MORPHOSYS AG 2021
Non-financial Report
Our Sustainability Approach | Business Ethics and Compliance | Social Matters | Employee Matters | Additional Information | 2 | |||
Contents
Contents | 01 | 02 | 03 |
Chapter | Chapter | Chapter |
Our
Sustainability Approach ----------- 03
About This Non-Financial
Group Report ---------------------------03 Our Understanding of Sustainability - ----03 Our Business Model----------------------03 Non-Financial Risk Analysis -------------03
Statement on the Impact of the Global COVID-19 Pandemic - ------------------- 04
Materiality Analysis --------------------- 04
EU Taxonomy Regulation-----------------05
Business Ethics
and Compliance --------------------- 07
Compliance Organization
and Anti-Corruption-------------------- 08 Bioethics in Preclinical Research --------- 10 Bioethics in Clinical Development ------- 1 1 Selling Practices and Labeling ----------- 12
Social Matters ----------------------- 13 Employee Matters ------------------ 18
Quality of Products --------------------- 14 | Employer Attractiveness ---------------- 19 |
Access to Medicine --------------------- 15 | Diversity and Equal Opportunities -------- 20 |
Innovation in Research | Employee Engagement------------------ 21 |
and Development (R&D)----------------- 16 | Occupational Health |
Data Protection - ----------------------- 16 | and Safety (OHS) ----------------------- 23 |
Additional Information ------------- 25
Independent Practitioners'
Limited Assurance Report ---------------25
Imprint - -------------------------------27
Our Sustainability Approach | Business Ethics and Compliance | Social Matters | Employee Matters | Additional Information | 3 | ||||
About This Non-Financial Group Report | Our Understanding of Sustainability | Our Business Model | Non-Financial Risk Analysis | ||||||
Our Sustainability Approach
About This Non-Financial Group Report
With the following separate non-financial report, MorphoSys AG provides information pursuant to Section 315b and Section 289b ff. HGB (German Commercial Code) on material non- financial aspects for the Group's fiscal year 2021 (January 1, 2021 to December 31, 2021) and thus on those aspects relevant for an understanding of the Group's business development,
results of operations and group management as well as the effects of its business activities and pursuant to Article 8 of Regulation (EU) 2020/852 of the European Parliament and of the Council of June 18, 2020 on establishing a framework to facilitate sustainable investment and amending Regulation (EU) 2019/2088 (hereinafter the "EU Taxonomy").
The requirements of the CSR Directive Implementation Act (CSR-RUG) were taken into account in the preparation of the non-financial report. In particular, the analysis of the material aspects as well as the description of the concepts were additionally oriented on the Global Reporting Initiative (GRI) stand- ards. A full application of the GRI standard is too extensive for the MorphoSys Group at the current time and therefore not expedient.
Unless otherwise stated, the report applies to the entire MorphoSys Group according to the scope of consolidation for financial reporting purposes. In July 2021, we completed the acquisition of Constellation Pharmaceuticals Inc. (hereinafter "Constellation Phar- maceuticals"). The transaction added two clinical-stage cancer drug candidates, that complement and enhance MorphoSys' own proprietary pipeline. Constellation Pharmaceuticals is therefore also in the scope of this report, and statements relating only to Constellation Pharmaceuticals are shown accordingly.
PricewaterhouseCoopers GmbH Wirtschaftsprüfungsgesellschaft (PwC) has been engaged on a voluntary basis to perform a limited assurance on the non-financial report in accordance with ISAE 3000 (Revised). The report can be found
References made in this non-financial report to information outside of the Annual Report are additional information and are therefore not part of the assurance engagement.
Our Understanding of Sustainability
We are conscious of the responsibility we share for present and future generations and see sustainable action as a prerequisite for long-term business success. MorphoSys is dedicated to the discovery, development and commercialization of outstanding, innovative therapies for patients, with a focus on cancer and autoimmune diseases. To ensure sustainable business success, we incorporate Environmental, Social and Governance (ESG) into our daily business and base our business model on sustainable growth that is aligned with the interests of stakehold- ers. We are focused on creating long-term value and weigh our actions in terms of their impact on the environment, society, patients and employees.
Our Business Model
Information on our business model can be found in the 2021 Annual Report ›› on page 9.
Non-Financial Risk Analysis
According to the CSR-RUG on the disclosure of non-financialinformation, companies must, in addition to reporting on material aspects, also disclose related risks that are linked to their own business activities, business relationships, products and services, and that are very likely to have or will have serious negative effects on the material aspects according to Section 289c (2) HGB. The Group has not identified any such risks in the financial year under review on a net basis in accordance with Section 289c (3) Nos. 3 and 4 HGB. Further information on opportunities and risks can be found in the Risk and Opportunity Report section of the 2021 Annual Report ›› on page 61.
Our Sustainability Approach | Business Ethics and Compliance | Social Matters | Employee Matters | Additional Information | 4 | ||||
Statement on the Impact of the Global COVID-19 Pandemic | Materiality Analysis | ||||||||
Statement on the Impact of the Global COVID-19 Pandemic
MorphoSys recognizes the impact of the global COVID-19 pandemic on healthcare systems and society worldwide, as well as the resulting potential impact on preclinical and clinical pro-
The following three topics have been identified as most rele- vant: business ethics and compliance, social matters, and employee matters with the respective subcategories.
grams, especially clinical trials. Measures to mitigate the impact of the pandemic on MorphoSys' employees and patients were implemented immediately. We continuously monitored the situation and took appropriate decisions on a case-by-case basis to ensure the safety of our employees, patients, clinical trial personnel and other stakeholders, as well as to safeguard data integrity.
Materiality Analysis
Social Matters
02
Materiality scoring on impact and business relevance for identified material aspects per topic
- • • • highest score among material aspects of the respective topic, descending by points
More detailed information on mitigation measures and efforts to ensure normal business operations in the different areas can be found in the respective paragraphs of this report.
Materiality Analysis
The report presents the material non-financial aspects that have been determined according to their business relevance and the Group's impact on the aspects according to Section 289c (3). The analysis was based on a business analysis and involved the responsible departments as well as MorphoSys' Executive Committee in 2020.
In 2021 we reviewed the analysis of all identified non-financial aspects of sustainability at MorphoSys. A yearly review is necessary to consider all current developments in selecting the most material topics for our non-financial report and to adjust the priorities as necessary. The validation has been done by internal experts and two members of our Management Board, and we have made an adjustment of the material topics accordingly.
• • • • | Quality of Products | ||
• • • • | Access to Medicine | ||
• • • • | Innovation in Research and | ||
Development (R&D) | |||
Business Ethics and Compliance | • • • | Data Protection | Employee Matters |
01 | 03 |
- • • • Compliance Organization and Anti-Corruption
• • • • | Selling Practices and | • • • • | Employer Attractiveness | |
Labeling | • • • | Employee Engagement | ||
• • • | Bioethics in Preclinical | • • • | Occupational Health | |
Research | and Safety (OHS) | |||
• • • | Bioethics in Clinical | Material non-financial | • • | Diversity and Equal |
Development | Opportunities | |||
aspects at MorphoSys | ||||
Our Sustainability Approach | Business Ethics and Compliance | Social Matters | Employee Matters | Additional Information | 5 | |||
EU Taxonomy Regulation
EU Taxonomy Regulation
Background and objectives of the regulation
On June 22, 2020, the EU Taxonomy Regulation was published in the Official Journal of the European Union (EU) which entered into force on July 12, 2020. The basis for this is the Sustainable Finance Action Plan, which is one of the four pillars of the European Green Deal. To achieve the climate and energy targets 2050 of the EU it is necessary to redirect capital flows towards a more sustainable economy.
apply to our business activities based on the NACE (nomen clature statistique des activités économiques dans la Commu- nauté) codes. As the business model of MorphoSys is to dis- cover, develop and deliver innovative medicines for patients impacted by cancer and autoimmune diseases, we have not identified any EU Taxonomy-eligible economic activities. MorphoSys is therefore not covered by the Climate Delegated Act and not identified as a relevant source of greenhouse gas emissions.
Accounting Policy
Reconciliation
Our consolidated turnover can be reconciled to our consoli-
dated statement of profit and loss (IFRS) onof our Annual Report 2021 ("Revenues").
Capital Expenditure (CapEx) K PI
Definition
The CapEx KPI is defined as Taxonomy-eligible CapEx (numer- ator) divided by our total CapEx (denominator).
The EU Taxonomy is a classification system for environmentally sustainable economic activities. The intention is to create greater transparency with regard to the degree of sustainability of corporate activities, investments and operating expendi- tures.
Initial reporting for fiscal year 2021
According to Art. 8 EU Taxonomy Regulation and Art. 10 of the Art. 8 Delegated Act, all companies covered by the CSR-RUG must also provide information on the share of their group turn over, capital expenditure (CapEx) and operating expenditure (OpEx) for the reporting period 2021, which are associated with Taxonomy-eligible economic activities related to the first two environmental objectives (climate change mitigation and climate change adaptation). As the CSR-RUG applies to MorphoSys, we provide information on the EU taxonomy within our non-financial report.
Basis of reporting
Identification of Taxonomy-eligible activities
The first step for the implementation of the EU Taxonomy for MorphoSys was the identification of the activities that could
The specification of the KPI´s is determined in accordance with Annex 1 of Art. 8 Delegated Act. We determine the Taxonomy- eligible KPI´s in accordance with the legal requirements. In the following section we describe the accounting policy for turn over, Capital Expenditure and Operating Expenditure.
Turnover K PI
Definition
The turnover KPI is defined as Taxonomy-eligible turnover from product sales, license fees, milestone payments, service fees and royalties (numerator) divided by our total group turnover (denominator).
For further details on our accounting policies regarding our total turnover, please see ›› page 119 of our Annual Report 2021.
As we have not identified any Taxonomy-eligible activities for the financial year 2021, this results in a share of Taxonomy- eligible economic activities in our total turnover of 0%.
The denominator comprises additions to property, plant and equipment and intangible assets during the financial year under review before depreciation, amortization and re-measure- ments, including those resulting from revaluations and impairments as well as excluding changes in fair value. It includes additions to fixed assets (IAS 16), intangible assets (IAS 38) and right-of-use assets (IFRS 16). Additions resulting from business combinations are also included. Goodwill is not included in CapEx as it is not defined as an intangible asset under IAS 38. As we report the numerator as zero, there is no risk of double counting of economic activities.
For further details on our accounting policies regarding our CapEx, please see ›› page 128 and 129 of our Annual Report 2021.
Reconciliation
Our total CapEx can be reconciled to our consolidated balance sheet (IFRS) ›› on page 105 of our Annual Report 2021 ("Prop- erty, Plant and Equipment", "Intangible Assets"); to our notes to the balance sheet ›› on page 128 ("5.8 Property, Plant and Equipment - Additions"), ›› on page 128 ("5.9 Leases-Additions") and
("Intangible Assets-Additions").
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MorphoSys AG published this content on 15 March 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 17 March 2022 13:30:04 UTC.
