S2 Workers in the Value Chain
The content of this section is not part of the statutory audit of the annual financial statements but has undergone a separate limited assurance by our auditor.
The content of this section is voluntary, unaudited information, which was critically read by the auditor.
ESRS-Kennzeichnung:
As an international company, we are active in a variety of different supply chains, businesses and companies, and have business relationships with partners around the world. This means we have links to a large number of people who contribute to our business activities. We accept the resulting obligations and opportunities along the value chain and strive for sustainable value creation. Together with our partners, we are working to uphold human rights as well as international labor and social standards and to minimize risks. Another important matter for us is socially just climate transformation.
ESRS-Kennzeichnung:
Good collaboration with our partners is closely linked to our business success. It is decisive for ensuring resilient, responsible supply chains and for the production of high-quality, safe and more sustainable solutions and products. We therefore attach considerable importance to the interests and viewpoints of workers in the value chain during our collaboration with our partners. We aim to minimize negative impacts on workers in the value chain through our engagement and to achieve a positive impact. By adopting our due diligence approach (see G1 Business Conduct) and establishing standards and initiatives in our work with our partners (see Actions), we advocate for the rights of the workers in our value chain and good and safe working conditions and promote worker training.
Our double materiality assessment indicates three material impacts on the workers in our upstream supply chain (see the following table)
Impact |
Evaluation |
Position in the value chain |
Description |
|---|---|---|---|
Increased health and occupational safety risks when handling chemical raw materials |
Negative, |
Upstream value chain |
In the production of chemical raw materials, there are increased health and safety risks in our upstream value chain, particularly if required safety measures are not complied with. This is a common problem primarily in countries whose national laws do not include any, or low requirements with respect to labor protection standards. |
Risk of child labor in specific supply chains |
Negative, |
Upstream value chain |
Child labor is a particular risk in critical and less transparent supply chains and in countries with little state control and low incomes. This applies, for example, to our upstream supply chains for renewable raw materials, minerals and seeds. Smallholder farms and artisanal mines are particularly affected. |
Risk of forced labor in specific supply chains |
Negative, potential |
Upstream value chain |
Sourcing minerals or renewable raw materials from countries with little state control may be associated with the risk of forced labor. Workers in regions with poverty and inequality are particularly affected. |
The impacts identified are a common issue primarily in countries whose national law has no or low requirements for labor protection standards and in which there is little state control and low incomes. All workers in our upstream supply chain were included in the double materiality assessment. This includes workers from joint venture partners as well as workers who work at our sites but are not part of our own workforce.
In line with the results of our double materiality assessment, we identified the following groups as being particularly exposed to the impacts of our business activities: mine workers in the battery value chain, workers in seed production, field workers and workers in chemical plants with high hazard potential. A lack of transparency regarding working conditions at subcontractors represents an increased risk in general. Our risk analysis focuses primarily on countries with high ESG risks such as China, India, Malaysia, Brazil or Thailand, with India demonstrating a particularly high risk of child labor. Further information on the inclusion of the interests and viewpoints of our stakeholders can be found in the General Disclosures chapter of the (Consolidated) Sustainability Statement.
We consider workers in our downstream value chain during our due diligence reviews of business partners (for more information, see G1 Business Conduct), but do not consider them to be a material target group in relation to impacts, risks and opportunities. We did not identify any material financial risks and opportunities for BASF in relation to workers in the value chain. We systematically record opportunities and risks as part of our general opportunity and risk management (for additional information, see Opportunities and Risks).
Strategy and Governance
ESRS-Kennzeichnung:
A core element of our sustainability strategy is to respect and protect the dignity, rights, health and safety of individuals, both within and outside our own workforce. We view sustainability topics as holistically as possible, including the aspects that have been identified as material – health and occupational safety as well as potential child and forced labor. We aim to act as a role model for responsible and safe behavior along our entire value chain, and to work together in a spirit of trust with partners such as suppliers, service providers, contractors, joint venture partners and customers. We adopt a holistic strategic approach that includes all workers in our supply chains; however, the focus in our reporting is on the upstream value chain, in line with the results of our materiality assessment.
General information on our overarching policies can be found in the General Disclosures chapter of the (Consolidated) Sustainability Statement. This includes, among others, the BASF Code of Conduct, the BASF Policy Statement on Human Rights, our risk-based sustainability management for procurement as part of our procurement requirement, the Supplier Code of Conduct and our principles for the responsible sourcing of renewable raw materials. The specific aspects of these policies are explained in the following section.
In addition, we have established a requirement for the responsible sourcing of battery materials for the upstream supply chain, which also covers the issues of child and forced labor. The requirement is globally binding for all employees of the Battery Materials division and can be accessed via the BASF intranet. Accountability lies with the Battery Materials division management. As part of the requirement, we are committed to the U.N. Guiding Principles on Business and Human Rights, the OECD Guidelines for Multinational Enterprises and Due Diligence Responsible Supply Chains of Minerals from conflict-affected and high-risk areas (CAHRAs). In order to monitor compliance with the requirement, Battery Materials reports once a year to the responsible member of the Board of Executive Directors as well as to the Corporate Compliance and Global Procurement units.
We are committed to complying with applicable laws and international standards (see G1 Business Conduct). We also expect our partners to comply with the law and with standards, including the regulations governing health and occupational safety as well as child and forced labor. Equally, we expect them to endeavor to enforce these standards at their own partners and take steps to ensure that they comply with this responsibility. We rely here on a systematic, integrated, risk-based approach and established monitoring and management systems.
For us, the implementation of supply chain-specific due diligence processes is a continuous and comprehensive task. We have embedded our responsibility for human rights and thus also for ensuring safe working standards and preventing potential child and forced labor in BASF’s Code of Conduct and Supplier Code of Conduct and have set it out in more detail in our Policy Statement on Human Rights. All employees and leaders bear responsibility for ensuring that we act in accordance with our Code of Conduct and Policy Statement on Human Rights.
- More information on the BASF Code of Conduct
- More information on the Supplier Code of Conduct
- More information on our Policy Statement on Human Rights
Human rights due diligence
Human rights is an important topic for us and this is reflected in our organizational structures. The head of our Legal and Compliance organization also acts as Chief Human Rights Officer and is responsible for monitoring overall risk management, including human rights risks under the German Supply Chain Due Diligence Act (LkSG). Our Compliance organization reports regularly to the Board of Executive Directors and the Audit Committee on this matter. In addition, we have integrated sustainability-related evaluations in our governance and decision-making processes, for example in relation to investment, acquisition and divestiture projects.
The governance of human rights due diligence at BASF also lies with the Compliance organization. In addition, several specialist units are responsible for steering specific human rights topics, including through our Human Rights Expert Working Group (for more information, see chapter G1 Business Conduct). Relevant aspects of human rights topics are also part of the global qualification guidelines for security personnel and are incorporated into the standard agreements with contractors.
We use our Human Rights Advisory Council to access additional external human rights expertise (for more information, see General Disclosures). At the meetings held in 2025, we exchanged views with experts for example on human rights issues in global supply chains, including the risks of forced labor and how to deal with dilemma situations, and discussed our responsibility in the context of due diligence.
Procurement guidelines
Our Procurement organization has set out guidelines for the upstream supply chain in a global, risk-based management system; these specify how we implement our due diligence processes. We have defined the standards for this in a global requirement. We continuously enhance our structures and processes so as to reflect changes in the framework conditions. Procurement requirements and targets are set centrally and are binding for all employees with procurement responsibility worldwide. We endeavor to ensure compliance with these guidelines using a multistage control process. In this process, minimum standards drawn up by the Corporate Center units are used to support and monitor the individual risk management systems of our business units during implementation. The Corporate Audit unit, as the third instance involved, verifies the effectiveness and compliance of the risk management.
We have set out our expectations of suppliers in the global Supplier Code of Conduct, which is based, among other things, on the Ten Principles of the UN Global Compact and the Responsible Care® initiative. Topics covered by the Code of Conduct include compliance with human rights, the exclusion of child and forced labor as well as human trafficking, safeguarding labor and social standards, as well as antidiscrimination and anticorruption guidelines. We regularly develop our Code further. It is available in the most relevant languages for our suppliers and integrated into electronic ordering systems and purchasing conditions across the Group.
We want to help shape the transformation toward climate neutrality in a socially just way (just transition). This is why we also focus closely on the processes used for sourcing renewable raw materials. In addition to positive environmental effects such as reducing greenhouse gas emissions, these can also have negative effects on social factors, depending on the raw materials. We take this into account in our risk analyses and have drawn up clear principles for the responsible sourcing of renewable raw materials (for information on the monitoring of compliance, see E4 Biodiversity and Ecosystems). These basic principles also refer to the ILO’s standards and its Declaration on Fundamental Principles and Rights at Work, which in turn include the topics of child and forced labor as well as occupational safety. At the same time, we seek dialog with our stakeholders to identify conflicting goals (see Renewable raw materials).
Actions
We are implementing concrete actions to mitigate negative impacts and risks and at the same time facilitate opportunities related to workers in the upstream value chain. These aim at promoting open dialog, evaluating and developing our suppliers, and improving conditions for their workers by taking preventive measures and through local initiatives. Our management processes come into effect in the event of specific incidents.
We rely primarily on the following actions:
Engagement with workers via dialog forums and advisory councils
Use of uniform global grievance mechanisms to channel the concerns and needs of workers in the value chain
Supplier ESG risk analysis
Risk-based evaluation of suppliers through online assessments (EcoVadis) or on-site audits, for example as part of the chemical industry’s Together for Sustainability (TfS) initiative
Implementation of corrective measures at suppliers
Support for suppliers in growing sustainability-related skills in the form of appropriate training
Engagement and grievance mechanisms
ESRS-Kennzeichnung:
We include the viewpoints of our partners and their workers in our decisions and actions via dialog forums and advisory councils with external experts, such as our Human Rights Advisory Council (for more information, see General Disclosures) and our Nature Advisory Council (for more information, see General Disclosures). In the Civil Society Forum, founded in 2024, we exchange ideas with representatives of the civil society and trade union spectrum (for more information, see General Disclosures). Topics including children’s rights and combating child labor in the seed business were most recently discussed in fall 2024.
Moreover, we also seek direct dialog with our suppliers. We use specific dialog formats in higher-risk business areas such as our seed business or in the procurement of castor oil. In addition, we gain insights into the perspectives of workers in the value chain through the continuous exchange in multistakeholder initiatives, such as Cobalt for Development (see also Mineral raw materials), the Global Battery Alliance (see also Mineral raw materials) or the Responsible Mica Initiative (see also Mineral raw materials). We also enter into dialog with relevant stakeholders through our involvement in other committees such as the sustainability network econsense, where we are the topic sponsor in the Human Rights & Value Creation cluster.
The relevant units such as Sustainability Relations and Corporate Compliance, as well as Global Procurement and the specialist units in our operating divisions are responsible for ensuring appropriate, regular dialog (for additional information on the allocation of responsibilities for the units within the Board of Executive Directors, see Management and Supervisory Boards).
We assess the effectiveness of our collaboration with workers in the value chain, for example in the course of our supplier evaluations and follow-up evaluations (see Evaluating and developing our suppliers). We also assess the progress made with our implemented actions, and with our initiatives and projects.
ESRS-Kennzeichnung:
We promote a culture in which critical issues and concerns can always be raised openly. For this purpose, we offer globally standardized grievance mechanisms at operational level. The key instrument is our Compliance Hotline. For more information on how the problems raised and addressed via this hotline are tracked and monitored, see G1 Business Conduct. The Compliance Hotline offers the opportunity to report concerns, risks and violations in BASF’s activities or in the value chain confidentially and also anonymously. This also includes potential concerns in relation to health and occupational safety as well as child and forced labor. In addition to BASF employees, the hotline is open to all external stakeholders, and especially workers in our supply chains.
Our grievance mechanism is set out in our Supplier Code of Conduct, which is made available to our partners and service providers via our electronic ordering system as part of our purchasing conditions.
Evaluating and developing our suppliers
ESRS-Kennzeichnung:
When selecting suppliers and evaluating supplier relationships, alongside economic criteria ESG standards are especially important. This means that selecting, evaluating and auditing suppliers are key elements of our sustainable supply chain and risk management, with the intention of ensuring that suppliers comply with the laws, regulations and standards in force, and especially with those relating to our material topics of potential child and forced labor as well as EHS standards. Due to the large number of suppliers, they are evaluated on the basis of risk. Here, we take both country and industry-specific risks and our ability to exert influence into account. Supplier evaluation is mainly performed as part of the TfS initiative, of which BASF is a founding member. TfS performs online assessments via the EcoVadis rating agency or conducts on-site audits using TfS-approved auditors. A total of 100 audits (2024: 118) with regard to sustainability standards were carried out at raw material supplier sites on our behalf in 2025. We received EcoVadis sustainability assessments for 257 suppliers with potential sustainability risks (2024: 328). We also take into account other certification systems and external audits, such as the Roundtable on Sustainable Palm Oil, when evaluating our suppliers. Depending on business requirements, we perform our own Responsible Care audits at selected contract manufacturers if material risks have been identified with respect to occupational safety, health and environmental protection. To prevent the risk of potential child labor, for example, we use targeted checks on suppliers in higher-risk countries, such as in our seed business supply chains in India.
Our employees in procurement are supported in this process by a dedicated procurement-specific sustainability team. This consists of a core team plus a supplementary sustainability network comprising employees from the regions and procurement clusters concerned. In addition, we have a global audit team that audits EHS topics at contract manufacturers.
We carefully analyze the results of our evaluations, which are summarized in audit reports or scorecards together with concrete plans for corrective actions, and document them in a central database. Where performance is inadequate, we contact the suppliers and request that they implement improvements. We review our suppliers’ progress according to a defined time frame based on the sustainability risk identified, or after three years at the latest. Over the past few years, we have identified some need for adjustment at our suppliers with respect to environmental, social and governance standards. Examples include deviations from health and occupational safety measures and labor law requirements. In follow-up evaluations performed in 2025, we identified improvements in these areas.
We support our suppliers in developing measures for improvement. The webinars held by TfS in various languages on sustainability and the implementation of corrective measures are an important part of supplier development. In 2025, these were attended by a total of 1,019 supplier employees (2024: 990). In addition, the TfS Academy online learning platform is aimed at procurement employees as well as suppliers. It covers the entire spectrum of ESG topics, including child and forced labor, as well as health and occupational safety. There are currently more than 300 courses available in eleven different languages. We also continued our cooperation with East China University of Science and Technology in Shanghai, China, in 2025. A total of 38 employees from 26 Chinese suppliers received further training on ESG topics including child and forced labor as well as health and occupational safety.
Preventive actions and local initiatives
The examples given below entail decentralized measures, projects and initiatives. They are not governed by a centrally managed action plan. Rather, they aim for continuous optimization and further development. This goes hand in hand with the BASF approach to sustainability steering (see General Disclosures).
We are aware of the challenges in specific supply chains. For example, in 2025, we continued our proactive engagement in our upstream supply chains, where we usually have no direct contractual relationships, less transparency and less influence. We are working together with partners and civil society and are active in cross-industry initiatives. Projects often start on the ground to build specific local expertise regarding sustainable and responsible supply chains. In addition to making environmental improvements, our particular objective is to promote social aspects such as safe working conditions, adequate wages, access to healthcare systems and opportunities for upskilling/reskilling. We discuss the appropriateness of measures on a case-by-case basis with relevant stakeholders such as NGOs and government representatives. We also discuss our plans in our external dialog forums, in the Human Rights Advisory Council and in the Nature Advisory Council. We measure the effectiveness of specific projects using progress reports on, and studies of, for example, developments in the areas of income and living conditions and the establishment of policy frameworks and regulations.
Seeds
In 2022, BASF, Syngenta and Arisa joined forces to set up a multistakeholder initiative in the vegetable seed business in India. Under the name Wage Improvements in Seed Hybrids (WISH), the initiative addresses combating child labor and paying fair wages in the vegetable seed sector in the Indian federal states of Karnataka and Maharashtra. The first phase of the project involved a survey of more than 4,100 households, in which roughly 6,900 children, 200 farmers, 400 workers and other stakeholders took part, identifying the focus topics for improving local conditions. In the second phase of the project, which has been running since 2023, the partners are now using a variety of instruments to address these areas. Examples include training and upskilling/reskilling, networking, stakeholder integration (since 2024), advocacy efforts at local and international level, digital documentation and the dissemination of best practices. The multistakeholder cooperation was further strengthened by the joining of three further partners from the vegetable seed sector in the fourth quarter of 2024. BASF, Syngenta and Arisa together with the new partners aim to maximize the positive impact of the project by also engaging in a dialog with other national and international companies in the seed business. In 2024 and 2025, external NGOs conducted more than 1,450 training courses and information sessions in 28 villages within the project area reaching more than 600 farmers; BASF was responsible for 211 seed production farms in 2025. The sessions involved more than 10,000 stakeholders from various interest groups in total, including around 3,400 workers. The aim of the project is to achieve tangible improvements with respect to increasing wages and avoiding child labor in the vegetable seed sector. By the end of 2025, average wages in the project area had already improved, depending on region and farm activity. An external research study also showed that the rate of children attending school in the project area’s regions rose by 8 to 16 percentage points, while the rate of children dropping out of school decreased by 2 to 4 percentage points. The initiative will continue for an initial six-month period in 2026.
Renewable raw materials
Palm oil, palm kernel oil and their derivatives are some of our most important renewable raw materials; these are described in detail under E4 Biodiversity and Ecosystems (see Policies regarding the sourcing of renewable raw materials and Actions regarding the sourcing of renewable raw materials). Based on our Supplier Code of Conduct, we have defined our expectations of suppliers in the palm-based value chain in an additional procurement policy (BASF Palm Sourcing Policy). This addresses not only the protection of forests and other natural ecosystems, but also traceability and environmental aspects, the protection of workers’ rights and the rights of Indigenous peoples as well as the inclusion of smallholder structures.
Another important raw material for BASF, albeit on a much smaller scale, is castor oil. We use castor oil to manufacture products such as plastics and ingredients for paints and coatings, as well as products for the cosmetics and pharmaceutical industries. We were a founding member of, and have been active since 2016 in the Sustainable Castor Initiative – Pragati, with the aim of establishing a certified sustainable supply chain for castor oil in India. As part of Pragati, smallholders receive training, which is based on a specially developed sustainability code, SuCCESS, on topics such as health, the safe use of crop protection products to minimize occupational safety risks, and cultivation methods.
Plants also form the basis of many other products in our portfolio for cosmetics. This applies, for example, to our biopolymers and bioactives. Through resource-conserving sourcing practices, we aim to preserve ecosystems and enable more sustainable management for the people whose livelihoods depend on them. For example, we have been combining economic, environmental and social aspects including improved, safe working conditions and access to medical care for several years now in our holistic procurement initiatives for Argan (Morocco), Rambutan and Galanga (both Vietnam). We have consolidated our bioactives activities in our Responsibly Active program.
Mineral raw materials
We have relationships with a large number of suppliers of mineral raw materials, which we use to manufacture products including automotive and process catalysts or battery materials for electromobility. We have implemented the EU’s Conflict Minerals Regulation, for example by carrying out a compliance check for the import of conflict minerals in our ordering system. The EU Conflict Minerals Regulation aims to combat the financing of armed conflicts and human rights violations such as child and forced labor. It also defines supply chain due diligence for tin, tantalum, tungsten and their ores as well as gold (3TG) imported into the EU from conflict-affected and high-risk areas (CAHRAs).
We also attach importance to certifications, such as the certificate of the London Bullion Market Association (LBMA) for gold, the certificate of the London Platinum and Palladium Market (LPPM) for platinum group metals, the certificate of the Initiative for Responsible Mining Assurance (IRMA) and the Responsible Minerals Assurance Process of the Responsible Minerals Initiative. Furthermore, BASF is committed to responsible and sustainable global supply chains for other mineral raw materials. These include cobalt, a key component in the production of battery materials. We have organized our cobalt supply chain according to established sustainability requirements such as the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals. Our goal is to not purchase cobalt from artisanal mines as long as responsible labor, social and environmental standards cannot be verified.
Together with BMW, Samsung SDI, Samsung Electronics, Volkswagen, Stihl and Deutsche Gesellschaft für Internationale Zusammenarbeit (German Corporation for International Cooperation, GIZ), we have been involved in the cross-industry initiative Cobalt for Development since 2018. It is intended to improve working and living conditions for artisanal miners in the Democratic Republic of Congo and to explore and implement opportunities for legalizing artisanal mining. To achieve this, the initiative offers programs such as training on important environmental, social and governance aspects of responsible mining practices. In the second phase, which started in the spring of 2023, mining cooperatives continued to receive training on topics such as occupational safety and environmental management. In addition to technical support in mapping and sampling the deposits, joint strategies were developed together with stakeholders from the Congolese government to create a legal basis for the miners to continue operating the mine. With the start of the third phase in spring 2025, we have committed ourselves to the initiative for another three years. The aims of the project have been updated with regard to the practical and legal implementation of the mining project with a cooperative in order to provide a sustainable operating basis for the project after completion of the third phase in spring 2028.
Also relevant in the context of battery materials is the Global Battery Alliance (GBA), which was cofounded by BASF in 2017. It has over 150 members and promotes dialog between businesses, governments and civil society. At the same time, the GBA develops means for steering a sustainable and responsible circular economy for batteries, with the aim of establishing this by 2030. It acts as the multistakeholder platform to develop widely accepted rules for comprehensive and standardized reporting of ESG topics. These include environmental protection, child and forced labor as well as human rights, among other things. The GBA’s regulations were tested in pilot projects in 2024, published as a beta version (version in the late development phase) in 2025 and are expected to be ready in time for the future battery passport, the digital identification document for batteries provisioned by the EU Batteries Regulation.
In addition, our Platinum Group Metals catalyst recycling business, which processes secondary Platinum, Palladium and Rhodium materials, adheres to the LPPM’s Responsible Sourcing Guidance. The requirements of the Guidance are mandatory for LPPM-approved refineries (Good Delivery Refiners) as well as for members of the LPPM accreditation lists (Sponge Accreditation Lists). The Guidance provides a framework for responsible sourcing by requiring audited due diligence processes and annual independent third-party reviews to mitigate risks of conflict-related sourcing. Its aim, aligned with the OECD Due Diligence Guidelines for Minerals from Conflict Regions and High-Risk Areas (CAHRAs), is to combat human rights violations, prevent conflicts and uphold anti-money laundering standards.
Another mineral raw material that BASF processes is mica.1 As a base for effect pigments, it is mainly used in the production of coatings and seed coatings. As an active member of the Responsible Mica Initiative (RMI), we advocate for the elimination of child labor and unacceptable working conditions, specifically in India’s mica supply chain. The initiative is focusing on labor standards, strengthening local communities and legal frameworks in the period up to the target year of 2030. As the RMI’s recent progress report shows, activities in the relevant regions of India have already led to improved income and living conditions. These include improved access to clean drinking water through the installation of pumps and filtration systems and improved access to healthcare through doctors’ visits in villages and enrollment in public health insurance plans.
Management of specific incidents
If we learn of irregularities or violations in the course of our audits or from other sources such as media reports or our Compliance Hotline, we take them very seriously, react immediately and require our partners and suppliers to implement corrective measures without undue delay and to stop the violations. In the case of serious violations of the standards defined in our Supplier Code of Conduct or of international principles, such as intolerable working conditions or child or forced labor, we reserve the right to impose commercial sanctions. These can go as far as termination of the business relationship. The same applies to failure to correct violations, or for displaying systematic violations of these standards. In 2025, we made the decision to terminate one direct business relationship, effective March 1, 2026.2 We are in close contact with our suppliers, especially in higher-risk areas and regions, and monitor the implementation of relevant standards and required measures for improvement. Effective April 21, 2025, BASF has sold its shares in the joint venture companies BASF Markor Chemical Manufacturing (Xinjiang) Co., Ltd. and Markor Meiou Chemical (Xinjiang) Co., Ltd. in Korla, in the northwestern Chinese province of Xinjiang, to Verde Chemical Singapore Pte. Ltd.
In addition, action plans have meanwhile been developed and implemented for cases of infringements of the German Supply Chain Due Diligence Act (LkSG) that were identified in 2024. In the 2025 reporting year, infringements were identified and are currently being processed.
1 Mica is defined as a group of minerals from the phyllosilicates with the same atomic structure. In colloquial language, mica minerals are referred to as “glimmer.”
2 We consider all direct suppliers of the BASF Group in the business year concerned to be Tier 1 suppliers. These are suppliers that provide us with raw materials, investment goods, consumables and services. Suppliers can be natural persons, companies or legal persons under public law.
Global Targets
ESRS-Kennzeichnung:
Our global corporate target of responsible procurement (for additional information, see Our Targets and Target Achievement 2025) aims to holistically improve our suppliers’ sustainability performance: It covers both comprehensive sustainability matters and the matters of health and occupational safety as well as potential child or forced labor that are material for the Workers in the Value Chain topic. BASF has not set itself a specific target for the Workers in the Value Chain topic.
We want to drive sustainability in the supply chain in a targeted manner and are therefore focusing on suppliers with an increased sustainability risk: For the time horizon up to 2030, BASF is concentrating on improving the sustainability performance of those suppliers who achieved inadequate results in evaluations. We are striving toward ensuring that annually, 80% of suppliers who underwent a sustainability evaluation during the reporting period, and who had inadequate results in a prior comparable evaluation, improve their sustainability performance. An improvement could result, for example, from a positive development of the EcoVadis score or successful implementation of corrective measures confirmed in a follow-up audit. In 2025, the figure was 77% (2024: 76%). In order to achieve our target level of 80% annually by 2030, we began establishing a tracking process involving specialists from the Compliance organization in 2024. They contact suppliers with inadequate results and monitor the implementation of corrective measures.
For us, a supplier evaluation is valid for three years. We then carry out a new internal classification by means of a risk assessment and derive appropriate follow-up measures based on this. The global target is anchored in the objectives of our employees with purchasing responsibility.
As a matter of principle, we strive to prevent child and forced labor, negative impacts on occupational safety and health protection as well as impacts on other sustainability-related topics. These expectations are set out globally in our Supplier Code of Conduct and are audited via multistage, risk-based monitoring systems. We are steering toward a situation where our suppliers comply with the requirements set out in the Supplier Code of Conduct. We take action if we become aware of severe violations in the areas of health and occupational safety or child or forced labor. We contact the suppliers concerned, offer them training and explicitly request that they implement corrective measures within a defined time frame. We systematically track implementation, as we aim to achieve improvements in these areas. If we find that infringements have not been remedied or minimized, we can impose commercial sanctions or terminate the contracts concerned.
The expectations of our stakeholders are continuously taken into account when setting potential targets. We ensure that this is the case through regular meetings with external stakeholders, which are held as part of our strategic stakeholder engagement, as well as in meetings with investors (see General Disclosures), in which we discuss the sustainability topics that are material for BASF.
