Water and Marine Resources (E3)

Water and marine resources are essential to both environmental sustainability and the resilience of industrial operations. As part of our commitment to responsible business practices, we recognize the importance of managing water use efficiently and minimizing our ecological footprint. Although our direct impact on water resources is relatively limited, water remains a material topic due to its relevance to stakeholders, regulatory obligations, and our water efficiency target. We integrate sustainable water management into our strategy to support long-term operational resilience and responsible resource use.

Our material impacts, risks and opportunities related to water resources (E3 SBM-3)

Our policy related to water resources (E3-1)

Our policy requires our sites to use water as efficiently as possible and to consider it an environmental aspect. All sites strive to optimize existing water-related processes and adopt innovative solutions for water use in new or significantly modified processes. We conduct a cost-benefit analysis of all water conservation measures, including their impact on energy consumption and carbon emissions. All our sites are required to fully and transparently map their water flow from the point of extraction, at each stage of processing, use and treatment, and through to the point of discharge. We expect water withdrawal to be measured with water meters and the data documented in our Environment, Health, and Safety (EHS) data management system. Our sites are required to ensure that they provide employees and visitors with clean drinking water, sanitary facilities and hygienic conditions.

Our water management system encompasses sites located in areas at water risk and with high water stress. These sites must comply with applicable laws and meet company requirements like our water-efficiency target. We expect our sites located in such areas to be particularly vigilant in using water responsibly. They are also required to monitor local and regional developments and adjust their water use accordingly.

Our policy does not classify water treatment as a form of sustainable water procurement and does not address the water-related aspects of the design of products and services. This is carried out by our business sectors and/or their research and development (R&D) departments. Steps we take to prevent water contamination are described in the section Our policies in connection with water pollution (E2-1). We do not have policies or practices for sustainable oceans and seas.

Our actions related to water resources (E3-2)

We strive to manage water resources efficiently and sustainably across our operations; therefore, the responsible use of water is an important part of our commitment to the United Nations’ Sustainable Development Goals (SDGs). We rolled-out a training on conscious water use for all our employees to raise awareness about the overexploitation of natural resources, the global water crisis, preventing emissions and the pollution of surface or groundwater. It is complementing the mandatory Sustainability Strategy training, allowing topic-specific deep dives.

Our sites operate under an environmental management system, which includes key indicators such as water withdrawal. The performance of sites in accordance with a Corporate EHS audit is rated on a five-tier scale, from excellent to critical, which determines the frequency of audits across environmental topics (air, water, waste) and guides the implementation of corrective actions. Risk-based environmental assessments are conducted every three years at all production sites, including evaluations of water-related impacts. 90 of our sites are certified with ISO 14001 Environmental management system, confirming our commitment to environmental practice.

Initiatives to minimize water withdrawal

As part of our commitment to sustainable water management, we systematically identify and assess opportunities for all three of our business sectors to conserve and responsibly use water. This includes designing site-specific water conservation plans for our large production sites, laboratories, and warehouses. These initiatives, which are tailored to local conditions and needs, aim to reduce water withdrawal, reclaim water and promote reuse. Water use is locally managed at each site, with various individual measures and actions contributing to water-saving initiatives. An overview of all actions is monitored by the respective EHS department in the business sectors. Through this, these initiatives help us make progress toward our 2030 water-efficiency target.

Our EHS Handbook for Construction Projects provides guidance on effective water resource management. Additionally, we have established a sustainability best-practice sharing platform, available for all our business sectors, to deepen our collective knowledge on sustainable water use and to support collaborative efforts in addressing shared water challenges.

Our Life Science business sector’s EDISON program aims to systematically enhance energy and water efficiency across its sites worldwide. Each year, sites can submit funding requests based on their specific needs. New projects are selected for funding annually based on energy, water, CO₂e impact, and Net Present Value. The EDISON program is scheduled to run until 2030. Four sites – located in Canada, France, Switzerland, and the U.S. – implemented water-saving projects through the EDISON program in 2025. One of the sites is located in an area at water risk and with high water stress. As part of our program, we have, for example, installed heating, ventilation and air-conditioning systems to reclaim water for irrigation, replaced vacuum pumps with high-efficiency models and installed water-efficient fixtures. Other projects involve recovering water through reverse osmosis, reusing water from steam systems, recovering wastewater for process systems, and implementing closed-loop clean-in-place water systems for production equipment.

Compete-to-Green is the strategic sustainability framework of our Healthcare business sector, encompassing environmental dimensions across the organization. Within this initiative, the water circularity program focuses on site-specific projects aimed at improving water efficiency and reuse at business units. In 2025, production sites in Brazil, Italy, Mexico and Switzerland ran water-conservation projects. Two of them are located in an area of high water stress. Three projects used reverse osmosis technology to clean wastewater for reuse in utility systems. Another project involved upgrading water infrastructure to improve a site’s overall efficiency. We use a digital tool to document completed projects and collect ideas for upcoming initiatives along with preliminary estimates of their potential impact. Consolidating these data helps us reduce water withdrawal, identify emerging trends and share best practices across our sites. The water circularity program, which will continue in 2026, is scheduled to run through 2030.

In addition, we developed a technical guideline for our Healthcare business sector that aims to provide a framework for sustainable water management and circular economy. The guideline establishes guidance for preserving, reusing and recycling water. It also provides specific recommendations for areas with high water stress. The guideline is primarily intended for Healthcare’s manufacturing activities (such as production, R&D and laboratories). However, some of the content can also be applied at our other business sectors’ locations. This will help us achieve our water-efficiency target for 2030, while also reducing potentially harmful residues in our wastewater to below the no-effect threshold (predicted no-effect concentration, PNEC, water reference level). More information can be found under Our targets related to water pollution (E2-3).

Our Electronics business sector installed an innovative rainwater collection system at one of its Taiwan sites in 2025 to help us reach our water-efficiency target. The system’s smart control technologies along with a 14-day weather forecast optimize rainwater collection and use. This initiative not only improves water efficiency but also reduces the need for emergency interventions during extreme weather events, such as typhoons and heavy rainfall. Its success indicates that it may be a viable solution at some of our other sites as well.

Our target related to water resources (E3-3)

Our metrics related to water resources (E3 MDR-M)

Of the total water withdrawal, 3,319,937 m³ (2024: 797,418 m³)was attributable to Merck KGaA, Darmstadt, Germany. The increase in water withdrawal in fiscal 2025 is attributed to the fact that we are allocating water volumes, which were previously assigned to the Electronics business sector, to Merck KGaA, Darmstadt, Germany, due to the sale of Surface Solutions.

Data from water withdrawal at each environmentally relevant site is collected by local working groups according to local and global internal standards. Our operational sites (manufacturing and warehousing) and our larger dedicated R&D and office sites are required to record relevant water volumes (total water withdrawal) in our central EHS data management system. The on site recording methods vary both in terms of the data source, such as measurement (via flow meters or volume counters), meter reading or billing, and the frequency (monthly, quarterly or annually). This data is entered quarterly by a dedicated employee at each site into a central reporting platform that records the measured data. The data is then reviewed and validated by Group function Corporate Sustainability, Quality and Trade Compliance through consistency checks. The measurements of the entity-specific metrics are not validated by an external body.

We determine whether a site is located in areas of water risk and high water stress via a water risk factor of the WRI Aqueduct Water Risk Atlas. We therefore compare the geodata of our sites with the information in the WRI Aqueduct Water Risk Atlas. We define a site as being located in a water risk area if the respective total water risk factor in WRI Aqueduct is 3 or higher (“high: 3 – 4”; “extremely high: 4 – 5”). At the same time, we apply the definition of high water stress as given in the ESRS glossary annex. Although we operate sites in areas at water risk and high water stress, our respective water withdrawal is low and of no relevance to the respective local environment.