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People

"Bring Your Curiosity to Life" – our promise as an employer describes how we collaborate, how we advance our business, how our employees can develop within the company and who we are. Our development into a global science and technology company over the past 350 years would not have been possible without the passion, creativity and curiosity of our employees. And we are certain that our current and future employees safeguard our economic success. They create innovations for patients and customers, and secure our ability to compete. For this reason, the development of all our employees is such an important concern to us. In short, we are working to create an environment where people are able to develop and to reach their full potential.

A career with Merck KGaA, Darmstadt, Germany, is enriching – both from a professional and a personal perspective. We offer the necessary framework conditions that meet the individual needs of our employees, that encompass an exciting range of tasks and advanced training possibilities, furthering flexible forms of cooperation and a culture of mutual esteem and respect. The latter is particularly important as our workforce represents a broad range of nationalities, cultures, religions and age groups as well as a variety of personal and professional backgrounds. We are convinced that this diversity paired with a corporate culture based on mutual respect strengthens our innovative potential and contributes to our success.

overview of our headcount figures

As of December 31, 2018, we had 51,749 employees worldwide1 (2017: 52,941). In 2018, we were represented by a total of 207 legal entities with employees in 66 countries.2

distribution of employees

by Region

1 The Consumer Health business was transferred to Procter & Gamble (P&G) on December 1, 2018, and was already classified as a discontinued operation according to IFRS 5 in April 2018. With the completion of the sale, around 3,300 employees joined P&G.
2 The Group also has employees at sites which are not fully consolidated subsidiaries. These figures refer to all people directly employed by the Group and therefore may deviate from figures in the financial section of this report.

Driving innovation through curious people

As a science and technology company, we are always looking for new solutions and working to continuously evolve our approaches. Engaged, curious employees are key to our ability to innovate – and therefore also for our success. We need a corporate culture that broadens the knowledge base of our employees, one that creates exciting opportunities and motivates them to take a proactive role in shaping the development of our company.

FOSTERING INNOVATIVE POTENTIAl

Curiosity and a focus on new ideas provide a fruitful basis for innovation and have a positive impact on company performance. In order to create a place – supplementing classic research and development, where we can develop ideas into viable businesses beyond the current scope we opened the modular Innovation Center in Darmstadt back in 2015. It serves as the prototype for our Innovation Center that we opened in March 2018 as part of the 350-year anniversary festivities. The Innovation Center offers our employees the opportunity to explore new ideas in an inspiring setting and to work on selected projects. Sufficient scope and adequate support, also in the form of a suitable working environment, actively promote the innovative strength of our employees. The strategic orientation of our innovation activities is determined by innovation fields that are related to our business fields and provide potential for revolutionary technologies and business ideas. In 2018, in addition to the existing innovation field of Biosensing and Interfaces, we defined two further fields: Clean Meat and Liquid Biopsy technologies.

In order to contribute external ideas and offer the opportunity of open innovation for our innovation projects, we are building strong relationships with external partners in all industries and target the start-up community via our Accelerator.

Apart from initiatives to generate ideas and advance projects, the Innovation Center offers our employees various training courses on topics such as innovative methods, creative techniques and developing business models. In 2018, initial projects in the Innovation Center reached a milestone by becoming minimum viable products. This includes a solution where our company anchors real objects, such as products, in a blockchain to make supply chains secure and thus protect companies as well as end consumers.

valuing cultural diversity

We are a global science and technology company with employees who represent a varied cross-section of gender identities, nationalities, cultures, religions, age groups and sexual orientations. They contribute their professional backgrounds, individual life experience and perspectives to their work. We believe that a diverse workforce – paired with a respectful corporate culture – strengthens our ability to innovate and contributes significantly to our business success.

Our Chief Diversity Officer is responsible for the strategic management of diversity and inclusion. The Diversity Council, a body consisting of senior leaders from all business sectors and selected Group functions, is specifically working on the implementation of our diversity strategy, revised in 2018. Key elements of this are recruiting people representing a breadth of qualifications, skills and experiences as well as developing and retaining these people. In addition, we support specific employee networks in order to foster exchange among like-minded individuals. Apart from our women’s networks in various countries, we also support networks that promote the interests of the LGBTIQ (lesbian, gay, bisexual, trans, intersex, questioning) community as well as African-American and international employees. Our carer network brings together employees from all over the world who care for a relative.

Our aim is to raise awareness for diversity and inclusion among our employees. We piloted initial training sessions in 2018 to create awareness of unconscious bias, which will be rolled out globally in 2019. Accordingly, around 380 employees have already been given the opportunity to identify their own unconscious thought patterns and stereotypes to help them avoid any unconscious unfair treatment resulting from such bias. We also introduced the Job Analyzer, an online tool that allows job advertisements to be checked for critical wordings prior to their publication, thus fostering gender-neutral communication with those applying for jobs.

As a global employer with intercultural expertise, people from a total of 136 nations work for our company; 24.1% of our employees are German citizens and 73.9% of our employees work outside Germany. At our headquarters in Darmstadt, 11% of our staff comes from 89 different countries.

Women currently make up 44% of our workforce. However, the ratio of women to men varies widely across the different regions, businesses and functions. We are therefore working to raise the proportion of women wherever they are underrepresented, taking into account the situation typical for the industry as well as regional differences.

Demographic change is posing challenges to the society in Germany as well as several other EU countries, the United States, China and Japan. The average age of our employees is slightly more than 41. We assume that this figure will continue to rise in the coming years and are preparing for this situation. As part of our range of ‟Health and Well-being” offers, we specifically promote employee physical and psychological well-being. These offers vary from country to country and are adapted to local circumstances. In addition, we offer multifaceted continuing education throughout our employees’ careers.

In Germany, we signed the ‟Charta der Vielfalt” (Diversity Charter) in 2013, the ‟Charta der Gleichstellung” (Equal Opportunity Charter) in 2015 and the Inclusion Action Plan of the German Mining, Chemical and Energy Industrial Union (IG BCE) in 2017. By joining these initiatives, we underscore our commitment to fairness and tolerance in the workplace.

Furthering and asking more of talent

We endeavor to identify and develop the abilities of our employees early on. Our objective is to extensively develop current and future employees and offer them interesting advanced training opportunities in order to prepare them for more challenging tasks.

a holistic recruitment approach

When filling job vacancies, we pursue a holistic recruitment approach coupled with globally uniform and binding procedures. This starts with an internal job posting before external channels such as job portals and recruitment agencies are used. This process enables us to offer employees better development opportunities. For employees with leadership responsibility, we offer targeted interview coaching to support them in selecting candidates and to establish uniform quality standards.

A globally accessible welcome portal is available to new employees in order to help them prepare for their new job at Merck KGaA, Darmstadt, Germany, and to support their onboarding phase. To further improve the onboarding process, supervisors, Human Resources and new employees can exchange information and documents before their first day of work. In addition, all new employees are assigned an experienced colleague who can help them to familiarize themselves with the daily working routine. Our managers are also given detailed information such as onboarding plans and process descriptions to support them with this task.

vocational training to recruit young people

In 2018, we again maintained a constant, high vocational training rate in Darmstadt, our largest site. A total of 562 young people were enrolled in vocational training in 24 different occupations at our headquarters in the reporting period. We give unlimited employment contracts to all employees in vocational training who work in occupations for which we have sustainable demand. On average, the post-vocational training hiring rate – taking voluntary terminations into account – was more than 90% over the past five years. We also offer vocational training at other sites in Germany, in which a total of 60 young employees participated.

We promote the professional and social expertise of our employees in vocational training through numerous regional and global project activities. This included the support of a foundation for street children in South Africa in 2018. Furthermore, through our ‟Start in die Ausbildung” (Starting vocational training) program, we help prepare young people who have not been able to find a vocational training position. The number of interns increased slightly compared to the previous year with 21 participants aged between 16 and 25 years. Although they have a school leaving qualification, they had been searching for a vocational training position for at least one year without success.

Since 2016, we have also been working on a specially developed program to help refugees enter the job market. As part of the ‟Integrating refugees through training” program, a further group of twelve young people who were forced to flee their home countries started language, technical, cultural, and career-related training to prepare them for vocational training and thus for the labor market.

targeted advanced training and maximizing performance capability

Our focus on systematic personnel development allows us to sustainably strengthen the performance potential within our company and to increase the motivation of our people. Only by expanding the abilities of each individual can we count on innovative and curious employees and managers in the future and flexibly respond to different requirements.

Employee development at our company is founded on regular exchanges and a culture in which employees aspire to high levels of performance and engagement. As the basis for internal strategic talent management, the performance and potential management process is globally aligned for all employees in accordance with the same principles and is part of a shared IT system. We systematically combine talent recognition with performance assessments based on employee target agreements, as we are convinced that ongoing feedback helps all employees to grow in terms of their performance and potential. Regular individual assessments permit us to more readily identify high-potential employees and to further them accordingly. Clear objectives, differentiated and open feedback, and individual development plans are thus important prerequisites for both the personal development of every individual and the success of the company.

Furthermore, we have established our ‟Science Network”. Due to the broad positioning of our company, we do not have a central research and development organization that unites expertise across our businesses. Through this project we are promoting the establishment of a science community within the company to accelerate the exchange of innovative ideas and facilitate collaboration among all our R&D employees. One element of this project is the ‟Continuous Performance Dialogues” between 1,300 employees and their supervisors to align performance and potential appraisals with research and development needs. Other aspects focus on the advanced training of experts and their career paths and on the transfer of knowledge within the network.

Global classroom training courses and workshops developed specifically for teams help our employees develop and build individual abilities in line with new requirements and perspectives. In 2018, more than 4,100 employees participated. Digital solutions in the form of more than 3,735 e-learning and languages courses are available to our employees. To enable our employees to realize their full potential, we also provide local business- and function-related offers. All measures are documented in a globally standardized development plan.

Individual development opportunities are also supported by our job architecture. It applies globally and enables us to harmonize all positions and to simplify their classification. This job architecture defines three fundamental career types: managers, experts and project managers. They are all equivalent. Employees who wish to advance in their careers and aim for a top position within the company can also do so via the expert and project manager career paths.

Building empowered leaders

One of the major duties of our managers is to motivate and encourage employees to show their innovative strength. A dialog in a spirit of partnership, the development of strategic competencies and the continuous further development of our leaders help to build trust and to strengthen our company’s success over the long term.

strategic competency development

A transparent competency model is a further pillar of our personnel development efforts. Managers and employees should show strategic competence by being purposeful, future-oriented, innovative, results-driven, collaborative and empowering. By demonstrating these qualities, our managers can build a strong culture of collaboration based on curiosity, creativity and trust. In addition, our leaders are expected to set an example by living our company values and taking responsibility for their own decisions. Based on this competency model, we have defined six leadership behaviors that summarize the conduct we expect from our leaders.

To assess the performance and potential of every individual and to establish an effective leadership culture, regular and differentiated feedback is of utmost importance. In this way, employees and supervisors can develop a shared vision, execute the business strategy and further develop a unifying corporate culture.

using the opportunities provided by digitalization

The digital transformation has been leaving its mark on the world of work for a long time now. New, agile ways of working are thus increasingly gaining in importance. At our company, we want to support this trend actively, which is why we are offering our employees many opportunities for digital and innovative working.

Using the big data applications developed by People Analytics within Human Resources, managers receive quick and targeted answers to personnel-related questions. In addition to the traditional master data, the software also holds information on compensation, performance and potential as well as on commitment or succession planning and is able to link this data. This means that leaders have a comprehensive data set at their disposal, which they are able to use taking into account data protection provisions. The analyses are based on algorithms and allow the early identification of trends (predictive analysis) and data-based decisions.

Our manager and employee self-services are another good example of modern working methods. Employees can use these services to manage their own data, retrieve information and perform personnel-related tasks independently.

Digitalization also features in our training and advanced training programs as IT skills are becoming increasingly important. At the same time, digital media create new ways of learning. For this reason, we are integrating topics such as 3D printing and artificial intelligence into our training content with increasing frequency. We are also increasingly relying on new kinds of learning and innovation methods, such as scrum or design thinking.

diversity and management

In order to manage our global and diverse organization, we need managers who can build international teams and promote international collaboration so as to contribute to a productive and flexible working environment. We seek managers whose inclusive leadership style also reflects different employee and customer traits. This opens up career opportunities for talented employees from all areas of our company and ensures a broad experience base as well as differentiated decision-making.

At our company, many teams work across sites and internationally. The diversity of competencies and experiences among the team members offers tremendous potential that our leaders can make use of. Internationality and a global mindset characterize our company culture and are therefore mirrored by our international management team. In 2018, 63.6% of our executives were not German citizens. Altogether, 70 different nationalities are represented in such positions.

Our goal for the period until 2021 is to maintain the proportion of women leaders at a stable level of 30%, and we are working to further increase the representation of women in leadership positions and business units where they are still underrepresented. To achieve this objective, during the reporting period we formed special teams that are responsible for developing goals and measures at departmental level to help us move female candidates into positions in different areas and hierarchies. At the end of 2018, women occupied 32.3% of leadership roles Group-wide. These figures are steadily increasing across the company as a whole, but not consistently across business units, Group functions and hierarchical levels. The report on stipulations to promote the proportion of women in leadership positions at Merck KGaA, Darmstadt, Germany, pursuant to section 76 (4) and section 111 (5) of the German Stock Corporation Act (AktG) can be found in the Corporate Governance section of this report.

management programs for executives

We use targeted advanced training to nurture our top talent and senior executives. The eight-month International Management Program strengthens the leadership competencies and global thinking of top talent at the start of their career. In cooperation with leading international universities, our Company University has been offering a cross-regional, modular advanced training program since 1999. To date, 397 members of top management have taken part. Furthermore, our company cooperates globally with academic institutions in order to support employees who wish to earn an MBA. In 2015, we launched management programs specifically for people managers in growth markets, which focus on business management and Group-specific topics. These programs are offered in China, the Middle East, Africa and Latin America, for example. Moreover, in 2018 we ran the ‟Managerial Foundation Program” (MFP) for new people managers in 20 countries with 795 participants. The ‟Advanced Management Program” (AMP) for experienced leaders (‟managers of managers”) builds on the MFP and was attended by 242 people managers in five countries. For the top management we also offer a ‟Global Leadership Program” (GLP). This program addresses issues such as leadership culture and prepares participants for the leadership challenges of tomorrow. Since 2016, 678 leaders have participated in the GLP.

In 2018, we once again expanded our workforce pool to internally fill management positions when they become vacant. In 2018 once again, most management position vacancies were filled by internal candidates. In addition, we recruited highly qualified external executives in order to add new perspectives to our long-standing in-house expertise.

Differentiated solutions to support employee well-being

As an employer, we take on responsibility for the well-being of our people and offer a wide range of opportunities to optimize work-life balance and to protect their health and safety.

fostering work-life balance

As a responsible employer, the physical and mental well-being of our employees is extremely important to us. To enable employees to plan their lives independently and to stabilize their long-term satisfaction at a high level, providing a flexible and health-oriented working environment is a special focus of our human resources work.

A healthy work-life balance is a crucial precondition for the performance ability and motivation of our people. We plan to roll out a Group-wide guideline on flexible working in 2019. At present, we offer our employees at many sites around the world various flexible and innovative working models. The Mywork at Merck KGaA, Darmstadt, Germany, working model allows employees at the German sites in Darmstadt and Gernsheim, for example, to freely choose their working hours and location in agreement with their teams and supervisors. In addition, we also introduced the Mywork at Merck KGaA, Darmstadt, Germany, for Merck Accounting Solutions & Services Europe GmbH, a subsidiary of Merck KGaA, Darmstadt, Germany, Merck Export GmbH, Darmstadt, Germany, a subsidiary of Merck KGaA, Darmstadt, Germany, Merck Schuchardt OHG, Hohenbrunn, Germany, a subsidiary of Merck KGaA, Darmstadt, Germany, Merck Selbstmedikation GmbH, Darmstadt, Germany, a subsidiary of Merck KGaA, Darmstadt, Germany, and Merck Chemicals GmbH GmbH, Darmstadt, Germany, a subsidiary of Merck KGaA, Darmstadt, Germany. Employees no longer record their time electronically and must document their hours only if they exceed their standard working hours within the agreed working time framework. At the end of December 2018, a total of 5,698 employees made use of this model. In 2018, 4.8% of our employees worldwide worked part-time, 12.5% of whom are men.

By offering information, advice and assistance in finding childcare and nursing care as home and garden services, we help employees to reconcile the demands of their professional and personal lives. At various sites, employees benefit from childcare options that we subsidize. For example, a daycare center has been operating at the Darmstadt site, looking after children between the ages of one and twelve, for over 50 years. The adjacent new building houses a nursery for up to 60 children between the ages of one and three years. During the orientation phase, our employees can make use of additional offices for parents at the daycare center. In addition, a good ratio of staff to children is important to us to reliably supervise the children.

a transparent and flexible employee reward system

At our company, we reward the performance of every individual through appropriate and competitive total compensation. For years, we have been achieving this through global processes and programs that are supported by digital platforms. We also offer our managers flexible, market- and needs-oriented compensation tools. These support well-informed decisions and thus provide comprehensible, performance- and position-based compensation. Apart from monetary compensation components, we also offer our employees attractive fringe and social benefits. Our fringe benefits feature globally under the internal ‟benefits4me” brand. Its offerings comprise three pillars:

  • Company benefits including a company pension
  • Health and well-being
  • Service offers

Specific benefit packages are in place at a national level to meet the different needs of our employees using well-established management mechanisms. Focusing more closely on individualized fringe and social benefits in the future will continue to enable our employees to individually choose those benefits that best meet their personal situation and stage of life.

A CONSTANT FOCUS ON HEALTH AND SAFETY

Workplace safety and health protection are the highest priority at Merck KGaA, Darmstadt, Germany. It is especially important to us to do everything in our power to prevent workplace-related illnesses and accidents. We apply the lost time injury rate (LTIR) as an indicator to determine the success of measures aimed at accident prevention as well as occupational health and safety. This key performance indicator describes the number of workplace accidents resulting in lost time of one day or more per one million working hours. After having reached the goal of 2.5 that we had set in 2010, in 2015 we set ourselves a new, ambitious goal: By 2020 we intend to sustainably lower the LTIR to 1.5. With an LTIR of 1.3 in 2018, we overachieved this goal.

Since 2010, we have been using the ‟BeSafe!” program to further expand our occupational safety activities. Uniform standards as well as local modules to meet specific safety requirements at individual sites can help achieve a steady improvement in the current situation. The program focuses on engaging managers in the safety culture and building their buy-in; it aims to make safety an intrinsic value and empower our employees to take responsibility for their own safety. In 2018, we continued to sensitize our employees to workplace hazards through numerous awareness campaigns.

Since 2010, our company has been presenting the Safety Excellence Award annually in order to underscore the importance of safety. It is granted to all production sites with no workplace accidents on record for the year; in 2018, it was awarded to 62 out of 90 sites.

regular global employee surveys

We want to create a working environment that empowers our employees to think outside of the box and find new solutions, opening the door to creative ideas and the discovery of new market opportunities. In order to promote this and to allow us to carry out even better comparisons both within the company and with our competitors, we conduct Group-wide employee engagement surveys every year. In this way we ensure a regular exchange between employees, leaders and the top management. The honest feedback we receive from staff shows us whether the aforementioned measures and initiatives are successful as well as highlighting areas where we can improve further.

In October 2018, the global employee engagement survey was again conducted in 22 languages and the status of implementation reviewed. Around 45,000 employees (86%) took part. Our Group-wide score, which indicates how attached our employees feel to the company, was 61%. We are thus on a par with other pharmaceutical and chemical companies. These surveys are supplemented by smaller ‟snapshot surveys”, where employees are asked about selected strategic issues or projects.

The results are used to identify strategic focus areas and they feed into the company-wide work on an ongoing basis.

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OVERVIEW OF EMPLOYEE FIGURES1

Group (overall)
Dec. 31, 2016
Group (overall)
Dec. 31, 2017
Group (overall)
Dec. 31, 20182
Number of employees global, total 50,414 52,941 51,749
by region Asia-Pacific (APAC) 10,754 11,294 10,486
Europe 24,438 25,980 25,792
Latin America 4,140 4,050 3,340
Middle East and Africa (MEA) 1,045 1,097 1,153
North America 10,037 10,520 10,978
Number of employees (FTE – full-time equivalents) global, total 49,652.7 52,223.5 51,039.8
by region Asia-Pacific (APAC) 10,725.3 11,272.1 10,462.9
Europe 23,727.1 25,302.5 25,126.8
Latin America 4,136.5 4,046.2 3,339.5
Middle East and Africa (MEA) 1,041.8 1,096.1 1,151.1
North America 10,022.0 10,506.7 10,959.6
Number of countries 66 66 66
Number of legal entities global, total 215 217 207
Number of nationalities global, total 129 131 136
Number of nationalities working in Germany 91 97 95
Percentage of employees with German citizenship 23.1% 23.2% 24.1%
Percentage of employees working outside Germany 75.3% 74.9% 73.9%
Percentage of employees with global managers 9.7% 10.2% 10.6%
Percentage of women in the workforce global, total 42.8% 43.1% 44.0%
in Germany 38.6% 39.1% 38.9%
Percentage of women in leadership positions
(= role 4 or higher)
global, total 28.8%3 30.3%3 32.3%5
in Germany 28.7%3 29.7%3 30.9%5
Percentage of executives (= role 4 or higher) global, total 5.7%3 6.0%3, 4 6.5%5
Percentage of executives who are not German citizens 64.7%3 64.4%3 63.6%5
Number of nationalities 703 653 705
Number of employees in vocational training in Germany 576 588 604
Vocational training rate 5.1% 4.4% 4.1%
Number of employees in the model (Germany)
of the Mywork at Merck KGaA, Darmstadt, Germany
4,507 5,267 5,698
Percentage of employees working part-time global, total 4.7% 4.6% 4.8%
Men 10.6% 10.7% 12.5%
Percentage of employees aged 17 – 29 years global, total 14.7% 14.5% 14.5%
Percentage of employees aged 30 – 49 years global, total 62.5% 62.1% 61.1%
Percentage of employees aged 50+ global, total 22.8% 23.4% 24.4%
Average age globally 41.3 41.4 41.7
Average age by region Asia-Pacific (APAC) 36.7 36.9 36.9
Europe 42.4 42.5 42.8
Latin America 39.9 40.3 40.4
Middle East and Africa (MEA) 39.3 39.4 39.2
North America 44.3 44.1 44.1
Germany 42.9 43.0 43.3
Average length of service global, total 9.9 9.8 10.0
Average length of service in Germany 14.2 14.0 14.5
1
The Group also has employees at sites which are not fully consolidated subsidiaries. These figures refer to all people directly employed by the Group and therefore may deviate from figures in the financial section of this report.
2
The Consumer Health business was transferred to Procter & Gamble (P&G) on December 1, 2018 and was already classified as a discontinued operation according to IFRS 5 in April 2018. With the completion of the sale, around 3,300 employees joined P&G.
3
Not including Sigma-Aldrich legal entities in Germany or Allergopharma.
4
Ratio adjusted retrospectively.
5
Not including the Sigma-Aldrich legal entity in Steinheim (Germany) or Allergopharma.