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Competitive conduct
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Competitive conduct
A major focus of our lobbying activities in 2006 was the new European chemicals legislation, REACH (Registration, Evaluation and Authorization of Chemicals). REACH came into effect on June 1, 2007 and stipulates that producers and importers of chemicals must systematically test their impact on health and the environment. This Regulation relates to chemicals manufactured or imported in quantities of more than one metric ton annually. Across the EU it affects some 30,000 substances. Bayer companies have to compile information on around 700 chemicals and notify this to the European Chemicals Agency in Helsinki, Finland. The cost to Bayer in the next 11 years is expected to be in the upper double-digit million range.
Following seven years of preparation and tough debate, the REACH legislation is certainly a very comprehensive law. Compared with the original drafts, the final Regulation has achieved a reasonable balance between environmental considerations, the protection of health and economic requirements.
Major improvements were achieved with respect to registration in particular. The data level required for substances used purely as industrial intermediates has been adjusted. More data are required for substances produced or imported in quantities of 100 metric tons or more and for substances used in consumer products.
The main cause of concern is the new authorization process for substances with particularly hazardous properties. The new statutory substitution requirements will result in the replacement or banning of hazardous substances per se, even if they could be used safely.
Following seven years of preparation and tough debate, the REACH legislation is certainly a very comprehensive law. Compared with the original drafts, the final Regulation has achieved a reasonable balance between environmental considerations, the protection of health and economic requirements.
Major improvements were achieved with respect to registration in particular. The data level required for substances used purely as industrial intermediates has been adjusted. More data are required for substances produced or imported in quantities of 100 metric tons or more and for substances used in consumer products.
The main cause of concern is the new authorization process for substances with particularly hazardous properties. The new statutory substitution requirements will result in the replacement or banning of hazardous substances per se, even if they could be used safely.
Political donations: Clear guidelines
The Bayer Group has issued a clear directive which states that no donations may be made to politicians, political parties or related institutions. In the United States, individual employees make private donations to the Bayer Corporate Political Action Committee (BAYPAC) which supports individual candidates for election to parliament. In 2005/2006 a total of US$ 226,000 was donated to 240 candidates in various election campaigns. These donations are independent of party lines.
Providing financial support for specific patients’ organizations on the basis of clear and transparent guidelines that prevent influence being brought to bear is an integral part of corporate policy at Bayer HealthCare. Bayer HealthCare also supports the European Federation of Pharmaceutical Industries and Associations (EFPIA) in its endeavors to draw up a corresponding self-commitment on the part of the industry.
As in the past, German employees who are elected to the European Parliament, German parliament, a regional parliament or local council are covered by our “Officeholders Directive”
.
Bayer CropScience openly shares its views on current multinational policy issues and topics of importance to the company on the Internet under “Corporate Positions” as “To the point” discussions focusing on issues such as water, biodiversity and human rights.
Providing financial support for specific patients’ organizations on the basis of clear and transparent guidelines that prevent influence being brought to bear is an integral part of corporate policy at Bayer HealthCare. Bayer HealthCare also supports the European Federation of Pharmaceutical Industries and Associations (EFPIA) in its endeavors to draw up a corresponding self-commitment on the part of the industry.
As in the past, German employees who are elected to the European Parliament, German parliament, a regional parliament or local council are covered by our “Officeholders Directive”
.Bayer CropScience openly shares its views on current multinational policy issues and topics of importance to the company on the Internet under “Corporate Positions” as “To the point” discussions focusing on issues such as water, biodiversity and human rights.
Group-wide compliance management: Systematic action to counter violations
Corporate compliance has become a central factor in the creation of value. Bayer AG, its subgroups (Bayer HealthCare, Bayer CropScience and Bayer MaterialScience) and its service companies each have a Compliance Officer and Compliance Committees. A working group at Group level ensures a constant exchange of information.
Their daily work comprises raising awareness of Bayer’s code of conduct and training employees in specific aspects. They are also responsible for adopting effective controls and, if necessary, sanctions. If employees at the company’s sites in Germany have reasonable grounds to suspect that the code of conduct is being infringed in their sphere of activity, they can call an external law firm – anonymously if they wish – via a special telephone hotline. Employees called the law firm in ten instances in 2006, compared with nine cases in the previous year. The reports are passed on to the Compliance Officer at Bayer AG on an anonymized basis. Similar reporting facilities are being set up in other countries. In the United States, for example, there is a telephone hotline (“Integrity Line”) to an ombudsman which operates analogously to the German hotline.
Special attention is paid to infringements of antitrust and anticorruption law because these can cause substantial financial damage to the company as well as damaging its reputation. Bayer has openly communicated violations and serious financial consequences, including the fact that two employees in the United States had been given prison sentences.
We have stepped up training in antitrust law and introduced more stringent internal regulations. Moreover, antitrust legislation was one of the issues addressed during “Compliance Awareness Week” in October 2006, when Bayer employees in the United States were given extensive information on legal conduct.
The state prosecutor in Cologne, Germany, is currently investigating allegations of overpayment and invoicing for services not rendered in the technical divisions of the company. These relate to employees of Bayer and external companies.
To reinforce its policy, Bayer has declared 2007 the year of anticorruption.
In Mexico, Bayer has a particularly good reputation for legal and responsible conduct. Evidence was provided by a report published by “Tranparencia Mexicana", the national section of Transparency International, in January 2007. Bayer came out top in the chemical/pharmaceutical industry category in Mexico and was ranked fifth overall.
Their daily work comprises raising awareness of Bayer’s code of conduct and training employees in specific aspects. They are also responsible for adopting effective controls and, if necessary, sanctions. If employees at the company’s sites in Germany have reasonable grounds to suspect that the code of conduct is being infringed in their sphere of activity, they can call an external law firm – anonymously if they wish – via a special telephone hotline. Employees called the law firm in ten instances in 2006, compared with nine cases in the previous year. The reports are passed on to the Compliance Officer at Bayer AG on an anonymized basis. Similar reporting facilities are being set up in other countries. In the United States, for example, there is a telephone hotline (“Integrity Line”) to an ombudsman which operates analogously to the German hotline.
Special attention is paid to infringements of antitrust and anticorruption law because these can cause substantial financial damage to the company as well as damaging its reputation. Bayer has openly communicated violations and serious financial consequences, including the fact that two employees in the United States had been given prison sentences.
We have stepped up training in antitrust law and introduced more stringent internal regulations. Moreover, antitrust legislation was one of the issues addressed during “Compliance Awareness Week” in October 2006, when Bayer employees in the United States were given extensive information on legal conduct.
The state prosecutor in Cologne, Germany, is currently investigating allegations of overpayment and invoicing for services not rendered in the technical divisions of the company. These relate to employees of Bayer and external companies.
To reinforce its policy, Bayer has declared 2007 the year of anticorruption.
In Mexico, Bayer has a particularly good reputation for legal and responsible conduct. Evidence was provided by a report published by “Tranparencia Mexicana", the national section of Transparency International, in January 2007. Bayer came out top in the chemical/pharmaceutical industry category in Mexico and was ranked fifth overall.
Political lobbying: Reorganized
To step up our activities to represent the Bayer Group’s interests at political level, we have reorganized this area internally and have set up a Politics Community Council (cc Politics) to structure and coordinate our activities in this field. It draws on information, for example, from our liaison offices and Senior Bayer Representatives, who help place our views in the political debate.
The current political issues have been identified, evaluated and assigned to the responsible experts (caretakers). The subgroups assume responsibility for issues closely related to their business. Overarching political issues of relevance to the entire Group are assigned to the relevant Corporate Center departments.
The current political issues have been identified, evaluated and assigned to the responsible experts (caretakers). The subgroups assume responsibility for issues closely related to their business. Overarching political issues of relevance to the entire Group are assigned to the relevant Corporate Center departments.
Politics Community Council |
| Permanent members |
 Corporate Center departments:Regional Coordination (lead) Environment & Sustainability Communications Corporate Office Heads of Berlin, Brussels, Beijing and Washington liaison officesIssue caretakers at the subgroups |
| Other political caretakers attend meetings of the Politics Community Council as required. |
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