As a health care Group with more than 300,000 employees, Fresenius plays an important role in society. For more than 100 years, our mission has been to preserve life, promote health, and improve patients’ quality of life – as defined in our company objective – ever better medicine for ever more people. The importance of modern and functional health care for society again became particularly clear in 2021. Our employees worldwide have continued to work tirelessly and under sometimes difficult pandemic conditions – in clinics, dialysisDialysisForm of renal replacement therapy where a semipermeable membrane – in peritoneal dialysis the peritoneum of the patient, in hemo dialysis the membrane of the dialyzer – is used to clean a patient’s blood. centers, factories, and logistics. In acute care, we have significantly increased the number of intensive care beds and ventilation stations. The dialysis centers also continued to provide safe treatments, even for kidney patients infected with COVID-19. We have consistently ensured the supply of our vital medicines, medical devices, and services for critically and chronically ill patients.
For Fresenius, economic success is not an end in itself, but a means of continuously contributing to medical progress. The patient’s well-being always comes first. It is our point of reference for all business decisions. The common goal of all business segments is to improve health care quality and efficiency. We aim to provide innovative solutions and work proactively to enable a growing number of people to have access to high-quality, affordable medicine.
In our Code of Conduct, we commit to integrity in dealing with our business associates as well as to socially responsible behavior and transparent communication. The Fresenius Code of Conduct defines basic principles that apply to all employees and the management of the Fresenius Group. It also sets out the framework for the relevant regulations of the individual business segments, and defines our respective activity areas. Further information can be found in the Compliance and Integrity section.
- We take responsibility for our patients’ well-being and are committed to the highest quality in our products, treatments, and services.
- We want to do the right thing and comply with all applicable rules and laws. In addition to legal requirements, we adhere to high ethical standards and rules of good corporate governance.
- We largely owe our success and growth to the commitment of our more than 300,000 employees worldwide. Our aim is therefore to be perceived as an attractive employer to acquire talent, retain employees, and allow them to further develop their skills.
- We think and act long-term in our business decisions. We protect nature as the basis of life and treat resources with care.
- We are committed to respecting human rights as defined by international standards, such as the Declaration of Human Rights of the United Nations.
We analyze the impact of our actions with the help of the United Nations’ 17 Sustainable Development Goals (SDGs). A particular focus is on the goals of good health and well-being (SDG 3), high-quality education (SDG 4), and decent work and economic growth (SDG 8). We also align our sustainable actions closely to the United Nations Global Compact and the sustainability requirements of the capital market. Further information is available on our website.
The business model
Fresenius is a global health care Group and one of the leaders in its respective markets. The Fresenius Group comprises four independently operating business segments managed by Fresenius SE & Co. KGaA: Fresenius Medical Care is the world’s leading provider of products and services for individuals with renal diseases based on publicly reported revenue and the number of patients. Fresenius Kabi provides lifesaving medicines, medical devices, and services for the critically and chronically ill. Fresenius Helios is Europe’s largest private hospital chain, with clinics in Germany, Spain, and Latin America. Fresenius Vamed specializes in health care facilities projects and service business. The Group Management Report contains additional information on the Group’s business model and ownership structures, on legal and economic factors, as well as key sales markets and competitive positions.
Our value chain
Fresenius has an international distribution network and operates more than 90 production facilities. The largest of these are located in the United States, China, Germany, Japan, and Sweden. In the Fresenius Group, all purchasing processes are controlled by central coordination points in the business segments. Competence teams bundle the needs, conclude framework contracts, and continuously monitor current market and price trends. They also coordinate global procurement for individual production sites or clinics and initiate quality and safety controls for raw materials and procurement goods. Supply reliability and quality of care play an important role in an environment characterized by ongoing cost-saving efforts by health care providers and by price pressure in the markets. We therefore constantly optimize our purchasing processes, standardize procurement materials, identify new sources of supply, and negotiate the best possible price deals. Maintaining high flexibility while meeting our strict quality and safety standards is crucial. A broad portfolio of suppliers reduces potential procurement or raw material shortages in both the product and service business. Additional information is included in the section Procurement of the Group Management Report.
The identification and assessment of potential sustainability risks (non-financial risks) initially takes place at both the Group level and in the four business segments via the existing risk management system. Sustainability risks are assessed that are already covered by the existing risk catalogs and risk reporting of the Fresenius Group. In an additional step, potential sustainability risks are discussed on a quarterly basis at Group level by the corporate functions Risk Management & Internal Control System, Business Integrity and Investor Relations & Sustainability of Fresenius SE & Co. KGaA, and supplemented if necessary. In the future, we intend to record and assess sustainability risks across the Group in a more harmonized approach together with financial, legal, and compliance risks. This will enable us to achieve an integrated view of our impact on the issues (inside-out perspective) on the one hand and the impact of the issues on Fresenius (outside-in) on the other. This allows us to assess their short-, medium- or long-term financial impacts as well as their impacts on society and the environment. In the area of human rights, we have already started to do this. Further details are provided in the Human Rights chapter.
In the reporting period, we analyzed potential sustainability risks in the areas of climate change and water scarcity. We did not identify any material risks to our business model in either area. Overall, we did not identify any material non-financial risks, taking into account risk mitigating measures (net risk assessment), related to our own business activities, business relationships, products, or services that are very likely to have an adverse effect on the non-financial aspects mentioned above or on our business operations. The Group Management Report contains further information on opportunities and risks as well as a detailed presentation of risk management.
Our sustainability goals and programs
We pursue specific sustainability approaches at the level of the four business segments and Fresenius SE & Co. KGaA. The business segments build their own sustainability programs and regularly review how they can further develop and optimize them.
In May 2021, the Fresenius Annual General Meeting approved a new compensation system for the members of the Management Board of Fresenius Management SE. In the context of short-term variable compensation, ESG (Environmental, Social, and Governance) targets have an influence on compensation for the first time in this system, with a weighting of 15%. The focus of the ESG targets is on the key sustainability topics identified by Fresenius in the materiality analysis: quality / patient well-being, innovation anddigital transformation, employees and diversity, environment, and compliance and integrity. With the identification of key performance indicators (KPIs) and the definition of comprehensive management concepts, the company will create a basis to make the sustainability performance of the business segments measurable. The identified key performance indicators are intended to facilitate target setting and measurement in the long term and also to be incorporated into the long-term variable compensation of the company’s executives.
In the reporting year, the members of the Executive Board achieved the ESG targets. A detailed presentation can be found in the Compensation Report. The ESG methodology for determining target achievement is available on the website of Fresenius SE & Co. KGaA.
For Fresenius Medical Care, the target achievement of the company’s Global Sustainability Program is used, which is also part of the compensation system for the members of the company’s Management Board. Fresenius Medical Care’s Global Sustainability Program reflects the increasing requirements for sustainability management as well as the company’s commitment to continuously improving its performance. It defines global targets for eight focus areas in the period between 2020 and 2022. Fresenius Medical Care selected these areas based on the results of the company’s materiality analysis, which identifies the most relevant sustainability topics for its business. The focus areas are the responsibility towards the patients as well as the employees, anti-bribery and anti-corruption, data protection and privacy, human and labor rights, sustainable supply, environment, and occupational health and safety. The program’s objective is to establish common global standards, goals, responsibilities, and key performance indicators to monitor sustainability performance.
In February 2022, the Management Board of Fresenius Management SE has implemented a climate target, complementing the existing sustainability goals and programs for the Fresenius Group. Fresenius Group aims to achieve climate neutrality by 2040 and to reduce 50% of absolute scope 1 and scope 2 emissions by 2030 compared to 2020. We will continuously assess scope 3 emission impacts for inclusion in our targets. Further information on our environmental management and emissions within our business segments and the Group are provided in the chapters Climate Protection - Energy and Emissions and Environmental management.
Our sustainability organization
Sustainability at Fresenius is the responsibility of the CEO of Fresenius Management SE, as shown in the overview aside. Fresenius Management SE is the general partner of Fresenius SE & Co. KGaA. The Group Management Board is regularly informed about sustainability issues by the Investor Relations & Sustainability department of Fresenius SE & Co.KGaA. The Management Board and the Supervisory Board review the progress and the results of the sustainability management, which are then published in the separate Group Non-financial Report. The Supervisory Board is supported in this process by the auditor’s limited assurance engagement. The Audit Committee has a special role in reviewing the Group Non-financial Report. The Supervisory Board as a whole is responsible for monitoring the Company’s sustainability performance.
FRESENIUS GROUP SUSTAINABILITY ORGANIZATION
Investor Relations & Sustainability coordinates the implementation of sustainability guidelines and standards at operational level and is responsible for the non-financial reporting of the Fresenius Group. Business Integrity (formerly Corporate Compliance) is responsible for our Code of Conduct and manages issues relating to human rights, supply chain, and compliance. Data protection and Cybersecurity are independent areas of responsibility. The departments and functions at Fresenius SE & Co. KGaA level support the business segments in the development of guidelines and management concepts relating to these sustainability topics. The business segments have also defined departments and responsible persons – often in the form of sustainability officers who coordinate all sustainability issues within the business segment. Fresenius Medical Care is itself a stock-listed company and has therefore established its own sustainability governance structure. Sustainability is also an integral part of the Management Board there. The highest governing body for sustainability issues at Fresenius Medical Care is the Sustainability Decision Board. Headed by the CEO, it is responsible for integrating sustainability into the company’s strategy and business. Together with the Sustainability Decision Board, the Management Board decides on strategic initiatives. In the reporting year, a member of the Supervisory Board was appointed to the position of Lead Independent Director. Her responsibilities include addressing matters relating to ESG aspects of the company.
The Group Sustainability Board
The Group Sustainability Board (GSB) is composed of those responsible for sustainability at Group level and in the business segments and is scheduled to meet every two months. The Board discusses the future sustainability strategy of the Fresenius Group. The overall goal of the GSB is to identify the most important sustainability issues for the Group and to strengthen intra-Group cooperation.
In 2021, six GSB meetings were held under the leadership of CEO Stephan Sturm. That year, the GSB focused on the implementation of the EU taxonomy, and the exchange of best practices, and the implementation of the ESG targets of the Management Board of Fresenius Management SE.