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`105
`
`The following table provides an overview of the amount of the variable compensation paid in 2010 and 2011:
`
`€ thousand
`Karl-Ludwig Kley
`Michael Becker *
`Kai Beckmann (since 4/1/11)
`Stefan Oschmann (since 1/1/11)
`Bernd Reckmann
`Elmar Schnee (until 6/30/11) **
`Matthias Zachert (since 6/1/11)
`Total
`
`Variable compensation
`
`2011***
`3,100
`2,084
`1,188
`2,100
`3,300
`1,042
`1,079
`13,893
`
`2010****
`2,189
`1,314
`n/a
`n/a
`1,095
`1,752
`n/a
`6,350
`
`* Michael Becker was the Chief Financial Officer of Merck KGaA until May 31, 2011. After June 1, 2011, Michael Becker remained a General Partner of Merck KGaA, but was no longer a
`member of the Executive Board.
`** Elmar Schnee was a General Partner of Merck KGaA in the period from January 1, 2011 to June 30, 2011, but was no longer a member of the Executive Board of Merck KGaA.
`*** The variable compensation for 2011 is based on an extrapolation since the consolidated result of the E. Merck Group was not yet available when this information was prepared and
`includes the aforementioned one-time payments to Karl-Ludwig Kley, Michael Becker and Bernd Reckmann.
`**** The variable compensation stated for 2010 deviates from the data provided in 2011 since the consolidated result of the E. Merck Group was not yet available when this information
`was prepared and was therefore extrapolated.
`
`Total compensation
`Consequently, this results in the following total compensation for the Executive Board members of Merck KGaA:
`
`€ thousand
`Karl-Ludwig Kley
`Michael Becker
`Kai Beckmann
`Stefan Oschmann
`Bernd Reckmann
`Elmar Schnee
`Matthias Zachert
`Total
`
`Fixed compensation
`
`Variable compensation
`
`Total
`
`2011
`1,100
`800
`600
`1,000
`1,000
`450
`583
`5,533
`
`2010
`1,000
`800
`n/a
`n/a
`750
`900
`n/a
`3,450
`
`2011
`3,100
`2,084
`1,188
`2,100
`3,300
`1,042
`1,079
`13,893
`
`2010
`2,189
`1,314
`n/a
`n/a
`1,095
`1,752
`n/a
`6,350
`
`2011
`4,200
`2,884
`1,788
`3,100
`4,300
`1,492
`1,662
`19,426
`
`2010
`3,189
`2,114
`n/a
`n/a
`1,845
`2,652
`n/a
`9,800
`
`Pension provisions
`The individual contractual pension obligations grant the members of the Executive Board entitlement
`to a lifelong old­age pension or surviving dependents’ pension in the event of reaching the individual
`contractually agreed age limit, permanent disability, or death.
`
`The amount of the old­age pension is determined by a percentage share of pensionable compensation
`defined by the Personnel Committee.
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`The individual values are presented in the following table:
`
`Karl-Ludwig Kley
`Michael Becker
`Kai Beckmann
`Stefan Oschmann
`Bernd Reckmann
`Elmar Schnee
`Matthias Zachert
`
`Pensionable
`compensation
`(€ thousand)
`790
`560
`300
`500
`500
`570
`400
`
`Percentage
`entitlement
`70
`75
`41
`45
`56
`49
`40
`
`The percentage entitlement increases up until retirement annually by 2% up to 70% for Michael Beckmann and Matthias Zachert, as well as for Bernd Reckmann, whose pension
`entitlement was correspondingly increased in fiscal 2011.
`
`The following amounts were added to pension provisions in 2011:
`
`€ thousand
`Karl-Ludwig Kley
`Michael Becker
`Kai Beckmann
`Stefan Oschmann
`Bernd Reckmann
`Elmar Schnee
`Matthias Zachert
`Total
`
`Additions to pension provisions
`
`2011
`–1,699
`1,247
`1,053
`498
`693
`1,016
`153
`2,961
`
`2010
`2,162
`1,216
`n/a
`n/a
`829
`777
`n/a
`4,984
`
`Amount
`of pension
`provisions as
`of Dec. 31,
`2011
`5,268
`7,302
`1,825
`498
`4,309
`3,458
`153
`22,813
`
`The surviving dependents’ pension grants the spouse a lifelong surviving dependents’ pension amounting
`to 60% of the pension entitlement, dependent children either a half­orphan’s or an orphan’s pension maxi­
`mally until the age of 25.
`
`Benefits in the event of termination of the duties as an Executive Board member
`Above and beyond existing pension obligations, no further obligations exist in the event of the premature
`termination of the contractual relationships of the Executive Board members.
`
`Miscellaneous
`The members of the Executive Board additionally receive certain benefits, mainly contributions to insurance
`policies as well as a company car, which they are entitled to use privately. The members of the Executive
`Board must declare these benefits in their tax returns. In total, the value of miscellaneous benefits amounted
`to € 121 thousand in 2011 (2010: € 86 thousand). Of this amount, in 2011 € 28 thousand was attributable to
`Karl­Ludwig Kley (2010: € 29 thousand), € 22 thousand to Michael Becker (2010: € 24 thousand),
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`Kai Beckmann € 14 thousand, € 15 thousand to Stefan Oschmann, € 25 thousand to Bernd Reckmann (2010:
`€ 26 thousand), € 3 thousand to Elmar Schnee (2010: € 7 thousand), and Matthias Zachert € 14 thousand.
`The members of the Executive Board do not receive additional compensation for serving on the boards of
`Group companies.
`
`Should members of the Executive Board be held liable for financial losses while executing their duties,
`under certain circumstances this liability risk is covered by a D&O insurance policy from Merck KGaA.
`The D&O insurance policy has a deductible in accordance with the legal requirements and the recommen­
`dations of the German Corporate Governance Code.
`
`Payments to former Executive Board members and their surviving dependents
`Pension payments to former members of the Executive Board or their surviving dependants amounted
`to € 9,734 thousand in 2011 (2010: € 9,091 thousand). Pension provisions totaling € 89,204 thousand exist
`for pension entitlements of this group of persons (2010: € 90,082 thousand).
`
`Outlook: Variable compensation as of 2012
`At its meeting on February 7, 2012, the Personnel Committee of the Board of Partners of E. Merck KG resolved
`to add a long­term variable compensation component to the variable compensation of the members of the
`Executive Board. This Merck Long­Term Incentive Plan is effective as of January 1, 2012. It aims to enhance the
`sustainability of the compensation system and to align it not only with the target achievement based on
`key performance indicators, but above all with a sustainable performance of Merck shares. To prepare for its
`resolution, the Personnel Committee was supported by an independent external compensation advisor.
`
`Subject to the resolution of the Personnel Committee each year, under the Merck Long­Term Incentive
`Plan the members of the Executive Board could be eligible to receive a certain number of virtual shares –
`Merck Share Units (MSUs) – at the end of a three­year performance period. The number of MSUs depends
`on the total value defined for the respective person and the average closing price of Merck shares in Xetra
`trading during the last 60 trading days prior to January 1 of the respective fiscal year. In order to participate
`in the Plan, members of the Executive Board must personally own an investment in Merck shares equivalent
`to 10% of their respective fixed annual compensation, taking into account the equity interest held in
`E. Merck KG as a General Partner. It is not permitted to sell these shares during the performance period.
`
`After termination of the three­year performance period, the number of MSUs to be granted is determined
`based on the development of two key performance indicators (KPIs). These are:
`
`a) the performance of the Merck share price compared to the DAX ® with a weighting of 70%, and
`
`b) the development of the EBITDA margin, adjusted for exceptional items, during the
`performance period as a proportion of a defined target value with a weighting of 30%.
`Depending on the development of the KPIs, at the end of the respective performance period the members
`of the Executive Board are granted between 0% and 150% of the MSUs they could be eligible to receive.
`
`The members of the Executive Board receive a payment based on the number of MSUs granted. The
`value of an MSU corresponds to the average closing price of Merck shares in Xetra trading during the last
`60 trading days prior to January 1 after the performance period. The net amount after taking tax into
`account is invested in Merck shares by the members of the Executive Board. One third of these shares may
`be sold at the earliest one year after termination of the performance period, another third after two years,
`and another third after three years.
`
`In fiscal 2012, the members of the Executive Board are eligible to receive MSUs with the following
`total values: Karl­Ludwig Kley € 1.5 million, Kai Beckmann € 1.0 million, Stefan Oschmann € 1.0 mil­
`lion, Bernd Reckmann € 1.0 million and Matthias Zachert € 1.0 million. The Executive Board resolved to
`
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`introduce a new long­term incentive plan for eligible executives and employees effective January 1, 2012
`which corresponds in its composition largely to the Merck Long­Term Incentive Plan.
`
`Compensation of the Supervisory Board members of Merck KGaA
`The compensation of the Supervisory Board members is defined by Article 20 of the Articles of Association
`of Merck KGaA. Apart from reimbursement of their expenses, the members of the Supervisory Board receive
`fixed and variable compensation.
`
`The fixed compensation amounts to € 7,000 per year. The Chairman receives double this amount and
`the Vice Chairman receives one and a half times this amount.
`
`The members of the Supervisory Board also receive € 550 for each percent of the dividend resolved by the
`General Meeting in excess of 6% of the share capital, with a corresponding portion for fractions of a percent.
`The Chairman receives double this amount and the Vice Chairman receives one and a half times this amount.
`
`Supervisory Board members who have only been in office for part of the fiscal year receive lower
`compensation in proportion to their term of office. The company reimburses the value­added tax levied
`on the compensation.
`
`The individual values are presented in the following table:
`
`Compensation of the Supervisory Board members of Merck KGaA 
`
`Fixed compensation
`
`Variable compensation
`
`Total compensation
`
`€
`2010
`2011
`2010
`2011
`2010
`2011
`60,288
`70,859
`46,288
`56,859
`14,000
`14,000
`Rolf Krebs 1 (Chairman)
`45,216
`53,144
`34,716
`42,644
`10,500
`10,500
`Heiner Wilhelm (Vice Chairman)
`30,144
`35,429
`23,144
`28,429
`7,000
`7,000
`Crocifissa Attardo
`30,144
`35,429
`23,144
`28,429
`7,000
`7,000
`Mechthild Auge
`30,144
`35,429
`23,144
`28,429
`7,000
`7,000
`Johannes Baillou 2
`30,144
`35,429
`23,144
`28,429
`7,000
`7,000
`Frank Binder 3
`30,144
`35,429
`23,144
`28,429
`7,000
`7,000
`Wolfgang Büchele 2
`30,144
`35,429
`23,144
`28,429
`7,000
`7,000
`Michael Fletterich
`30,144
`35,429
`23,144
`28,429
`7,000
`7,000
`Edeltraud Glänzer
`30,144
`35,429
`23,144
`28,429
`7,000
`7,000
`Michaela Freifrau von Glenck 4
`30,144
`35,429
`23,144
`28,429
`7.000
`7,000
`Frieder Kaufmann
`30,144
`35,429
`23,144
`28,429
`7,000
`7,000
`Hans-Jürgen Leuchs 2
`30,144
`35,429
`23,144
`28,429
`7,000
`7,000
`Albrecht Merck 3
`30,144
`35,429
`23,144
`28,429
`7,000
`7,000
`Karl-Heinz Scheider
`30,144
`35,429
`23,144
`28,429
`7,000
`7,000
`Theo Siegert 1
`30,144
`35,429
`23,144
`28,429
`7,000
`7,000
`Osman Ulusoy
`527,520
`620,009
`405,020
`497,509
`122,500
`122,500
`Total
`1 As members of corporate bodies of E. Merck KG, these Supervisory Board members each received an additional payment of € 150,000 for performing this function in 2011 (2010: € 150,000).
`2 As members of corporate bodies of E. Merck KG, these Supervisory Board members each received an additional payment of € 140,000 for performing this function in 2011 (2010: € 140,000).
`3 As members of corporate bodies of E. Merck KG, these Supervisory Board members each received an additional payment of € 120,000 for performing this function in 2011 (2010: € 120,000).
`4 As members of corporate bodies of E. Merck KG, these Supervisory Board members each received an additional payment of € 80,000 for performing this function in 2011 (2010: € 80,000).
`
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`
`Section 6.6 of the
`German Corporate
`Governance Code
`
`Ownership, purchase or sale of shares in the company by members of the Executive Board and of the
`Supervisory Board
`As of December 31, 2011, the members of the Executive Board and of the Supervisory Board either directly
`or indirectly held 27,892 shares of Merck KGaA. Their total ownership represents less than 1% of the issued
`shares of Merck KGaA. Transactions executed by members of the Executive Board and of the Supervisory
`Board are disclosed on the Merck website at www.merckgroup.com/investors
` Corporate Governance
` Directors’ Dealings.
`
`Information on Corporate Governance Practices
`
`Reporting
`It is Merck KGaA’s objective to provide the latest information to all shareholders, media, financial analysts
`and interested members of the public, while creating the greatest possible transparency. For this reason,
`Merck uses a wide range of communication platforms to engage in a timely dialogue with all interested
`parties about the situation of the company and business changes. Merck’s principles include providing
`factually correct, comprehensive and fair information.
`
`Information subject to disclosure requirements, as well as information that is not, can be accessed
`worldwide on the Merck KGaA website (www.merckgroup.com), which is the company’s most important
`publication platform. Apart from a detailed financial calendar, quarterly and half­year financial reports
`covering the past six years are available here in German and English. In addition, in line with the legal
`requirements, ad hoc announcements are published on the website. These contain information on circum­
`stances that could impact the Merck share price.
`
`Regular press conferences, investor meetings on the occasion of investor conferences as well as road­
`shows offer another platform for dialogue. The company presentations prepared for this purpose are also
`available on the Merck KGaA website. In addition, the Investor Relations team is always available to private
`and institutional investors who wish to receive further information.
`
`To ensure the greatest possible transparency, all documents concerning the Annual General Meeting
`are available on the company website. Additionally, some parts of the Annual General Meeting are webcast
`live on the Internet.
`
`Dealing with insider information
`Dealing properly with insider information is very important to us. Our insider committee examines the
`existence of insider information, ensures compliance with legal obligations, and prepares any necessary
`measures. The members of the insider committee are appointed by the Executive Board; at least two
`members work in Group Legal & Compliance. The insider committee meets at regular intervals, yet also
`meets when circumstances require. The Chief Financial Officer is vested with the authority to make the
`final decision on handling potential insider information.
`
`In order to ensure a high level of protection for insider information, in 2011 the Executive Board issued
`an internal insider guideline applicable throughout the Group worldwide. This guideline informs employees
`about their responsibilities under insider trading laws and gives clear instructions for compliant behavior.
`In addition, it describes the function of the insider committee in detail. Moreover, our Code of Conduct, which
`is binding on all employees, also contains an explicit, detailed reference to the ban on using insider informa­
`tion. Within the scope of obligatory training courses on the Code of Conduct, all employees are instructed
`on the subject of insider trading.
`
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`
`Accounting and audits of financial statements
`Merck KGaA prepares its consolidated financial statements and Group management report in accordance
`with International Financial Reporting Standards (IFRS), as applicable in the EU, as well as the supplementary
`rules applicable under section 315a (1) of the German Commercial Code (HGB) and as stipulated by our
`Articles of Association. The Group financial statements and the Group management report are prepared by
`the Executive Board and examined by an auditor, taking into account the generally accepted standards for
`the audit of financial statements promulgated by the Institut der Wirtschaftsprüfer (IDW).
`
`The Supervisory Board commissioned KPMG AG Wirtschaftsprüfungsgesellschaft, Berlin, to audit the
`Group financial statements and the Group management report for 2011. Neither party identified any
`conflicts of interest. Moreover, the Supervisory Board agreed with KPMG AG that the auditor shall inform
`the Supervisory Board without delay of any grounds for bias or disqualification occurring during the audit if
`these cannot be immediately rectified. Additionally, the auditor must immediately report to the Supervisory
`Board any findings and issues which emerge during the audit that have a direct bearing upon the tasks
`of the Supervisory Board. The auditor shall inform the Supervisory Board or note in the audit report any
`circumstances determined during the audit that would render inaccurate the Statement of Compliance
`made by the Executive Board and the Supervisory Board. It has also been agreed with the auditor that in
`order to assess whether the Executive Board has fulfilled its obligations in accordance with section 91 (2)
`AktG, the audit will also cover the company’s early warning risk identification system. Moreover, the auditor
`is required to examine and evaluate the accounting­relevant internal control system insofar as this is
`necessary and appropriate for assessing the accuracy of financial reporting.
`
`Values and compliance
`In accordance with its Mission Statement, “We at Merck do what we say and then measure ourselves on
`this basis,” Merck relies on a common set of values: courage, achievement, responsibility, respect, integrity,
`and transparency. Based on a corporate culture that places the fundamental company values at the center
`of our entrepreneurial actions, the Code of Conduct helps those involved in the business process to imple­
`ment the values when dealing with one another on a daily basis.
` Merck has created the Code of Conduct as a set of rules and regulations intended to help Merck employ­
`ees to act responsibly and to take the right decisions in their daily work. The Code of Conduct explains
`the principles for dealings with business associates, general partners, colleagues, and employees, as well as
`the communities in which we operate. Thus, it supports all employees in acting ethically – not only in their
`dealings with one another, but also outside the company. The Code of Conduct is thus the main set of rules
`of our compliance program.
`
`To Merck, compliance means observing legal and company­internal regulations and the basic ethical
`principles anchored in the company values. With the Code of Conduct and the various unit­specific compliance
`rules, the values are integrated into daily work and business practice. The Code of Conduct is binding on all
`employees, both at headquarters as well as the legal entities abroad. The Compliance Office monitors observance
`of the Code of Conduct with support from corresponding auditing and training programs throughout the
`Group. All employees are called upon to report compliance violations to their supervisor, Legal, HR or other
`relevant departments. Merck created the position of Group Compliance Officer (GCO) in 2002. This employee
`is responsible for setting up, maintaining and further developing our global compliance program. By taking
`appropriate measures, the GCO helps to lower the risk of serious legal violations of, for instance, antitrust law
`or anticorruption rules. The role of the Group Compliance Officer is reflected in the legal entities by the
`approximately 60 local compliance officers, who ensure that compliance measures are implemented in the
`
`The Code of Conduct can
`be found on the Merck
`website at:
`www.merckgroup.com
`→ Publications
`→ Code of Conduct
`
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`111
`
`legal entities in the countries. This Group­wide network is used to steer the global compliance program. Regular
`regional and global compliance meetings are held to promote the exchange of information within the network.
`Newcomer training seminars were introduced in 2010 for newly appointed compliance officers. These seminars
`serve to build up compliance expertise and strengthen teambuilding within the compliance organization.
`
`A high degree of importance is attached to regular compliance seminars, which are conducted as on­site
`events, as well as via web­based training courses. By presenting various training topics on corruption,
`antitrust and competition law, health care compliance and the Code of Conduct, they serve to sensitize
`employees and management to the consequences of compliance violations and to show ways of avoiding
`them. By setting up a central speak­up line, employees can report compliance violations by telephone or
`via a web­based application in their respective national language. The speak­up line is available 24 hours a
`day, free of charge. Case numbers enable anonymous, two­way communication. The reports received are
`individually reviewed. If a compliance violation exists, corresponding corrective action is taken based on
`concrete action plans. If necessary, disciplinary measures are taken. These range from a simple warning up
`to the dismissal of the employee who violated a compliance rule. In 2011, Merck set up a compliance
`committee to guide these processes. The Compliance Committee consists of members from various Group
`functions; they are involved in reviewing compliance violations and introducing countermeasures.
`The joint work in the Compliance Committee enables processes between the various Group functions to
`be optimized.
`
`In cooperation with Internal Auditing, the Compliance Office regularly reviews the implementation of
`Group­wide compliance measures at the legal entities abroad. The audits regularly focus on the local
`compliance structure, the compliance measures taken, as well as the existence of corresponding compliance
`guidelines and processes.
`
`The Compliance function reports regularly to the Executive Board, informing it of the status of compli­
`ance activities, compliance risks as well as serious compliance violations. The Executive Board informs the
`supervisory bodies at least once a year about the key compliance issues.
`
`Risk and opportunity management
`The Executive Board, the Supervisory Board and the Finance Committee are regularly informed about the
`current risk portfolio of the Group and the individual companies. More detailed information can be found
`in the Risk Report on page 84 et seq.
`
`Avoidance of conflicts of interest
`Within the framework of their work, all Executive Board and Supervisory Board members of Merck KGaA
`are exclusively committed to the interests of the company and pursue neither personal interests nor grant
`unjustified advantages to third parties.
`
`Before an Executive Board member takes on honorary offices, board positions or other sideline activities,
`this must be approved by the Personnel Committee of the Board of Partners of E. Merck KG.
`
`The Chairman of the Executive Board, Karl­Ludwig Kley, and the Chief Financial Officer, Matthias Zachert,
`are both members of the Executive Board of E. Merck KG. This does not, however, lead to conflicts of interest.
`
`In its report to the General Meeting, the Supervisory Board discloses any conflicts of interest involving
`its members and how they were dealt with. Consultancy agreements as well other service and work contracts
`of a Supervisory Board member with Merck require the approval of the Supervisory Board. In fiscal 2011,
`there were neither conflicts of interest nor consultancy agreements or other service or work contracts with
`Merck KGaA involving Supervisory Board members.
`
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`
`Adherence to environmental and safety standards
`At Merck, closed­loop thinking guides the way in which we address environmental concerns and environmental
`protection issues. To this end, we integrate precautionary measures into our planning processes. Our
`Environment, Health and Safety Policy with its principles and strategies implements the guidelines formulated
`by the national and international associations of the chemical industry in the Responsible Care ® guidelines.
`The Responsible Care ® Global Charter developed by the International Council of Chemical Associations
`(ICCA) in 2006 puts even more emphasis than before on overall responsibility for products, supply chains
`and the community. Merck signed this expanded version of Responsible Care® for the entire Group in
`February 2007.
` Many guidelines specify how the sites and employees of the Merck Group are to observe the principles
`in their daily work. The Group function Environment, Health, Safety, Security & Quality steers these global
`activities and ensures compliance with regulatory requirements, standards and business needs throughout
`the entire Group. In this way, Group­wide risks are minimized and continuous improvement is promoted
`in the areas of Environment, Health, Safety, Security, and Quality. Corporate Responsibility reports are also
`published at regular intervals.
`
`Procedures of the Executive Board, Supervisory Board, Board of Partners and its Committees
`
`Members of the Executive Board of Merck KGaA
`Notes on memberships of statutory supervisory boards and comparable German and foreign supervisory
`bodies (section 285 sentence 1, No. 10 HGB in conjunction with sections 125 (1) sentence 5 AktG)
`
`Member
`
`Memberships of
`(a) other statutory supervisory boards and
`(b) comparable German and foreign supervisory bodies
`of corporations
`
`Karl-Ludwig Kley
`Darmstadt
`Chairman
`Michael Becker*
`Darmstadt, Chief Financial Officer (until 5/31/11)
`
`(a) – Bertelsmann AG, Gütersloh
`– BMW AG, Munich (Vice Chairman)
` – 1. FC Köln GmbH & Co. KGaA, Cologne (Chairman)
`(a) – Symrise AG, Holzminden (since May 2011)
`(b) – Bâloise Holding AG, Basel, Switzerland
`
`Kai Beckmann
`Griesheim, Head of Group Human Resources
`(since 4/1/11)
`
`no board positions
`
`Stefan Oschmann
`Munich, Head of the Pharmaceuticals
`business sector
`
`(b) – Merck Serono S.A., (Chairman, since 1/10/11)
`
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`113
`
`Member
`
`Bernd Reckmann
`Seeheim-Jugenheim, Head of the Chemicals
`business sector
`Elmar Schnee **
`Darmstadt (until 6/30/11)
`Matthias Zachert
`Bonn, Chief Financial Officer (since 6/1/11)
`
`Memberships of
`(a) other statutory supervisory boards and
`(b) comparable German and foreign supervisory bodies
`of corporations
`
`(b) – Millipore Corp., Billerica, MA, USA (until 9/28/11)
`– Millipore Corp., Cidra, Puerto Rico (until 9/28/11)
`(b) – Merck Serono S.A., Coinsins, Switzerland (until 1/10/11)
`– ChemGenex Pharmaceuticals Ltd., Geelong, Australia
`
`no board positions
`
`* Michael Becker was Chief Financial Officer of Merck KGaA until May 31, 2011. After June 1, 2011, Michael Becker remained a General Partner of Merck KGaA, but was no longer a
`member of the Executive Board of Merck KGaA.
`** Elmar Schnee was a General Partner of Merck KGaA, but was no longer a member of the Executive Board of Merck KGaA in the period from January 1, 2011 to June 30, 2011.
`
`The general partners with no equity interest (Executive Board) manage the business activities in accordance
`with the laws, the Articles of Association and the rules of procedure. They are appointed by E. Merck KG
`with the consent of a simple majority of the other general partners. The members of the Executive Board
`are jointly responsible for the entire management of the company. Certain tasks are assigned to individual
`Executive Board members based on a responsibility distribution plan. Each Executive Board member
`promptly informs the other members of any important actions or operations in his respective business
`area. The Executive Board is responsible for preparing the annual financial statements of Merck KGaA,
`the quarterly and half­year financial statements, as well as the annual financial statements of the Merck Group.
`In addition, the Executive Board ensures that all legal provisions, official regulations and the company’s
`internal policies are abided by, and works to achieve compliance with them by all the companies of the Merck
`Group. A Group­wide guideline defines in detail which transactions require prior Executive Board approval.
`
`The Executive Board provides the Supervisory Board with regular, up­to­date and comprehensive
`reports about all company­relevant issues concerning planning, business developments, the risk situation,
`and risk management. A Supervisory Board resolution regulates further details on the information and
`reporting duties of the Executive Board vis­à­vis the Supervisory Board.
`
`The Executive Board informs the Board of Partners and the Supervisory Board at least quarterly of the
`progress of business and the situation of the company. In addition, the Executive Board informs the stated
`boards at least annually of the company’s annual plans and strategic considerations.
`
`The Executive Board passes its resolutions in meetings that are normally held twice a month.
`
`Page 117
`
`

`
`114
`
`Merck 2011
`Corporate Governance
`
`
`
` Statement on
`Corporate Governance
`
`Supervisory Board
`
`Member
`
`Rolf Krebs
`Mainz, Physician,
`Chairman
`
`Memberships of
`(a) other statutory supervisory boards and
`(b) comparable German and foreign supervisory bodies
`of corporations
`
`(a) – Epigenomics AG, Berlin (Chairman)
`– Ganymed Pharmaceuticals AG, Mainz (Chairman)
`– Merz GmbH & Co. KGaA, Frankfurt
` – Merz Pharmaceuticals GmbH, Frankfurt
`– Senator GmbH & Co. KGaA, Frankfurt
`(b) – E. Merck KG, Darmstadt
`– Air Liquide S.A., Paris
`
`Heiner Wilhelm
`Reinheim, Chairman of the Works Council of the
`Darmstadt site of Merck KGaA, Vice Chairman
`
`no board positions
`
`Crocifissa Attardo
`Darmstadt, Full-time member of the Works
`Council of the Darmstadt site of Merck KGaA
`
`no board positions
`
`Mechthild Auge
`Wehrheim, Head of Strategy,
`CardioMetabolic Care, Merck Serono,
`Merck KGaA
`
`Johannes Baillou
`Vienna, Austria, Managing Partner of Bondi
`Immobilien-Consulting GmbH, Vienna
`
`no board positions
`
`(b) – E. Merck KG, Darmstadt (Vice Chairman)
`
`Frank Binder
`Zurich, Switzerland, Chief Executive Officer of
`Novarca Deutschland GmbH, Frankfurt/Main
`
`(a) – Landbell AG für Rückhol-Systeme, Mainz (Chairman)
`(b) – E. Merck KG, Darmstadt
`– Athena AG, Zurich (until 12/16/11)
`– BMR-Yachting AG, Zurich (Chairman)
`
`Wolfgang Büchele
`Mannheim, Member of the Board of Directors
`of Kemira Oy, Finland
`
`Michael Fletterich
`Gernsheim, Chairman of the Works
`Council of the Gernsheim site of Merck KGaA
`
`Edeltraud Glänzer
`Wiesbaden, Member of the Managing
`Board of Industriegewerkschaft Bergbau,
`Chemie, Energie (IG BCE)
`
`Michaela Freifrau von Glenck
`Zurich, Switzerland
`Teacher
`
`(b) – E. Merck KG, Darmstadt
`– BorsodChem Zrt, Kazincbarcika, Hungary (Chairman of the Board until
`1/31/11, Member of the Board of Directors from 2/1/11 until 12/31/11)
`
` – First Chemical Holding Kft, Budapest, Hungary (until 12/31/11)
`– Kemira Oy, Helsinki, Finland
`
`no board positions
`
`(a) – B. Braun Melsungen AG, Melsungen
`– Solvay Deutschland GmbH, Hannover (Vice Chairman)
`
`no board positions
`
`Page 118
`
`

`
`Merck 2011
`Corporate Governance
`
`
`
` Statement on
`Corporate Governance
`
`115
`
`Member
`
`Memberships of
`(a) other statutory supervisory boards and
`(b) comparable German and foreign supervisory bodies
`of corporations
`
`Frieder Kaufmann
`Rossdorf, Full-time member of the Works
`Council of the Darmstadt site of Merck KGaA
`
`no board positions
`
`Hans-Jürgen Leuchs
`Ingelheim,
`Graduate chemist
`
`(b) – E. Merck KG, Darmstadt
`– Zeton B.V., Enschede, Netherlands
`– Zeton International Inc., Burlington, ONT, Canada
`
`Albrecht Merck
`Schriesheim, Commercial Director of the Castel
`Peter winery, Bad Dürkheim
`
`(b) – E. Merck KG, Darmstadt
`
`Karl-Heinz Scheider
`Gross-Zimmern, Head of Contract
`Manufacturing Chemicals, Merck KGaA
`
`no board positions
`
`Theo Siegert
`Düsseldorf, Managing Partner of
`de Haen Carstanjen & Söhne, Düsseldorf
`
`Osman Ulusoy
`Wiesbaden, Vice Regional Director
`(Hesse-Thuringia) of Industriegewerkschaft
`Bergbau, Chemie, Energie (IG BCE)
`
`(a) – Deutsche Bank AG, Frankfurt
`– E.