In addressing these trends, we are continuing a long tradition of corporate responsibility, which is also reflected in our reporting practices. We have been detailing our efforts to meet our obligations to society since 1993. This initially took the form of environmental reports, but then in 2003 evolved into a full Corporate Responsibility (CR) Report released every two years. In 2016, we started publishing our CR Report on an annual basis.
In our 11th CR Report, we elaborate on our ambition to create shared value for both our company and society as a whole.
With transparency as a key goal, we aim to extensively inform our stakeholders of our activities and successes, along with the challenges we face. Our 2019 Corporate Responsibility Report meets the regulatory requirements for a combined separate non-financial report. The index to the non-financial report provides an overview of the relevant content.
This CR report also documents the progress we have made in implementing the principles of the United Nations Global Compact (Communication on Progress).
This CR report covers fiscal 2019 and pertains to our entire Group including our subsidiaries in 66 countries. Any deviations from this reporting framework are indicated on a case-by-case basis.
Acquisitions of Intermolecular and Versum Materials
The closing of the acquisition of Intermolecular, Inc. on September 20, 2019 and Versum Materials, Inc. on October 7, 2019 marked two major milestones in the transformation journey of our Performance Materials business sector. Together, we are optimally positioned to enable next-generation digital devices for a smart, safe and connected world. The business combination is expected to make us a leading electronic materials player focused on the semiconductor and display industries. Intermolecular and Versum Materials will strengthen our Performance Materials business sector and become part of the Semiconductor Solutions business unit, one of the three Performance Materials business units alongside Display Solutions and Surface Solutions.
We are still in the process of consolidating the approaches, goals, results, and measures for the primary non-financial topics identified through our materiality analysis and expect this to be entirely completed by 2021. The sections of the non-financial report in which these acquisitions play a significant role reflect the December 2019 status of the consolidation.
Data collection and consolidation systems
In general, the 2019 CR Report provides non-financial indicators that represent the entire Group, including the recently acquired companies Intermolecular and Versum Materials. The majority of the figures we publish reflect the status as of December 31, 2019. We explicitly state when the information provided deviates from these parameters.
Since 2005, we have been using a Group-wide electronic data collection system to collect environmental and occupational health and safety data, which are tracked locally at our individual sites and approved following review. To maximize the quality of these data, we support the sites in optimizing their collection processes and their corresponding quality assurance measures. Moreover, our Group Environment, Health, Safety, Security, Quality (EQ) function takes measures such as internal EHS audits to review both the processes and the data provided.
We compile environmental performance indicators from all our production sites Group-wide, as well as those warehouse, research and administrative facilities that are relevant in terms of their environmental footprint. The scope of consolidation therefore covers all Group sites that have relevant impacts on the environment, with the exception of the newly acquired Versum Materials sites, which will be incorporated into our data collection process as of 2020 where pertinent.
All employee master data are continually updated in an SAP database. Some employee data are only disclosed for select sites or countries, which is accordingly indicated in the respective text passages.
We use community data management software to track data pertaining to our community outreach activities.
Determining report content
We align the content of our CR Report with the internationally recognized guidelines of the Global Reporting Initiative (GRI) and the principles of completeness and materiality, as well as input from our stakeholders. This report has been prepared in accordance with the “GRI Standards: Comprehensive Option”. Furthermore, we have taken into consideration the requirements of the capital market for assessing companies' sustainability performance.
In 2018, we performed a comprehensive materiality assessment to determine the CR topics of relevance to our Group, which we then updated in 2019. Experts from our business sectors and relevant Group functions reviewed the findings and validated them. Moreover, as stipulated by section 289c (2, 3) of the German Commercial Code (HGB), we checked the issues validated in 2018 for "double materiality". We have derived the content of this CR report from the results of the materiality assessment, which can be found together with the materiality matrix under Materiality analysis.
Our Executive Board has reviewed and approved this report. The content of the non-financial report has also been reviewed by the Supervisory Board in accordance with section 111 (2) of the German Stock Corporation Act (AktG).
KPMG AG Wirtschaftsprüfungsgesellschaft has audited the annual financial statements and management report of our company for the fiscal year spanning January 1 to December 31, 2019 and has issued an unqualified opinion.
The additional content provided on both the company's websites as well as external web pages that is linked in this report does not form part of the information assured by KPMG.
Point of contact:
We welcome your feedback and are happy to answer any questions.
Merck KGaA, Darmstadt, Germany
Group Corporate Responsibility
Frankfurter Str. 250
Tel.: +49 6151 72-0
Fax: +49 6151 72-200
The previous CR report was published in April 2019. Our next CR report is scheduled for publication in April 2021.