Independent Assurance Report

To the Management Board of Bayer AG, Leverkusen

Our engagement

We have reviewed the parts of the Bayer Sustainable Development Report (hereinafter: the report) listed below for the reporting period from January 1, 2007 to December 31, 2007:

„Performance Report"
“Climate change” “Procurement management” “Access to medicines” and “Corporate compliance” (hereinafter referred to together as the “Focus Issues”)

A review is aimed at achieving a limited level of assurance and is therefore less extensive than an audit, which is aimed at achieving reasonable assurance. Consequently, a review cannot ensure that all significant issues are identified as in an audit. Accordingly, we cannot express a conclusion in the positive form (audit opinion) on the parts of the report.

Limitations of our engagement

Our engagement did not comprise any parts of the report beyond the pages listed above. Our engagement also did not include any quantitative or qualitative information relating to the prior year, any prospective statements or statements from external experts.

Criteria

Our examination is based on the reporting principles and criteria presented on the back flap of the report.

Responsibility of the Management Board of Bayer AG

The Management Board of Bayer AG is responsible for the preparation and the content of the report in compliance with the above-mentioned criteria. This responsibility includes the implementation of internal controls for the preparation of a report that is free from material misstatements, in accordance with the above criteria and based on suitable methods for gathering source data.

Our independence

The Ernst & Young independence principles, which are in compliance with the requirements of the Code of Ethics for Professional Accountants issued by the International Federation of Accountants and the principles set forth in the German commercial code [“Handelsgesetzbuch”], the law regulating the profession of German public auditors [“Wirtschaftsprüferordnung”] and the German professional independence standards, apply for the firm, partners and professionals. These principles prohibit financial interests in our clients which could impair independence or give that impression. Partners and professionals are required to issue a declaration each year to confirm that they comply with the firm’s principles.

Our responsibility

Our responsibility was to issue an assurance report on the “Performance Report” and “Focus Issues” parts of the report based on our review. Our responsibility in performing our assurance activities is to the management of Bayer AG only and in accordance with the terms of reference agreed with them.

We conducted our review in accordance with the International Standard on Assurance Engagements (ISAE) 3000. This standard requires that we comply with our professional duties and plan and perform the review to obtain a limited level of assurance to preclude that the “Performance Report” and “Focus Issues” parts of the report are not in accordance, in material respects, with the aforementioned reporting principles and criteria.

Within the scope of our engagement, we requested evidence on a sample basis based on risk and materiality criteria to obtain a limited level of assurance on the compliance of the “Performance Report” and “Focus Issues” parts of the report with the reporting principles and criteria. The nature and scope of our work was based on our professional judgment and we have performed all the procedures deemed necessary to provide a basis for our conclusions. The performance of our engagement mainly involved the following work:

Assessment of the suitability of the underlying criteria and their consistent application.
Inquiries of employees concerning the sustainability strategy, sustainability principles and sustainability management of Bayer AG.
Inquiries of employees responsible for data capture and preparation of the Sustainable Development Report designed to assess the sustainable development reporting system, the data capture and compilation methods as well as internal controls to the extent relevant for a review of the Sustainable Development Report.
Inspection of the relevant documents and systems for gathering, analyzing and aggregating data from the areas Health, Safety & Environment (HSE) and Human Resources (HR) in the reporting period as well as tests on a sample basis.
Analytical considerations at Group level, subgroup level and the level of significant reporting units with regard to analysis and aggregation of HSE and HR data in the preparation of the report..
Inquiries and inspection of documents on a sample basis relating to the collection and reporting of HSE and HR data during site visits for the following 10 reporting units: Bayer Technology Services Leverkusen (Germany), CURRENTA Leverkusen (Germany), Bayer Business Services Leverkusen (Germany), Bayer MaterialScience Brunsbüttel (Germany), Bayer HealthCare Berlin (Germany), Bayer HealthCare Berkeley (United States), Bayer MaterialScience Baytown (United States), Bayer CropScience Norwich (United Kingdom), Bayer CropScience Vapi (India) and Bayer MaterialScience Antwerp (Belgium).
Inquiries of employees from selected departments at the Group’s headquarters, at subgroup level and the service companies and at the sites visited as well as inspection of documents relating to significant qualitative statements made in the “Focus Issues.”
Review of material qualitative statements in the “Performance Report” with regard to consistency and plausibility and inspection of selected underlying documents.
Review of selected press articles to ascertain whether they reflect company-specific topics of relevance for sustainable development considered in the “Performance Report” and “Focus Issues.”

Our conclusion

Based on our work, nothing has come to our attention that causes us to believe that the “Performance Report” and “Focus Issues” parts of the report are not presented fairly, in material respects, in accordance with the reporting principles and criteria.

Rudolf X. Ruter
Auditor

Annette Johne
Auditor

Ernst & Young AG
Auditors
Tax advisors

Düsseldorf, May 14, 2008