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The success of the Bayer Group is based on many

factors. Among the most important ʹ along with their
technical expertise ʹ is their employees͛ sense of
responsibility. Bayer is committed to conducting its
operations not only in compliance with law but also
according to ethical principles as their success is also
very much the result of their values, which they are
constantly working to reinforce and communicate to
our employees, shareholders and clients.

The Code of Business Conduct applicable to all

employees of the Company was approved by the Board
at its meeting held on 24th April, 2005 and was
disseminated to all employees.

   
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Bayer͛s quest for competitive excellence consists of their commitment to lawful and ethical conduct and
adhering to Bayer͛s values. Integrity, honesty and respect for people remain some of their core values.
The company is committed to provide a safe and conducive work environment, free of sexual
harassment, to its employees and expects them to combine ͞Expertise with Responsibility͟. The Bayer
Prevention of Sexual Harassment Policy has been formed to prohibit, prevent or deter the commission
of acts of sexual harassment at workplace and to provide the procedure for redressal of complaints
pertaining to sexual harassment.

A three member Complaints Committee, headed by a woman (Shirin v. Balsara, General Counsel &
Secretarial)

Has been constituted; and to prevent the possibility of any undue pressure or influence from senior
levels, the Complaints Committee consists also of Ms. Bhawana Mishra, as an outside neutral
representative. Mr. K.S. Harish, Vice President ʹ Human Recourses is the third Committee member. No
matter has been referred to the company till date.

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Bayer aims to succeed in the competitive arena by being innovative, quality-driven, reliable and fair. This
means observing both company-specific and statutory regulations. The Corporate Compliance Policy
forms the basis for this. It draws attention to a number of principles that are of particular significance in
practice.

PRINCIPLES
Bayer respects applicable law, including international law, and requires its employees and business
partners to do likewise. This policy lists some of the main points that are of particular practical
relevance.

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Bayer is absolutely committed to the principle of fair competition and, in particular, to the strict
observance of antitrust law.


 
Corruption will not be tolerated.

! " # 

Bayer is conscious of its responsibility to protect health and the environment and ensure people͛s
safety.

$ %% &

The provisions of all national and international foreign trade laws must be observed.

'(   !%

Every employee is obligated to treat confidentially any internal information that could affect the price of
the company͛s stock.

!%)*%! 
An internal control system must provide for the proper documentation of key business processes.
Controls must be established to ensure that all transaction details relevant for accounting purposes are
fully and correctly captured.

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All employees are expected to behave in a friendly, objective, fair and respectful manner toward
colleagues and third parties. Discrimination or harassment of any kind will not be tolerated.

! 
 ! $%!$" $
Confidential company information must not be disclosed to any third party or made public. Employees
must treat the intellectual property rights of other entities with the same respect.

*c% 
 
All employees must always keep their personal interests separate from those of the company. Personnel
decisions and business relationships with third parties must also be based solely on objective criteria.

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The Company endeavors to be cooperative in its dealings with all authorities and government agencies.
All information communicated to the authorities must be correct and complete and be provided in an
open, timely and understandable manner.
IMPLEMENTATION

The company provides employees with access to all the necessary information resources and counsel to
prevent violations of the law or company regulations.

Every supervisor must organize his or her area of responsibility so as to ensure adherence to company
rules and applicable law and thus to the Corporate Compliance Policy.

The holding company, subgroups, service companies and country organizations appoint Compliance
Officers, whose responsibilities include providing advice and training on compliance issues and
investigating any alleged compliance violations.

All employees are required to immediately report any violations of the Corporate Compliance Policy.

Corporate Auditing will review the effectiveness of the Corporate Compliance Policy at regular intervals.

-
. -

The Give program is Bayer Australia and New Zealand͛s community investment program, aligned to the
Bayer Mission Statement: ͞Bayer: Science for a Better Life͟. It allows Bayer as a corporate entity to
make a positive impact in the areas in which we operate and helps to fulfil our role as a socially
responsible corporate citizen. Bayer believes it has a responsibility to work hand in hand with the
community as part of our company goal to ͞benefit people and improve their quality of life͟.

Give provides a tangible way for employees to live some of Bayer͛s core values such as ͚respect for
people and nature͛ and ͚sustainability of our actions͛. It also supports our employees in the community
and charity activities that they embrace outside of work. This reinforces our philosophy towards
providing more than just a ͚job͛ for our staff. We aim to increase their work-life balance, bolster pride in
working for Bayer and look at new opportunities to broaden their horizons and their skills.

Bayer provides all employees with one day's paid leave per year for
volunteeringj
Bayer matches funds raised by employees dollar for dollar up to a
certain limit therefore doubling the total that goes to charity.
Typical staff fundraising activities include morning teas,
competitions, fun runs or themed dress days.

Bayer offers a pre-tax payroll giving scheme making donations easy and tax
effective. Bayer matches these donations dollar for dollar (limits apply).

Bayer provides grants to facilitate community activities for employees and

their families. Grants are allocated based on set guidelines and must
demonstrate benefit to the local community.

Overarching the Give program is the partnerships with Mission Australia and
Aussie Helpers. In addition Bayer partners with a number of organisations in the
areas of environment, science education, human and animal health and culture.
Click here for more information on Bayer͛s partnerships.

*
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Some 40 years ago in Elkhart, Indiana, ã
  ã
  

ãã was born when Bayer
volunteers reached out to their community schools to help teachers teach and students learn science
the way scientists do ʹ by doing it. Today, Bayer sites in 12 locations across the country operate local
ãã programs, exposing their communities͛ children to hands-on, inquiry-based science on a regular
basis.

Each local ãã program is tailored specifically to a community͛s science education needs and is
developed in partnership with local schools and school districts, parent groups, civic/community
organizations and other area businesses.

Supporting all these efforts is Bayer͛s national volunteer corps of more than 1,000 employees.

Making Science Make Sense has garnered numerous accolades and recognitions for Bayer, including
three U.S. presidential awards.

- Ron Brown Award for Corporate Leadership

- President͛s Service Award
- The Presidential Award in Science, Mathematics and Engineering Mentoring
- National Science Board's Public Service Award
- Keystone Centre͛s Leadership in Education Award
- The Conference Board͛s Best in Class Award
- North Carolina Governor͛s Business Partnership Award
- Wildlife Habitat Council͛s Corporate Lands for Learning Award
- Carnegie Science Centre͛s Chairman͛s Award
- Berkeley Public Education Foundation Business Partner of the Year Award
- Northern California Association for Women in Science Award
- Texas Board of Education͛s Heroes for Children Award
- South Carolina State Board of Education͛s Business Award for Volunteer Efforts

, !!, 

As a science and research based company with major businesses in health care, nutrition and innovative
materials, Bayer has a strong stake in helping to improve science education and to ensure that all
individuals are scientifically literate.

The Making Science Make Sense (MSMS) program is an initiative that advances science literacy among
students through hands-on, inquiry-based science learning. The students need to learn science the way
scientists do - by doing it! The aim of this program is to make the process of studying science interesting
and more exciting for children.
In India, MSMS was launched in 2007. The program was conducted for class 5 and 6 in four leading
schools in Mumbai. It is in class 5 and 6 that students get introduced to science as a full-fledged subject
of study.


Bayer reached out to over 1000 students and the program culminated in an inter- school quiz
competition, ͞Battle MSMS͟, that saw overwhelming participation.

In 2008, Bayer India will advance ͚Making Science Make Sense͛ to another four schools and reach out to
around 2000 students. The target group remains the same - students of class 5 and 6.

The program includes live demonstrations, experiments and interactive sessions. Audio - visual tools are
used to enhance the learning experience. Additionally, the program also covers sessions on
͚Environmental Science͛. The Animal Health division of Bayer HealthCare will conduct sessions on ͚Pet
Care͛ as a part of the extended module.

/ ã
ã
 


$!!
(Approximately 200 students from 10 city schools battle it out in a fiercely contested science challenge
in Mumbai)

#0 12034145 Bayer͛s school education initiative, Making Science Make Sense (MSMS) 2009-
2010, was brought to a conclusion at:

- K. J Somaiya Institute of Management Studies

- Billabong High International School ʹ Thane
- Rustomjee Cambridge International School
- Smt Sulochanadevi Singhania School ʹ Thane
- Bombay Scottish ʹ Powai
- Jamnabai Narsee School ʹ Vile Parle)

These schools were declared the proud winners of Battle MSMS.

Launched in India in 2007, Making Science Make Sense was conducted for class five & six of four leading
schools in Mumbai as it is in these years that students get introduced to science as a full- fledged subject
of studies. The basic premise behind this programme is to make science learning fun for children, so that
right from an early age, they enjoy and appreciate the subject and are encouraged to pursue it in their
higher studies. As a science and research based company with major businesses in health care, nutrition
and innovative materials, Bayer has a strong stake in helping to improve science education and to
ensure that all individuals are scientifically literate. This is also in line with the company͛s mission
statement ͞Bayer: Science for a Better Life.͟

A part of the company͛s CSR activities, the MSMS program aims to enthral students by giving them an
opportunity to approach science through hands-on inquiry-based experiments and demonstrations. The
initial phase of the activity, conducted during school hours, engaged the Class V and VI students in
various demonstrations and experiments. For example, activities included the functioning of hydraulic
bridges, air zookas, finger prints, paper chromatography, water rockets, etc. The activities are chosen
keeping in mind the age and the science curriculum of the students. They cover scientific concepts which
are reiterated in the manual that accompanies each learning kit. The students feel like 'little scientists'
as they develop scientific projects all by themselves! They have a lot of fun experimenting and learning
even without realizing that they are being taught.
Over 2500 students benefited from the program for the academic year 2009 -2010, The schools covered
included Christ Church School - Byculla, , Bombay Scottish School - Mahim, , Maneckji Cooper Education
Trust School - Juhu, , D.A.V. Public School - Thane, , Bombay Cambridge Gurukul - Andheri, , Rustomjee
International School and R. N. Podar School ʹ Santacruz besides the ones mentioned above.

Bayer has partnered with Mexus Education Pvt. Ltd. for the Making Science Making Sense project.
Mexus, formerly known as Axiom Education, is a leading innovative education solutions provider for the
K-12 segment (kindergarten to 12th grade) that specializes in imparting tailor made solutions to schools
and corporate houses, towards scientific learning, keeping in mind educational technology as well as
curriculum development.

Founded originally 1995 in the United States, Bayer is today implementing Making Science Make Sense
activities in ten countries worldwide: the US, Colombia, France, India, Ireland, Italy, Japan, Singapore,
Taiwan, Denmark and the United Kingdom.

+14*

Staged in and around Newbury, the first Bayer Newbury 10K was run in summer 2008 and attracted
over 500 entries. The event serves the sport and general local community with a much needed inclusive
sporting event in the locality. As well as boosting visitors to the town centre, the event also supported,
and was organised by the Newbury Athletic Club, and raised thousands for Sail4Cancer, and numerous
other charities supported by individual runners.

The event now looks set to be a regular fixture in the Newbury sporting calendar.

New this year is chip timing. There will be cash prizes for the winners; trophies for the first team back,
first Bayer team and ͚best fancy dressed͛; and medals and ͞goody-bags͟ for all participants.

The entry fee is £10 for members of affiliated athletic/running clubs and £12 for non-members. There
will be no on-the-day entries.
                  
   

Money raised from the entry fee will go to Naomi House, a children and young people͛s hospice that
provides support to those with conditions that mean they are unlikely to live to become adults. The
charity provides care to families living in communities across the seven counties of Berkshire, Dorset,
Hampshire, Isle of Wight, Surrey, West Sussex and Wiltshire. Some of the entry fee will also be used by
the Newbury Athletic Club for sports equipment and development of its young athletes.
The Bayer Group worldwide has traditionally believed in the norm of corporate environmental
protection in every sphere. In line with this belief, Bayer initiated the Young Environmental Envoy
Programme in 1998. We launched the BYEEP in India in 2002.

The programme seeks to educate youth on the global effort to save and protect the environment, as we
appreciate the fact that in order to conserve our habitat, we need the cooperation and understanding of
young students.

Every year, two selected students represent India at Bayer AG, Leverkusen (Germany) along with their
counterparts from several other countries. This is a week long, all-expense-paid study tour sponsored by
Bayer, where students have an opportunity to experience how environmental protection is practiced by
the company, people and government in industrialized countries.

Students are required to send a write-up (not more than 1500 words) on their contribution in their
locality / college etc. for improving the environment along with practical examples on or before
September 15, 2008. The programme is open to all Indian students within the age group of 18-24 years
actively involved in a current or completed environmental project. Short-listed students will be called
for an interview, to gauge their knowledge and communication skills. Two selected students will make it
to Germany for an all expenses paid educational tour.

In keeping with its social commitment of environmental protection in every sphere the health care
company of the Bayer Group, has initiated the Young Environmental Envoy Programme (BYEEP).
Students interested in the programme have to write an intriguing article on ͚Environment Protection͛
and Bayer will sponsor a free educational trip to Germany to the winners.

The programme seeks to educate youth on the global effort to save and protect the environment as
Bayer appreciates the fact that in order to conserve the habitat, one needs the cooperation and
understanding of young students.

Bayer initiated the BYEEP program in 2002 in India to increase awareness and educate the youth on the
global effort to save and protect the environment. Every year students are selected to represent India at
a week-long program held in Germany.

.
    

Bayer's corporate vision to change the world with great care also defines our environmental vision. We
believe that taking into consideration and minimizing our environmental impact is an integral part of
every product, process or development we initiate.
Bayer is a member of the American Chemistry Council and is a full
participant in ACC's Responsible Care program, which promotes
safe operation and open dialogue with the community. Bayer
follows the Responsible Care codes of management practice as
the model for operating all of their units.

A major focus of Bayer͛s

activities in the field of
youth environmental
education was the week-
long Tunza International
Youth Conference
2007, the environment
summit of the United
Nations Environment
Programme (UNEP) for
young people that is
held every
two years
and was
attended this
time by 180
young
people from
85 countries.
Through its
partnership with UNEP,
Bayer AG became the first
private- sector company
to host the TUNZA conference. This was also the first time it had been held in Western Europe, the first
two conferences having taken place in Asia and Eastern Europe. At the beginning of the conference ʹ for
which the slogan was ͞Technology in Service of the Environment͟ ʹ Bayer and UNEP announced an
extension of their partnership for a further three years, accompanied by a Φ200,000 increase in Bayer͛s
annual contribution to Φ1.2 million. Bayer also supported UNEP by helping to organize regional
conferences in Asia, Latin America and Africa.

Another element of the collaboration between UNEP and Bayer in 2007 was the organization in
Bangkok, Thailand, of ͞Eco-Minds 2007.͟ This science symposium was dedicated to the topic of
protecting freshwater supplies. Turkey was recently added to the ͞Young Environmental Envoy͟
program, which means 17 countries now send delegates on a week-long study trip to Germany at
Bayer͛s invitation once a year. Climate change was the subject of this year͛s eastern European photo
competition established by Bayer and entitled ͞Ecology in Focus,͟ and also of the International
Children͛s Painting Competition on the Environment, in which around 13,500 children from 104
countries took part.

At the beginning of 2007, UNEP launched its ͞Plant for the Planet: Billion Tree Campaign,͟ which aimed
to persuade organizations and individuals throughout the world to plant a billion trees during the course
of the year to combat climate change. Bayer gave wholehearted support to this campaign, arranging for
100,000 trees to be planted at UNEP headquarters in Nairobi. Each of the delegates at the TUNZA
conference symbolically planted a tree, and some two dozen Bayer companies around the globe joined
in this statement of ecological solidarity. The Bayer Group contributed significantly to the success of the
unique campaign by planting some 300,000 trees in all


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The Bayer Science & Education Foundation supports people who show particular dedication and can
claim outstanding achievements in their field ʹ including and particularly when they are just starting out
in a scientific career. The spectrum of sponsored activities ranges from support for school projects
through scholarships for schoolchildren, young trainees with a non-academic background and students
to honors for renowned scientists. The foundation focuses on natural science, technology and medicine.

Within the scope of the !$   , the foundation supports school projects that make
science and technology instruction better and more innovative and attractive through additional course
offerings.

The  &$ provides scholarships that enable scientifically ambitious young
students, committed young people in the non-academic sector and schoolchildren to realize individual
study plans and projects abroad. Some of these scholarships
are as follows:

1.Bayer Scholarships for students specializing in selected

areas of science and engineering.

2. Carl Duisberg Scholarships for students specializing in

human medicine und veterinary medicine.

3. Kurt Hansen Scholarships for students aiming to become

science teachers.

4. lHermann Strenger Scholarships for young people with a non-academic background.

 5. Bayer School Scholarships to support particularly ambitious students.

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 .

Hunger and poverty are the most urgent problems in many parts of the world. Bayer helps to address
these issues, in part through a commitment to sustainable agriculture. One example of support for
projects initiated by the governments themselves in countries affected by these social problems is
the 787 program in Brazil. Poverty is the most common reason for child labour, which is still
widespread in many regions of the world. Bayer actively supports the #( % for the
Protection of Children's Rights.

The global challenges of our time include access to clean water. Together with National Geographic,
Bayer has established the 7- # 9 %7 in order to promote innovative research into the
conservation of drinking water.


Health and basic medical care are among the fundamental needs of humanity. Bayer cooperates closely
with the World Health Organization (WHO) in the fight against epidemics such as African sleeping
sickness and Chagas' disease.

Together with the U.S.-based non-profit organization The Global Alliance for TB Drug Development (TB
Alliance), we are working to develop a new anti-tuberculosis drug aimed at shortening the current
duration of treatment. Bayer is also particularly committed to the fight against the two other biggest
epidemics of the modern age: HIV/AIDS and malaria.


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Self-determined family planning is still a taboo subject in many developing and emerging countries.
Many women have unplanned pregnancies, often at a very young age. According to the World Health
Organization (WHO), 1,500 women die every day as a result of complications during pregnancy and
childbirth. 10,000 children worldwide die every day during their first few months of life, 99 percent of
them in developing countries. As part of its Sustainability Program, Bayer intends its lighthouse project
"Family Planning" to make a substantial contribution to helping women to plan their lives themselves. A
fundamental aspect of family planning is access to contraceptives. Working with partners such as the
United Nations Population Fund (UNFPA) and the International Planned Parenthood Federation (IPPF),
Bayer hopes that the provision of more health information and education will reduce the risks
associated with unplanned pregnancies and unsafe termination of pregnancy.

9%!

According to WHO statistics, around 16 million children are born every year to mothers WHO are
between 15 and 19 years of age. More than 90 percent of these mothers live in developing or emerging
countries. In these countries, there is very often a lack of knowledge on sexuality and contraception
methods and the topic is frequently seen as taboo. Yet knowledge, education and explanation are vital
elements in empowering women to determine their own lives and make their own family planning
decisions. Bayer HealthCare͛s family planning program therefore also pursues another approach they
support comprehensive sex education. This includes the topic of HIV/AIDS, particularly in Africa. Our
goal is to help children and adolescents to make a conscious decision to use contraception and to stop
the spread of sexually transmitted diseasesj

Bayer is participating in a project organized by the German Foundation for World Population (DSW),
which runs sexual and reproductive health education programs in developing countries. The programs
encourage young people to pass on their knowledge to their peers.

Bayer HealthCare is involved in a further project which aims to increase awareness of the wide range of
contraceptives available and to provide information on long-term contraception and sterilization. The
RESPOND project (Responding to the Need for Family Planning through Expanded Contraceptive Choices
and Program Services) launched by the non-governmental organization Engender Health in June 2009 is
receiving support from Bayer HealthCare in the form of training material. It provides information on
long-term contraception and sterilization for developing countries.

('%""!'!

Climate change is expected to hasten the spread of tropical diseases such as malaria and dengue fever
into regions which have not been affected by these parasites in the past. Researchers at Bayer Crop
Science were the first to find a way of incorporating the active substance deltamethrin, which the WHO
recommends as protection against mosquitoes, into polypropylene fibers. The outcome of this work is a
new textile fiber which can be used to make impregnated mosquito nets which are softer, stronger and
stay effective for longer. The product, which goes by the brand name LifeNetΡ, is a long-lasting
insecticidal net (LLIN) which is scheduled to REACH the market in the next few years.