Solutions for climate protection and resource use

Energy consumption in buildings is responsible for almost

20 percent of global greenhouse emissions. Bayer’s

“Eco-Commercial Building Program” lighthouse project already

makes climate protection in the building sector a viable option

today. Through a partnership network including suppliers,

construction companies, architects and property owners,

Bayer and its partners create customized solutions for the

construction of commercial and public buildings ranging

from energy-optimized concepts to zero-emission buildings.

The key goal of constantly reducing the company’s own

greenhouse gases is being pursued in two other lighthouse

projects focusing on energy efficiency. Oxygen depolarized

cathode technology based on common salt will be used in the

future in chlorine production to reduce energy consumption

by between 30 and 50 percent. Improving energy efficiency

is also at the center of our new measurement and

manage-ment method STRUCTese

®

(Structured Efficiency System

for Energy). This method is to be applied to 60 of our most

energy-intensive production facilities worldwide by 2012.

Another lighthouse project in 2010 will test the Resource

Efficiency Check, a method that is designed to analyze the

use, from all angles, of all production-relevant resources,

such as energy, water and raw materials, in production

pro-cesses and processing procedures.

Alliances for sustainable health care

Bayer’s “Family Planning” lighthouse project supports the

United Nations’ Millennium Development Goals of

reduc-ing child mortality, improvreduc-ing health care for mothers and

strengthening equal opportunities by 2015. The company is

working together with partners to improve knowledge of

sexu-ality, health and contraception in developing countries. These

alliances are also making hormonal contraceptives available

either free of charge or at reduced prices.

More than 3.3 billion people – mainly the poorest of the poor

– are affected by so-called neglected diseases. In cooperation

with the World Health Organization (WHO) Bayer provides

medicines free of charge to treat African sleeping sickness and

Chagas’ disease. Bayer is also working together with partners

on a new tuberculosis therapy that reduces the present

dura-tion of treatment of six months by a third.

More detailed information can be found at

www.sustainabilityprogram.bayer.com

Challenge

Focus

Projects

Global access

to health care

Nutrition

for a growing

population

Climate and

environmental

protection

Alliances for

sustainable

health care

More

high-quality food

Solutions for

climate protection

and resource use

  Family

Plan-ning

  Neglected

Diseases

  Food Chain

Partnership

Vegetables

 

Direct-Seeded Rice

  EcoCommercial

Building

Program

  Energy

Efficiency

  Resource

Efficiency

Figure

Updating...

References

Updating...

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