Bayer, the crop science and chemicals giant, said it would invest more than $5.6 billion in weedkiller research and trim its environmental impact — a move that follows three consecutive jury verdicts involving one of its top-selling herbicides.
Bayer acquired Monsanto, the maker of Roundup weedkiller, in a $63 billion deal last year, creating the world’s largest seed and agrochemical company. But the merger has left Bayer with a market valuation of $56 billion and a sustained public relations crisis.
Bayer has been entangled in litigation over claims that Roundup causes cancer, even while the company has consistently defended the safety of glyphosate and Roundup. Just last month, Bayer said that “glyphosate-based products can be used safely and that glyphosate is not carcinogenic.”
Billions of dollars for weedkiller research, plus a pledge to reduce the company’s environmental footprint by 30 percent through 2030, signaled more than a research and policy change. It also signaled a shift in tone for Bayer. On its website, along with a full-page ad in Friday’s Washington Post, Bayer said, “We listened. We learned.”
“As a new leader in agriculture, Bayer has a heightened responsibility and the unique potential to advance farming for the benefit of society and the planet,” the company said. “We are committed to living up to this responsibility.”
The company said that “glyphosate will continue to play an important role in agriculture and in Bayer’s portfolio.” But the chemical has been a complicating factor since Monsanto was folded into the Bayer empire.
One month ago, jurors awarded $2 billion to a California couple who blamed their cancer diagnoses on Roundup. Bayer shares plummeted, as they did following two other verdicts involving Roundup. In March, a jury awarded $80 million to a California man who said Roundup gave him non-Hodgkin’s lymphoma. And in August, a jury in California awarded $289 million to a former groundskeeper who blamed Roundup for his terminal cancer. (A judge later reduced that amount to $78.5 million.)
Beyond those verdicts, Bayer potentially faces thousands of other lawsuits from people who say their farming and landscaping work led to direct and sustained contact with Monsanto’s herbicides.
Still, the Environmental Protection Agency handed the company a regulatory victory earlier this year, saying that it continues to find “no risks to public health when glyphosate is used in accordance with its current label” and that “glyphosate is not a carcinogen.”
Ken Cook, president and co-founder of the nonprofit Environmental Working Group, said that if Bayer is serious about reforming its products, it has to commit to a “fundamentally new paradigm for pesticides, which must start with a simple principle: This class of chemicals should not end up in people.” EWG has raised concerns about glyphosate’s hazards for children’s health. On Wednesday, EWG published a report saying that Roundup had been detected in 21 oat-based cereals and snack products tested by the organization.
When Bayer bought Monsanto, the company probably thought it could ride the support of the EPA and other regulators through any legal risks involving Roundup, said Anthony Johndrow, an expert on how corporations manage crises. But the company underestimated the reputational damage that came from those lawsuits, and how they damaged the company’s public perception.
Friday’s announcement — “We listened. We learned.” — is one step toward showing consumers and industries wary of glyphosate that Bayer is sincerely making a change, Johndrow said. That includes Bayer making its decisions more transparent: The company published its glyphosate safety studies and said it will invite scientists, journalists and nongovernmental organizations to Europe as part of a glyphosate re-registration process.
“[Bayer] knew what they were buying [with Monsanto]. They knew what they were getting,” Johndrow said. “This is theirs going forward, whether they like it or not.”