Corporate Compliance Policy

Cororate Comliance Policy English Edition

FOREWORD Dear Emloyees, The global nature of Bayer s oerations means that our activities are subject to a wide variety of statutory regulations and standards throughout the world. That makes cororate comliance a articularly imortant toic for us because cororate comliance means acting with integrity and observing the legal and ethical framework at all times. Cororate comliance is not an abstract concet, but a code of behavior that alies to everyone. It is valid for emloyees at all levels, in all arts of the Bayer Grou and in all countries. Only by strictly adhering to these standards can we avoid significant legal and economic risks to our comany, and thus to us all. And in this way we also reserve the legitimate interests of all our stakeholders including customers, suliers and shareholders and resect the needs of society, such as the rotection of eole and the environment. Observing these rules at all times is therefore essential to maintain our ride in working for Bayer. And it is the only way we will gain society s accetance of our business activities and achieve a sustained increase in cororate value. Bayer will forgo any business that would only be ossible by violating the law or comany rules. No suervisor may issue any instruction to the contrary. Our Cororate Comliance Policy forms the framework for acting in accordance with the rules. It is based on roven rinciles that have always governed our business activities: exertise, fairness and reliability. I ask every one of you to internalize the rules contained in this Policy, imlement them fully in your own field of work and take advantage of the training courses rovided on the subject. The Cororate Comliance Policy and our global comliance organization can rovide assistance on all comliance issues, esecially in cases of doubt. Please take u these offers of hel, which have been secially rovided for you. Let us work together to uhold Bayer s good reutation. Worldwide integrity is the basis for our sustained success. Dr. Marijn Dekkers Chairman of the Board of Management of Bayer AG BAYER CORPORATE COMPLIANCE POLICY 3

Introduction: Why be concerned about cororate comliance? age 6 Our Princiles of Business Conduct 1. We are committed to fair cometition no antitrust violations age 8 2. We are committed to integrity in business dealings no corrution age 11 3. We are committed to the rincile of sustainability no inaroriate risks for human health and the environment age 12 4. We are committed to uholding foreign trade laws no exort infractions age 14 5. We are committed to safeguarding equal oortunity in securities trading no illegal insider trading age 15 4

CONTENTS 6. We are committed to roer record-keeing and transarent financial reorting no decetion age 16 7. We are committed to fair and resectful working conditions no discrimination age 18 8. We are committed to rotecting the fruits of our own endeavors and resecting the legally recognized rights of others no infringement of our own or others roerty rights age 19 9. We are committed to keeing cororate and ersonal interests searate no conflicts of interest age 20 10. We are committed to cooerating with the authorities no misinformation age 22 How does this olicy affect each individual s daily work routine? age 23 How is comliance structured at Bayer? age 25 5

Introduction Why be concerned about cororate comliance? Bayer is esteemed as a comany with distinct strengths. While this reutation is the roduct of many years work, the careless, imroer actions of just one emloyee can damage our image in the blink of an eye. We must revent this. To do so requires that all emloyees be guided in their activities by reasoned rinciles, articularly those set forth in this Cororate Comliance Policy. Remember that the way each emloyee conducts the comany s business can affect Bayer s ublic image. Cororate comliance refers to the lawful and roer conduct of the comany s business. Each emloyee is obligated to obey all alicable laws and cororate guidelines in his or her work for Bayer. The Cororate Comliance Policy serves as the basis for this. It does not, however, cover all conceivable situations or describe all of the articular rules that must be followed. Furthermore, the law in some countries may rescribe stricter standards than those set forth here, in which case the stricter standards govern. Unlawful and unethical behavior can have far-reaching consequences for the comany, including: criminal enalties administrative fines civil and unitive damages seizure of rofits exclusion from contracts termination of business relationshis attemted extortion harm to our image negative ercetions by the caital market Individual emloyees who violate the rinciles of this Cororate Comliance Policy also face serious consequences, such as fines or imrisonment, claims for damages, sanctions under labor law and ossible termination of emloyment. Emloyees who disobey the rules cannot claim to have been acting in Bayer s interests, because any comliance violation ultimately harms the comany. In view of the ossible consequences, any advantage somebody urorts to have gained in a secific situation can never, not even economically, be advantageous to the comany as a whole. 6

Bayer desires to succeed in the cometitive arena by being innovative, quality-driven, reliable and fair. If the only way to close a deal is by acting in a way that is illegal or unethical, we will forego the deal. An emloyee who declines business in such circumstances will never suffer retaliation as a result. We are continuously in the ublic eye. By systematically imlementing this Cororate Comliance Policy, we show the media, our investors, cometitors, the authorities and our business artners that comliance is an integral art of our cororate culture. rules that affect them and to seek counsel in case of doubt. Ignorance is no defense against the otential consequences of breaking the rules. For suort, emloyees can turn to their suervisors, their resective Comliance Officer or any of their comany s secialist deartments, including the legal deartment, Cororate Auditing and Cororate Security. Emloyees should esecially avail themselves of these resources when others may be harmed, they themselves are in danger, a high degree of risk is involved or the legal situation is unclear. Bayer is a globally active comany. Our emloyees, therefore, are exosed to a wide variety of norms and ethical rinciles, some of which are often unfamiliar to them. What at first sight aears to be a urely local matter may also be subject to the laws of a foreign jurisdiction. This Cororate Comliance Policy is intended to give emloyees a oint of reference in their daily work and thereby hel them avoid violations. By definition, its focus is limited to areas of articular ractical significance. However, it should also encourage emloyees to familiarize themselves with the BAYER CORPORATE COMPLIANCE POLICY 7

Our Princiles of Business Conduct 1. We are committed to fair cometition no antitrust violations Bayer is a firm suorter of the free market economy. Antitrust law is the free market s most imortant tool for ensuring fair, un restricted cometition. Violations of the antitrust laws of the individual countries and regions in which Bayer does business, including, in articular, U.S. and Euroean antitrust laws, can have dramatic consequences for the comany. As mentioned in the introduction, we could face a variety of negative reercussions, including serious fines, lawsuits, exclusion from ublic contracts and harm to our reutation. Emloyees who violate antitrust laws also face severe external reercussions, including ossible imrisonment. Internally, Bayer will not show any leniency towards emloyees who disregard antitrust laws. Even if a business matter runs into difficulties through no fault of the emloyee, resorting to unlawful agreements with cometitors is not accetable. Comliance is the only ermissible course of action, even in a crisis. The effects doctrine of antitrust law is articularly imortant to note. According to the effects doctrine, determining the occurrence and unishability of an antitrust violation does not deend only on the jurisdiction in which the violation occurred. In some cases, causing an adverse effect on cometition in another jurisdiction may constitute an antitrust violation. Antitrust law rotects cometition in three ways: by forbidding collusion among cometitors and anticometitive arrangements among suliers and customers, as discussed below in Section 1.1 by forbidding the abuse of a dominant market osition, as discussed below in Section 1.2 by overseeing the acquisition and sale of comanies as well as other business combinations (merger control), as discussed below in Section 1.3 8

1.1 Antitrust violations The major tyes of antitrust violations include: rice fixing allocating market shares agreements on roduction caacities allocating geograhical markets allocating customers dictating or controlling a customer s resale rice Any kind of concerted actions, informal talks or gentlemen s agreements that are intended to restrict cometition or may have the effect of doing so are rohibited. Emloyees must not even give the aearance of being a art of any such consiracy. Acting in concert with other bidders when cometing for contracts from the rivate sector or ublic sector is not only an antitrust violation, it is a criminal act. Please involve the legal deartment when entering into or contemlating any kind of agreement with a cometitor, even if the subject matter of the agreement lies outside of the area in which Bayer and the other arty comete. and discuss matters of mutual interest. This is quite legitimate, rovided, however, that the limits imosed by antitrust law are resected. Accordingly, emloyees should normally consult the legal deartment before articiating in such meetings. Care is called for in the mere handling of market information. Market research is indisensable and, of course, legal as a rule. However, not all information-gathering techniques, such as certain organized market information systems, are suitable for this urose. Benchmarking with cometitors is also ermissible in rincile. But in all these cases there are certain acknowledged rules of the game to ensure that information which is sensitive from an antitrust viewoint is given in a sufficiently anonymous manner that its origin cannot be identified and it therefore cannot influence current market develoments. For examle, we are not allowed to exchange information concerning customer relationshis, rices, imminent rice changes or the like with our cometitors, nor are we ermitted to disclose our own calculations, caacities or lans to cometitors. Trade association meetings rovide the oortunity to get together with cometitors BAYER CORPORATE COMPLIANCE POLICY 9

Finally, bear in mind the rovisions of antitrust law when negotiating the terms and conditions of agreements where Bayer acts as a customer or sulier. Clauses that imact resale rices, restrict use or resale, or stiulate exclusive arrangements always require legal review. 1.2 Abuse of market ower Dominant market ositions are by no means illegal er se if they accrue, for examle, from our own achievements. In addition, atents rovide legally rotected monoolies for certain eriods of time. A comany is said to dominate a market when it has no substantial cometition in that market. The behavior of comanies with dominant market ositions is subject to articularly strict antitrust controls as a means of comensating for this lack of cometition. Dominant market ositions must not be abused, that is they must not be exloited in ways that would be unfeasible or at least unrealistic in a true cometitive environment. Comanies with a dominant market osition may not deliberately undercut cometitors rices with the aim of driving them out of the market. Nor may they execute agreements with customers that contain contract eriods, exclusive arrangements, discount offers or ackage deals that make it imossible for their cometitors to vie for the same customers business. Comanies may not abuse dominant market ositions in their relationshis with customers either, for examle by demanding rices that are not economically justified. Bayer emloyees must seek legal counsel anytime they susect that certain stes are being taken or certain terms enforced because of a dominant market osition. 1.3 Observing merger guidelines Business divestitures, acquisitions and joint ventures generally require the aroval of domestic and foreign antitrust agencies once the volume of the deal reaches a articular threshold. Failure to follow the corresonding registration requirements can result in stee fines and, more articularly, render the deal null and void. In order to ensure that registration requirements are adequately accounted for during lanning, the legal deartment must be involved at an early stage. 10

2. We are committed to integrity in business dealings no corrution corrution. Bayer will not tolerate Corrution is contrary to fair cometition and harms the comany s economic standing and reutation. In addition, many countries treat corrution as a crime, regardless of whether the actual act takes lace in their jurisdiction or in another country. Thus, Bayer emloyees are strictly rohibited from attemting to unlawfully influence business artners, whether through favors, gifts or the granting of other advantages, anywhere in the world. This rule articularly alies to dealings with individuals acting on behalf of government agencies or other ublic institutions. Bayer will not entertain any business deals that involve breaking the law or violating comany rules relating to the granting or accetance of favors, mindful of the fact that some business may be lost as a result. No amount of otential additional revenues or earnings can justify illegal business ractices. This alies without excetion throughout the Bayer Grou. No emloyee, regardless of the country in which he or she works, is entitled to violate the law or comany olicy. Any gift, even those given indirectly (for examle to friends, relatives or associations), is considered an advantage. Examles include: cash, invitations to events, airline tickets, hotel stays, emloyment for friends or relatives, secial ersonal favors and even the rovision of exensive food and drink. The granting or accetance of gifts must take lace in comliance with the law as well as Bayer s internal guidelines. If stricter rules and laws exist (for examle codes of conduct issued by harmaceutical associations), then the stricter standard must be observed. Bayer emloyees are not allowed, under any circumstances, to demand ersonal gifts. Likewise, they may not offer or grant gifts of cash, or gifts equivalent to cash, to any ublic official. In dealings with business artners, emloyees must avoid granting or acceting any gifts in connection with the negotiation, award or erformance of a contract, and any gift granted or acceted must be of a size deemed unobjectionable under the laws alicable to both the giver and the reciient. In case of doubt, lease contact the resective legal deartment. BAYER CORPORATE COMPLIANCE POLICY 11

3. We are committed to the rincile of sustainability no inaroriate risks for human health and the environment Bayer is well aware of the comany s goal to rotect the environment and the health and safety of everyone who comes into contact with our roducts. This is extremely imortant to the way we conduct business. The comany develos and markets roducts and services aimed at heling eole. In keeing with this work, Bayer acknowledges its duty to hel meet the economic, ecological and social needs of resent and future generations. In other words, we are committed to sustainable develoment. 3.1 Product stewardshi and the limits of genetic engineering Ensuring the roer use of our roducts requires monitoring them over their entire roduct life cycles. Addressing otential risks resonsibly is articularly imortant. Once a otential risk related to the handling of one of our roducts is identified, the aroriate ersons within the comany are to be notified immediately, even if the risk arises only in conjunction with a third arty s roduct. The urchaser of the roduct must be advised of risks associated with its use, and every roduct must bear the aroriate warning labels. An essential comonent in the develoment of any roduct or new technology is assessing the otential risks and benefits of the roduct or new technology, one such technology being biotechnology. Bayer regards genetic engineering as an essential method for develoing new roducts and solving roblems. It must be used in awareness of our resonsibility for human safety and the rotection of the environment and in comliance with all alicable laws. Our work in genetic engineering is governed by ethical values and, in articular, by resect for life and human dignity. Consequently, Bayer absolutely refuses to use genetic engineering methods to work in human genetics and rejects any attemt at human cloning. No emloyee may articiate in such rojects or make his or her knowledge available for such a urose. With regulated roducts (including harmaceuticals and esticides), emloyees must observe all alicable laws regarding all asects of the manufacture, testing, storage, imort, exort or commercialization of such roducts. All laws and regulations also must be observed when handling hazardous materials. Prohibited materials may not be manufactured or brought onto comany remises. 12

3.2 Environmental rotection We believe in making an imortant contribution to sustainable develoment through the efficient use of resources. Reducing the consumtion of energy and raw materials in roduction and thereby limiting discharge requires exhausting all reasonable oortunities for rocess otimization. secialists in occuational medicine and safety who strive to maintain and imrove safety and health. Occuational health and safety regulations hel to ensure this. Emloyees share in the resonsibility for occuational safety in the worklace. Sometimes accidents occur because we become less careful. In general, no commercial usage of air, water or soil may take lace without a ermit. Hence, all emloyees involved in the construction and oeration of our roduction facilities must follow local rules to aly for and receive ermits. 3.3 Plant safety Extreme care must be exercised when dealing with otential sources of danger. Every emloyee is called uon to strictly and constantly observe all safety rules in his or her resective worklace: for his or her ersonal benefit, and for the benefit of colleagues and the comany as a whole. Industrial lants and installations require careful lanning and regular, systematic insection and servicing in order to revent malfunctions, accidents, releases, and major hazards. Emloyees who work in our lants must be thoroughly trained, be given detailed working instructions and be roerly suervised. When an incident occurs, the resonsible suervisors and safety reresentatives must immediately notify those units of the comany resonsible for health, safety and environmental rotection. For this urose, use of Bayer s early warning system, the Bayer Emergency Resonse System (BayERS), is mandatory. 3.4 Occuational health and safety Maintaining the health of our emloyees is in everyone s the emloyees and the comany s best interests. Line management receives suort in reventing accidents and illness from BAYER CORPORATE COMPLIANCE POLICY 13

4. We are committed to uholding foreign trade laws no exort infractions Bayer is committed to uholding all domestic and international foreign trade laws. We suort the efforts of the international community to revent the manufacture and roliferation of chemical, biological and nuclear weaons and their de livery mechanisms as well as to combat international terrorism. We also actively articiate in international endeavors aimed at reventing the manufacture of illicit substances through suervision of the relevant recursors. All emloyees are required to observe the restrictions and bans on domestic and international trade in listed goods, technologies and services. Emloyees must also resect the trade bans and restrictions that are art of international embargos and international efforts to combat terrorism, including those which may affect ayments and other movements of caital as well as those involving the reexort controls of the United States and other countries. Emloyees should forgo any business where doubt exists as to the legality of a roduct s use or distribution. 14

5. We are committed to safeguarding equal oortunity in securities trading no illegal insider trading Every Bayer emloyee is required by law to maintain secrecy with resect to any inside, non-ublic information about the comany that could affect its stock rice. Using such inside information for ersonal gain or the gain of others is rohibited. Common examles of inside information include knowledge about the intended divestiture of arts of the comany, the acquisition of outside comanies, the formation of joint ventures, new findings regarding key roducts, or secific information about business develoments which has not yet been made ublic. Insider trading laws rohibit trading in securities on the basis of non-ublic information or the sharing of such information with third arties. In other words, insiders may not divulge non-ublic information to third arties, whether inside or outside of Bayer, excet on a need-to-know basis and with reasonable measures in lace to ensure that the information remains confidential and cannot be misaroriated by third arties. BAYER CORPORATE COMPLIANCE POLICY 15

6. We are committed to roer record-keeing and transarent financial reorting no decetion An internal control system must rovide for the roer documentation of an entity s key business rocesses and the establishment of controls to ensure that all transaction details relevant for accounting uroses are fully and correctly catured. or certified ublic accountants). Comments attributable to the comany that are inaroriate, unclear, incomlete or made in haste may be extremely damaging because they can be misinterreted, misused or taken out of context. Emloyees must be courteous and efficient when using email and other forms of online communication. The volume of emails should be ket to the necessary minimum. The following guidelines are essential for ensuring accurate and timely financial reorting: Files must therefore be comlete, orderly and readily understandable. All records and files must be ket in such a way as to ermit delegation to a colleague at any time. Emloyees should retain records for as long as statutory or internal rovisions require, and must never destroy documents relevant to threatened or ending official or judicial roceedings. Any item of corresondence, whether a letter, fax, email or even verbal comment, must be communicated in observance of roer etiquette and be clear and consistent in content so that it can be resented or surrendered to a third arty (such as an investigative body, court of law, other governmental institutions All items with accounting relevance must be suorted by comlete and correct documentation and entered into the books accordingly. The comany s accounting records and related documents must fully and accurately reflect all business transactions and give a true and fair view of the comany s assets. Every emloyee tasked with resenting information that is relevant to our financial reorting and destined for ublic disclosure is resonsible for ensuring that this information is comlete and accurate. Emloyees must 16

romtly notify their suervisors or the resonsible Comliance Officer if ever they have reason to doubt whether material business transactions have been correctly resented in the financial reorting. Bayer rovides its stockholders, financial analysts, investor associations, media outlets and the general ublic with regular, timely reorts on the comany s situation and material changes in its business so as to maintain the greatest ossible degree of transarency. Bayer s reorting follows the guidelines secified in the German Cororate Governance Code, informing stockholders four times er year about the comany s financial osition, results of oerations and cash flows. The annual financial statements are ublished within 90 days of the end of the resective fiscal year. In the interests of fair disclosure, Bayer treats all of its stockholders and major target audiences the same when it comes to the rovision of information and announces any imortant changes without delay. Stockholders are also given timely access to information that Bayer ublishes outside of Germany in comliance with alicable foreign caital market regulations. Bayer also makes use of the Internet as a way to rovide interested arties with the latest cororate information. The Bayer website includes a Financial Calendar with imortant ublication and event dates, including dates for the annual reort, interim reorts and the annual stockholders meeting. BAYER CORPORATE COMPLIANCE POLICY 17

7. We are committed to fair and resectful working conditions no discrimination No erson is to be unfairly treated, disadvantaged, favored, harassed or ostracized because of race or ethnicity, color, nationality, religion, ideology, gender, age, hysical characteristics, aearance or sexual orientation or other rotected classes in the articular country. Everyone has the right to be rotected against discrimination and harassment of any kind whether within Bayer or in their contacts with outside arties. Bayer exects its emloyees to be friendly, objective, fair and resectful in their dealings with colleagues and third arties, including customers, suliers and officials. By doing so, they also make an active contribution toward rotecting Bayer s good reutation. The resonsibility for maintaining these standards of conduct rests with each and every emloyee, not just with suervisors. A violation of these standards will not be tolerated. Any conflicts should be referred to the emloyee s suervisor, the human resources deartment or the resonsible Comliance Officer, who, if necessary, will take the required action to aroriately address any wrongdoing and to revent a reeat violation. 18

8. We are committed to rotecting the fruits of our own endeavors and resecting the legally recognized rights of others no infringement of our own or others roerty rights The results of our scientific research and technical develoment work are extremely valuable business assets. Inventions, atents and other intellectual roerty are the reward for our endeavors and exenditures in the areas of research and develoment. They are extremely imortant to our comany s future, as are our brands, the value of which may in some cases be substantial and the result of decades of effort and marketing exenditures. We must therefore take utmost care to ensure that our rights in the roerty we create enjoy full legal rotection. Trade secrets and new knowledge should not be assed on to third arties, much less made ublic, without the roer legal rotection. The same care must be taken with information shared over the comany s intranet. over such roerty without the exress written consent of the secialist cororate units resonsible for these matters (Law, Patents & Licensing). Care should be taken to avoid any unintentional transfer of intellectual roerty through the negligent handling of comany information in ublic, such as working with lato comuters in full view of others or making casual comments in ublic or in resentations. Business data must be rotected against unauthorized access by third arties. No emloyee may make coies of business aers or data files other than for work-related uroses. Emloyees must resect the valid, legally recognized roerty rights of third arties and may not use them without ermission. No emloyee may create or disose of Bayer intellectual roerty (for examle: atents; marks, articularly trademarks; utility models and designs; coyrights) or execute an agreement or otherwise exercise discretionary authority BAYER CORPORATE COMPLIANCE POLICY 19

9. We are committed to keeing cororate and ersonal interests searate no conflicts of interest All emloyees must searate their own ersonal interests from those of Bayer. During working hours, in articular, emloyees have a rimary duty to romote Bayer s cororate interests. Conflicts of interest or even the mere aearance of such conflicts must be avoided. A list of tyical areas of conflict is given below. Where a conflict aears likely, emloyees should seek assistance from their suervisor. Personnel decisions: A erson s own individual interests or relationshis must not influence ersonnel decisions. Business relationshis with third arties: Business relationshis with third arties must be formed on the basis of objective criteria (for examle, rice, quality, reliability, technological standard, roduct suit ability, existence of a long-standing and trouble-free business relationshi). The execution of a contract or continuation or termination of a business relationshi with a third arty must not be influenced by ersonal relationshis, ersonal interests or tangible or intangible ersonal advantages. The suly of roducts or rovision of services to Bayer by comanies that are controlled by Bayer emloyees or their close relatives must be subject to close scrutiny. Contracting of suliers or other business artners of Bayer for ersonal uroses: If an emloyee wishes to lace a ersonal suly or other business contract with a erson or entity that also has a re-existing business relationshi with Bayer and that emloyee is in a osition to directly or indirectly influence Bayer s business relationshi with the sulier or business artner in question, the emloyee must notify his or her suervisor in advance and receive the suervisor s ermission before lacing the contract. Using the services of Bayer emloyees for ersonal uroses: Suervisors and managers may not abuse their authority by availing themselves of the services of Bayer emloyees for ersonal uroses. 20

Use of Bayer roerty (for examle, equiment, goods, vehicles, office sulies, documents, files, data storage media): Emloyees may not use items belonging to Bayer for their own ersonal uroses or remove such items from comany remises without their suervisor s exress consent. Likewise, no data, rograms or comany aers may be coied or removed from the comany s remises without aroval. Use of the Internet and email system: Bayer rovides Internet access and electronic communications for business uroses. The occasional, only marginal use of the business Internet connection for rivate uroses during individual breaks is ermitted. This ermission may be revoked at any time. Private Internet use must be strictly limited in duration and must not interfere with an emloyee s duties. Private use of the Internet is subject to the rovisions of a Grou Regulation. Use of the email system rovided by Bayer is for business uroses only. The email system must not be used for rivate uroses. inform his or her suervisor. This alies articularly to ositions with comanies that already do business or comete with Bayer or might reasonably do so. Personal involvement in olitical arties or other social or olitical institutions: Bayer welcomes its emloyees voluntary involvement in such organizations as long as it does not interfere with the erformance of their duties for Bayer. Public exression of ersonal oinions by emloyees: When exressing their ersonal oinions in ublic, emloyees must not give the imression that these oinions reresent the views of the comany. Outside emloyment: Any emloyee intending to accet emloyment with an outside comany even on a freelance basis or to set u his or her own business must BAYER CORPORATE COMPLIANCE POLICY 21

10. We are committed to cooerating with the authorities no misinformation The comany endeavors to be cooerative in its dealings with all authorities and government agencies while at the same time defending its own interests and rights. All emloyees resonsible for collecting comany information and communicating it to securities market authorities, to other regulatory authorities or for other ublic announcements should communicate such information comletely, oenly, correctly, timely and understandably. The resonsible legal deartment must be notified immediately when emloyees are contacted by any authority, such as the olice or ublic rosecutor s office, whose job it is to investigate ossible legal violations or rosecute violators. In articular, information or documents should be rovided only after consulting and with the assistance of the resonsible legal deartment. 22

How does this olicy affect each individual s daily work routine? All Bayer emloyees must adhere to this Cororate Comliance Policy. It is intended to rotect both the comany and its emloyees. This olicy defines the framework within which Bayer emloyees can act with confidence and directly benefits them by, among other things, safeguarding the emloyees from discrimination and establishing rules for occuational safety. Its observance therefore is in the best interest of emloyees both as individuals and as imortant contributors to Bayer s success as a whole success from which emloyees benefit. Every emloyee is called uon to review his or her own behavior in light of the standards set forth in this Cororate Comliance Policy and to ensure that these standards are observed. Comliance is factored into each emloyee s erformance review as a matter of course. Emloyees should bear in mind that there are secific laws and internal guidelines that address in greater detail the toics discussed here. Emloyees are required to familiarize themselves with the alicable laws and internal rules governing their areas of resonsibility and to follow these laws and rules in their daily work. Any ambiguities should be clarified. The comany rovides its emloyees with access to all the necessary information resources and counsel to revent violations of the law or comany regulations. The rovisions of this Cororate Comliance Policy take recedence over any conflicting instructions given by a suervisor. In addition to suort from suervisors, there are information resources (such as the MARGO database) accessible via the intranet, and advice is available from the resonsible Comliance Officer and secialist deartments such as the legal deartment, Cororate Auditing and Cororate Security. Sulementary information is available on the intranet under the heading Cororate Comliance. Every suervisor must organize his or her area of resonsibility so as to ensure adherence to this Cororate Comliance Policy and alicable law. In articular, suervisors must communicate the rules alicable in their areas of resonsibility, monitor adherence to them and enforce them. Problems must be actively addressed and resolved. BAYER CORPORATE COMPLIANCE POLICY 23

Each suervisor is exected to set an examle for his or her area of resonsibility by acting with integrity and thereby ensure that comliance is internalized as a fundamental art of our cororate culture. All emloyees are required to immediately reort any violations of the Cororate Comliance Policy. Violations of this Cororate Comliance Policy should be reorted to the resonsible Comliance Officer or to Cororate Auditing immediately. Emloyees may also notify their suervisor or the legal deartment. The comany also offers ways of reorting susected comliance violations anonymously, for examle via a telehone hotline. The comany will ensure that no emloyee is in any way disadvantaged because he or she, acting in good faith, reorts a ossible comliance violation. When the reorting emloyee is himself/herself involved in a violation of this Cororate Comliance Policy, the comany, in determining any action to be taken against that emloyee, will consider whether or not the reort and any timely assistance given in investigating the ossible violation heled avert further damage to the comany. When emloyees susect corrution or the intentional mishandling of comany roerty or finances, for examle, embezzlement, fraud, breach of trust or the offering or accetance of bribes, they should reort the matter without delay directly to Cororate Auditing. Promtly reorting this kind of information is likely to save the comany from suffering additional, more serious harm or at least mitigate the damage. For this reason emloyees should direct this kind of information to the individuals and deartments mentioned above, because they are most caable of taking the necessary legal stes. 24

How is comliance structured at Bayer? The Board of Management of Bayer AG aoints the General Counsel of Bayer AG as Grou Comliance Officer. In this function he reorts directly to the Board of Management. In addition, Comliance Officers are aointed by the grou management comanies (Bayer AG, Bayer HealthCare AG, Bayer CroScience AG, Bayer MaterialScience AG, Bayer Business Services GmbH and Bayer Technology Services GmbH)* and each country organization. The subgrous (Bayer HealthCare, Bayer CroScience and Bayer MaterialScience) also aoint countrysecific Comliance Officers for each of their oerating units, who reort to the Comliance Officer of the resective grou management comany. All of the Comliance Officers aointed in a secific country form the local Comliance Community, which is headed by that country s Senior Bayer Reresentative. Each Comliance Officer has the following core resonsibilities: to rovide advice to assess risk to conduct comliance training to establish communication channels for reorting susected comliance violations to investigate alleged comliance violations and assist in deciding on ossible sanctions against the emloyees involved to arrange audits ertaining to a) ossible comliance violations b) subject matters identified through risk assessment to introduce any necessary organizational changes as determined in the course of comliance investigations to reare and issue reorts (on individual cases and for the year) Bayer will ensure the ongoing viability of this Cororate Comliance Policy by creating the necessary framework for its oeration and roviding the necessary resources. The viability and effectiveness of this Cororate Comliance Policy will be regularly reviewed. Constant monitoring along with frequent evaluation and reorting are designed to ensure its continual imrovement. In addition, Cororate Auditing will carry out a review of the Policy s effectiveness on behalf of the Grou Comliance Committee at regular intervals. * For secial arrangements concerning Currenta GmbH & Co. OHG and its subsidiaries, see age 26. BAYER CORPORATE COMPLIANCE POLICY 25

Phone: 00 800 15 15 1700 (toll-free number for Germany*) Calls will be answered by our indeendent hotline rovider Exolink. If you do not seak English, lease ask for an interreter to join the conversation. Please stay on the line and do not hang u as your reort is very imortant. E-mail: bayercomliance@exolink.co.uk Publisher Bayer AG Law, Patents & Comliance 51368 Leverkusen Germany December 2014 Reorders Bayer Serviceline Phone: +49 214 30-57546 Fax: +49 214 30-57547 E-mail: serviceline@bayer.com Web Reorting: www.exolink.co.uk/bayercomliance Cororate Comliance on the Intranet * For Comliance Hotline numbers in other countries, contact data of Comliance Officers and information about Cororate Comliance at Bayer, lease visit the Intranet (emloyees only): cororate-comliance.intranet.cnb Cororate Comliance on the Internet * For all Comliance Hotline numbers by country and for general information on Cororate Comliance at Bayer, lease visit the Internet: www.bayer.com/en/cororate-comliance.asx Scoe of Validity This Cororate Comliance Policy alies to all emloyees of the Bayer Grou throughout the world. Secial arrangements aly at Currenta GmbH & Co. OHG and its subsidiaries. The resective resolution of the Executive Board of Currenta GmbH & Co. OHG in consultation with the shareholders if necessary must be observed. 26

Bayer AG 51368 Leverkusen Germany www.bayer.com English edition, December 2014