Non-Financial Statement

Our approach to sustainability

For QIAGEN, sustainability means long-term economic success combined with respect for the natural environment and healthy, high-performance workplaces, with the aim to make improvements in life possible as a good corporate citizen.

Our commitment to sustainability goes beyond formal regulations. As a market and innovation leader in life sciences and molecular diagnostics, we believe there is room for innovation in driving sustainable development in our industry, and we are resolved to continue moving forward.

To achieve this, QIAGEN has integrated sustainability throughout its value chain. We pledge to continually evaluate the potential environmental impact of our business, saving energy and reducing negative environmental impacts of our operations. We look after the welfare of our employees, taking care of their developmental needs and supporting them in every way to become and remain committed and responsible. We extend our commitment to sustainability into the supply chain, committing our business partners to sign up to our environmental, social and human-rights related standards.

We recognize that ongoing success for QIAGEN also depends on the sustainability of society’s resources. This is why we engage in dialogue with our various stakeholders - employees, customers, patients, suppliers, shareholders, non-governmental organizations (NGOs) and communities - in order to gain a better understanding of our operating environment, including market developments and cultural dynamics. Depending on the subject matter, we use different approaches ranging from standardized questionnaires to one-to-one conversations.

Please find information about our business model, organizational structure, products, customers, business strategy, as well as main trends and issues pertaining to the reporting year, in our Management Report.

Material non-financial information

For guidance on materiality and non-financial disclosure, we base our non-financial reporting on the Sustainability Reporting Standards (SRS) of the Global Reporting Initiative (GRI Standards 2016) as well as on the sustainability accounting standards for Medical Equipment and Supplies and Biotechnology of the Sustainability Accounting Standards Board (SASB).

To identify the relevant information, we have conducted a systematic materiality analysis. For each thematic aspect prescribed in the European Commission’s CSR Directive 2014/95/EU (environmental, social and employee matters, respect for human rights, anti-corruption and bribery) we identified a series of topics, which possess high business relevance, strongly influence the decisions of our stakeholders, and where QIAGEN’s activities have significant impact on the thematic aspects. In a joint workshop with representatives from our different departments, the various perspectives had been assessed and discussed. The final list had been validated by our senior management and resulted in the following material topics:

• Environmental matters: energy consumption, emissions
• Employee matters: training, diversity, employee satisfaction, employee retention
• Social matters: quality and product safety, customer satisfaction, access to healthcare
• Respect for human rights: conflict minerals
• Anti-corruption and bribery matters: antitrust, anti-corruption

Business ethics

For QIAGEN, conducting business in a responsible way includes looking beyond our day-to-day business operations into the ethical foundations of our company. This means, in particular, the respect for human rights and legally compliant business behavior.

Human rights

QIAGEN believes that the respect for human rights is an essential component of promoting sustainability in our global business. As a publicly listed company with international operations, we regard ourselves as a responsible corporate citizen in all the countries and regions where we do business. This role includes rights and obligations governed by international and national law, with human rights as one of the foundations of international law.

In this sense, we acknowledge and endorse the UN Universal Declaration of Human Rights, the European Convention on Human Rights, and the business-related OECD Guidelines for Multinational Enterprises, the ILO Declaration on Fundamental Principles and Rights at Work, and the UN Guiding Principles on Business and Human Rights and its application in National Actions Plans of our relevant jurisdictions.

In 2018, QIAGEN began developing a Human Rights Policy, which is expected to be adopted during 2019 and become part of our Global Policy Manual. It is designed to provide guidance to all human rights issues in our sphere of influence, such as in our relationship with customers, on the employee level, and in our supply chain. The policy is available in the sustainability section of our corporate website.

Compliance

As a publicly listed company with international operations, QIAGEN is subject to regulation in various jurisdictions. Unethical behavior and non-compliance with laws and regulations have the potential to seriously harm our business, our reputation and our shareholders and to expose our employees to personal liability. QIAGEN has established a comprehensive Compliance Program which translates legal and regulatory requirements as well as our fundamental values into clear, precise and understandable guidelines as our Corporate Code of Conduct and Ethics and supplementing specific policies for our employees. The policies include, but are not limited to aspects as conflicts of interest, insider trading, revenue recognition, interactions with healthcare professionals, confidentiality and social media.

Special attention is paid to antitrust and anti-corruption laws (see section “Opportunities and Risks” in the Management Report ). Our specific antitrust and anti-corruption policies set forth our commitment to ensure that QIAGEN and its subsidiaries abide by the antitrust and anti-corruption laws of the countries in which we operate.

We extend our Compliance Program not only to our management and employees, but also to third-party intermediaries as distributors or agents. Third-party due diligence lies in the remit of the Sales Compliance Manager. This contains the following five elements:

1. Anti-corruption questionnaire and certification for new distributors, resellers and agents;
2. Risk assessment based on a calculated risk score, which factors location of business (Transparency International Index Score, TIIS) and annual sales revenue for distributing QIAGEN products by multiplying total revenues of the prior calendar year with the inverse of the TIIS;
3. Training;
4. Contractual obligations;
5. Due diligence;

also including payment monitoring.

All our policies are provided to all employees worldwide. Online training reaches all employees in local language, supported by multiple communication resources. All new employees are required to take online training on our Corporate Code of Conduct and Ethics at a minimum. Additional trainings which are customized to the specific area of responsibility are mandatory. All employees in Sales and Marketing as well as Upper Management are required to take training on anti-corruption and antitrust laws. Such basic trainings are followed by refresher courses on a regular basis. In addition, employees are informed through the company’s Compliance@QIAGEN intranet page and regular updates on compliance topics via the company’s internal communication platform Yammer.

We have established a hotline for reporting accounting-related concerns on an anonymous basis in good faith. We also offer a direct email and telephone hotline for employees to address questions or make suggestions for our Compliance Program.

Our Compliance Program is overseen by the Compliance Committee under the leadership of the Head of Global Legal Affairs and Compliance, who reports in this function directly to the Audit Committee of the Supervisory Board. The Compliance Committee consists of managers from Legal, Internal Audit, Human Resources, Commercial Operations, Trade Compliance and Regulatory functions.

In the reporting period QIAGEN had no legal actions pending or completed with regard to antitrust or corruption.

Environment

Environmental protection is an issue of continued and committed concern for QIAGEN. As an international pioneer in our industry when it comes to eliminating harmful substances and waste products in laboratories, we have seen the value of environmentally responsible solutions as a source of competitive advantage, as well as an act of corporate citizenship.

We strive to reduce the consumption of energy and water and to impose limits on packaging, waste, and transportation. With these efforts, we aim to operate in the most cost-efficient and environmentally friendly way possible. To support these aims, our key production facility in Hilden, Germany, is currently being recertified according to the international energy management norm ISO 50001. To best cater to the specific nature of our industry, at other sites we work according to our own environmental guidelines.

As concerns about climate change and effects of dwindling natural resources continue to impact pricing, we will be exposed to fluctuations in costs of these key inputs. By being able to improve our manufacturing efficiencies and limit our dependence on finite resources, we are engaging in active risk management, serving our customers and enhancing the value of our company.

For QIAGEN, the commitment to safe and environmentally sound practices comes with a culture of operational excellence - reinforced by training, decision-making and standard procedures. Operations employ a concept we called QIAzen, derived from the Japanese word “kaizen” (continuous improvement). Key employees in Operations have received QIAzen training to identify and prioritize avenues to improve our manufacturing organization, initiate projects, and monitor implementation with cross-functional teams. This includes issues of environmental concern such as transportation and the consumption of energy and natural resources. This applies, in particular, to our sites in Hilden (Germany), Köping (Sweden), Germantown (USA), as well as Shenzhen and Beijing (China).

QIAGEN is acting proactively to minimize its contribution to climate change. We recognize consumer and customer awareness of our corporate environmental stewardship as an opportunity and a way to differentiate from our competitors. Investments in renewable energies serve to maintain our competitive advantage by protecting against the rising costs of conventional energy.

QIAGEN recognizes material climate change risks such as intensified weather events, e.g. severe rainstorms or power outages that might impact our manufacturing operations. Operations also could be negatively impacted by volatility in the cost of raw materials, components, freight and energy. New laws or regulations adopted in response to climate change could increase energy costs, the costs of certain raw materials, components, packaging and transportation. In line with the development of a <2°C climate target (limiting global warming to less than 2 degrees Celsius), QIAGEN will develop a company strategy for the reduction of climate risks, covering both physical and transitional risks.

Environmental performance

To increase transparency regarding our own global energy consumption and greenhouse gas emissions, QIAGEN has extended the coverage of the energy consumption data in 2018 by the integration of a centralized data collection process management for all production sites, research centers and major offices. As a result, our global data collection coverage was increased from 30% in 2017 to more than 95% in 2018. The consideration of additional sites led to an increase in our total energy consumption of 91.3 GWh in 2018 compared to an energy consumption in the reporting year 2017 of 35.3 GWh as shown in the table below.

In addition to our energy and climate management activities, we have started to collect data regarding fresh water consumption and waste for the two largest production sites in the USA and Germany. The table below lists figures for the 2017 and 2018 reporting years and puts our consolidated environmental data in relation to our production volume sold to establish a basis for a long-term monitoring system. With the help of these key performance indicators (KPIs), we will be able to target reduction potential for energy, climate emissions, fresh water as well as waste. We are in the process of implementing additional procedures, including dashboards and other tools, to enable improvements in measurement and monitoring of these metrics during 2019.

The expansion in the collection of our energy data enabled us to calculate our corporate carbon footprint (CCF) more accurately in the reporting year according to ISO 14064. As of 2018, all relevant scope 1+2 emissions are included in the CCF. Scope 1 covers direct greenhouse gas emissions (GHG emissions) from combustion of fossil fuels on our own premises; scope 2 are indirect emissions originating from external generation of electricity for our operations. In 2018, QIAGEN emitted 13,150 tCO2 in scope 1, corresponding to 43% of the total GHG emissions (2017: 3,661 tCO2). For the scope 2 emissions, 17,430 tCO2 occurred, representing 57% of the total GHG emissions (2017: 8,851 tCO2). Our total carbon footprint amounted to 30,587 in 2018 (2017: 12,512 tCO2). This increase is again attributable to the expansion of our data scope.

The now almost complete coverage of our scope 1 and 2 emissions offers a good starting point for the development of a <2°C compatible climate target in 2019 together with the identification of climate-related risks and opportunities. In addition, we have started to collect data for calculating GHG emissions in scope 3. These emissions occur along our value chain, for example through transport services, suppliers or the use of our products. We are currently collecting the relevant data and will integrate the first scope 3 categories into our CCF in 2019.

At our Hilden site, action plans have already been drawn up to achieve reduction targets. On the basis of this experience, we can now develop concrete action plans for other sites, research centers and offices. They will be developed simultaneously with the establishment of the <2°C climate target, since we will be investigating long-term mitigation reduction potential as well as interim solutions, e.g. purchase of green electricity.

To limit the footprint of our business on the environment, we have already introduced a broad panel of activities and programs. We run simulations to reduce energy consumption and have installed energy recovery and control systems to provide only the minimum power required for operations. Improvements encompass energy extraction from co-generators, better insulation, heat recovery and installation of intelligent building systems.

As a significant part of the energy consumption associated with our business occurs beyond our own premises, transportation of people and cargo is an additional focus. In 2018, we have started to change our transports from air to sea freight wherever it is reasonable and possible. We have currently been able to convert around 150 tonnes per year to sea freight. In the next phase, which we will start in 2019, we expect to convert 100 additional tonnes per year.

At QIAGEN’s headquarters, discounted train and bus tickets encourage employees to use public transportation, and we have installed charging stations for electric cars and bikes. The pool of company cars has been changed to ecological and CO2-efficient models in a continuous adjustment process. Low emissions play a critical role in the decision process for new company cars. At most sites, video conferencing systems have been installed to encourage virtual team meetings and reduce travel between sites.

Plastic Footprint Reduction

The use of plastic materials is increasingly being questioned in public debates. QIAGEN currently uses plastics in many our products and production support materials, as well as for transport and packaging purposes. We are aware of our responsibility in this respect and are working intensively with a special internal team focusing on solutions to avoid and reduce the usage of plastic, or at least improve the recyclability of the plastic used.

The reduction of plastic materials presents us and our industry with a number of challenges: Due to the use of our products in laboratory or medical applications, these products are subject to strict functional and legal requirements so in many cases other materials cannot simply be substituted for plastics. In the case of packaging materials, we must ensure that appropriate safety and hygiene standards are met.

In 2018 we set up a global, cross-departmental “Plastic Footprint Reduction” focus team to analyze the use of plastics and specifically identify reduction potential for QIAGEN. Our approach is to completely avoid unnecessary materials, develop more environmentally friendly alternatives or, where possible, optimize recyclability. As a first step, we have targeted polystyrene foam boxes that are used within the cold chain packaging of our products and are currently working on reducing the size of the boxes while optimizing the way the contents are structured. Our ultimate goal is to replace polystyrene foam boxes to a more environmentally friendly alternatives wherever possible.

In order to also identify starting points within our supply chain, we have initiated a query with suppliers about the use of plastic materials. We are currently exploring ways to establish a “box cycle” where supplies are packaged directly by our suppliers and the packaging material is returned to them. In addition, we are in discussions with suppliers in order to achieve a better recyclability of their products.

As a medium-term objective we will investigate our product kits with regards to the plastic materials used and evaluate potential alternatives for material components, e.g. bioplastics or biodegradable plastics, that are not in direct contact with the product. At the same time, we are working on establishing a material identification system that will make recycling of unavoidable plastics easier worldwide.

Employees

QIAGEN’s long-term success and growth are shaped decisively by the knowledge, skill and passion of our employees. Focusing on human capital therefore drives our economic performance and considerably influences the sustainability of our operations. We are convinced that the professional and personal development of our employees is an integral factor in creating value for our customers, patients, colleagues, partners and shareholders. Being the industry’s employer of choice by attracting and developing top talent is one of our global goals. To achieve that, QIAGEN creates a work environment that empowers and involves employees at all levels.

As a company headquartered in the European Union, freedom of association and collective bargaining are cornerstones of the good relationship between management and representatives of employees. We don’t have significant operations in countries with severe legal limitations to freedom of association and collective bargaining. In all regions where we operate we respect local laws and regulations concerning labor relations.

Among all QIAGEN guidelines, the following policies aim to incorporate QIAGEN’s culture and values into all of our internal and external relationships. These are available internally for all employees.

Our Ethical Standards Policy: QIAGEN’s cultural norms and values are defined in the “3I’s: Identity, Inspire, Impact.” Our values form the basis of our business success and every employee is expected to treat everyone in an open, honest, and respectful manner.

Our Diversity & Inclusion Philosophy: At QIAGEN, we are committed to the richness of diversity. Diverse teams strengthen our organization through the variety of ideas of opinions. In addition, teams outperform and succeed when they are composed of individuals with the widest possible range of personalities, backgrounds and traits. Therefore, we are committed to maintaining an environment where all individuals have the opportunity to grow and contribute to our progress.

All our employees in the various regions of the world are covered by the relevant local laws or by our voluntary corporate guidelines to the greatest possible extent, which guarantee freedom of association and/or collective bargaining mechanisms.

Depending on local law and custom, there are different types of employment ranging from long-term fixed contracts to temporary positions, also including flexible time and programs for parents returning from childcare. In 2018, we employed 5.57% part-time employees and 1.26% temporary employees (with QIAGEN contract / fixed-term work contract).

Employee training

As a fast-growing technology and knowledge-based company, we consider high-quality training and career development to be an integral part of our success. The QIAGEN Academy provides the possibility to either take part in e-learning sessions globally or to participate in personal trainings. The focus is on job-specific skills, competencies and leadership development.

In 2018, 87% of all QIAGEN employees completed internal training. In addition 87 employees participated in our advanced leadership development programs.

In 2018, we ran a mix of instructor-led, virtual instructor-led and e-learning courses attended by 4,892 employees. The company also organized 20 development centers with almost 150 participants designed to assesses leaders and future leaders' competencies and identify development opportunities.

As part of our talent and succession management, we have established transparent career paths with the QIAGEN Profile Navigator (QPN). It defines jobs, core competencies and approaches to advancement across the global organization.

In addition, QIAGEN’s global Performance Enhancement System (PES) creates a clear framework of regular, one-on-one review sessions for each employee and their manager to discuss career development. These include discussions of goals and achievement levels, assessment of relevant competencies, as well as training needs and career planning steps.

The supervisor feedback process provides the opportunity for employees to provide anonymized feedback to their supervisors. For 2018 as in previous years employees provided overall very positive feedback.

QIAGEN has implemented a program to develop promising specialists and managers to prepare for senior positions in cooperation with the University of Würzburg, Germany (QIAGEN Executive MBA Business Integration Program). Participants not only benefit from a curriculum providing a wide range of management skills and knowledge, but they also experience an international environment, learning with colleagues from around the world. In 2018 another class of 16 participants graduated.

Diversity

We are committed to create a working environment where all individuals have the opportunity to grow and contribute to our progress, regardless of age, educational background, gender, nationality, physical abilities, racial and ethnic background, religion, or sexual orientation. Strategic consideration of diversity not only makes QIAGEN a better place to work. We also consider it to be a key success factor on the path to achieving our mission and goals.

In 2018, the gender split across the whole company was at 51% men and 49% women. The participation of women in leadership roles was at 28%. Specific information about the diversity policy for the composition of the Managing Board and the Supervisory Board can be found in the Corporate Governance Report.

In 2018, QIAGEN introduced the Diversity Ambassador program, selecting more than 20 QIAGEN employees from across the world to champion diversity in the sites and countries they are based in. Training has been developed to help address unconscious bias, including an online assessment, and is aimed at all managers of people, including all individuals involved in Recruiting & Hiring. Our recruitment team members have all undertaken training aimed at helping to identify unconscious bias and eliminate it from the hiring process. QIAGEN remains committed to diversity, and we continue to develop and implement additional programs to promote awareness and are working to implement additional procedures to enable improvements in measurement and monitoring of diversity in future periods.

Employee satisfaction and retention

Recognizing that QIAGEN’s employees are the key to our success, we seek to be a great place to work. QIAGEN offers opportunities to work on exciting tasks and projects in an engaging work environment. Employees join QIAGEN and stay with QIAGEN because they can see how their work makes a difference to people`s life everywhere in the world. Internal and external ratings have improved significantly and show QIAGEN’s reputation and preferred position in the global working environment.

A prudent work-life balance is an important measure to create and maintain employee satisfaction. We provide services to help employees balance their personal lives with the company’s dynamic work environment, including in-house childcare, sabbatical programs, and flexible working hours.

QIAGEN has implemented frameworks for performance-based compensation, equity-based compensation, and incentive programs for new ideas and innovation. These programs aim to ensure fair and attractive compensation and to encourage each employee to work for the company’s long-term benefit.

An essential component of QIAGEN’s efforts to maintain a high level of satisfaction at work is our corporate health and safety management. We offer a wide range of measures and tools, from annual “health days” with free counseling, screening and medical check-ups to sports opportunities in the form of in-house gyms, on-site soccer fields and beach volleyball courts.

QIAGEN’s commitment to being an employer of choice is also reflected in the high number of applications for open positions, which exceeded 40,000 applications in 2018. At the same time, the average voluntary annual turnover rate remained largely unchanged.

Occupational safety and health protection

QIAGEN recognizes its responsibilities with respect to health and occupational safety in all our operations and meets all applicable governmental requirements. We prepare hazard analyses and risk assessments, carry out occupational safety and health audits and implement improvement measures in which all our divisions are involved. All employees of the company are obliged to actively work for occupational safety and to follow relevant instructions and regulations. Safety, orderliness and cleanliness are demanded by management as a key success factor.

The figures in the below table are based on our production sites and major non-production sites in the regions and countries indicated for the year ended December 31, 2018. Recordable accidents includes the following incidents: lost workdays; restricted work; and medical treatment beyond first aid.

Information from the comparable year is not included as our process for of implementing additional procedures to enable improvements in measurement and monitoring is currently underwear. We expect to provide recordable accidents and additional metrics for current and future periods.

Customers and products

QIAGEN’s mission is to make improvements in life possible by enabling our customers to achieve outstanding success and breakthroughs in life sciences, applied testing, pharma and molecular diagnostics. We are committed to customers and their patients to deliver innovative solutions that unlock new insights for scientific research, forensics, food safety or better treatment decisions. We understand and live up to our responsibility to customers and patients who depend on us for reliable, efficient and safe workflows.

Customer satisfaction

Customer satisfaction is an integral part of the QIAGEN mission of making improvements in life possible which is therefore the direct responsibility of the Chief Executive Officer. Our customers have high expectations on reliability, safety and the environment-friendly manufacturing of our products. We develop our products and services in close contact with our customers and incorporate their feedback into our processes.

Our commitment is to continually improve the customer experience, taking into account their evolving needs and expectations. QIAGEN has established a global systematic approach to measure customer experience in the form of an aggregated Customer Experience Indicator (CEI). The CEI is measured on a monthly basis through a set of internal KPIs (product and delivery performance, phone support, etc.) that are directly linked to customer experience in our transactions. Thus, we are able to identify quickly and systematically areas for improvement while staying closely connected with our customers. Employee performance in relation to the CEI is embedded into our annual goal setting process. With an average CEI of 1,515 of possible 2,000 points in 2018, we have managed to further increase our strong performance compared to the previous year.

Quality and product safety

QIAGEN stands for quality. Since QIAGEN’s founding 30 years ago, we have always been committed to the highest quality, and we always strive to exceed our customers’ expectations. QIAGEN’s reputation as a quality supplier is best-in-class in our industry and the foundation of our loyal global customer base.

To achieve and maintain our quality standards, we established Total Quality Management (TQM) systems in all of our manufacturing facilities around the globe. These assure constant high quality as well as safe and effective medical devices. QIAGEN’s TQM systems are certified according ISO 9001, ISO 13485, ISO 18385, as well as 21 CFR 820 and all other applicable medical device standards around the globe (see section “Government Regulations” in the Management Report).

QIAGEN products and their components are safe to use by customers, as well by our employees in Research and Development (R&D). We use a list of qualified substances (the “MDx Toolbox”), specifically excluding any substances of concern. Our transparent and responsible product and development policy also includes the communication and marketing of products. As with all companies in the medical device/in vitro diagnostics industry, product claims and product properties are verified and validated during development and approved by regulatory bodies around the world as part of the product submission process.

QIAGEN, like other companies, is exposed to the financial implications of potential recalls and other adverse events due to equipment failures, manufacturing defects, design flaws, or inadequate disclosure of product-related risks. In the event of a recall, QIAGEN has established global procedures applicable to all QIAGEN sites. Processes, responsibilities and improvements programs are defined as required by regulating authorities to avoid the reoccurrence of recalls. There is full traceability of each product to the final customer; therefore, any recalls are executed by direct customer notifications. Due to QIAGEN’s stringent quality management, recalls rarely occur: 2018 (4), 2017 (0), 2016 (3), 2015 (1). The percentage of affected product is low as well: 2018 (0.09%), 2017 (0%), 2016 (0.21%), 2015 (0.022%). In past recalls, 90% to 100% of customers have been reached and confirmed recall notification.

The safe use of our electronic devices in terms of cybersecurity is another high-priority area at QIAGEN. All relevant employees are regularly trained in the latest technology and applications to ensure that our customers do not face any risks related to cybercrimes.

Access to healthcare

QIAGEN is aware of the importance of providing access to healthcare and research products around the world. In developing countries with scarce resources, new ways are needed to ensure access to affordable diagnostics that play a critical role in helping to prevent and treat diseases. In particular, infectious diseases and various malignancies can be treated much more cost-effectively through early and precise detection - and with improved patient outcomes. However, many emerging countries lack properly trained lab personnel and technical infrastructure to utilize the latest molecular testing technologies.

For QIAGEN, a strategic approach to providing access to diagnostic technologies can yield opportunities for growth, innovation and unique public-private partnerships. To support our growth strategy in emerging markets, we are expanding our presence in these markets and adapting our products to local needs, where necessary. An example is the development of careHPV as an adaptation of our gold standard digene HC2 test for detection of high-risk human papillomavirus (HPV), which has been shown to be the primary cause of cervical cancer. In cooperation with PATH, an NGO, and support from the Bill & Melinda Gates Foundation, QIAGEN developed this dedicated testing system for use in regions with limited healthcare resources. The main advantages of decentralized HPV testing are:

• immediate analysis at the point of care
• instant treatment decisions
• higher compliance of patients

Our careHPV Test is currently available in more than 25 countries worldwide. Since its launch through the end of 2018, more than 3 million tests have been distributed.

Another example is our effort to advance diagnostics for tuberculosis (TB) in low-resource, high disease burden countries. Based on a five-year memorandum of understanding signed in 2015, QIAGEN is cooperating with FIND, an NGO, to develop innovative and affordable tests to detect people with latent TB infections who are at risk of developing active TB.

Furthermore, we are providing financial support to several organizations and initiatives focused on global health projects. In 2018, among the projects that we continued to support were the International Agency for Research on Cancer in Tanzania, Basic Health International in El Salvador, and the Pink Ribbon Red Ribbon initiative in different countries.

Sustainable supply chain management

QIAGEN strives to ensure that its quality standards, compliance with laws and regulations, as well as ecological and social standards, are maintained along the entire value chain of suppliers and partners. For us, organic growth is the goal, not maximum profit. We demand the same from our business partners. In 2018, we revised our procurement policy to include specific requirements for corporate governance, environmental and social standards, which we expect from our suppliers as minimum standards. The policy is publicly available on the QIAGEN Website.

In alignment with QIAGEN’s Compliance Program (especially QIAGEN’s Corporate Code of Conduct and Ethics), every QIAGEN employee must conduct themselves honestly, fairly, and objectively in all business relationships with suppliers and all others with whom QIAGEN maintains business relationships. Employees in the Procurement organization, especially, must understand our revised procurement guidelines and comply with them.

Structure of our supply chain

QIAGEN operates in over 35 locations worldwide. Our sites are supported by a global supplier network that includes approximately 9,000 suppliers in over 60 countries, supplying resources such as chemicals and bioreagents, plastics, packaging materials, as well as other materials and services essential to our business. In 2018, 89.7% of our overall purchasing volume came from OECD countries.

Region of origin of suppliers

Due diligence process

In order to minimize compliance, environmental and social risks in our supply chain, we introduced a multi-stage vendor selection process in 2018. As a first step, existing suppliers were subjected to a risk analysis with regard to ecological and social criteria based on their geographic location. These criteria were supported by information from the MVO Nederlands platform financed by the Dutch Foreign Ministry, as well as the Bertelsmann Stiftung foundation's Sustainable Development Goals Index. As a result, 70 suppliers were identified for whom potential risks exist due to geographic location and sales to QIAGEN.

The revised procurement policy was then sent to these suppliers with the request to sign. All new suppliers must also sign this policy in order to be approved as QIAGEN suppliers. In detail, the policy contains requirements with regard to legal compliance, bribery and corruption, labor rights, non-discrimination and fair treatment, health and safety as well as environmental protection and conservation. In addition, first-tier suppliers must confirm REACH, RoHS and SEC compliance as appropriate.

As part of our supplier selection process, we additionally assess the suppliers’ policy with a perspective on QIAGEN's requirements. Supplier audits are conducted if non-compliance is suspected. To our knowledge, there were no violations regarding corporate governance, environmental and social standards in the reporting period.

Conflict minerals

The sourcing of certain minerals (known as “conflict minerals”) has been linked with human rights abuses in the Democratic Republic of Congo ("DRC") and other conflict zones. QIAGEN has performed an extensive inquiry into the company’s supply chain to confirm that the products supplied to us are either DRC conflict-free or that the suppliers are not aware of any non-compliance in their supply base. QIAGEN has no indication that any conflict minerals from the Democratic Republic of Congo or adjoining countries are used in the company’s laboratory instruments.

Our products consist of sample and assay kits, known as consumables, and automated instrumentation systems. We do not believe that any Conflict Minerals are necessary to the production or functionality of any of our consumable products. We conduct due diligence measures annually to determine the presence of Conflict Minerals in our instrumentation products and the source of any such Conflict Minerals. Because we do not purchase Conflict Minerals directly from smelters or refineries, we rely on our suppliers to specify to us their Conflict Minerals sources and declare their Conflict Minerals status. We disclosed our Conflict Minerals findings to the U.S. Securities and Exchange Commission ("SEC") for the calendar year ending December 31, 2017, on Form SD on May 17, 2018, and will provide updated disclosure to the SEC annually.