Merck 2010 Annual Report Download - page 96

Generally, Merck strives to minimize and manage its legal risks. We have taken the necessary
precautions to identify threats and defend our rights where necessary. Risks arising in connection
with litigation are continually identified, assessed and communicated.
A compliance program applies to our employees worldwide, which enjoins them to comply with
laws and guidelines, and provides them with the relevant training and support. The core of
the program is the Merck Code of Conduct, which defines guidelines for ethical behavior. This
is complemented by a training and testing program, a SpeakUp Line for reporting compliance
violations, as well as a global network of compliance officers.
Insofar as possible and practical, the company limits liability and damage risks through insur-
ance coverage, the type and scope of which is continually adjusted to current requirements.
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Merck’s success is significantly influenced by the competence and dedication of its employees.
Due to intensive competition, it is increasingly difficult to recruit and retain qualified specialists,
particularly in the pharmaceutical sector.
We are meeting this challenge by continuously enhancing our range of international personnel
marketing measures. Merck addresses specialists and executives by means of a Talent & Succession
Management process established throughout the Group. This process helps to identify internal
talent for management positions and facilitates the objective assessment and development of
talent, thus enabling positions to be quickly filled with suitable employees as a result of targeted
selection via an internal talent pool. Vacancies arising over the short term are managed by means
of clearly defined, appropriate deputizing arrangements. Key factors for employee retention
and satisfaction are identified and evaluated by means of regular, corporate-wide employee
surveys. We derive measures from the results of these surveys and monitor their efficacy in
follow-up surveys. A performance management system applicable to the whole Merck Group
was introduced to better measure employee contributions to the company’s success. This is
to facilitate a consistent evaluation of the degree to which personal goals are achieved and
for measuring the degree to which the Merck Values are lived. On this basis, individual HR
development measures are identified and implemented. This ensures the targeted preparation
of employees for new business challenges and their motivation to solve these challenges for
the benefit of the company. The Rewards Policy system complements this process by ensuring
that performance-related payment components are handled consistently throughout the Group.
The Merck Long-Term Incentive Plan offers eligible executives and experts a long-term, profit-
related compensation component. More information can be found in Note (32).
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