Responsibility for people: Merck employees Audited

In accordance with the Merck Values, we live a culture of mutual esteem and respect. We want to become better and faster by recruiting, developing and motivating the most suitable employees. In addition, we would like to further enhance the performance culture of our company and promote the diversity of our workforce.

As of December 31, 2013, Merck had 38,154 employees worldwide (2012: 38,847). Merck was represented by a total of 191 companies in 66 countries, with 63 production sites located across 21 countries.

Fit for 2018

The “Fit for 2018” transformation and growth program impacted HR work in 2013 as well. At the majority of Merck’s sites, the structural prerequisites were put in place and agreements were reached with the respective social partners in order to create a socially responsible approach to the workforce reduction required by the transformation process. For example, in Germany, around 1,200 employees chose to participate in a partial retirement program or a voluntary leaver program. By the end of 2013, we had completed the process of moving Merck Serono headquarters from Geneva to Darmstadt. In comparison with 2012, the total number of employees in 2013 decreased by 693.

Vocational and advanced training

Merck continues to take the vocational and advanced training of its employees very seriously. We have therefore maintained a constant vocational training rate at Darmstadt, the largest site of the Merck Group. In 2013, a total of 516 young people were enrolled in vocational training programs at this site, in 23 different occupations. At other sites where we offer vocational and advanced training, we have likewise maintained a high vocational training rate.

“Start in die Ausbildung”, a German program to prepare young people for an apprenticeship, was continued with 20 interns, the same number as in 2012.

In 2013, we globally harmonized our approach to advanced training, better gearing it towards the future business focus of the Merck Group. Here, our goal is to advance the competencies and abilities of our employees and managers so that they can help implement our corporate strategy more efficiently while at the same time unlocking their individual potential. We have accordingly revised our training programs at all levels.

Performance management

In 2012, we ran a pilot of an integrated performance and talent management process, which we then rolled out broadly in 2013. Merck considers it important to identify employee potential early on and foster it on an individual basis. We want to offer our talent attractive career opportunities as well as continual personal and professional prospects within the company.

The new process systematically combines talent recognition with the Performance Management Process that allows us to objectively assess the performance of each individual employee. This assessment is a crucial prerequisite for personal development as well as for the overall success of the company. Key features here are clear objectives, differentiated and open feedback on performance, as well as individual development plans. To date, around 22,400 employees have participated in the globally harmonized Performance Management Process.

Internal talent development and external recruiting

Through the above-mentioned process, Merck aims to bolster its performance culture and develop talent in a more targeted manner. In 2013, we achieved our first successes and expanded our pool of internal talent, which makes it easier to fill management positions with internal staff when they become vacant. In 2013, 92% of management position vacancies were filled by internal candidates. Merck also recruited external executives for several key positions in the organization in order to add new outside perspectives to our long-standing in-house expertise.

Merck is using the motto “Make great things happen” to position itself in the global job market, which conveys to potential applicants a sense of what makes Merck unique: an inspiring, motivating work environment in which innovations thrive; an environment in which everyone has the opportunity to apply their ideas and engagement to benefit customers and the company, while at the same time growing as employees.

Occupational health and safety

As a responsible employer, 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 internationally recognized key performance indicator describes the number of workplace accidents resulting in lost time per one million working hours. Merck set itself the goal of reducing the LTIR to 2.5 by 2015. In 2013, we again outperformed this goal, achieving an LTIR of 2.1.

This continuous rate of improvement can be particularly attributed to the BeSafe! program, which was launched in 2010. In 2013, we continued to sensitize our employees to workplace hazards through numerous activities and awareness campaigns. BeSafe! is a Group-wide initiative with harmonized standards and local modules for the specific requirements at individual sites. This 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.

Since 2010, Merck has been presenting the Safety Excellence Award 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 2013, 38 out of 63 production sites were recognized.

Workforce diversity

We believe that workforce diversity leads to greater innovation and promotes better team performance, which is why we aim to foster diversity among our employees. To this end, the Executive Board has defined three focus areas. As a global company, we particularly endeavor to achieve a good balance between different cultures and nationalities, between different age groups, as well as between male and female employees.

In addition to creating the position of Chief Diversity Officer, who is responsible for strategically managing diversity within the Merck Group, Merck also established the Diversity Council in 2013. This aims to build further buy-in for diversity within the company. The council consists of high-ranking managers from every division as well as from several Group functions; it is primarily concerned with developing and refining our diversity and inclusion strategy.

In addition, Merck supports specific employee networks in order to foster exchange among like-minded individuals, building expertise that benefits the company. For example, in 2013, we worked with a network of international employees to better gear our Darmstadt site to an international workforce. This helps employees from across the globe to easily and quickly familiarize themselves with Group headquarters, thereby increasing work efficiency within the company.

Focus areas: Internationality, demography, gender ratio

One of our fundamental principles is to recruit employees from the countries in which we operate and offer them career development opportunities. People from a total of 114 different nations work at Merck. Only 27% of Merck employees are German citizens, and 72% work outside of Germany. Three of our four divisions are currently headed by non-Germans.

In Germany, several other EU countries and the United States, we must prepare ourselves for demographic change. In these countries, the average age of our employees exceeds 40 – and we assume that this figure will continue to rise in the coming years. In Europe, we are addressing these demographic challenges through various programs. These include adapting workplaces to the needs of older employees and establishing a health management program to maintain their ability to do their jobs.

Women currently make up 42% of our entire workforce. Since the ratio of women to men varies widely across the different regions, divisions and functions, Merck has set itself the goal of increasing the percentage of female employees wherever they are underrepresented.

Filling management positions

We believe that balanced diversity among management enhances career advancement opportunities for talented employees while also helping to provide a broad experience base within the company. It furthermore allows for differentiated entrepreneurial decision-making, thereby making a significant contribution to the success of the company.

As a global company, Merck considers it highly important to have an international management team. Currently, 61% of our managers – meaning positions rated Global Grade 14 and up in our Global Grading System – have a nationality other than German. Altogether, 59 different nationalities are represented in such positions.

The percentage of management positions held by women (Global Grade 14 and up) is currently 25% Group-wide. In the subsidiaries outside of Germany, this percentage is higher than at Group headquarters in Darmstadt. Likewise, more women work in managerial positions in our Pharmaceuticals divisions than in our Chemicals divisions. Certain Group functions such as IT have a lower percentage of women in management positions. However, the figures are clearly increasing across the Group as a whole. Merck has reached its strategic goal of raising the percentage of management positions held by women from 25% to 30% and intends to further increase this percentage by 2016. In order to achieve this ambition, Merck is implementing numerous measures at the local level. 2013 was the first time that a woman was appointed as head of a Merck Group division.

Work-life balance

Merck wishes to help its employees achieve a good balance between their professional and personal objectives. This maintains and strengthens their motivation and performance potential, making it easier for them to plan their daily lives.

In Germany and other countries, Merck offers various flexible working hour models. Globally, approximately 5% of our employees worked part-time in 2013. 8% of our part-time employees are men.

In addition to this, Merck introduced a comprehensive employee assistance program called “assistance4me” in 2013. Throughout Germany, this initiative offers employees extensive help with regard to finding childcare and nursing care, as well as home and garden services. At various sites, employees benefit from childcare options that Merck subsidizes. A daycare center has been operating at the Darmstadt site in Germany for more than 40 years, financially supported by the Merck family. In 2013, Merck invested in expanding the facility, increasing the daycare center staff by 40% in order to provide 50 additional spots. The hours of operation were also extended. The daycare center will be hiring English-speaking staff in order to accommodate the increasingly international workforce at Merck.