ALTANA

Innovation and Employees

Innovation
ALTANA’s products and services are geared to offering our customers special solutions and giving them a competitive edge. Our customers usually integrate us in their product development process at an early stage. To be able to maintain or consolidate our position as one of the leading specialty chemicals companies, we have to steadily grow our competencies and continuously expand our own product portfolio.

In the Group’s divisional research and development facilities, our product portfolio is steadily developed further. In addition to existing applications in current or new markets, activities to develop new applications for these markets are a focal point. To be able to tap into new fields of business, we identify the needs of our customers and incorporate them in the development of new solutions.

To interlink the Group’s diversified knowhow and competencies across industries and technologies, selected research and development projects are initiated and coordinated centrally at the Group level. Via external networks and close cooperation with universities and research institutes, external impetus is absorbed and the possibility of using it in the Group is examined. In the 2017 fiscal year, we intensified these activities. A special focus was on the action field “digitization.” We launched our first projects in this area, which invest in the digitization of processes along the entire value chain, as well as automated application-technology reviews that supplement and support research and development. In addition, we strengthened our company in a targeted manner through new competencies in the fields of software development and data analysis, both by hiring new employees and with acquisitions.

In 2017, ALTANA pushed ahead its entry into new sales markets by acquiring innovative technologies in the field of printing as well as labels and packaging in order to generate growth potential and expand its product portfolio in the future. ALTANA intends to develop these activities to marketability in the coming years.

Examples of undertakings that were pushed forward centrally via ALTANA’s holding company in 2017 were projects in the field of printed electronics and the strategic digital printing partnership with the Israeli Landa Corp. In closer cooperation with the new central department Corporate Venturing, technology and market potential will be examined and entry into new attractive sales markets developed. In the next few years, our divisions should benefit from this wideranging development potential in different ways.

The basis of our innovative strength is a worldwide research and development network encompassing 1,102 employees at present. In the year under review, expenses for research and development activities amounted to € 142.5 million (previous year: € 129.3 million). The continued high share of research and development expenses in sales of 6.3 % (previous year: 6.2 %) is yet another expression of our innovation focus.

Employees
In the course of 2017, the number of people employed by the ALTANA Group climbed by 219, or 4 %, to 6,186 (previous year: 5,967). The increase was primarily due to acquisitions made in 2017 (+ 111 employees) and the expansion of business activities.

In the BYK division, the number of employees rose by 145 to 2,200 people (previous year: 2,055). The PolyAd companies in Germany and the U.S. acquired at the beginning of 2017 accounted for a significant share of the increase. In addition, the division’s workforce grew against the background of the expansion of its additives business in Germany, the U.S., and China.

The number of employees in the ECKART division decreased by 32 to 1,716 people in 2017 (previous year: 1,748) due to company restructuring initiated in 2015. The reduction primarily concerned the German sites in Hartenstein and Wackersdorf. The division dissolved its own sales organization in Mexico in 2017 and it was integrated into the BYK division. Most of the employees switched to the corresponding BYK company.

In the course of 2017, the workforce of the ELANTAS division increased by 85 to a total of 1,061 people (previous year: 976). The acquisitions made in the U.S. in the course of the year accounted for the main share of the increase. The number of employees in Germany also increased due to the expansion of business activities.

ACTEGA’s headcount rose by 13 employees to 1,094 (previous year: 1,081). The main reason for this was the technology acquisitions in Germany and the U.S. made in the course of the year. However, ACTEGA reduced the personnel at its site in Brazil on account of restructuring measures.

The functional structure of the workforce did not alter significantly in 2017. With 52 %, or 3,198 people (previous year: 3,114), most of the employees continued to work in production. In 2017, the number of people employed in research and development rose by 81 to 1,102 (previous year: 1,021), accounting for the highest percentage increase.

The headcount in marketing and sales, as well as administration, increased by a total of 54 people in the course of 2017. In 2017, administrative functions continued to comprise the smallest share of the Group’s workforce, with 889 people working in this area (previous year: 873).

In 2017, all of the regions exhibited a positive increase in workforce numbers. In terms of the regional structure, there were no major shifts, among other things due to the acquisitions made in 2017. The European Group companies continued to employ by far the largest number of people worldwide, with a headcount of 3,927 (previous year: 3,850). At the end of the year, 3,196 people worked in Germany (previous year: 3,126), the majority of them at ECKART’s and BYK’s largest production and development sites, in Hartenstein and Wesel, respectively. The number of staff in the Americas increased the most, primarily on account of the acquisitions made in the U.S. The number of employees in the U.S. climbed from 1,376 to 1,477 at the end of 2017. The staff numbers in the Asian Group companies also increased, from 741 employees in the previous year to 782 in the year under review.

At the end of the 2017 fiscal year, 1,627 women and 4,559 men worked at ALTANA. On the balance-sheet date, 89 % of all employees had an unlimited employment contract and 11 % a limited employment contract. This ratio was the same for both genders. Of the women employees, 77 % worked full-time and 23 % part-time at the end of 2017. 98 % of the male employees worked full-time. Apart from its own employees, 239 people from employment agencies worked for the ALTANA Group on December 31, 2017.

ALTANA competes internationally for specialists and managers. Like all companies in the chemical industry, in the years to come the ALTANA Group, particularly in Europe, will enter a phase that due to the demographic development makes precise succession planning indispensable already today. To be able to hold our own in this environment, in 2017 we began to strategically reposition ALTANA’s human-resources activities in the project “HR Transformation.” The initial focus was on an evaluation of how ALTANA should reorient its personnel-related services and processes in the future and what a new organization should look like. The project was launched in 2017 with an analysis of the actual situation to ascertain future organizational needs. All measures introduced to strengthen ALTANA’s corporate culture and to further develop our human-resource management are carried out based on our Guiding Principles. By concentrating on the values that are enshrined in these principles and communicating them transparently, we ensure that our staff management and our actions have a common orientation.

Human-resource development is very important in ALTANA’s agenda for the future, the Keep Changing Agenda. “Mobilizing people” is one of the strategic thrusts for the coming years. This includes promoting diversity, effective succession planning, and strengthening international mobility. Since 2016, these requirements have been pursued by the ALTANA holding company’s Leadership & Talent Management department to ensure that structured succession planning can be implemented even more effectively in the future.

Declaration of Corporate Governance Pursuant to Section 289 f (4) of the German Commercial Code (HGB)
Promoting women in management positions remained a focus in the 2017 fiscal year. By intensifying measures that had been introduced in the past, and with new instruments, we further anchored the expansion of diversity in our humanresource management. One focus was promoting women. The ratio of women in ALTANA’s national and international management development programs has increased significantly in recent years. In addition, our further education program includes special offers for women. The mentoring program launched in the previous year as a pilot project was reissued and extended to other Group sites in 2017. Furthermore, various informal platforms were created to promote general dialog on this issue. Among them are regular meetings of women in management positions that focus on strengthening the network, and workshops for further development of family-friendly employment models intended to contribute to continual improvement of the general working conditions at ALTANA.

ALTANA’s medium- to long-term goal is to increase the share of women in management positions to the percentage of women in the entire workforce.

In keeping with legal requirements regarding equal participation of women in management positions in private business and the public service sector that went into effect in April 2015, ALTANA AG’s Supervisory Board specified in September 2015, in accordance with section 111 (5) of the German Stock Corporation Act, a target of a 25 % share of women in the company’s Supervisory Board before the first target-achievement period ended on June 30, 2017. For the Management Board, which was initially reorganized within the framework of the generation change and which has no women members, the Supervisory Board did not plan any changes regarding the specification of targets for the first target-achievement period. ALTANA’s Supervisory Board, comprised of six shareholder representatives and six employee representatives, had three women and nine men at the end of the target-achievement period. As expected, there were no changes in the gender-related makeup of the Management Board at the end of the target-achievement period.

In accordance with the legal specifications of section 76 (4) of the German Stock Corporation Act, the Management Board was required to define targets for the share of women at the two management levels below the Management Board of ALTANA AG. Until the end of the first target-achievement period on June 30, 2017, a target of 10 % for the first management level and 30 % for the second management level was resolved. At the end of the target-achievement period on June 30, 2017, the share of women in the first management level below the Management Board of ALTANA AG was 17 %. On the second management level, the share of women was 57 %. Thus, the targets set were exceeded significantly.

At the end of the first target-achievement period, new targets were established by the Supervisory Board and the Management Board of ALTANA AG. For the Supervisory Board, a target of 25 % was resolved by the end of the new target-achievement period on June 30, 2020. For the Management Board, neither personnel changes nor an expansion of the body are planned by the end of the new target-achievement period. As a result, it will continue to have no women members. For the first management level under the Management Board, a target of 20 % women is to be achieved by the end of the new target-achievement period on June 30, 2020, and for the second management the target is 30 %. Target figures were also stipulated for the German subsidiaries subject to codetermination.