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Designed to Matter2009 Sustainability ReportContents • Introduction • P&G Profile •Product Innovation•

Operational Improvement•

Social Responsibility•

Employee Engagement• Stakeholders • GRI Index

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About this publication
This is the eleventh Sustainability Report for P&G’s worldwide
operations. Data in this report covers the period from
July 1, 2008, through June 30, 2009. Financial information
is given in U.S. dollars.
This report was prepared using the Global Reporting Initiative’s(GRI) G3 Reporting Guidelines. The mission of the GRI is topromote international harmonization in the reporting of
relevant and credible corporate economic, environmental
and social performance information to enhance responsible
decision making. The GRI has not verified the contents ofthis report, nor does it take a position on the reliability of
information reported herein.
For further information about the GRI, please visit
www.globalreporting.org.
For the latest P&G news, in-depth information
on P&G’s brands, and for shareholder and career
information, please visit www.pg.com.

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Operational Improvement•

Social Responsibility•

Employee Engagement• Stakeholders • GRI Index

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At P&G, we focus our Sustainability efforts
on improvements that matter, to make themost meaningful impact we can.
Our commitment begins with P&G’s Purpose,
Values and Principles, in which Sustainability
is embedded, and manifests itself in a systemic
and long-term approach.
We strive to make our actions matter.

Our five Sustainability strategies:
Strategy 1: Products

Strategy 4: Employees

Delight the consumer withsustainable innovations that
improve the environmental
profile of our products.

Engage and equip all P&Gers
to build Sustainability thinking
and practices into theireveryday work.

Strategy 2: Operations

Strategy 5: Stakeholders

Improve the environmental
profile of P&G’s own
operations.

Shape the future by working
transparently with our stakeholders to enable continued
freedom to innovate in a
responsible way.

Strategy 3: Social
Responsibility
Improve children’s lives throughP&G’s social responsibility
programs.

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Contents • Introduction • P&G Profile •Product Innovation

CEO Statement
P&G is 172 years old this year. Our Company has grownthrough multiple recessions and the Great Depression.
We’ve navigated through wars, economic crises, andthe unrelenting pace of change that has accelerated
dramatically in recent decades. Through all this volatility,
the one factor above all others that has enabled P&G
to grow responsibly is the clarity and constancy of P&G’s
Purpose — to touch and improve consumers’ lives withbranded products and services.
In fact, our growth strategy for the coming decade is linked
tightly to our Purpose. We will grow P&G’s business by touching
and improving more consumers’ lives in more parts of theworld … more completely.
To execute this strategy and fulfill the Company’s Purpose, wemust grow responsibly and sustainably. As a result, Sustainability
is at the heart of P&G’s business model. Keeping Sustainability
at the core of our business fuels innovation and strengthens
our results.
When I was named Executive Sponsor for Sustainability at P&G
and then subsequently named CEO, many questioned whether
or not I would remain the Sustainability sponsor. For me, thiswas never a question. We’re a company that focuses on growth
now and for generations to come, and therefore Sustainability
should and will be a focus area for me.

•

Operational Improvement•

Social Responsibility•

Employee Engagement

We bring the power and scale of our brands and our people —our two most important assets — to solve real problems facing
the world. It’s been a part of our culture for decades.
This past March, despite the economic environment and inrecognition of the progress we’ve already made, we increased
each of our previously established 2012 goals. Then in September,to enhance our social commitment, we further increased ourgoal for providing safe drinking water in the developing world
by another 1 billion liters, for a total of 4 billion liters by 2012.
This will prevent 160 million days of disease and save thousandsof lives. On the environmental side, I endorsed the Copenhagen
Communiqué on Climate Change, which calls for an effective
and equitable international framework to address climate change.
Within P&G, we are focusing our own efforts on reducing
greenhouse gas emissions and innovating and educating to
impact consumer behavior. As I hope these recent actions help
to illustrate, our commitment to touch and improve the livesof the world’s consumers, now and for generations to come,is stronger than ever.

• Stakeholders • GRI Index

4 of 81… Touch and improve the lives of
the world’s consumers, now andfor generations to come.

Bob McDonald
President and Chief Executive Officer

At P&G, we are focusing our Sustainability efforts on building
long-term capabilities for the Company. That’s why the themeof this report is “Designed to Matter.” We design our strategies
and plans to ensure that the work we do makes a meaningful
difference — in the environmental footprint of our products andoperations, in areas of the world where people most need ourhelp, and in the lives of our employees and external partners.

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Designed to Matter:
Committed to Meaningful Improvements

Leadership Statement
At P&G, we are focusing our efforts where we can makethe most meaningful difference in both environmental andsocial Sustainability. In 2007, P&G established five strategies
for Sustainability and set goals to be achieved by 2012.
This past March, in recognition of the progress we’ve madeso far and to emphasize our commitment to achieving evenmore significant wins, we increased each of our goals. It’s apart of P&G’s culture to continuously raise the bar, and ourwork in Sustainability is no exception. I’d like to share just a
few highlights of the work we’ve done this year.
Products — We continue to climb toward our goal of atleast $50 billion in cumulative sales of “sustainable innovation
products” by 2012. We made progress toward this goal infiscal 2009 by introducing innovative new products such as
Ariel Excel Gel, a highly concentrated and extremely effective
laundry detergent introduced in Western Europe, as well asother smaller product and packaging innovations that add up
to big improvements.
Operations — We continue to drive conservation efforts in
manufacturing and we applied smart eco-designs to reduce ouroperational footprint. Beyond that, we expanded our efforts
across the entire supply chain, taking a holistic end-to-end viewof opportunities. We initiated projects in transportation thatcreated significant energy savings and we chartered a Supplier
Sustainability Board to guide the development of supplierrelated strategies.
Social Responsibility — Together with our partner organizations,
we are developing and expanding successful programs aroundthe world to enable 300 million children to Live, Learn and Thrive,
touching and improving the lives of more than 75 million
children this past year. More of our brands are using theirconsumer reach to drive awareness and results in significant

social issues. Pampers’ partnership with UNICEF is committed
to eradicating maternal and neonatal tetanus. The Always andTampax Protecting Futures program aims to keep girls in thedeveloping world in school during the days they have their period
by making feminine protection products available to them.
Employees — Employees at 78 of our sites around the world
agreed to “Take the R (Responsibility) for Tomorrow” during
our annual Earth Day employee education event. Many of ouremployees went on to participate on Site Sustainability teams
or to engage in our global Sustainability Ambassador Network,
which now has nearly 500 members. Their role is to encouragesustainable behaviors among their co-workers.
Stakeholders — We are working transparently with external
stakeholders to ensure P&G has the freedom to innovate andgrow in a responsible way. We are working diligently, both bydedicating resources internally and by partnering externally,
to tackle important topics that impact both our world and ourbusiness. This year’s report discusses how we are working withstakeholders on the following challenges.
Solid Waste is a priority for P&G because some of our
products and most of our packages enter the solid waste
stream. Consumers want to make sustainable choices andlearn more about waste management of our products andpackaging; this compels us to constantly seek improvementsin the design, manufacture and delivery of our products andto collaborate externally to develop improved integrated
waste management systems.

Water is of crucial importance to both the production anduse of our products, so our approach to water is focused on
responsible water use by both our Company and consumers.
And because a lack of safe drinking water is a leading causeof debilitating disease and death in developing countries,
especially for young children, we are also working hard to
help provide safe water to children in need.
Product Safety is at the heart of the trust consumers placein P&G brands. All of our products are thoroughly evaluatedfor safety for people and the environment before they go
to market. P&G also consistently promotes research thatenhances understanding of product safety. Beyond thesafety of ingredients themselves, we also conduct extensive
studies to understand real consumer use of our products.
P&G remains squarely focused on having a meaningful impact
in both environ­mental and social Sustainability work. We are
upholding our commitments and stretching our employees andour partners to continuously raise the bar for the level of results
we can achieve.

Len Sauers
Vice President, Global Sustainability

Climate Change is a serious issue facing the world today.
So while P&G is not an energy-intensive business, we focus
our efforts in two areas: reducing our own emissions andinnovating and educating to positively impact consumer
behavior.

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Employee Engagement• Stakeholders • GRI Index

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P&G Report Card:2012 Sustainability Goals
These goals, originally set in 2007, were increased in March 2009. The goal for Children’s Safe
Drinking Water (CSDW) program was again increased in September 2009. Progress against goals
is as of June 30, 2009

Strategy1:Products

Strategy3:Social Responsibility

GOAL Develop and market at least $50 billion in cumulative
sales of “sustainable innovation products,” which areproducts that have an improved environmental profile.(1)PROGRESS(in billions of U.S. dollars)

Cumulative Sales
since July 2007

Cumulative sales of sustainable
innovation products$13.1

GOAL Deliver an additional 20% reduction (per unit
production) in CO2 emissions, energy consumption, water
consumption and disposed waste from P&G plants, leading
to a total reduction over the decade of at least 50%.

Energy UsagePROGRESSSinceJuly 2007

LIVE, LEARN AND THRIVE
Number of Children Reached135 million

CHILDREN’S SAFE DRINKING WATER

Strategy2:Operations

PROGRESS(percent reduction per unit production)

GOAL Enable 300 million children to Live, Learn and Thrive.(2)Prevent 160 million days of disease and save 20,000 lives by
delivering 4 billion liters of clean water in our Children’s
Safe Drinking Water program.(3)Since
July 2007

Since
July 2002

-11%

-48%

CO2 Emissions

-10%

-52%

Waste Disposal

-30%

-53%

Water Usage

-13%

-52%

Liters of Clean Water Delivered

930 million

Days of Disease Prevented

39 million

Lives Saved

> 5,200(1) Sustainable Innovation Products are included if they have launchedin market since July 1, 2007, and have a >10% reduction in one ormore of the following indicators without negatively impacting theoverall Sustainability profile of the product: A. Energy, B. Water,
C. Transportation, D. Amount of material used in packaging or
products, E. Substitution of nonrenewable energy or materials withrenewable sources.
(2) Live, Learn and Thrive (LLT) is P&G’s global cause that focuses oursocial investments on efforts that improve the lives of children inneed ages 0 – 13.
(3) Within Live, Learn and Thrive, our signature program is Children’s
Safe Drinking Water. Methodology for calculating diarrheal days
and mortality was developed with Population Services Internationaland Aquaya Institute. Details are provided on page 50 of this report.

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P&G Profile
Touching Lives. Improving Life.
Today, P&G serves about four billion people
around the world. And P&G people work to
make sure our brands live up to their promise
to make everyday life just a little bit better,
now and for generations to come.

P&G’s world headquarters is located in Cincinnati, Ohio,
U.S.A. Three billion times a day, P&G brands touch thelives of people around the world. The company has oneof the strongest portfolios of trusted, quality, leadershipbrands, including Pampers®, Tide®, Ariel®, Always®, Whisper®,Pantene®, Mach3®, Bounty®, Dawn®, Gain®, Pringles®, Charmin®,
Downy®, Lenor®, Iams®, Crest®, Oral-B®, Actonel®, Duracell®,Olay®, Head & Shoulders®, Wella®, Gillette®, Braun®, and Fusion®.
The P&G community includes approximately 135,000 employees
working in about 80 countries worldwide.

P&G is a publicly owned company. Its stock is listed and tradedon the New York and Paris exchanges.
For more information on P&G’s investor relations, please visit
our website at: www.pg.com/investors/sectionmain.jhtml.
Please visit www.pg.com for the latest news andin-depth information about P&G and its brands.

Our products are sold in more than 180 countries primarily
through mass merchandisers, grocery stores, membership club
stores, drug stores and “high frequency stores,” the neighborhood
stores which serve many consumers in developing markets.
We continue to expand our presence in other channels
including department stores, perfumeries, pharmacies, salonsand e-commerce.

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Billion-Dollar Brands
P&G is a company of leading brands. At the beginning of the decade,P&G had ten billion-dollar brands in its portfolio — brands that generate
more than one billion dollars in sales each year. Today, we have 23 ofthese billion-dollar brands.

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Half-Billion-Dollar Brands
P&G also has 20 brands generating about $500 million or more in annual
sales. When these are combined with the billion-dollar brands, P&G’s top
43 brands account for 85% of sales and more than 90% of profit. Together,
these 43 brands have delivered a 9-year compound average sales growthrate of approximately 10% — double the growth rate of the balance of
P&G’s brand portfolio.
To learn more about P&G brands, visit www.pg.com.

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Employee Engagement

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• Stakeholders • GRI Index

P&G at a Glance
FINANCIAL HIGHLIGHTS
Financial Summary (Unaudited)
Amounts in millions, except per share amounts

2009

2008

2007

Net Sales$79,029

$81,748$74,832

Operating Income

16,123

16,637

15,003Net Earnings

13,436

12,075

10,340Net Earnings Margin from Continuing Operations

14.3%

14.4%

13.4%

$   3.58

$   3.56$   2.96

Diluted Net Earnings per Common Share

4.26

3.64

3.04

Dividends per Common Share

1.64

1.45

1.28

Diluted Net Earnings per Common Share from Continuing Operations

For more financial details,
please see P&G’s 2009 Annual Report:
www.annualreport.pg.com/annualreport2009.

Net Salesby GBU (1)(in billions)2009 NET SALES(% of total business segments)

GBU

Reportable Segment

Key Products

Billion-Dollar Brands

BEAUTY

BeautyCosmetics, Deodorants, Hair Care, Personal
Cleansing, Prestige Fragrances, Skin Care

Head & Shoulders, Olay,
Pantene, Wella

Grooming

Blades and Razors, Electric Hair Removal Devices,
Face and Shave Products, Home Appliances

Braun, Fusion, Gillette, Mach3

Health Care

Feminine Care, Oral Care, Personal Health Care,
Pharmaceuticals

Actonel, Always, Crest, Oral-B

Snacks and Pet CarePet Food, Snacks

Iams, Pringles

Fabric Care and Home Care

Air Care, Batteries, Dish Care, Fabric Care,
Surface Care

Ariel, Dawn, Downy, Duracell,Gain, Tide

Baby Care and Family Care

Baby Wipes, Bath Tissue, Diapers,
Facial Tissue, Paper Towels

Bounty, Charmin, Pampers

HEALTH AND
WELL-BEING

HOUSEHOLD CARE

$26.3

$16.7

$37.3

(1) Partially offset by net sales in corporate to eliminate the sales of unconsolidated entities included in business unit results.

As part of P&G’s initiative to optimize resources to fit a growing global business and to accelerate innovation and growth, the Company operates its
business through Global Business Units (GBUs), as described under Organizational Structure. This organizational structure accounts for why P&G does
not provide employee data, sales, or profits by individual countries. Some countries may provide this data in reports other than this one.

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Operational Improvement•

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Employee Engagement• Stakeholders • GRI Index

Major Acquisitions

Economic Development

Shareholders

Acquisitions used $368 million of cash in2009, primarily for the acquisition of Nioxin,a leader in the scalp care professional hair caremarket, which was incorporated into Beauty.

Innovation is a P&G cornerstone. About$2 billion is invested annually in research anddevelopment—the largest amount among theworld’s consumer product companies. We
have more than 34,000 patents worldwide,
and we average more than one new patent
per day.

As of June 30, 2009, there were approximately
2,301,000 common stock shareowners,
including shareholders of record, participantsin the Shareholder Investment Program,participants in P&G stock ownership plans,
and beneficial owners with accounts at banks
and brokerage firms.

These intellectual assets are of tremendous
value to P&G. But some are not being fully
realized; we invent more than we cancommercialize. Through our External Business
Development group we continue to identify
non-strategic proprietary technologies which,when developed to their full potential, canyield sustainable revenue sources and bring
important technologies to the market.

Contact

Proceeds from
Asset Sales
Proceeds from assets sales were $1.1 billion
in 2009, mainly due to the sales of our Coffeebusiness, the Thermacare brand, and a numberof other minor brands. Of these proceeds,$350 million related to debt issued in connection with the Folgers coffee transaction. The
underlying debt obligation was transferredto the J.M. Smucker Company pursuant to
the transaction. No cash was received from
Smucker in the exchange transaction.

Global Purchases
This year, P&G purchased more than
$45.7 billion in materials and services tomanufacture and market our products. We
employ locally and purchase the majority of
our raw materials, equipment and services
within those regions where we manufacture
our products. Our purchasing professionals
understand and participate in both global andlocal markets to acquire the materials andservices we need to make our products andrun our business.

P&G invites collaboration. Our ExternalBusiness Development group and the Connect& Develop organization manage thousands ofactive connections with other companies andinstitutions. This includes a wide variety ofdeal structures, including licensing, sale,technology swap, joint ventures, and more.
P&G’s goal is to be the partner of choice inworking with others to improve the lives of
the world’s consumers.

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Shareholder Services representatives
are available Monday – Friday, 9 – 4 EST
at 1-800-742-6253(1-513-983-3034 outside the U.S.A.
and Canada)

Write to:
The Procter & Gamble Company
Shareholder Services Department
P.O. Box 5572
Cincinnati, Ohio, U.S.A. 45201-5572

For more information:• Please visit www.pg.com/investors• E-mail us at shareholders.im@pg.com• Call for financial information at
1-800-764-7483

For more information, please visit
www.pgconnectdevelop.com.

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• Stakeholders • GRI Index

Organizational Structure
Our organizational structure is comprisedof three Global Business Units (GBUs):
Global Operations, Global Business
Services (GBS), and Corporate Functions.

In fiscal year 2009, our three GBUs were:• Beauty• Health and Well-Being• Household Care
The primary responsibility of the GBUs
is to develop the overall strategy for ourbrands. They identify common consumer
needs, develop new product innovations
and upgrades, and build our brands througheffective commercial innovations andmarketing plans.

Global Operations
Global Operations is comprised of our Market
Development Organization (MDO), which is
responsible for developing go-to-market plansat the local level. The MDO includes dedicatedretail customer, trade channel, and countryspecific teams. It is organized along fivegeographic units:

We define developing markets as theaggregate of CEEMEA, Latin America, AAIK,
and Greater China. Developed markets arecomprised of North America, Western Europe,
and Japan.

GlobalOperations(Market Development Organizations)Global Business Services
GBS provides technology, processes, andstandard data tools to enable the GBUs andthe MDO to better understand the businessand better serve consumers and customers.
The GBS organization is responsible forproviding world-class solutions at a low
cost and with minimal capital investment.

Corporate Functions
Corporate Functions provides the Companylevel strategy and portfolio analysis, corporate
accounting, treasury, external relations,
governance, human resources, and legal, as
well as other centralized functional support.

Global Business Units

Global Business Units

BeautyHealth andWell-Being

Household
Care

Global Business Services
Shared Services
Corporate Functions
Governance, Capability, Functional Innovation• North America• Western Europe• Central & Eastern Europe / Middle
East / Africa (CEEMEA)• Latin America• A sia
Asia is comprised of Japan, Greater China,
and ASEAN / Australia / India / Korea (AAIK).

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Operational Improvement•

Manufacturingand Outsourcing
P&G has 140 manufacturing facilities inover 40 countries. These facilities handle
the majority of P&G’s production.
Our primary focus is meeting consumer needs.
To ensure that our products are affordable,
our manufacturing facilities must provide thebest value for the Company. We conduct
regular reviews to ensure that our facilities arehighly competitive, and this process includes
benchmarking versus third-party manufacturers.
When it makes sense for the business and itis the most competitive solution, we may use
contract manufacturers. For example, wemight use contract manufacturers when we
enter a new market and need to access atechnology or process we don’t have before
determining whether to build our own facility
there. Or we might do so when introducing
a new product, allowing us to determine

Social Responsibility•

Employee Engagement

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• Stakeholders • GRI Index

P&G Plants Locations
As of June 30, 2009
production needs prior to investing in new
capacity at a P&G facility. Sometimes we use
third-party manufacturers on a longer-term,
ongoing basis because it is the most costeffective solution for the business. When wedo this we are usually manufacturing “in theregion, for the region” as our third-party
manufacturers are predominantly regional.
The percentage of P&G production supplied bycontract manufacturers varies according to theneeds of the business and the ability of P&G
facilities to compete and win production basedon providing the best value. Currently, werely on third-party manufacturers for about
10 –15% of our total manufacturing volume.

COUNTRY

CITY

PLANT NAMECATEGORY OWNER

Argentina

Pilar

Pilar

Fabric Care

Argentina

Villa Mercedes

Villa Mercedes

Baby Care

Australia

SomersbySomersby

Hair Care

Belgium

AarschotAarschot

DuracellBelgium

MechelenMechelen

Fabric Care

BrazilLouveira

Louveira

Feminine Care

BrazilManausManausBlades & Razors

BrazilSão Paulo

Anchieta

Fabric Care

CanadaBelleville

BellevilleFeminine Care

CanadaBrockville

BrockvilleHome Care

Chile

Santiago

Santiago

Baby Care

China

Beijing

BeijingFabric Care

China

ChengduChengduFabric Care

China

Dongguan

Dongguan

Duracell

China

Guangzhou

Huangpu

Hair Care

China

Minhang

Minhang

Braun

China

Shanghai

Shanghai

Blades & Razors

China

Tianjin

Tianjin

Personal Beauty

China

Tianjin

Tianjin (Hair Care)

Hair Care

China

Tianjin

XiqingHair Care

Colombia

Medellin

Medellin

Fabric Care

Czech Republic

Rakovnik

RakonaFabric Care

Egypt

Cairo

Cairo

Fabric CareFranceAmiensAmiensFabric CareFrance

Blois

Blois

Hair CareFrancePoissyPoissyPersonal Beauty

FranceSarreguemines

Sarreguemines

Hair Care

Germany

BerlinBerlinBlades & Razors

Germany

CologneColognePersonal Beauty

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• Stakeholders • GRI Index

COUNTRY

CITY

PLANT NAMECATEGORY OWNER

COUNTRY

CITY

PLANT NAMECATEGORY OWNER

Germany

Crailsheim

Crailsheim

Feminine Care

MexicoMexico City

VallejoFabric Care

Germany

Euskirchen

Euskirchen

Baby Care

MexicoNaucalpan

Alce Blanco

Oral Care

Germany

Gross-Gerau

Gross-Gerau

Oral Care

MexicoNaucalpan

Naucalli

Blades & Razors

Germany

Hünfeld

HuenfeldHair Care

MexicoTepejiTepejiBaby Care

Germany

Kronberg

Kronberg

Braun

MoroccoCasablanca

Casablanca

Fabric Care

Germany

Marktheidenfeld

Marktheidenfeld

Braun

MoroccoMohammedia

Mohammedia

Fabric Care

Germany

Rothenkirchen

Rothenkirchen

Hair Care

Netherlands

Coevorden

Coevorden

Pet CareGermany

Walldürn

Wallduern

Braun

Nigeria

IbadanIbadanFabric Care

Germany

Weiterstadt

Weiterstadt

Pharmaceuticals

PakistanHub

Hub

Personal Beauty

Germany

Worms

Worms

Chemicals

Peru

Lima

Materiales

Fabric Care

GuatemalaEscuintla

Escuintla

Fabric Care

Philippines

CabuyaoCabuyaoFabric Care

Hungary

CsömörBudapest

Feminine Care

PolandAleksandrow Lodzki

Aleksandrow

BeautyIndia

BhiwadiBhiwadiBlades & Razors

PolandLodz

BhopalMandideep

Fabric Care

Lodz — LMC(Jozefow Street)

Blades & Razors

India
India

District Solan

Baddi

Fabric Care

PolandLodz

Blades & Razors

India

Goa

Goa

Feminine Care

Lodz — PLMC
(Wodna Street)

Ireland

Carlow

Carlow

Braun

PolandWarsaw

Targowek

Baby Care

Ireland

NenaghNenaghPersonal Beauty

PortugalGuifões

Porto

Fabric Care

Ireland

Newbridge

Newbridge

Personal Health Care

Puerto Rico

Cayey

Cayey

Personal Beauty

Italy

Campochiaro

Campochiaro

Fabric Care

Puerto Rico

ManatiManatiPharmaceuticals

Italy

Gattatico

Gattatico

Home Care

RomaniaTimișoaraTimișoara

Fabric Care

Italy

PescaraPescaraFeminine Care

RomaniaUrlaţiUrlaţiFabric Care

Italy

Rome

Pomezia

Fabric Care

Russian Federation

Dzerzhinsk

Dzerzhinsk

Hair CareJapan

AkashiAkashiBaby Care

Russian Federation

Novomoskovsk

Novomoskovsk

Fabric CareJapan

Ibaraki

IbarakiHair Care

Russian Federation

St. Petersburg

St. Petersburg

Blades & Razors

Japan

TakasakiTakasaki

Fabric Care

Saudi Arabia

DammamDammamFabric Care

Japan

Yasu

Shiga

Personal Beauty

Saudi Arabia

JeddahJeddahBaby Care

Malaysia

KuantanKuantanFabric Care

Singapore

Singapore

Pioneer Perfume

Chemicals

MexicoApaseo El Grande

MariscalaHair Care

South Africa

Johannesburg

Johannesburg

Baby Care

MexicoApizacoApizacoFamily Care

South Korea

Ch’onanCh’onanFeminine Care

MexicoMexico City

Naucalpan

Personal Health Care

Spain

JijonaJijonaBaby Care

MexicoMexico City

Talisman

Personal Beauty

Spain

Mataró

Mataró

Fabric Carewww.pg.com/sustainability

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Operational Improvement•

Social Responsibility•

Employee Engagement

15 of 81

• Stakeholders • GRI Index

COUNTRY

CITY

PLANT NAMECATEGORY OWNER

COUNTRY

CITY

PLANT NAMECATEGORY OWNER

Spain

Mequinenza

Mequinenza

Baby Care

United States

LaGrange

LaGrange

DuracellSpain

Montornès del VallèsMontornès

Feminine Care

United States

Lancaster

Lancaster

DuracellThailand

Bangkok

BangkokHair Care

United States

Leipsic

Leipsic

Pet CareThailandSamut Prakan

Bangkok (Wella)

Hair Care

United States

Lewisburg

Lewisburg

Pet CareTurkey

Gebze

Gebze

Fabric Care

United States

Lima

Lima

Fabric Care

UkraineBorispolBorispolFeminine Care

United States

Mehoopany

Mehoopany

Family Care

UkraineOrdzhonikidze

Ordzhonikidze

Fabric Care

United States

North Chicago

North Chicago

Personal Beauty

United Arab Emirates

Dubai

Dubai

Fabric Care

United States

OxnardOxnardFamily Care

United Kingdom

LondonLondonHome Care

United States

Phoenix

Phoenix

Personal Health Care

United Kingdom

Manchester

Manchester

Family Care

United States

Pineville

Alexandria

Fabric Care

United Kingdom

Reading

Reading

Personal Beauty

United States

Russellville

Russellville

Pet Care

United Kingdom

Whitley Bay

Seaton Delaval

Personal Beauty

United States

Sacramento

Sacramento

Fabric Care

United States

AlbanyAlbanyFamily Care

United States

St. Louis

St. Louis

Home Care

United States

AndoverAndover

Personal Beauty

United States

Stamford

Stamford

Hair Care

United States

AuburnAuburnFeminine Care

Venezuela

Barquisimeto

Barquisimeto

Fabric Care

United States

Augusta

Augusta

Fabric Care

Venezuela

GuatireGuatireBaby Care

United States

AuroraAuroraPet CareVietnamBinh Duong

Binh Duong

Fabric Care

United States

AvenelAvenelChemicals

United States

Bear River City

Box Elder

Family Care

United States

BostonBostonBlades & Razors

United States

Cape Girardeau

Cape Girardeau

Baby Care

United States

Cincinnati

Cincinnati

Fabric Care

United States

Cleveland

Cleveland

DuracellUnited States

Cockeysville

Hunt Valley

Personal Beauty

United States

Dover

Dover

Baby Care

United States

Green Bay

Green Bay

Family Care

United States

Greensboro

Greensboro

Oral Care

United States

Henderson

Henderson

Pet Care

United States

Iowa City

Iowa City

Hair Care

United States

Iowa City

Iowa City

Oral Care

United States

JacksonJacksonSnacksUnited States

Kansas City

Kansas City

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Operational Improvement•

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Employee Engagement• Stakeholders • GRI Index

16 of 81Governance
The objective of our governance structure
is to maintain corporate governanceprinciples, policies, and practices that
support the accountability of management and the Board of Directors. These
are in the best interest of the Company
and our shareholders, and they are
consistent with the Company’s Purpose,
Values and Principles. We believe that
good governance practices contribute tobetter results for shareholders. Everything
we do is done with our commitment to“doing the right thing” in mind.
Governance Structure
Governance starts with the Board of Directors,
which has general oversight responsibility for
the Company’s affairs pursuant to Ohio’s
General Corporation Law, the Company’s
Amended Articles of Incorporation and Codeof Regulations, and the Board of Directors’
Bylaws. In exercising its fiduciary duties, theBoard of Directors represents and acts onbehalf of the Company’s shareholders.
Although the Board of Directors does nothave responsibility for the day-to-day
management of the Company, it stays
informed about the Company’s business andprovides guidance to Company management
through periodic meetings, site visits, andother interactions. The Board is deeply
involved in the Company’s strategic planning
process, leadership development, andsuccession planning.

Additionally, the Board has adopted guidelines
for determining the independence of its
members. As of June 30, 2009, approximately
83% of our directors qualified as being
independent from the Company.
The Board has approved a code of conduct,outlined in our Worldwide Business Conduct
Manual. This code applies to all directors,
officers, and employees and is designed tohelp ensure compliance with all applicablelaws and Company policies, including thoserelated to sustainable development.
Shareholders may communicate with theBoard of Directors and submit shareholder
proposals as described in the Company’s
proxy statement.
Additional details concerning the roleand structure of the Board of Directors
are contained in the Board’s Corporate
Governance Guidelines, which can be found in
the corporate governance section of theCompany’s website at www.pg.com/investors.
Our corporate governance guidelines,
independence guidelines, and charters
for all Board committees are available at our
website at www.pg.com/company/our_commitment/corp_gov.

Management’s Responsibility
for Financial Reporting
P&G has a strong history of doing what’s
right. Our employees embrace our Purpose,
Values and Principles. If you analyze what has
made our Company successful over the years,
you may focus on our brands, our marketingstrategies, our organizational design, and ourability to innovate. But if you really want to
get at what drives our Company’s success, theplace to look is at our people. Our people are
deeply committed to our Purpose, Values andPrinciples. It is this commitment to doing
what’s right that unites us.
This commitment to doing what’s right isembodied in our financial reporting. Highquality financial reporting is our responsibility —one we execute with integrity and within boththe letter and spirit of the law.
High-quality financial reporting is characterized by accuracy, objectivity, and transparency. Management is responsible formaintaining an effective system of internal
controls over financial reporting to deliver
those characteristics in all material respects.
The Board of Directors, through its Audit
Committee, provides oversight. To audit ourconsolidated financial statements, they haveengaged Deloitte & Touche LLP, who has
issued an unqualified opinion.

Our commitment to providing timely, accurate,
and understandable information to investors
encompasses a number of efforts:
Communicating Expectations to Employees —Every employee — from senior managementon down — is trained on the Company’s
Worldwide Business Conduct Manual, whichsets forth the Company’s commitment to
conduct its business affairs with high ethicalstandards. Every employee is held personallyaccountable for compliance and is provided
several means of reporting any concerns
about violations.
The Worldwide Business Conduct
Manual is available on our website atwww.pg.com/company.
Maintaining a Strong Internal Control
Environment — Our system of internal controls
includes written policies and procedures,segregation of duties, and the carefulselection and development of employees.
The system is designed to provide reasonableassurance that transactions are executed as
authorized and appropriately recorded, that
assets are safeguarded, and that accounting
records are sufficiently reliable to permit the
preparation of financial statements conforming in all material respects with accounting
principles generally accepted in the UnitedStates. We monitor these internal controls
through control self-assessments by business
unit management. In addition to performing
financial and compliance audits around thewww.pg.com/sustainability

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17 of 81Governance (continued)
world, including unannounced audits, our
Global Internal Audit organization provides
training and continuously improves internal
control processes. Appropriate actions aretaken by management to correct any identified
control deficiencies.
Executing Financial Stewardship — We
maintain specific programs and activities
to ensure that employees understand theirfiduciary responsibilities to shareholders.
This ongoing effort encompasses financial
discipline in our strategic and daily businessdecisions, and brings particular focus tomaintaining accurate financial reporting andeffective controls through process improvement, skill development, and oversight.
Exerting Rigorous Oversight of theBusiness — We continuously review ourbusiness results and strategic choices.
Our Global Leadership Council is actively
involved — from understanding strategies
to reviewing key initiatives, financial performance, and control assessments. The intent
is to ensure that we remain objective,
identify potential issues, continuously
challenge each other, and ensure thatrecognition and rewards are appropriatelyaligned with results.

Engaging Our Disclosure Committee —We maintain disclosure controls and procedures
designed to ensure that information required
to be disclosed is recorded, processed,
summarized, and reported accurately and ina timely fashion. Our Disclosure Committee isa group of senior-level executives responsible
for evaluating disclosure implications ofsignificant business activities and events.
The Committee reports its findings to the CEO
and CFO, providing an effective process toevaluate our external disclosure obligations.
Encouraging Strong and Effective Corporate
Governance from Our Board of Directors —We have an active, capable, and diligent
Board that meets the required standards forindependence, and we welcome the Board’s
oversight. Our Audit Committee comprises
independent financial directors with significant knowledge and experience. We review
significant accounting policies, financial
reporting, and internal control matters withthem, and encourage their independent
discussions with external auditors.

Executive Compensation
The Compensation & Leadership Development
Committee has established the following
principles for compensating all Company
employees:• Support the business strategy• Pay for performance• Pay competitively
These overall principles have served theCompany well and enabled us to deliver strong
shareholder value over time — including
compound average shareholder returns
above the Dow Jones Industrial Average forthe past one-, three-, five- and 10-year
periods. The Committee and the Board of
Directors are charged with the consistent andfair application of these principles. We believe
this has helped to develop and retain talented
employees who are committed to theCompany’s success.

Additionally, we expect executives to upholdthe fundamental principles in the Company’s
Statement of Purpose, Values and Principles,in addition to the Worldwide BusinessConduct Manual, the Sustainability Report,
and the Environmental Quality Policy. These
principles include integrity, maximizing thedevelopment of each individual, developing
a diverse organization, and continually
improving the environmental quality of theCompany’s products and operations. In
upholding these principles, executives not
only contribute to their own success but also
help ensure the prosperity of P&G’s business,
employees, shareholders, and the communities
in which the Company operates.

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18 of 81

Political Involvement
P&G’s political involvement is an important means of building and protecting
our business.
Guided by our Purpose, Values and Principles,P&G participates in the political process tohelp shape public policy and legislation thathas a direct impact on the Company. This
engagement ensures that the interests ofour employees, consumers, and shareholders
are fairly represented at all levels of government around the world. We are committed
to being transparent about our politicalinvolvement globally.
P&G’s public policy and legislative priorities
are reviewed regularly with senior businessleaders and annually with the Governanceand Public Responsibility Committee of theBoard of Directors.

Lobbying Activity
P&G’s Global Government Relations team
(P&G GGR) represents the Company’s pointof view in Washington, D.C., in U.S. state
capitals, and in key country capitals aroundthe world. Working with the businesses,
P&G GGR focuses on legislative and public
policy issues that impact the Company’s
bottom line and long-term business interests.
Where permitted by law, P&G GGR engages
and educates policy makers and key stakeholders on issues that impact our business;
facilitates the exchange of information between
key decisionmakers and public policy organizations in the U.S. and abroad; and leads Company
actions on policy matters both unilaterally andin industry coalitions and associations.

P&G complies with all U.S. federal and state
laws, including the Lobbying Disclosure Act
and Honest Leadership and Open Government
Act, that require reporting on lobbying
activities and certification of compliance with
Congressional gift rules. P&G reported U.S.
lobbying expenditures of $3.66 million in thelobbying disclosure reports filed with the Clerkof the U.S. House of Representatives and theSecretary of the U.S. Senate for the 2008
calendar year. In 2008, P&G reported lobbying
activity in the range of €200,000 to 250,000(approximately $290,000 to 365,000 USD) in
the European Union under new voluntary
guidelines issued by the EU Commission.
In 2008, P&G spent roughly $9.2 million indues to U.S. associations with annual duesof $25,000 or more, of which $1.8 million,
roughly 19.5%, was identified by 40 associations as funds spent on lobbying and politicalactivities.
A listing of P&G’s U.S. associations
and percentage of dues attributable
to political activities can be found atwww.pg.com/political_activities.

U.S. Corporate Political Activity
P&G engages in the political process byproviding financial support to state ballot
initiatives and issue advocacy campaigns thathave a direct impact on the business. P&G’s
involvement in these campaigns is overseen
by a multifunctional team comprised ofrepresentatives from Global Government
Relations, Legal, Human Resources, Corporate
Communications, and other functions related

to the specific issue under consideration. The
team makes recommendations to the Global
External Relations Officer for approval, or for
further review and approval by the President
and CEO and Chairman as appropriate. As withall other aspects of our political involvement,
our participation in such efforts is guided by
our Purpose, Values and Principles and by ourbusiness strategies, and is fully reported inaccordance with governing laws. In 2008,
P&G gave $460,000 in contributions to stateballot initiatives and other issue advocacy
campaigns that had a direct impact on thebusiness.
A listing of these initiatives can be foundat www.pg.com/political_activities.

P&G Political Action Committee(P&G PAC)
The P&G PAC is a voluntary, nonpartisan
political action committee. Registered as the
P&G Good Government Committee with the
U.S. Federal Election Commission (FEC) andappropriate state offices, the PAC allows
P&G employees to pool personal, voluntaryfinancial contributions to support candidates
at the federal, state, and local level who
support issues important to the businessand the quality of life in the communities inwhich we live and work.

Support of candidates is based on theirsupport of P&G issues and sustained constituent relationships. The PAC generally does notcontribute to Presidential candidates, national
political parties, trade and industry associationor leadership PACs, or multiple candidates
running in the same race. In 2008, the P&G
PAC contributed $270,280 to 184 candidates
running for office. The average contribution
was $1,469.
Additionally, P&G operated a separate state
PAC in Massachusetts, and a federal PAC
related to the acquisition of Gillette. In 2008,
the P&G/Gillette state PAC contributed$1,250 to three Massachusetts state andlocal candidates, and the Gillette Federal
PAC did not make any contributions tocandidates. Both PACs were closed in the
beginning of 2009.
P&G PAC activity is available on the FEC
and state elections websites. A listingof all 2008 PAC contributions is available atwww.pg.com/political_activities.

P&G PAC operations are transparent andcompliant with all applicable laws. It isgoverned by a set of bylaws and supervised
by a diverse board of Company senior
managers, U.S. Government Relations
personnel, and P&G Legal counsel.

www.pg.com/sustainability

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19 of 81

Policies and Management
Systems for Reporting
Performance
Policies

Performance

Process for Data Collection

While P&G competes hard to achieve
leadership and business success, the Company
is concerned not only with results, but alsowith how those results are achieved. We will
never condone or tolerate efforts or activities
to achieve results through illegal or unethicaldealings, anywhere in the world.

P&G measures operational performance inorder to drive continuous improvement. A
company-wide system of measuring performance has been developed. This approachenables the Company to report data on awide range of operational categories. Our
actions are not just profit-driven but also
progress-driven, to ensure a better qualityof life for everybody, now and for generations
to come. Our extensive consumer research
related to our brands also helps us identify
ways we can best address Sustainability.

P&G’s data collection systems have been inplace for many years. They are designed tobe simple enough so that the people closest
to the work can use the tools, regardless oflocation. This simplicity enables the Company
to collect data and update systems annuallyat a relatively low cost. Each business unit is
responsible for the accuracy and consistencyof its data.

Management Systems
P&G’s Management Systems ensure that theCompany’s policies are implemented in aconsistent manner throughout the world.
These Management Systems align with theCompany’s policies and promote a regularflow of information that helps the Company
better manage its progress on elements ofsustainable development.

Acquisitions
Acquisitions, mainly Wella and Gillette, havebeen included in the metrics presented herein.
The only thing that is different for acquisitions
is the expectations of performance withrespect to meeting all of P&G standards. We
allow a six-year glide path to meet the audit
performance score of 8.0 out of a ten-point
scale. A mid-point expectation is 6.5 within
three years. Our experience has been that theacquisitions exceed those expectations.

All data is reported on a global basis. In
order to achieve consistency and to ensure
a common understanding throughout theorganization, employees are trained in how toreport and document data. Our standard is touse metric units and English as our businesslanguage, backed where necessary with local
translations. To ensure the standard collectionof data, the Company has the following work
process in place:• Key terms are defined.
• The data to be collected are identified.
• Flow sheets are agreed upon regarding whocollects data and on what systems.
• Technically sound methods are used byfacilities to estimate data and validate
year-to-year results.
• Personnel are trained on the work process,as appropriate.

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Social Responsibility•

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20 of 81

Product
Innovation
Insight Matters
We combine two key strengths — consumer
understanding and science — to deliver
sustainable innovations that don’t require
trade-offs in performance or value.

Strategy 1:
Products
GOAL Develop and market at least $50 billion in cumulative
sales of “sustainable innovation products,” which areproducts that have an improved environmental profile.(1)PROGRESS(in billions of U.S. dollars)

Cumulative sales of sustainable
innovation products

Cumulative Sales
since July 2007

$13.1

(1) Sustainable Innovation Products are included if they have launchedin market since July 1, 2007, and have a >10% reduction in one ormore of the following indicators without negatively impacting theoverall Sustainability profile of the product: A. Energy, B. Water,
C. Transportation, D. Amount of material used in packaging or
products, E. Substitution of nonrenewable energy or materials withrenewable sources.

www.pg.com/sustainability

Contents • Introduction • P&G Profile • Product Innovation •Operational Improvement•

Social Responsibility•

Employee Engagement• Stakeholders • GRI Index

Consumer InsightTechnology Insight

Because we are in touch with the realityof consumers, we can make innovation
decisions based on their needs. We knowthat most consumers are unwilling to
make trade-offs on performance or value
to be more sustainable. This insight isconsistent in regions throughout the world.

A second decision making factor comesfrom our unique, holistic view of technology. Our science is based upon life cycle
thinking, a discipline we helped pioneer.

We have found that two relatively small
groups exist on the ends of a decision making
spectrum. On one end, “niche” consumers arewilling to sacrifice performance or value fora more sustainable product. On the other, asmall segment is focused on providing “basic
living” for their families and do not makepurchases based on Sustainability factors.
CONSUMER TYPES

U.S. 17%74%

9%

EUROPE 18

%

74

8%

JAPAN 12%

81%

7%

%

Niche

Sustainable
Mainstream

This approach considers the entire environmental footprint of a product, from raw
materials to consumer use and disposal.
It examines multiple factors in each step todetermine the overall environmental impact.
P&G’s unique combination of consumer
insights and technology insights results insustainable product innovations that canbe delivered by changing the product, its
packaging, or both. Dozens of these innovations have been launched successfully acrossP&G. Some examples from Ariel, a leading
P&G laundry brand, show how such advances
come to life.

Packaging

21 of 81Distribution

LIFE CYCLEASSESSMENT
Manufacturing

Materials

Usage

Disposal

Basic

The vast majority of consumers (around 70%)
we call the “sustainable mainstream” — wantchoices that have improvements in theirenvironmental profile. But they will only alterpurchasing decisions when they can have theperformance they require and the value theyneed. At P&G, this group is the focus of ourSustainability decisions.
Why does this matter? By meeting the needsof this largest segment of consumers, we candeliver the greatest positive impact.

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22 of 81

Dramatic Changes
in Formulation
Ariel Excel Gel, the new generationof Ariel detergents, was designed fromscratch for ultimate cleaning at low
temperatures. This formulation change
has helped bring about reductions inenvironmental impact, expending lessenergy, water, packaging, and waste.
The science behind Ariel Excel Gel’s lowtemperature performance is called catalytic
detergency — a type of chemistry that actually
regenerates itself. At first, stains are broken
down and suspended in the water away fromclothes. But Ariel Excel Gel then returns to theclothes and removes additional stains, again
and again. This means a small amount of gel
will achieve fantastic results in water temperatures as low as 15°C.

But Ariel Excel Gel takes Sustainability a stepfurther. The next-generation formula uses
only ingredients that add value to the cleaning
performance, adding no thickeners, solvents,or stabilizers. Thanks to a breakthroughformulation that forms a gel naturally, theproduct’s easy-squeeze consistency is achieved
without the need for any structuring agents.
This makes it possible to handle the same
number of loads in a highly concentrated
formula, leading to a dramatic reduction inpackaging.

Why does this matter? During the laundry life
cycle, 70% of energy consumption happens
during the product’s use, heating the water
needed to wash. Eliminating the need to heat
the water cuts energy use dramatically.

A NOTICEABLE REDUCTIONIN OVERALL ENVIRONMENTAL
FOOTPRINT*

40 – 50%
Less water to manufacture

30 – 40%
Less energy to manufacture

20 – 50%
Less energy by washingin low temperatures

14 – 45%
Less packaging

40 – 57%
Fewer trucks to transport* Variations are dependent on country differences (e.g., energy rates, base packaging comparisons)www.pg.com/sustainability

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Employee Engagement

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• Stakeholders • GRI Index

Systemic Thinking
in Packaging
P&G has experts in packaging
Sustainability working in every category.
These experts form a network to share
progress, challenges, and ideas forreapplication with other brands aroundthe world. We’re looking at packaging
improvements systemically, from shipment to shelf to use in the consumer’shome. Since 2006, this has resulted in
136,000 metric tons of packaging
material avoidance.
One example of oursystemic approach
involves an advanceby P&G teams in
LESS PACKAGING
Turkey. By replacing
MATERIAL THAN BOXES
cardboard shippingboxes on Ariel withseal-tight plastic bags, they found a way touse significantly less material while deliveringa superior product to market. Previously,
shipping Ariel involved packing eight bagsof Ariel granule detergent into a corrugatedbox. The team designed a new process that
Ariel bags require

80%

packed Ariel in large, seal-tight polyethylene
bags. Entirely recyclable, these bags require
80% less packaging material than boxes, andcan be opened without tools. They also takeup 20% less space during transport andstorage and help speed up the packaging line.
For our retail customers, the new outer
covering provides still more value. It allows
for easier stock management, with thetransparent film showing the product insidefor faster recognition of brands and sizes.
Because the packaging can be opened
without tools, it is easier to handle. And
it maxi­mizes shelf space, helping reduce
out-of-stock situations.
The success of this packaging advance has
inspired its expansion beyond Turkey. The
new process is currently being reapplied
across multiple regions, with three more
plants scheduled to be up and running by
early next year.

Since 2006,
improvements madecompany-wide resulted in

136,000
METRIC TONS OF
PACKAGING MATERIALAVOIDANCE

Switching from cardboard
shipping boxes (left) toseal-tight plastic bags
(right) uses up to 20%
less space.

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24 of 81

Sustainable Innovation Products 2008 – 2009
Products with a >10% reduction in one or more of the following indicators without negatively
impacting the overall Sustainability profile of the product: A) Energy, B) Water, C) Transportation,D) Amount of material used in packaging or products, E) Substitution of nonrenewable energy
or materials with renewable sources.
PRODUCTREGIONINNOVATION

Ariel Excel Gel

Western Europe

Formulation concentration deliveredsavings in water, energy, transportation,
packaging; Formulation to clean in cooler
temperatures, saving energy

Ariel

Western Europe

Formulation concentration delivered savingsin water, energy, transportation, packaging

Fairy, Dreft, Yes

Western Europe

Formulation concentration delivered savingsin water, energy, transportation, packaging

Ariel

TurkeyReplaced cardboard shipping boxes withseal-tight plastic bags, using less material

Downy, Lenor

GlobalFormulation concentration deliveredsavings in transportation and packaging

PanteneGreater China

Package weight reduction

Olay Total Effects

North America,
Greater China,
United Kingdom

Pump redesign reduced plastic

Prilosec OTC

North America

Redesigned to include twice the productin one blister-packBraun Series 5 shaver,GlobalBraun Series 3 shaver,Braun BodycruZer, Braun
Handblenders, Braun Hairstyler

Reduced packaging

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Contents • Introduction • P&G Profile • Product Innovation •While our focus on innovation keeps us
on the cutting edge of technology andconsumer understanding, we work froma strong foundation and commitment toensuring that our products, packaging,and operations are safe for employees,
consumers, and the environment. This
commitment is brought to life by thepolicies, procedures, and organizations
on the following pages.

Operational Improvement•

Social Responsibility•

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25 of 81

Environmental
Quality Policy
We will provide products and services ofsuperior quality and value that improve thelives of the world’s consumers. As part ofthis process, P&G continually strives toimprove the environmental quality of its
products, packaging, and operations aroundthe world. To carry out its Environmental
Quality Policy, P&G:

• Meets or exceeds the requirements of allenvironmental laws and regulations. We use
environmentally sound practices, even in theabsence of governmental standards. We
cooperate with governments in analyzing
environmental issues and developing costeffective, scientifically based solutions andstandards.

• Ensures that our products, packaging,and operations are safe for our employees,
consumers, and the environment.

• Continually assesses our environmental
technology and programs and monitors
progress toward environmental goals. We
develop and use state-of-the-art science andproduct life cycle assessment, from raw
materials through disposal, to assess
environmental quality.

• Reduces or prevents the environmental
impact of our products and packaging intheir design, manufacture, distribution, use,and disposal whenever possible. We take aleading role in developing innovative, practicalsolutions to environmental issues related toour products, packaging, and processes.
We support the sustainable use of resources
and actively encourage reuse, recycling, andcomposting. We share experiences andexpertise and offer assistance to others who
may contribute to progress in achieving
environmental goals.

• Ensures that every employee understands
and is responsible and accountable forincorporating environmental quality
considerations in daily business activities.
We encourage, recognize, and reward
individual and team leadership efforts toimprove environmental quality. We also
encourage employees to reflect theircommitment to environmental quality
outside of work.
• Has operating policies, programs, andresources in place to implement ourEnvironmental Quality Policy.

• Provides our consumers, customers,
employees, communities, public interest
groups, and others with relevant andappropriate factual information about theenvironmental quality of P&G products,
packaging, and operations. We seek toestablish and nurture open, honest, andtimely communications and strive to be
responsive to concerns.

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26 of 81

Product Safety
Household consumer products use a varietyof chemical ingredients to provide benefits tosociety, such as cleaner homes and improved
health and personal hygiene, thus enabling an
overall better quality of life. One expectationof consumer products is that they will be safe,that is, that their use will not adversely affecthuman health or the environment.

Our approach is based on the scientificassessment and management of risk  —  thelikelihood that people or the environment
will be exposed to harmful amounts of a
substance. Risk assessment is based on two
factors:

Throughout its history, P&G has believed thatthe safety of our products is a prerequisite forresponsible business. Our co-founder, James
Gamble, stated in the mid-1800s that “if you
cannot make pure goods and full weight, go
to something else that is honest, even if it isbreaking stone.” Today, this philosophy isreflected in our Statement of Purpose: “Wewill provide branded products and services ofsuperior quality and value that improve thelives of the world’s consumers, now and forgenerations to come.” Safety is an intrinsic
part of our products’ quality and value.

2. How it is used, specifically the extent of
exposure to humans or the environment.

1. How potentially “toxic” or “hazardous”
a chemical is, andIn recent years, some stakeholders haveexpressed concern about using risk as thebasis for product safety. These concerns havebeen driven by several issues, including:• Questions about whether the potential
hazards of existing chemicals have been
sufficiently studied and whether chemical
exposures can be adequately understood.
• Frustration with the slow pace of developing
publicly available risk assessments.
• New scientific findings that have not beenpreviously known or evaluated.

As a result, some believe that it might bebetter to base decisions on a chemical’s
hazards alone. This has been coupled withcalls for the far-reaching use of the “precautionary principle,” whereby substances thatare classified as “hazardous” would be broadly
restricted, with little further evaluation. We
recognize the attraction of such a “black andwhite” approach. However, we believe thatit could cause chemicals being used safely to
be unjustifiably removed from the market,
potentially depriving society of innovativeand beneficial technologies. Furthermore,experience has shown that even chemicals
that could be considered “non-hazardous”(even water) can cause harm under certain
circumstances, while potentially “hazardous”
chemicals can be safely used (e.g., ethanol).
From a policy standpoint, we continue tobelieve that chemicals management programs
should be based on:
1. Efficient risk-based priority setting processes
that use hazard data and basic exposure
information together to identify issues ofpotential concern, followed by practicalrisk evaluations that analyze chemicals ina tiered fashion to resolve such issues.
2. Risk management decisionmaking thatcombines information on a chemical’s risks,benefits, and costs with an understandingof societal concerns; the risks, benefits,
and costs of alternatives; and the use of
appropriate precautionary measures.
3. Communications that provide meaningful
and relevant safety information to stakeholders, so that they can make knowledgeable decisions.
These policies are the foundation of what we
do internally, as well as what we encourage
across government and industry. Internally,
they are enabled by collaboration among
Research & Development, Product Safety andRegulatory Affairs, Manufacturing, External
Relations, and management. Our efforts gobeyond safety and risk to include product life
cycle issues such as energy and resources use,
as well as waste management.

www.pg.com/sustainability

Contents • Introduction • P&G Profile • Product Innovation •Operational Improvement•

Product Safety
Organization
Product Safety & Regulatory Affairs (PS&RA)
is responsible for ensuring that products andpackages are safe for consumers, safe for theenvironment, and in compliance with laws andregulations where they are sold.
PS&RA also addresses other environmental
aspects of products and packages, such as
their compatibility with waste management
systems, natural resource use, or issues ofperceived safety. This organization is also
responsible for the development, validation,
and adoption of alternatives to animal testingand ensures that any claims the Company
makes about the safety or environmental
profile of its products are scientifically sound.
Risk assessment is the process the Company
uses to evaluate the safety of its products
and ingredients. In this process, chemicalhazard and exposure information areevaluated to determine the likelihood thata chemical can adversely affect biologicalsystems. The PS&RA organizations in eachbusiness unit work closely with productdevelopment teams in the development,
selection, and formulation of productingredients and mixtures with acceptablerisk profiles, as well as satisfying otherimportant business and consumer needs.
A key part of PS&RA is the Central Product
Safety (CPS) organization. CPS has direct
responsibility for ensuring that our products
are safe for consumers and the environment.
Its primary role is to advance the science used
to understand and evaluate the human andenvironmental safety and impact of ourSocial Responsibility•

Employee Engagement• Stakeholders • GRI Index

Approach to Animal
Welfare and Alternatives
products and includes development of
new methods using the latest advancements
in science and technology. It is helped inthis process by an External Advisory Board
consisting of several distinguished academic
scientists.
CPS’s work involves conducting basic research
to develop new methods for evaluating safety
and conducting studies in toxicology andbiodegradation, together with an understanding of exposures, to ultimately complete
human and environmental safety assessments
used to make business decisions for products
going to market as well as guide in thedevelopment of new technologies. CPS is
also involved in key national and international
initiatives (e.g., United Nations, Organization
for Economic Cooperation and Development)
directed toward supporting the soundmanagement of chemicals around the world
by sharing our toxicity information andestablishing principles for promoting thesafe and responsible use of chemicals.
For further details on the science andsafety of P&G products, we encourage
you to visit these websites:
Science in-the-Box:
www.scienceinthebox.com
The Science of Beauty:
www.pgbeautyscience.com
PG.com: www.pg.com

P&G products are used in homes aroundthe world 3 billion times a day, and we arecommitted to safeguarding the health of ourmany consumers.
Sometimes, to ensure that materials are safeand effective, we must conduct research
involving animals. This is a last resort. We
consider such research only after every otherreasonable option has been exhausted. The
vast majority of our tests do not use animals.
Wherever possible, we use computer models,
synthetic materials, published scientific studies,and comments from consumers about products
they use. P&G is well known for leadership indeveloping alternatives to animal tests, investing
more than $250 million and developing or
adapting more than 50 alternative methods.
We approach our work with respect,
openness, and responsibility by using animals
as a last resort, working with animal welfareorganizations and ensuring high standards ofcare. We have invested more than $15 million
since 2003 to help advance standards ofanimal care and welfare. We collaborate withgovernments and academia to promote theacceptance of alternatives. We actively shareour discoveries so that others can benefit fromthem. News of our advances has been sharedin more than 400 scientific publications. We
seek input from the world’s leading experts
to continuously improve our approach.
For details of our policy and practices

27 of 81

please go to: www.pg.com/science/animal_alt.shtml.
On this website you can also learn about:• Ongoing work to advance our animal
welfare and animal alternatives programs(in our regular Forward Focus newsletter).
• P&G’s participation in the World Congresses
on Alternatives & Animal Use in the Life
Sciences (2005, 2007, 2009), a leading
global scientific forum on refining, reducing,and replacing the use of animals in research.
• The joint declaration by P&G and the
Humane Society of the United Statescommitting the two organizations toa strategic partnership that aims at theelimination of animal use for consumer
product safety evaluation.
• P&G’s commitment to the European
Partnership for Alternative Approaches(EPAA), which aims to accelerate the rate
at which alternatives are agreed upon,validated, and put into practice.
• P&G’s support of the European Animal
Welfare and Alternatives Awards offeredby EUROTOX and the Humane SocietyInternational, as well as the North American
Awards offered by The Humane Society of
the United States.
For additional perspective on our
approach to product safety and animal
welfare, see our Product Safety section on
page 67 in Stakeholders.

www.pg.com/sustainability

Contents • Introduction • P&G Profile • Product Innovation •Operational Improvement•

Social Responsibility•

Employee Engagement

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• Stakeholders • GRI Index

Wood Pulp
Procurement Policy
P&G purchases wood pulp for tissue andabsorbent hygiene products. Though we
do not own or manage forests, we have a
responsibility through our procurement
practices to ensure sustainability of theworld’s forest resources. As such, we arecommitted to understanding the sourcesof our pulp fiber, transparency in sourcing,ensuring that sustainable forest management
practices are used, avoiding unwanted sourcesof wood, and working with stakeholders on
stepwise increases in preferred certification
schemes. Independent third-party verification
systems are used to ensure sustainable forest
management and wood traceability, while wework with global multi-stakeholder organizations to develop tools and scientific methods
to protect values and services that forests
provide such as biodiversity, watershed
protection and climate moderation. For
transparency, P&G does track and reportannually the amount of wood pulp itpurchases from suppliers certified undereach of the forest certification schemes.

Sustainable Forest Management
P&G purchases wood pulp from suppliers that:• Ensure the safety of forestry and manufacturing operations for employees and theenvironment.
• Document that wood is legally harvested
and that other legal requirements are met.
P&G will not knowingly use illegally sourced
wood fiber in our products.
• Practice principles of sustainable forest
management and continuous improvementin their own operations and in sourcing ofwood, as verified by independent forest andchain-of-custody certification.
• Do not obtain wood from High Conservation
Value Forests. P&G supports multi-stakeholder
efforts to develop information sources andtools that will help suppliers identify theseareas on their own forestlands and in theirprocurement of wood raw materials fromthird parties (e.g., www.hcvnetwork.org).
• Do not obtain the wood from geneticallymodified tree sources.
• Reflect our social values and support ofuniversal human rights through work withlocal governments and communities toimprove the educational, cultural, economic
and social well-being of those communities.
• Do not source wood from conflict timber(timber that was traded in a way that drives
violent armed conflict or threatens nationalor region stability).
We ensure compliance with this policy
through site visits, comprehensive surveys
and research, required documentation, andindependent third-party certification ofsustainable forest management practices.
P&G requires pulp suppliers to independently
certify their operations for sustainable forest
management. P&G also requires suppliers toprovide auditable assurance that wood fromsources not directly owned and managed bythem is legally sourced and that harvest is
conducted via sustainable practices.

Forest Certification• Avoidance of unwanted wood sources.

We give preference to pulp from Forest
Stewardship Council (FSC) certified forests
when it is available and meets productperformance requirements and competitivemarket conditions. We will utilize FSC
controlled wood in a stepwise approach toprogressively increase the amount of pulp
from FSC certified sources. P&G will actively
participate in ongoing discussions concerning
FSC standards, including becoming an FSC
member. As a minimum standard, P&G
requires that any wood pulp supplier ensurethat their forest certification systems are
consistent with the following generally
accepted criteria for sustainable forest
management:• Multi-stakeholder governance and transparency in decisionmaking and reporting.

• A commitment to forest regeneration andreforestation.
• Protection of soil quality, riparian zones andwater quality.
• Protection of ecologically and culturally
unique forest areas.
• Maintenance and conservation of biologicaldiversity.
• Participation of interested and affectedstakeholders.
• Continuous improvement in forestry
practices.
• Compliance with legislation, agreements
and accords• Support of universal human rights andrespect for ownership and use rights of local
communities and indigenous people.

• Independent third-party verification offorestry practices and chain of custody forwood fiber.

Forest Conversion
P&G may use wood fiber harvested fromrecently converted forest lands only if the
supplier can demonstrate that they haveprotected HCV forests using standards andtools developed through multi-stakeholder
efforts (e.g., www.hcvnetwork.org) and thatthe forestry practices meet the minimum
criteria previously discussed.

Efficient Use of Resources
P&G is committed to reducing demand on
the world’s forests and other resources. P&G
believes that we should invest our resources
where we can make the greatest sustainability
improvements and will continue to:• Focus on source reduction in the long termor use of less fiber through development ofinnovative technologies that provide maximum
product performance using minimal fiber.
• Evaluate the use of non-forest derived
sources of fiber, recognizing that alternatives
must also meet principles of sustainable
management.
• E xplore and implement energy and water
conservation opportunities in our paper
making operations.
• Use recovered fiber when it has no negative
impact on product performance,

www.pg.com/sustainability

Contents • Introduction • P&G Profile • Product Innovation •Operational Improvement•

Wood Pulp
Procurement Policy (continued)
All of our pulp suppliers have certified theirforestry operations for sustainable forest
management. The certification systems used
are as follows:

P&G bought a total of 1.65 million ADMT(air dried metric tons) of pulp in 2008 – 2009
for use in our tissue/towel products, diapers,
and feminine hygiene products. The pulp was
sourced from the following regions:
16%

Canada42%

Brazil41%

Indonesia *<1%

France<1%* From plantations; high conservation value
assessments done to protect biodiversity•

Employee Engagement

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• Stakeholders • GRI Index

Palm Oil

manufacturing efficiency, resource andenergy usage and waste generation. We willcontinue to invest in research to identify thetechnical breakthroughs needed to allow us
to use recovered fiber in our premium products
without an impact on product performance,
manufacturing efficiency, resource and energy
usage and waste generation.

United States

Social Responsibility

Sustainable Forestry Initiative (SFI)45%

Sistema Brasileiro de Certificcacao
Florestal (CERFLOR)

41%

Forest Stewardship Council (FSC)

1%

Programme for the Endorsementof Forest Certification (PEFC)

9%

Lembaga Ekolabel Indonesia (LEI)

1%

Canadian Standards Association
National Sustainable Forest
Management Standards (CSA)

3%

P&G has a goal of increasing FSC certified fiber
as acceptable sources are available that meet
our product and process requirements.
P&G will periodically consult external stakeholders to review emerging issues related toenvironmentally responsible fiber.

P&G is committed to the sustainable sourcingof palm oil. By 2015, we intend to purchaseand use palm oil that we can confirm to haveoriginated from responsible and sustainablesources. We will seek to accomplish this goal
through the following key steps.

Supplier and Partner Coaching
We will continue to share and reinforce our
expectations related to Sustainability, andencourage and reward “sustainable behavior”
on behalf of our partners and suppliers. This
will include visits to our suppliers and auditsof their on-the-ground operations to ensurethat their practices will meet or exceed our
Sustainability expectations, including theirselection, purchase, and responsible use ofland for the planting of palm plantations.
We will continue to partner with known
suppliers with whom we have long-standing
relationships and trust, as well as withemerging suppliers who embrace and support
our Corporate Sustainability principles andexpectations.

Stakeholder Partnerships
We will expand and strengthen relationships
with trade associations, government agencies,
nongovernmental organizations (NGOs), andother critical external stakeholders to help
influence positive changes and incremental
Sustainability improvements in the palm oil
supply chain and industry. We will partnerwith third-party organizations to help confirm
and validate our palm oil sourcing anduse strategies.

Industry Influence
We will continue to support industry efforts
to eliminate irresponsible and/or illegal
deforestation of land for use in the planting
and harvesting of palm plantations, as well as
efforts to help ensure the appropriate selection
and designation of land for such uses.

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Employee Engagement• Stakeholders • GRI Index

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Operational
Improvement
End-to-End Thinking Matters
We are expanding our work from a focus on
the core of our manufacturing operations to aholistic end-to-end view of opportunities.

Strategy 2:
Operations
GOAL Deliver an additional 20% reduction (per unit
production) in CO2 emissions, energy consumption, water
consumption and disposed waste from P&G plants, leading
to a total reduction over the decade of at least 50%.
PROGRESS(percent reduction per unit production)

Energy Usage

Since
July 2007

Since
July 2002

-11%

-48%

CO2 Emissions

-10%

-52%

Waste Disposal

-30%

-53%

Water Usage

-13%

-52%

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• Stakeholders • GRI Index

Manufacturing

End-to-End Strategy

Between raw materials and the creation ofa product, we strive to reduce waste, water,energy, and CO2 through systemic conservation
efforts. We apply smart eco-design throughinnovative construction process improvements.
And, we re-use where feasible, giving new life
to what was once waste.

Our strategy for making sustainableimprovements to our Operations impacts
all parts of the supply chain. It continues
to deliver strong results behind a threepronged approach: manufacturing,finished product logistics and supplierengagement.

Finished Product Logistics
In the logistics stage, we reduce waste inproduct customization by applying new
designs. We optimize transportation througha comprehensive multi-mode approach, andnow go further by leveraging common“intermodal” containers across different
types of transportation.

Supplier Engagement
We collaborate closely with suppliers acrossthe entire supply chain. Our new Supplier
Sustainability Board includes members fromover 20 leading global suppliers and is charged
with guiding the development of supplierrelated Sustainability activities and goals.

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Employee Engagement

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• Stakeholders • GRI Index

Manufacturing
Reducing Waste, Water, Energy, and CO2Across P&G facilities, Site Sustainability Leaders identify opportunities to reduce
P&G’s impact across four environmental footprints: waste, water, energy, and CO2.
The following examples illustrate results from these teams.
Waste
While our Beauty plant in Bangkok,
Thailand, had excellent results
across all four footprints, theirresults in reducing waste wereparticularly significant. The facility decreased
waste disposal by 86% by implementing aprocess to dewater plant by-product, reducing
the weight and volume of the material byremoving the water before disposal.
Waste disposal decreased

86%

Water

Energy and CO2
Projects at sites across Western
Europe have realized substantial
water savings. For example:

At our Baby Care plant in
Mequinenza, Spain, we performed an analysis
to understand where we were losing water.
The resulting water savings amounted to
28m3 per unit of production.
A new chiller at P&G’s pharmaceutical site in
Weiterstadt, Germany, enabled water savingsof 24.1m3 per unit of production.

Our Household Care plant inBrockville, Ontario, Canada,decreased its total site energy
use by 20% through a seriesof improvements. The site optimized HVAC
(Heating, Ventilation, Air Conditioning)systems, improved compressor and chiller
management, improved boiler efficiency, shut
down equipment automatically when not inuse, added timers to lights, and implemented
site-wide steam trap inspection and replacement. These efforts are now being replicatedacross many P&G sites globally.

Energy use decreased20%

AT HOUSEHOLD CARE
PLANT IN BROCKVILLE,ONTARIO, CANADAAT BANGKOK’S BEAUTY
PLANT

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Manufacturing
Conserving throughSmart Eco-Design

Giving Waste New Lifethrough Re-use

To evaluate key Sustainability elements
in a new construction process, we use the77 Point Plan, a process developed by our
Global Facilities Engineering group in
partnership with Arup International andvalidated by world-renowned architectural firm William McDonough + Partners.
The plan rates a facility’s potential impact
on CO 2 , energy, waste, water, andenvironmental quality.

What do you do when you don’t need it
anymore? Shampoo wash-out. Soupy
paper fines from paper towel production.
Tubes of outdated mascara. At P&G sites
all around the world, you “GARP it.”

The 77 Point Plan examines not only construction concerns, but also ongoing operations
once a facility is built. Beyond new projects,
the process is also used to review existing
facilities, with the results used to raise thedesign standard for P&G facilities throughout
the world. Two recent projects illustrate smart
eco-design in action.

Urlati, Romania: Beauty Plant
Before designing the Sustainability plan for thisfacility, the design team studied wind, solar, andhumidity patterns, rainfall and the solar path ofthe proposed site location. Large windows
throughout the building bring in natural lightand connect employees with the outdoors. By
using high-efficiency glass, the windows also
reduce energy use. External sunshades reducesunshine where and when necessary.

Euskirchen, Germany:
DACH Customization Center
A 10,000-square-meter facility in Euskirchen,
Germany, was built using sustainable materials
and will save roughly 7,300 metric tons of
CO2 over the building’s 40-year lifetime. The
center incorporates high-efficiency lighting,rainwater recycling, water-efficient sanitary
appliances, and a solar hot water system.
It is also the world’s first P&G building to deliver
an operating solar photovoltaic system. The
system is capable of generating 324 Gigajoulesof electricity per year, with an equivalent CO2
reduction equal to nearly 35,400 truck
kilometers.

Our Global Asset Recovery Purchases (GARP)
team is charged with finding external partners
who can turn waste and nonperforming
inventory into something useful. So when a
P&G site has something it hasn’t been able
to recycle, GARP steps in to help. In the lastyear alone, this small group of garbage gurusenabled more than ten thousand metric tons
to be recycled globally.

Budapest: Making Energy from Scraps
In Budapest, GARP teams are using scrap
feminine pads to fuel kilns at a local cement
factory, reducing the factory’s energy
consumption and P&G’s disposable waste.
Each year, the plant generates scrap material
in the making of Always and Naturella pads,
including off-spec product, end runs andout-dated material. The teams found thatwhen shredded, the scraps burn exceptionallywell. Budapest now has two shredders on site,
and is selling its scrap to a local cement maker
who mixes it with other combustibles to keep
his kilns running.

China: Softer, Younger-Looking Leather
Converting facial cream components for use
in leather care is one of many examples across
China where each of P&G’s seven mainland
distribution centers worked together to finda path to re-use. The facilities collaborated todevelop a standard operating procedure forrecycling that classifies all of P&G finishedgoods into one of 19 categories. They thendeveloped a recycling process for eachcategory. As a result, P&G China Distribution
Centers are now keeping 97% of all scrap
materials out of landfills.

The facility is capable of recovering heat
created in the manufacturing process, thenreusing it to heat the building and water. The
roof of its administration building faces due
south, maximizing the possible future use ofsolar panels.
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Employee Engagement• Stakeholders • GRI Index

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Finished Product Logistics
Optimizing OutboundTransportation
For decades, P&G has transported
product in a “multi-modal” fashion, thatis, using multiple forms of transport. But
today, we’re shifting toward “intermodal”
transportation, which uses shipping
containers that transfer smoothly fromone mode to another.
An intermodal approach optimizes thetransportation process. And by shifting awayfrom trucks and planes to boats and trains,
it saves fuel and reduces CO2 emissions.

Western Europe:
More Trains, More Gains
An intermodal program in Western Europe
increases the use of trains in its distribution
network. Before the
Pilot programs have
reduced CO2 emissions effort, more thanby more than
90% of Western
Europe’s finishedproduct traveled on
METRIC TONS PER YEAR trucks, covering over2 million kilometersof roads. The intermodal program aims toincrease rail transportation from 10% to 30%
by 2015, reducing CO2 emissions without any
trade-offs in customer service or cost.

4,000

Pilot programs in Belgium and France havebeen operating since July 2008, and each has
removed up to 5,000 trucks per year from theroads. The pilots have reduced CO2 emissions
by more than 4,000 metric tons per year — anamount equal to the CO2 produced by lighting
more than 15,000 homes annually.

Reducing Waste in
Product Customization
North America:
Trucks and Trains Save Diesel
A transport program in North America,
P&G’s first to incorporate an intermodal
component combining trucks and trains,
has reduced transportation costs andimproved Sustainability across the region.
Use of intermodal transport has increasedby 30%, saving 11 million liters of diesel fuel.
Overall miles in North America have been
reduced by 12% since the 2007/2008 fiscal
year, while the same volume of product has
been delivered.

Brazil: A Longer but Cleaner Journey
Since September 2008, P&G Brazil has bypassed
most of the 4,000 kilometers of road between
the Manaus plant in the Amazon and the main
distribution center in São Paulo. The new routetakes product via the Amazon River to the
Atlantic coast where
By using river and ocean
routes, CO2 emissions are it embarks on an
ocean journey, thenreduced by at leasta rail ride, andfinally a short roadtrip to the distribution center. It’s not
the shortest route distance-wise (in fact, it’s
40% longer) but it’s more environmentallysound than truck transport alone because theriver and ocean portions of the trip reduce
CO2 emission by at least 60%.

60%

In another effort to reduce waste, we areincorporating Sustainability criteria into
the design of customized product anddisplay units. Our suppliers are now often
able to eliminate redundant freight andpackaging waste within displays, so
we’re taking advantage of that capability.

12 – 30%

One example
is how we’ve
simplified the
MORE UNITS CAN FIT
ON A PALLET, REDUCING designs and
TRUCK MILEAGE AND
materials used for
CO2 EMISSIONS
in-store displays.
The new displays
are designed to use less material while
increasing pallet utilization, delivering bothmaterial and transportation savings. Now
12 – 30% more units can fit on a pallet,
helping reduce truck mileage and CO2
emissions. And by replacing plastic elementswith corrugated components, we are using
more recycled material in producing thedisplays.
Example of a new display thateliminates all plastic and uses
100% recycled corrugate

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Manufacturing Materials Flows 2008 – 2009
P&G’s use of material resources is highly efficient. Over 96% of incoming materials are converted
into finished product and more than half of the remaining waste is recycled or reused.

ENERGY

70.60

million gigajoules

RAW MATERIALS &PACKAGING

MATERIALS FORRECYCLING / REUSE

2.40%

finished product96.20%NON-HAZARDOUS
SOLID WASTE

1.10%

HAZARDOUS
SOLID WASTE

0.10%

AIR
EMISSIONS

0.10%

WATER
EMISSIONS

0.10%

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Resource & Waste Summary
The table below reports environmental statistics for Manufacturing Operations in the Global Business Units, Technical Centers,
and Distribution Centers. Table reflects divestiture of Western European Tissue/Towel, and Coffee Businesses.
Totals (absolute units x 1,000)

2009 Global Business Unit Detail (1) (absolute units x 1,000)

2009

2008

2007

BEAUTY

HOUSEHOLDCARE

HEALTH AND
WELL-BEINGTECHNICAL DISTRIBUTION
CENTERSCENTERS

Product Shipped

22,93623,187

21,742

2,635

19,136

1,165

0

N/A

Raw Materials from Recycled Sources

1,080

697

79

326

614

140

0

N/A

Generated Waste

871

935

983

129

587

134

16

5

Percent Recycled / Reused Waste

66%

59%

53%

59%

65%

80%

46%

64%

Solid Waste — Non-Hazardous

270

311

375

50

186

25

8

1

Solid Waste — Hazardous

27

30

48

3

20

2

1

1

Effluents (excluding water)

24

23

22

4

15

4

1

N/A

Air Emissions

19

16

17

1

16

3

0

N/A

70,64675,901

77,681

6,414

56,216

4,918

2,433

665

2,625

2,782

2,876

183

2,228

123

61

30

78,556

86,95889,6887,484

61,525

2,643

6,904

N/A

1.91

1.90

1.73

0.04

1.57

0.29

0.01

0.00

Production (metric tons)

Waste ( metric tons )Disposed Waste (metric tons)

(2)

Other
Energy Consumption (gigajoules )Greenhouse Gas Emissions (metric tons)
Water Consumption (cubic meters )SARA Releases (metric tons)

(4)

(3)

1 metric ton = 1,000 kg = 2,205 lbs.
(1) Beauty includes segments Beauty & Grooming. Health and Well-Being includes segments Health Care, Feminine Care, and Pet Care. Household Care includes
segments Fabric Care, Home Care, Duracell, Baby Care, Family Care and Snacks (Snacks data will transition to Health and Well-Being in 2010/11 to be consistent
with the Business Unit structure). Technical Centers includes each of the research centers that support the business units. Distribution Centers includes facilities thatfinished product distribution. 2009 numbers come from P&G manufacturing sites only; they do not include production from contract manufacturing operations.
(2) Air emissions include particulates, SO2, NOx, CO and VOC.
(3) Greenhouse gas emissions include CO2 from fuel combustion sources.
(4) Releases defined in the U.S. Superfund Amendments and Reauthorization Act (SARA) by the U.S. Environmental Protection Agency.

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EnergyEnergy Consumption

We have a strong history of reducing
the environmental footprints of ouroperations. Our production-adjusted
footprints, including Energy Usage,
Direct CO2 Emissions, Waste Disposed,
and Water Usage, have been dramaticallyreduced during the last seven years.
During 2009, we continued to haveoutstanding production-adjusted
reductions that have positioned us tomeet a 50% reduction for the decade
spanning 2002 – 2012. Importantly,
these Sustainability reductions are alsodelivering significant cost savings.

To deliver these outstanding results, ouroperating site personnel along with staff
resources from the GBUs, MDOs, Corporate
Engineering, GBS-Purchases, and Finance havecombined forces working against a common
Product Supply Sustainability approach. This
comprehensive approach will allow us to more
systematically reapply the successful current
operations strategies used over the past sevenyears. It not only addresses efforts to deliver
our current operations goal, but it looks at
strategies to:• E xpand our efforts to include the entire
supply chain via partnerships with MDOs
and suppliers.
• Continue efforts on our future operations
beyond 2012 via partnerships with R&D todeliver breakthrough sustainable innovation.

2-year Results (2007 – 2009)

The Energy Consumption graph (in gigajoules,
GJ) shows the addition of Technical Centers
for all three years. Gillette was added for thelast two years. We have seen a decrease overthe past three years: 77.7 million GJ,
75.9 million GJ, and 70.6 million GJ in 2007,2008, and 2009, respectively.

As part of our ongoing efforts to minimize
losses, the Company does a loss analysis at theplant level. Losses are defined as anything notshipped out the door as product, including
energy used. When energy is identified as amajor loss at a plant, it receives intense focus
for loss reduction.
Operations has made excellent progress
toward delivering the 20% energy footprint
reduction goal. Across businesses, teams
have embraced the targets and integrated
Sustainability into their daily work.
A key element to delivering the goal is
our energy conservation efforts. The threestrategies are:
1. Eliminating losses and encouraging
Sustainability behavior and culture
2. E xecuting specific footprint reduction
projects

Since July 2002

Production-Adjusted

Absolute

Production-Adjusted

Target

-8%

n/a

n/a

Energy Usage

-11%

-9%

-48%

Direct CO2 Emissions

-10%

-8%

-52%

Waste Disposal

-30%

-30%

-53%

Water Usage

-13%

-12%

-52%

3. Ensuring that new initiatives and capacity
projects are developed in a smart,sustainable way

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Contents • Introduction • P&G Profile •Product Innovation• Operational Improvement •Social Responsibility•

Employee Engagement

Greenhouse Gas

Climate Change Policy

Every company in every sector of the economy
has a role in controlling greenhouse gas
emissions. While P&G is not an energyintensive company, we are stepping up to do
our part. P&G is committed to energy-efficient
programs and we participate in voluntary
programs. Our focus has been on direct CO2
emissions (i.e., Scope 1). We have seen adecrease over the past three years in direct
CO2 emissions: 2.9 million metric tons,
2.8 million metric tons, and 2.6 million metrictons in 2007, 2008, and 2009, respectively.
Since 2002, we have reduced direct CO2
emissions by over 18% on an absolute basis(2002 base year of 3,215,031 metric tons).
This reduction occurred during a time when
global sales increased from $40 billion tonearly $80 billion.

P&G recognizes the scientific consensus
linking greenhouse gas emissions and climatechange. P&G is not an energy-intensive
company, but as a global citizen we areconcerned about the negative consequencesof climate change and believe that prudent
and cost-effective action by governments,
industry, and consumers to reduce emissions
to the atmosphere are necessary.

We continue to monitor our indirect CO2
emissions (i.e., Scope 2), which decreased
in 2009.

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• Stakeholders • GRI Index

Direct CO2 emissions
reduced over18%

ON AN ABSOLUTE BASISSINCE 2002

We will focus our efforts in two main areas:• Reducing the intensity of greenhouse gas
emissions (GHG) from our own operations
through:– Continued energy efficiency measuresthroughout our facilities– Continuing to transition fuel sources
towards cleaner alternatives* CO2 from fuel combustion sources– Continuing to drive more energy-efficientmodes of transporting finished products toour customers– Setting goals to drive continued improvement in our GHG emissions• Helping consumers to reduce their own
GHG emissions through the use of our
products via:– Product and packaging innovations thatenable more efficient consumer productuse and energy consumption– Consumer education
We will continue to publicly disclose ourgreenhouse gas and energy usage data
through the Company Sustainability report
and the Carbon Disclosure Project.
To learn more about our efforts withexternal stakeholders, please see the
Stakeholders section of this report on page 63.

www.pg.com/sustainability

Contents • Introduction • P&G Profile •Product Innovation• Operational Improvement •Waste Disposed

Waste Recycled

Total Waste for Disposal

Waste Returned to Process or Market

Total waste for disposal is our key management measure to keep waste under control.
Total waste disposed comprises the sum of
non-hazardous and hazardous solid waste,
plus the strength of effluent measured as
Chemical Oxygen Demand (COD) and air
emissions. It excludes recycling or reused
waste. It also excludes CO2 emissions. Thismeasurement has been in effect since 1990.

The total percentage of waste recycledincreased to 66%. This was driven by excellent
work in our Family Care, Fabric Care, Baby Care,and Hair Care categories.

The past three years, results have beenencouraging on a production-related basis
and we have seen an absolute reduction overthe past year, with total waste disposed of
380 thousand metric tons and 340 thousand
metric tons in 2008 and 2009, respectively.

Social Responsibility•

Employee Engagement

Non-Hazardous Solid Waste Disposed

Hazardous Solid Waste Disposed

Overall, the non-hazardous solid waste
disposed decreased from last year to 270
thousand metric tons.

Hazardous wastes are defined by regional
policies and local rules, so they vary fromregion to region. To further reduce our risks,
the number of approved hazardous waste
disposal sites that all U.S. plants use hasremained limited. Similar programs havebeen started in many regions of the world.

• Stakeholders • GRI Index

39 of 81

To learn more about our efforts on
waste, please see our featured story
on GARP earlier in this chapter on page 33
and our story on Solid Waste in Stakeholders
on page 64.
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Contents • Introduction • P&G Profile •Product Innovation• Operational Improvement •Social Responsibility•

Employee Engagement• Stakeholders • GRI Index

Water

Effluents to Water

Air Emissions

Water Consumption

Wastewater COD (Chemical Oxygen Demand)
Disposed increased slightly over the past
three years. This primarily reflects integrationof acquisition sites.

Each site monitors total suspended particulates, volatile organic compounds (VOCs),
carbon monoxide (CO), nitrogen oxides (NOx )and sulfur oxides (SO x ). Overall, the total
air emissions increased from last year to
19 thousand metric tons. This increase wasdue to increased fuel usage in Western Europe.
P&G continues to seek innovative methods
to address this trend.

We have seen a decrease over the past three
years in water consumption: 90 million m3,
87 million m 3, and 79 million m 3 in 2007,2008, and 2009, respectively. The Household
Care business unit is our largest water user.
Within Household Care, our Family Care
operations have the greatest need for water.

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SARA 313 Releases(United States only)
U.S. P&G plants report annually on the releaseof toxic chemicals to the air, water, and land.
These releases are defined in the U.S. Superfund
Amendments and Reauthorization Act (SARA)
by the U.S. Environmental Protection Agency.
The purpose of this documentation (referred
to as section 313) is to report publicly thereleases and transfers of hazardous chemicals
as defined by the agency.
The amount of SARA 313 releases have beensteady over the past two years.

SARA is reported one year behind; 2009 entry reflects
2008 data.

To learn more about our broader efforts
on water, please see the discussion on
our Children’s Safe Drinking Water programon page 48 and the Water section in
Stakeholders on page 66.

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Contents • Introduction • P&G Profile •Product Innovation

Environmental Liabilities
We are also subject to contingencies pursuant
to environmental laws and regulations thatin the future may require us to take action tocorrect the effects on the environment of prior
manufacturing and waste disposal practices.
Based on currently available information, we
do not believe that the ultimate resolutionof environmental remediation will have amaterially adverse effect on our financial
position, results of operations, or cash flows.

• Operational Improvement •Social Responsibility•

Employee Engagement• Stakeholders • GRI Index

Compliance withLaws and Regulations
There are numerous health, safety, andenvironmental requirements worldwide.
Plants are subject to safety rules andemission limits with operating requirementsthat may be embodied in sources such as
statutes, regulations, laws and permits.
It is P&G’s intent to comply with both theletter and the spirit of statutes, regulations,laws, and permit requirements. Identifiedcompliance issues are treated seriously, andall noncompliance matters are resolved as
expeditiously as possible.

41 of 81Business Continuity
Notice of Violations (NOVs)
The table lists global data on environmental,transportation, and worker health and safety
violations over the past three years. In 2009,
the number of fines decreased in every
category, particularly in our focus area oftransportation.
2009

2008

2007

34

82

37

$15,285$305,328$106,257

NumberFines

The following is a more detailed breakdownof global Notices of Violation (NOVs) andincludes U.S. Occupational Safety and HealthAdministration (OSHA) interventions.
NumberFines

Water-Based16$ 6,000

Air-Based

4

$

0

Solid Waste-Based

0

$

0

Paperwork

0

$

0

Transportation-Based5$ 3,000

Other

1

$

Worker Safety8$ 6,285

Total

34

$15,285

P&G’s Global Business Continuity Program
ensures that all critical sites and work processes
evaluate their risk mitigation programs,
exposure to catastrophic events at P&G sites
and sites of our key suppliers and service
providers that could significantly interrupt
business operations, and the business impact
of such events. Site and business unit leadersthen develop contingency plans to minimize
business interruption if a disabling event should
occur. Crisis Manage­ment team structures
are defined to manage business recovery using
the predefined contingency plans. Tests are
conducted annually to ensure that thecontingency plans are sufficient andup-to-date.
Business Continuity Plans are audited regularly,
and a report of the Business Continuity
Program’s status is made each January to the
Audit Committee.

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Operational Improvement• Social Responsibility •Employee Engagement

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• Stakeholders • GRI Index

SocialResponsibility
Commitment Matters
For more than 170 years, P&G brands andpeople have touched and improved consumers’
lives. This commitment extends to our social
investments. Through P&G’s Live, Learn andThrive cause, we are helping children in needaround the world:

Strategy 3:
Social Responsibility
GOAL Enable 300 million children to Live, Learn and Thrive.(1)Prevent 160 million days of disease and save 20,000 lives by
delivering 4 billion liters of clean water in our Children’s
Safe Drinking Water program.(2)Get off to a healthy start

PROGRESS

Receive access to education

LIVE, LEARN AND THRIVE

Build skills for life

Number of Children ReachedNot only do thousands of P&Gers lend theirtime and talents to these Live, Learn and Thrive
efforts, but we leverage the strength and reachof our brands to raise public awareness, engagement, and donations.

SinceJuly 2007135 million

CHILDREN’S SAFE DRINKING WATER
Liters of Clean Water Delivered

930 million

Days of Disease Prevented

39 million

Lives Saved

> 5,200(1) Live, Learn and Thrive (LLT) is P&G’s global cause that focuses oursocial investments on efforts that improve the lives of children inneed ages 0 – 13.
(2) Within Live, Learn and Thrive, our signature program is Children’s
Safe Drinking Water. Methodology for calculating diarrheal days
and mortality was developed with Population Services Internationaland Aquaya Institute. Details are provided on page 50 of this report.

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Contents • Introduction • P&G Profile •Product Innovation•

Operational Improvement• Social Responsibility •Employee Engagement• Stakeholders • GRI Index

P&G’s Purpose is to improve the everyday
lives of the world’s consumers, now andfor generations to come. We fulfill thisPurpose in many ways: through P&G
brands, first and foremost, but also
through our support of humanitarian,educational, and social cause efforts.
We are committed to focusing our social
investments and employee engagement ona single cause: P&G Live, Learn and Thrive.
Through our global cause, we are improving
life for children in need. In fact, since 2007,
P&G has already improved life for more than
135 million children in need around the world.
There are several reasons to concentrate ourresources in this area:• Disadvantaged children are most vulnerable
and least able to help themselves.
• We have deep expertise in health andhygiene as well as many existing programsin children’s education and development,
which are critical in addressing global needs
for children.
• Child development is a universal concern
across all global stakeholders in bothdeveloped and developing countries.

Our people and ourbrands are our greatest
assets, and together, they
are a tremendous force
that can make an impactthat matters.

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Operational Improvement• Social Responsibility •Employee Engagement

44 of 81

• Stakeholders • GRI Index

Live, Learn and Thrive Locations
P&G Live, Learn
and Thrive comes tolife through more than
100 programs in over
50 countries aroundthe world.

North America

Western Europe• Canada• Puerto Rico
• United States• Belgium• France• Germany• Greece• Ireland• Italy• Netherlands• Portugal• Spain• Sweden• Switzerland• United Kingdom

Latin America• Argentina• Brazil• Chile• Colombia• Costa Rica
• Dominican Republic• Mexico• Peru• Venezuela

Central & Eastern Europe,
Middle East & Africa• Côte d’Ivoire• Democratic Republicof the Congo• Egypt• Estonia• Ethiopia• Hungary• Kenya• Latvia• Lebanon• Lithuania• Malawi

Asia• Australia• Morocco• Nigeria• Pakistan• Poland• Republic of
the Congo• Russia• Saudi Arabia• South Africa• Tanzania• Turkey• Uganda• Bangladesh• China• Hong Kong
• India• Indonesia• Japan• Korea• Malaysia• Nepal• New Zealand• Philippines• Singapore• Vietnam

This year alone,
P&G and the P&G Fundcontributed more than

100 million dollars
to support our communities —
improving life for more than

75 million children
around the world.

•Live, Learn andThrive locations

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Contents • Introduction • P&G Profile •Product Innovation

Pampers and UNICEF:
Working Together for
Healthy Babies
Every year, 128,000 people die frommaternal and neonatal tetanus — acompletely preventable disease. So for
the fourth year running, Pampers is
teaming up with UNICEF to deliver thevaccines that vulnerable women andtheir children need.
The effort gets our consumers involved. With
the purchase of one pack of Pampers, one
dose of the vaccine is donated. Our campaign
has created the highest awareness ever formaternal and neonatal tetanus, helping put
the disease back on the agenda of healthauthorities.
Since the start of the campaign, a total of
45.5 million women and their babies havebeen protected against maternal and neonatal
tetanus — but more work remains to meetour goal of eliminating the disease by 2012.
Pampers has committed to providing thevaccine to target and protect an additional
33 million women and their babies in atleast 32 countries around the world.
This year, we’ve added a new form of employee
involvement. P&G and UNICEF have teamed
up to offer P&G employees in Western Europe
the opportunity to take a three-month unpaid•

Operational Improvement• Social Responsibility •Since 2006,

45.5 million
WOMEN AND THEIR BABIESPROTECTED AGAINST MATERNALAND NEONATAL TETANUS

sabbatical and work with UNICEF. The
program is aimed at employees who havealways wanted to undertake humanitarian
work but have not had the chance before.
UNICEF will benefit from the diverse backgrounds of P&G employees as they apply suchskills as communications, promotion, leadership training, and supply chain management.
Although resource requirements for UNICEF
are ever-changing, three to four assignments
are expected per year. The first volunteers
will begin in the spring of 2010.

Employee Engagement• Stakeholders • GRI Index

Safeguard: Building a
Great Wall of Hygiene
Establishing good hygiene habits earlyis essential to protecting children from
disease. So Safeguard, in partnershipwith the Red Cross and China’s Ministryof Health, launched the Safeguard HealthGreat Wall campaign on October 15, 2008 —Global Hand Washing Day.
The effort broadens health hygiene educationin schools, as well as building sanitation
facilities in rural China to encourage handwashing. Its goal is to educate 10 million
children in the next eight years. Consumerpurchases of Safeguard help fund theprogram, while volunteer opportunities
allow individuals to experience the importanceof good hygiene directly.

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Contents • Introduction • P&G Profile •Product Innovation

87,000
CHILDREN REACHED IN
5 YEARS, TRANSLATING TO:

2,623
Children mainstreamed
into formal school

100

Full enrollment villages

85

Villages free of child labor

4,495Children immunized•

Operational Improvement• Social Responsibility •Employee Engagement• Stakeholders • GRI Index

P&G and Shiksha:
Increasing Access to
Education in India

Always and Tampax:
Protecting the Futuresof Girls

India has the world’s largest numberof uneducated children, with nearly
half of all children not attending school.
Our Shiksha program is dedicated tofighting that trend, helping create amore educated, progressive nation.

Today, more than 600 million girls live inthe developing world. Many of these girls
miss several days of school each month
because they lack basic sanitary protection to manage their periods.

The program funds NGO efforts to address
the underlying causes of poor access to
education, such as poverty, health issues,
and access to immunization. In cases where
schools don’t exist, the program also funds
their construction. Each time a consumerbought a large pack of any P&G brand in India
between April and June of 2009, part of theproceeds went toward leading children on
the path to education.
Shiksha also benefits from the direct involvement of P&G employees. Each year, employees
participate in a Shiksha Walk-a-thon, joining
their families and others in raising awarenessfor the cause.

Since 2006,

80,000

GIRLS REACHED IN THE
DEVELOPING WORLD

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Protecting Futures works with partner organizations to provide puberty education, sanitary
protection, and sanitary facilities to help
vulnerable girls stay in school. In conjunction
with its partners and other external thoughtleading organizations, Protecting Futures
supports research on the issue and the impactof the interventions the program enables.
Since 2006, Protecting Futures has worked witheight partners in 17 countries, reaching morethan 80,000 girls in the developing world.

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Operational Improvement• Social Responsibility •Employee Engagement• Stakeholders • GRI Index

47 of 81

P&G Beauty’s Aqua
Collection: SupportingChildren’s Safe Drinking
Water
Each day, some 4,000 children die as aresult of not having clean drinking water.
But a special collection of P&G Beauty
products — each with its own hydration
benefit — is helping fight this problem.
For each purchase within “The Aqua Collection,”
safe drinking water is donated to children indeveloping countries through P&G’s Children’s
Safe Drinking Water program. CSDW is a
nonprofit program run by P&G which leverages
PŪR™ water filtration technology to provide
clean drinking water in the developing world.
P&G will provide 4 billion liters of clean water
between 2007 and 2012 through this program.
So while consumers have benefitted frommoisture where their hair and skin need it,
50 million liters of water have been donatedto date through this partnership with theBeauty business.
Again, the involvement of P&G employees
has had a direct impact on the program.
During “Sustainability Week” events in
Geneva, employees were educated aboutwater issues and other Sustainability topics.
For every employee who attended an event,
P&G donated 10 liters of safe drinking waterto CSDW.

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Operational Improvement• Social Responsibility •Employee Engagement• Stakeholders • GRI Index

48 of 81Children’s Safe Drinking
Water: P&G Live, Learn
and Thrive Corporate
Signature Program
Live, Learn and Thrive comes to life
through dozens of programs around theworld, including its signature program,Children’s Safe Drinking Water.
More than 4,000 children die every day
from diseases caused by drinking unsafe
water. P&G, in collaboration with the U.S.
Centers for Disease Control and Prevention,
has developed a low-cost technology calledPŪR Purifier of Water to purify even heavily
contaminated drinking water so that it meetsWorld Health Organization standards for safe
drinking water. Studies show that the PŪRsachets can reduce diarrheal illness in children
by more than 50%.

Impact of Children’s Safe Drinking
Water Program
Since the start of Children’s Safe Drinking
Water, we have delivered more than 1.6 billion
liters of clean drinking water. This has resulted
in an estimated reduction of 68 million days ofdiarrhea and more than 9,000 lives saved.

Objectives and Strategies
The program consists of not-for-profit socialand emergency relief work to provide safe
drinking water to the people who need it
most. Our goal is to reduce the sickness anddeath in children that results from drinking
contaminated water.

Program Components
The key to the program is strong partnerships
with groups around the world. In our social
execution, our partners are using social
marketing techniques to build and sustain
introduction of the PŪR technology. This
includes education on the local level about theimportance of clean drinking water and how
to use the PŪR sachets. For emergency relief,PŪR has been provided for disasters aroundthe world, and follow-up work has been done
to show that the use of PŪR is effective andpractical in emergency situations.

Results
During the last five years, our Children’s
Safe Drinking Water program has provided
164 million sachets, enough product to treat
1.6 billion liters of safe drinking water. We

have worked with UNICEF, Samaritan’s Purse,
Red Cross, AmeriCares, PSI, USAID, CARE,World Vision, and others to respond to someof the most critical emergency relief situations
including the Southeast Asia tsunami, hurricanes
in the Caribbean, floods in the Philippines andBangladesh, and earthquakes in Pakistan andIndonesia. Most recently, PŪR has been provided
to victims of the internal conflict in Pakistan
and the cholera outbreak in Zimbabwe.
Using PŪR sachets, safe drinking water has
been provided in more than 50 countries todate. Social markets are currently in Côte
d’Ivoire, the Democratic Republic of theCongo, the Dominican Republic, Ethiopia,
Indonesia, Kenya, Malawi, Nigeria, Pakistan,
Sudan, Tanzania, and Uganda.
The United Nations has declared 2005 to 2015
to be the “International Decade for Action,
Water for Life” for creating public awarenessand solutions for water-related issues. P&G iscommitted to making a difference on both
fronts  —  raising awareness and saving lives.
Our Children’s Safe Drinking Water Program
continues to be widely recognized. Awards
received in 2008 and 2009 include:

and response to disasters in an additional
13 African countries.
• Making a Difference Award, Possible Woman
Leadership Conference, for working tirelessly
to make a difference in the lives of womenand their families in developing countries.
• Breakthrough Innovation Award, Popular
Mechanics, for the innovative distribution
strategy used to reach people in need ofsafe water.
Major awards we have received in the past
include:• Grainger Challenge Bronze Award, National
Academy of Engineering and The Grainger
Foundation  —   for being an innovative,
sustainable solution for arsenic removalfrom drinking water.
• Global Leadership Award, United Nations
Association of the USA   —   in part, forproviding clean water for millions aroundthe world through the Children’s Safe
Drinking Water program.
• Ron Brown Corporate Leadership Award,
U.S. Presidential Award   —   for providing safe
drinking water and the ongoing commitment
to the Children’s Safe Drinking Water program.

• World Technology Award for the Environment,
World Technology Network, for innovative
work with the greatest likelihood for longterm significance.
• Global Citizen Award for Corporate
Philanthropy, U.S. Doctors for Africa,
for sustained work in 10 African countries

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Operational Improvement• Social Responsibility •Employee Engagement• Stakeholders • GRI Index

49 of 81

CSDW Emergency Relief andSocial Market Countries
Americas

Africa (continued)• Colombia• Dominican
Republic• Guatemala• Guyana• Haiti• Honduras• Nicaragua• Panama• Peru• Venezuela• Namibia• Nigeria• Republic of Congo• Senegal• Sierra Leone• Somalia• South Africa• Sudan• Tanzania• Uganda• Zimbabwe

AfricaAsia/Europe• Angola• Botswana• Burkina Faso
• Cameroon• Chad• Côte d’Ivoire• Democratic
Republic of
the Congo• Djibouti• Ethiopia• Ghana• Guinea Bissau• Kenya• Liberia• Malawi• Morocco• Mozambique• Afghanistan• Bangladesh• Cambodia• China• East Timor• India• Indonesia• Iran• Iraq• Maldives• Myanmar• Nepal• Pakistan• Philippines• Romania• Sri Lanka• Vietnam• Relief and Social

Market Countries

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Contents • Introduction • P&G Profile •Product Innovation•

Operational Improvement• Social Responsibility •Employee Engagement• Stakeholders • GRI Index

50 of 81Children’s Safe
Drinking Water Program
Methodology
Working with Population Services
International and Aquaya Institute, wehave developed the following methodology
to estimate the days of disease and lives
saved as a direct result of PŪR usage.
The number of PŪR sachets that are provided
are tracked on a monthly basis by country.
From this, we calculate the liters of safe drinking
water provided and estimate the impact on
reduction in days of diarrhea and estimatedlives saved. The illness and fatality rates byregion are derived from the World HealthOrganization Global Burden of Disease 2002
estimates. Sub-Saharan estimates are used for
product provided for emergency relief efforts
since diarrhea rates are typically high during
these situations.
The reduction in diarrheal illness from theuse of the PŪR sachets is based on the average
reduction measured in five randomized,
controlled health intervention studies involving
more than 25,000 subjects. These independently conducted studies are published in thepeer-reviewed literature.

Health Intervention Trials

Diarrhea

The U.S. Centers for Disease Control and Johns
Hopkins University have conducted five clinical
trials of PŪR and proven that it significantly
reduces diarrheal illness in children and thetotal population.

• 60% of PŪR is consumed by children.

Diarrhea
Reduction• The number of episodes of diarrhea
per child per year is– 5 episodes in sub-Saharan Africa– 2.2 episodes in Latin America

Location/Setting

Study Design

Rural
Guatemala2,982 people
52 weeks

24 – 29%

Rural
Guatemala3,401 people
13 weeks

40 – 72%

Rural Kenya —turbid water

6,615 people
20 weeks

17 – 42%• PŪR use averts 50% of the diarrhea
episodes.

Pakistan —urban setting

12,090 people
39 weeks

59 – 64%• A diarrhea episode lasts an averageof 7.3 days.

Liberia —refugee camp

2,191 people
12 weeks

87 – 95%• 40% of PŪR is used by adults.
• The number of episodes of diarrhea
per adult per year is– 0.98 episodes in sub-Saharan Africa– 0.21 episodes in Latin America

The specific assumptions are:• Each PŪR sachet treats 10 liters of water.
• An average of 1.5 liters of drinking water
is used per child per day and 2 liters ofdrinking water per adult per day.

Lives Saved• The fatality rate per case of childhood
diarrhea is– 0.001 in sub-Saharan Africa– 0.0002 in Latin America• The fatality rate per case of adult
diarrhea is– 0.0004 for sub-Saharan Africa– 0.00005 in Latin America

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51 of 81

Employee
Engagement
Responsibility Matters
We are driving efforts to make Sustainability topof mind for all P&G employees, keeping personal
responsibility relevant both at work and at home.
Why does this matter? It creates a mindset that’s
essential for driving ongoing innovation.
At P&G, employees often leave a meeting offering to “take the R” (responsibility) for a next stepor action item. Borrowing from this Company
vernacular, we frame our engagement efforts
around the “Take the R for Tomorrow” program.

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52 of 81

Earth Day Events:
A World of Progress
The program’s signature effort this year
was our weeklong celebration of EarthDay. Around the world, local events wereplanned around four primary themes:
reducing travel, reducing waste, reducing
energy use, and volunteering through ourLive, Learn and Thrive program.
To drive employee awareness, these themes
were brought to life in a sustainable manner
through big messages in big places. Manysites offered employee e-training and pledge
cards, others planned field trips and training
sessions on locally relevant topics, and somelocations conducted volunteer days with ourLive, Learn and Thrive partners.

Some highlights from the week’s activities:
In Latin America, Site Sustainability Teams
educated employees about waste andopportunities for recycling, introducing
new recycling bins.

14

METRIC TONS OF MATERIALARE NOW RECYCLEDPER QUARTER

At Miami Valley Technical Center, employees
reduced bottled water consumption by 70%,
using PŪR Pitchers in catering and encouraging
everyone to bring a reusable mug.

Bottled water
consumption reduced70%

In Beckett Ridge, Ohio, containers
were strategically placed to drive
cardboard recycling.

Recycled cardboard volume
has increased more than

3x

TO 350 KILOGRAMSFROM 100 KILOGRAMS

These new recycle
bins are being used
at many P&G sitesaround the world.

www.pg.com/sustainability

Contents • Introduction • P&G Profile •Product Innovation•

Operational Improvement•

Ongoing Events:
Maintaining Engagement
Year-RoundEarth Day celebrations are only the
beginning — truly sustainable employee
engagement keeps the spirit of personal
responsibility alive throughout the year.
In partnership with Jones Lange LaSalle,
P&G’s property management partner, wehave implemented ongoing efforts aimed
at educating employees further andinfluencing more sustainable workplace
behaviors.
In Asia, an Idea Challenge was held togenerate practical ideas for reducing energy,
water, and paper, with the aim of improving
sites’ Sustainability Scorecards. So far, nearly
130 ideas have been collected and some of
the best have been implemented.

At several sites in Western Europe, a Beauty& Grooming Sustainability Week was held toincrease awareness of Sustainability issues
and generate further engagement. Alongwith educational presentations from senior
management and Sustainability experts,
employees took part in a number of
meaningful activities.
In the Employee Sustainability Challenge,
employees earned “drops” of water byparticipating in activities such as carpoolingand switching to re-usable mugs. These drops
translated into a two-million-liter donation
through P&G’s Children’s Safe Drinking Water
program — a year’s worth of water for 700
families. At week’s end, employees gatheredat Lake Geneva for a daylong coordinatedcleanup effort.

Social Responsibility• Employee Engagement • Stakeholders • GRI Index

53 of 81

Contents • Introduction • P&G Profile •While “Take the R” has been the focal
point for our efforts to get employees
engaged in our sustainability efforts,
we recognize and take very seriously
the broader responsibilities we haveto our employees — and that starts with
our Purpose, Values and Principles.

Product Innovation•

Operational Improvement•

Social Responsibility

Our Purpose

Our Values

We will provide branded products andservices of superior quality and valuethat improve the lives of the world’s
consumers, now and for generations
to come.

P&G is its people and the values by which
we live. We attract and recruit the finest
people in the world. We build ourorganization from within, promoting andrewarding people without regard to any
difference unrelated to performance. We
act on the conviction that the men andwomen of Procter & Gamble will always
be our most important asset.

As a result, consumers will reward us withleadership sales, profit and value creation,
allowing our people, our shareholders, andthe communities in which we live and work
to prosper.

Integrity• We always try to do the right thing.
• We are honest and straightforward witheach other.
• We operate within the letter and spirit of
the law.

CONSUMERS• We uphold the values and principles of P&G
in every action and decision.

P&G BRANDS

P&G VALUES
Integrity
Leadership
Ownership
Passion for Winning
Trust

P&G Brands and P&G People
are the foundation of P&G’s
success. P&G People bring thevalues to life as we focus on
improving the lives of theworld’s consumers.

• We are data-based and intellectually honestin advocating proposals, including recognizing risks.

Leadership

P&G PEOPLE

54 of 81

• Employee Engagement • Stakeholders • GRI Index• We are all leaders in our area of responsibility, with a deep commitment to deliver
leadership results.

Ownership• We accept personal accountability to meet
the business needs, improve our systems
and help others improve their effectiveness.
• We all act like owners, treating the Company’s
assets as our own and behaving with theCompany’s long-term success in mind.

Passion for Winning• We are determined to be the best at doing
what matters most.
• We have a healthy dissatisfaction with thestatus quo.
• We have a compelling desire to improve andto win in the marketplace.

Trust• We respect our P&G colleagues, customers
and consumers, and treat them as we want
to be treated.
• We have confidence in each other’scapabilities and intentions.
• We believe that people work best when
there is a foundation of trust.

• We have a clear vision of where we aregoing.
• We focus our resources to achieve leadership objectives and strategies.
• We develop the capability to deliver our
strategies and eliminate organizational
barriers.

www.pg.com/sustainability

Contents • Introduction • P&G Profile •Product Innovation•

Operational Improvement•

Social Responsibility• Employee Engagement • Stakeholders • GRI Index

Our Principles
These are the Principles and supporting
behaviors, which flow from our Purpose
and Values.
We Show Respect for All Individuals• We believe that all individuals can andwant to contribute to their fullest potential.
• We value differences.
• We inspire and enable people toachieve high expectations, standards
and challenging goals.
• We are honest with people about theirperformance.

The Interests of The Company and
The Individual Are Inseparable• We believe that doing what is right for thebusiness with integrity will lead to mutual
success for both the Company and theindividual. Our quest for mutual success ties
us together.
• We encourage stock ownership andownership behavior.

We Are Strategically Focused in
Our Work• We operate against clearly articulated andaligned objectives and strategies.
• We only do work and only ask for work that
adds value to the business.
• We simplify, standardize and streamline ourcurrent work whenever possible.

Innovation Is The Cornerstone of
Our Success• We place great value on big, new consumer
innovations.
• We challenge convention and reinvent theway we do business to better win in themarketplace.

“We incorporate
Sustainability into our
products, packaging,and operations”

We Are Externally Focused

We Seek to Be The Best• We develop superior understanding of
consumers and their needs.

• We strive to be the best in all areas ofstrategic importance to the Company.

• We create and deliver products, packaging
and concepts that build winning brandequities.

• We benchmark our performance rigorously
versus the very best internally and externally.

• We develop close, mutually productive
relationships with our customers and our
suppliers.
• We are good corporate citizens.
• We incorporate sustainability into our
products, packaging and operations.

We Value Personal Mastery• We believe it is the responsibility of all
individuals to continually develop themselves
and others.
• We encourage and expect outstanding
technical mastery and executional
excellence.

• We learn from both our successes and our
failures.

Mutual Interdependency Is a Way of Life
• We work together with confidence and trust
across business units, functions, categories
and geographies.
• We take pride in results from reapplying
others’ ideas.
• We build superior relationships with all theparties who contribute to fulfilling our
Corporate Purpose, including our customers,
suppliers, universities and governments.
To read more on sustainable development guidelines for business conduct
based on P&G’s PVP, download this brochure:www.pg.com/company/who_we_are/ppv.shtml.


55 of 81

The Global Sullivan Principles
P&G was one of the founding membersof the Global Sullivan Principles. In
accordance with the Global Sullivan
Principles, we support economic
growth, social justice, human rights,
political justice, and equal opportunity
wherever we do business in the world.
The products we deliver, the consumers
we serve and how we serve them are inline with these expectations. We havealso reviewed and revised our policies
to make sure we are aligned with the
Global Sullivan Principles. We consider
ourselves a global company and a
global citizen.
We ensure our commitment to ouremployees through our human resources
system and profit-sharing program.
Our human resources system trains,
educates, and develops our people.
It offers flexible work arrangements,
giving employees the opportunity tomeet both business and personalneeds. It is ingrained in our culture
and policies to ensure that everyone istreated fairly and has the opportunity
to contribute to our vision and mission.
The profit-sharing program provides
employees with a stake in the
Company’s future.
Programs such as these enable us tobe a sustainable business and a viable
part of the communities in which we
do business.
To learn more about the Global
Sullivan Principles, please go to
www.thesullivanfoundation.org/gsp/.

www.pg.com/sustainability

Contents • Introduction • P&G Profile •Product Innovation•

Operational Improvement•

Human Resources
Human Resources ensures that P&G has
the employees, organizational design, andwork culture to deliver business productivity and to continually improve consumer,
employee, and shareholder value. They
provide recruiting, training, development,
diversity, benefits, and compensation
coordination for the Company.
It is the Company’s intent to develop all
employees to their full potential. To achieve
this goal, the following support systems arein place:• Career discussions, performance appraisals,
assignment plans, transfer and promotion
plans.
• Informal network support groups• Mentoring to provide informal support
and guidance, in addition to coaching
and training provided by each employee’s
direct manager.

Employee Privacy
P&G respects employee privacy and dignity.
We will only collect and retain personal
information from employees that is required
for the effective operation of the Company
or as required by law. We will keep that
information confidential and release it only
to those who have a legitimate need to know.

Social Responsibility

56 of 81

• Employee Engagement • Stakeholders • GRI Index

Diversity & Inclusion
Harassment Policy
P&G is committed to providing a harassmentfree work environment. This is the right thing
to do not only from a social perspective,
but also from a business perspective. It
enables our diverse work force to contributeto their highest potential. We will not tolerateharassment of anyone by anyone — including
employees, suppliers, customers, contractors,
and agencies. Every employee is expected
to be proactive in ensuring that the work
environment is free from harassment of any
kind. Managers of others are responsible forsetting clear expectations for acceptablebehavior in the workplace.

Wages
P&G supports paying employees a competitive wage, as benchmarked against otherleading companies. Consistent with ourprinciple of valuing personal mastery, wereward employees for improving their skills
and capabilities.

Benefits
P&G is a recognized leader in employee
benefits. The Company’s benefits have beendeveloped to help protect the financial
security of employees. These benefits include
comprehensive coverage for health care,generous vacation and holiday time, andother work/family balance benefits, including
flextime, child care leave, and less-thanfull-time schedules.

Diversity & Inclusion is deeply rooted
in our company’s Purpose, Values andPrinciples. It is who we are, and aspire
to be, as a company.
When P&Gers come together we create a richtapestry. Each of us is truly unique. Beyond
the visible differences, we come from diverse
traditions, with a wide array of personal
experiences and points of view.
Through our commitment, P&G brings together
individuals from different backgrounds, cultures,and thinking styles who provide remarkably
different talents, perspectives, and life andcareer experiences. That’s why, in our increasingly interconnected world, it is only
appropriate that we celebrate everyone’s
uniqueness every day.
The mission of Diversity & Inclusion at P&G is:

Everyone Valued,
Everyone Included,
Everyone Performing at Their Peak ™
Diversity & Inclusion at P&G is EVERYONE.
It is living it every day. It is experiencing it
everywhere. It comes to life through everyday
experiences and interactions that inspire
P&Gers to unleash their potential and perform
at their peak. This peak performance isdirectly related to our ability to improve thelives of the world’s consumers. P&G iscommitted to creating a winning culture
where colleagues and managers of others
demonstrate sincere care for each other,extending a personal touch to each individualand genuinely getting to know each other.

A Competitive Advantage
Diversity & Inclusion is a sustained competitive
advantage for the continued growth of P&G.
It is implicit in the Company’s Purpose andValues and explicit in the Company’s businessstrategy for success.
• It enables P&G to be the “employer ofchoice” that hires, engages, and retains thebest talent from around the world, reflecting
the markets and consumers we serve.
• It is at the core of being “in-touch” so that
we create brands and products to improve
the lives of the world’s consumers now, andfor generations to come.
• Through our focus on understanding eachindividual’s skills, passions, and our fundamental commonalities, we enable behaviors
that lead to a culture of innovation.
P&G is a community of diverse, talented
people who are integral to our Company’s
success. To win, we must value, respect, andinclude the people that make P&G businesspossible.

www.pg.com/sustainability

Contents • Introduction • P&G Profile •Product Innovation•

Operational Improvement•

Social Responsibility

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• Employee Engagement • Stakeholders • GRI Index

Diversity & Inclusion (continued)
Leadership Focus and Accountability
Bob McDonald, Chief Executive Officer, holds
himself accountable for leading diversity andmonitoring progress in every part of ourCompany. He expects top leadership to
hardwire diversity and inclusion into theirbusiness strategies, establish clear expectations,and demonstrate personal accountability.
Top executives conduct in-depth diversity
reviews annually with organization heads
across the business units to assess progressand reinforce leadership accountability forcorrective actions. The top officers in the
Company have diversity results tied to theirstock options awards, and strong diversity
performance influences top ratings. Diversity
action plans are developed in each region of
the world to reflect the greatest opportunity
for the advancement of local diversity
strategies.
The P&G leadership team is the mostexperienced and diverse leadership team in
the Company’s history. The majority of these
executives have experience leading businesses
in both developed and developing countries.
P&G leaders at the Vice President level andabove come from 35 different countries,
with more than half of them originating fromoutside the United States.

Bob McDonald expects P&G to be a global
leader in diversity and inclusion. Peak diversity
performance requires goals and strategies thatdemand it, an inclusive culture that values it,a tracking system that measures it, andleadership behaviors that inspire it. He expects
everyone’s full engagement to ensure thatP&G delivers on its diversity and inclusion
mission in every part of our business.

Talent Support and Development
P&G strives to be the Employer of Choice bybuilding a diverse and fully engaged organization. We attract the best talent from aroundthe globe, leveraging each individual througheffective assignment and promotion planning
processes, and executing with excellence thecritical systems that affect, as well as support,
retention of each employee.
We focus on establishing long-term relationships with educational institutions that havediverse populations of highly qualified
students. To broaden our candidate baseworldwide, we utilize Taleo, our fully global,
Web-based candidate management system.
We supplement our base recruiting efforts by
utilizing intern programs, participating in
recruiting conferences, and conducting
outreach to high school students. We executespecial programs such as our Careers in
Business Initiative (CIBI) and P&G Marketing,
R&D, IDS & Finance Summer/Winter Camps tointroduce students to P&G’s success competencies. Additional teams help with efforts torecruit women around the globe and minority,
military and disabled candidates, among
others, in the United States.
Our foundation systems for ensuring employee
retention include effective first-year on-boarding/join-up programs, providing a good matchwith the first manager, developing coaching/mentoring/advocacy relationships, high-quality
challenging work/career plans, training (virtual,classroom and external), and supportive work/
life policies and practices. Employee support
groups and network teams exist throughout
the organization and contribute strongly toeffective recruiting, join-up and development
efforts. These groups include women globallyand Hispanic, African-American, Asian/Pacific-American, Native American, Gay/
Bisexual/Lesbian, and disabled employees in
the United States.

Diversity Metrics
P&G continues to focus on diversity as a global
strategy and expects its work force to become
increasingly diverse, enabling us to serve moreof the world’s consumers. Global data onenrollment by gender is shown in thefollowing table:
GLOBAL
ENROLLMENT

2009

2008

2007(2)

2006

Management

41.2

40.4

38.9

39.3

All Other
Employees(1)

38.8

38.8

39.1

39.0

% FEMALE

The percentages of minority and female
employees in the United States are shown in
the following table:
U.S.
ENROLLMENT

20092008 2007(2)2006Management

22.6

21.1

21.1

21.0

All Other
Employees(1)

19.3

19.3

21.8

18.6

Management

40.7

39.6

37.9

37.3

All Other
Employees(1)

38.8

38.0

38.1

39.5

% MINORITIES% FEMALE(1) Administrative, Technical, and Plant Technicians(2) Includes first-time integration of all Gillette
employees

www.pg.com/sustainability

Contents • Introduction • P&G Profile •Product Innovation•

Operational Improvement•

Diversity & Inclusion (continued)

Global Medical

P&G Recognition

Medical

In 2009, P&G’s solid progress in diversity andinclusion was recognized in many global and
U.S. surveys:

The simple four-word Vision of P&G’s Global
Medical organization is “Healthy People,
Healthy Business.” Our Company’s mostimportant asset is our people. P&G works
with employees to protect and enhance theirhealth and well-being. The Global Medicalorganization advises and assists management
and employees to assure a safe, healthy
work environment. Global Medical delivers
preventive health services to all employees at
all sites. It manages health issues that may
affect our people, technologies, and brands.

• FORTUNE’s World’s Most Admired
Companies (#6 overall; #1 in our industry)• FORTUNE’s America’s Most Admired
Companies (#19 overall, #1 in our industry)• Diversity Inc.’s Top 50 Companies for
Diversity (#11 in U.S., #3 in Top Global
Diversity Companies, #4 in Top 10
Companies for People with Disabilities,#7 Top 10 Companies for Latinos)• Working Mother Magazine as one of theTop 5 Companies for Multicultural Women,
2009 “Best in Class” Company for Training
and Development• Human Rights Campaign — Corporate
Equality Index Rating of 100• Black Enterprise “40 Best Companies for
Diversity”

Our Global Medical
Priorities flow directlyfrom our Purpose,
Values and Principles

Optimize
Employee
Perfomance• Great Place to Work surveys in France,
Spain, Sweden, United Kingdom

Enhance
Speed toMarket58 of 81

• Employee Engagement • Stakeholders • GRI Index

P&G Vibrant Living• Working Mother Magazine “100 Best
Companies for Working Mothers”• National Association for Female Executives
as one of the Top 10 Companies for
Executive Women

Social Responsibility

Since P&G is a principles-driven company, thefollowing Global Medical Priorities drive all of
our health systems worldwide:
1. Save a Life (Protect Our People)
2. Obey the Law (Protect Company Reputation)
3. Protect Key Technologies (Protect Brand
Integrity)
4. Enhance Speed to Market (Support
Emerging Technologies and New Business
Development)
5. Optimize Employee Performance
All medical standards of performance andstandard operating procedures flow directlyfrom specific P&G Principles, Values, compelling business needs, and the Global Medical
Priorities.

In 2009, we announced the new P&G
Vibrant Living initiative with the intent
to bring all Health & Wellness programs
together to better serve our employees
and their families. Our vision is tobecome the Healthiest, Most Engaged
People in the World. P&G Vibrant Living
will include focus in three areas:
Culture of Health — through emphasis
on nutrition, fitness, easy access to ourhealth information, and an environmentthat encourages healthy choices andpersonal management of health risks.
Health Education and Training —through programs like Corporate
Athlete; Blueprint for Healthy Livingin the U.S.; Wellness Balance in Latin
America; China Wellness and Fitness
Idol; and Wellbeing in Western Europe.
Consumer Engaged Health Care —which offers greater understanding of
how employees can make the mosteffective use of health care and takecontrol of their own health choices.

Save a Life

Obey the Law

PVP

Vibrant Living will roll out in the U.S. in
2009, with global expansion set for 2010.

Protect Key
Technologies

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Contents • Introduction • P&G Profile •Product Innovation•

Operational Improvement•

Social Responsibility• Employee Engagement • Stakeholders • GRI Index

59 of 81Worldwide Health, Safety,
and Environment Systems
Health and Safety Policy
P&G is committed to having safe and healthy
operations around the world. The goals are
to protect the lives and health of its employees and the communities surrounding its
operations, as well as to protect its assets,
ensure business continuity, and engenderpublic trust. To accomplish this, P&G will:• O perate facilities safely and ensure thatprocesses are safe and healthy for our
employees and residents of the surrounding
communities. We will accomplish this byfollowing uniform corporate safety standards
around the world. Safe operations have beena long-standing part of Company culture,reflecting the belief that our employees are
our most important asset.
• Construct our facilities so as not to compromise on the safety and health featuresdesigned into them.
• Monitor progress toward our objective ofpreventing injuries, illnesses, and incidents.
We will continually assess and improve oursafety and health technologies andprograms.
• Have every employee understand and be
responsible for incorporating safe behavior
in daily business activities. Every employee
is trained to work in a safe and healthymanner.
• Have operating standards, practices,
systems, and resources in place to implement this policy.

Worldwide Health, Safety andEnvironment Organization
Health, Safety & Environment (HS&E) is a global
community of resources responsible for ensuringthat all sites worldwide — including TechnicalCenters, Distribution Centers, and acquisitions — are operated safely and legally; thatprocess hazards are minimized or eliminated;that health risks are identified, managed,
or eliminated; and that waste from sites isreduced as much as possible. Several thousand
employees spend all or a portion of their timeon HS&E management. This year more than
1,241 full-time equivalents are involved in
HS&E activities. This is up from 1,154 FTEs lastyear and reflects the complete integration ofrecent acquisitions into P&G systems.
There are three major components to a site’s
HS&E organization: the base component, which
includes Environmental, Technical Safety andIndustrial Hygiene & Safety; Fire Protection
Systems; and Medical Systems. P&G uses aphased, detailed Risk Assessment process toevaluate the safety of processes and initiatives
being introduced at its own manufacturing
operations as well as at contractor manufacturing operations. The Risk Assessment process
is designed to enable high-speed innovation.
P&G regularly verifies that the HS&E programat all its manufacturing facilities meets theintent of the environmental management
standard ISO 14001. In 2006, we extended
verification to the Global Health and Safety
Management standard OSHAS 18001.
This verification was conducted by Environmental
Resources Management (ERM), a highly respectedinternational consulting firm in the field ofenvironment, health, safety, and sustainability.

Industrial Health and Safety
The health and safety of P&G employees areparamount in the principles of the Company:• Nothing we do is worth getting hurt.
• Safety can be managed.
• Every illness and injury could and shouldhave been prevented.
• Safety and health are everyone’s
responsibility.
The Company tracks and reports two metrics
for worker safety: total incident rate (TIR)and total lost workday case rate (LWDC).
TIR includes all cases that result in loss of
consciousness, lost workdays, restriction ofwork or motion, medical transfer to anotherjob, or medical treatment beyond first aid.
LWDC includes all cases that involve days
away from work or days of restricted activity
beyond the day of injury or onset of illness.
The TIR target for sites is to be below 1.5 cases
per year, per 100 employees. To achieve suchrates, programs to address employee safety,
such as safe behaviors, ergonomics andconfined space entry, have been implemented.
No target has been set for LWDC. Instead,incidents that potentially could lead to lost
workdays are managed. The following data isbased on criteria established by P&G for use
at all sites including acquisitions, plants, andtechnical centers. This year’s total incident rate
was lower, at 0.36 versus 0.47 incidents per
100 employees, while the lost workday caserate was also lower at 0.15 versus 0.24 cases
per 100 employees.

www.pg.com/sustainability

Contents • Introduction • P&G Profile •Product Innovation•

Operational Improvement•

Social Responsibility

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• Employee Engagement • Stakeholders • GRI Index

Worldwide Health, Safety,
and Environment Systems(continued)
Audit Programs

HS&E Benchmarking

P&G’s HS&E audit programs are designed
to ensure compliance with national, stateand local regulatory requirements as wellas corporate environmental standards andprocedures. Audit findings are reported
promptly to the business management
teams, who must address and correct allissues in a timely manner.

Benchmarking continues to be an important
tool used by P&G to assess and maintain thehealth of its global HS&E program and ensurethat we are applying the best practices andknowledge of our peer companies. Bench­
marking provides important external data
to verify our robust HS&E performance andprovides an opportunity to identify improved
management and technology approaches.

P&G’s audit programs apply to all its plants
and technical centers worldwide, including
Wella and Gillette. The fundamental philosophy is to have the same standards worldwide,
implemented by trained professionals at allplants and technical centers and audited
each year using a consistent, comprehensive
approach. The metrics used are consistent
with that philosophy.
Audits measure performance against a
mandatory set of standards and standard
operating procedures. The target performanceis 8 or better on a 10-point scale. The Company
reviews its sites on a frequent basis. The
percentage of sites audited this year was 87%.

To that end, P&G works with many multinational as well as European companies tounderstand our performance in areas suchas injury/illness, workers’ compensation,
property loss and regulatory fines, and HS&E
personnel productivity. In addition, we areroutinely involved in studies led by GEMI
(Global Environmental Management Initiative),with a business group membership of morethan 41 multi-national companies that survey
several key HS&E topics. As a result of thiswork, we have concluded that, compared toother leading companies, P&G continues todeliver strong HS&E results. Highlights include:• Injury/illness rate for employees — continued
to be within the lowest 25%• Lost workday rate for employees — continued
to be within the lowest 25%• Penalties paid (in dollars per billion dollars ofsales) — lowered to be within the lowest 25%• “Best in class” HS&E operations costs(in dollars per billion dollars of sales).
We are investing in our HS&E program todevelop and improve HS&E capability in bothacquisition and greenfield sites. While P&G’s
HS&E operational costs are excellent, ourlonger-term challenge is to continue to deliver
benchmark results while optimizing our HS&E
program costs.

Fire Protection
P&G operates its fire protection program on
the basic principle that each facility is uniqueand should have a program designed to meetits specific requirements. The Insurance
Division, working with Global Business Unit
fire protection leaders and local management,
determines the appropriate level of fire
protection for each P&G location.
Each facility’s program is organized and built
around the following key elements:• Protection Engineering• Maintenance and Inspections• Prevention Programs• Emergency Response• Qualified Personnel
Each facility has a fire defense profile that
describes the program requirements in detail.

• Property loss (in dollars per billion dollarsof sales) — continued to be within thelowest 33%

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Contents • Introduction • P&G Profile •Product Innovation•

Operational Improvement•

Worldwide Health, Safety,
and Environment Systems

Social Responsibility

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• Employee Engagement • Stakeholders • GRI Index

HIV/AIDS(continued)
Site HS&E Leadership Training

HS&E Program Costs

A key indicator of HS&E systems capability
is the percentage of sites with trained andqualified leaders. Leadership candidates train
on-site for an extended period after attending
a week-long seminar where their knowledge
and ability to handle specific situations areassessed. For full qualification, the candidates
must complete a qualification project at theirown plant. Currently, more than 81% of sites
worldwide have HS&E leaders qualified by
Corporate/GBU staffs, and more than 65%
have qualified fire protection leaders. This
training and qualification program applies toall sites, including Technical Centers andacquisitions.

There are two aspects of HS&E program costs:
1. Capital costs for new HS&E equipment.
2. People and operating costs for existing
facilities.
HS&E capital costs for 2008 – 2009 wereapproximately $32 million, which is flatcompared to last year. These costs include
the purchase and construction of pollution
control equipment such as wastewater
pretreatment and air emission controls.
HS&E total costs for existing sites, which
includes costs for personnel, operations, andcontractor expenses for HS&E activities in2008 – 2009, decreased slightly to $154 million
from 2007 – 2008. Efforts to reduce the amountof waste disposed have increased our overall
quantity of recycling but revenue generated
from these recycling activities decreasedslightly from last year to $32 million.

Worldwide, 40 million people are
infected with HIV/AIDS. It is estimatedthat someone becomes infected every
six seconds.
Infection rates in some African countries run
as high as 40% of the population. AIDS has
become the leading cause of death in
sub-Saharan Africa, with more than 28 million
people infected. In addition to the many lives
lost, there are an estimated 14 million children
orphaned by AIDS.

HIV/AIDS Policy
All employees, including those who are
HIV-infected or have AIDS, are treatedconsistently with the Company’s Purpose,
Values and Principles by the Company, their
managers, and co-workers.
Among other things, that means that eachindividual is treated with dignity and respect,
and that we do not discriminate against any
individual based on any difference not related
to performance.
We treat employees with HIV/AIDS the sameas we treat those with other serious illnesses.
Specifically, an employee who is HIV-infected
or with AIDS:• Has the same employment rights andresponsibilities as other employees.
• Has the same eligibility for employee
benefits and programs, including medicalcare and disability coverage, as noninfected
employees.

• Is afforded privacy and confidentiality
protection consistent with the Company’s
handling of confidential, medical, or othersensitive information.
• Is provided management support toremain productive.
With HIV/AIDS impacting sub-Saharan Africa
more than any other area in the world, P&G’s
sub-Saharan organization is leading theCompany’s HIV/AIDS effort. P&G’s effort,
which began in 1998, was revised in 2004
to coordinate with the latest national andinternational developments and standards.
The effort’s objectives are to:• Use employee and family awareness andprevention programs at our African locations
to help prevent the spread of HIV/AIDS.
• O ffer medical plans that assist employeeswith HIV/AIDS to get life-prolonging
medication, and in some cases supplement
these plans with additional Company support.
The workplace portion of the effort consistsof the following elements:• Establishing baseline measurements, suchas for knowledge, attitude, perception, anddisease prevalence.
• Conducting risk analysis and impact
assessment, considering issues such as costs
to P&G and impact on customers, suppliers,and health care facilities.
• Implementing prevention strategies, such asawareness training, voluntary counseling,
and testing for HIV/AIDS and sexuallytransmitted disease.

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HIV/AIDS (continued)• Implementing wellness programs to keep
infected employees as healthy as possible
and providing post-exposure prophylactics,
anti-retroviral treatment, Nevirapine,
vitamins and nutritional supplements, andhome-based care.
• Evaluating and monitoring the effectivenessof these interventions.
• A ssessing and improving Company benefits.

Specific P&G Activities to Fight
HIV/AIDS in South Africa
For the past 2 years, we have partnered with
our different Health Services Providers indelivering Wellness Packages to the organization. Part of this effort is the annual Wellness
Days, where experts are invited to talk about
wellness in the workplace.
Last year, we held a series of VoluntaryCounseling and Testing sessions (VCT). Overall,
22.5% of our employees were tested. Of theemployees tested, only a few were positive for
HIV/AIDS, which reconfirmed our previous datathat our infection rate is far lower than national
averages. This year, additional VCT was carriedout at our newly established manufacturingsite as part of the Wellness Strategy and theresults are pending.

To commemorate World AIDS Day, theCompany held a VCT on the December 1,
2008. The day started with a live HIV/AIDS
theatrical performance by an external
company. The objective of the play wasto drive awareness and education on how
to manage HIV/AIDS in the workplace. The
theatrical performance was well received
with 70% of the organization turning up to
watch the play, and we intend to do it again
in December 2009.
We continue to provide employees access toa P&G e-care website. By logging to thewebsite, employees can access a variety ofhealth-related information. The site also has
an online interactive feature called “Ask theDoctor” which enables employees to send
health-related questions to a medical professional. There are also condom dispensers ineach of the office rest rooms, which are
refilled every week.
We believe we have adequate resources (e.g.,benefits, recruitment, and training) to address
the impact of the disease. We will continue
with our efforts to educate employees aboutthe HIV/AIDS pandemic and encourage themto get to know their status, at the same time
responding to the government’s call for
corporations to engage employees in thefight against the pandemic.

PŪR and HIV/AIDS
The global response to HIV/AIDS needs toinclude the provision of safe drinking water,
and P&G is helping to build awareness of thisneed as well as providing safe drinking waterto people with HIV/AIDS.
In sub-Saharan Africa, where HIV/AIDS rates
are very high, we are working with a numberof partners to provide safe drinking water
to help people live positively with HIV/AIDS.
People who have HIV/AIDS are more susceptible
to water-borne diseases, including parasites,
viruses, and pathogenic bacteria. P&G’s PŪR
Purifier of Water effectively removes all ofthese elements from contaminated water,
making it a critical health tool for many
people with HIV/AIDS.

the UNC Med School in Malawi and Congo,
CARE in Côte d’Ivoire, and Society of Family
Health in Nigeria to provide safe drinking
water to people living with AIDS. We also
piloted healthy living kits in Kenya with Safe
Water and Aids Project (SWAP), Village AIDS
Clinics, and Living Missions. We found a highlevel of acceptance overall, and focus groups
revealed a desire to reduce intake of viruses.
Working with the Kenyan Red Cross, we haveleveraged their home-based care and foundwide acceptance for water treatment withPŪR by the community.

In 2008 at the Clinton Global Initiative,
P&G committed to providing a minimum of$1 million in additional funds to provide safe
drinking water to people living with AIDS,
and plans were implemented to meet thatcommitment. We are working with Family
Health International and PSI in Ethiopia,
Children’s Fund in Uganda, AMPATH in Kenya,

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• Stakeholders • GRI Index

Stakeholders
External Partnerships MatterNo single company has all the answers about
Sustainability, but P&G is committed to being
part of the solution. Meaningful progress requires
the right partners, especially when taking on
environmental challenges like solid waste,climate change, and water quality. Tacklingconsumer concerns like product safety also
requires collaboration.
Why do external partnerships matter? Because
these important topics impact both our world
and our business, today and in the future. So wetake them seriously, dedicating internal resources
while engaging externally. Only then can webe part of the conversation, helping find theanswers that Sustainability demands.

A stakeholder is anyone who has an interest in orinteraction with P&G. Stakeholders can be internal,
such as the Company’s 135,000 employees and its
Board of Directors, or external. External stakeholders
include the P&G consumers, our customers and supplierswith whom we do business, our shareholders, and thecommunities in which P&G people live and work.

Consumers

Governments

Consumer Organizations

Local, Regional, National;
Agencies (such as Health
Ministries, Regulatory
Boards); Pan-National
Commissions (such as EU);
Embassies, Diplomatic
Missions

Shareholders
Business Partners
Retailers, Wholesalers,
Distributors, Vendors,
Contractors, Suppliers,
Advertisers, Trade Unions

Industry Associations
Professional Organizations,
Scientific/Medical
Communities

NGOs
Health, Social Service,
Education, Environment

News Media

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Operational Improvement•

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Employee Engagement

Solid Waste
Growing responsibly compels us toconstantly seek improvements in thedesign, manufacture, and delivery of
our products. So P&G has establisheda Global Integrated Solid Waste
Management Team made up of its
experts around the world.
A Partner in the Journey
In 1995, P&G scientists firstpublished Integrated Solid
Waste Management: A Life
Cycle Inventory, a book
based on their experience
working with governmental agencies, academia,
environmental andconsu­mer organizations,and other industry partners in this area. It
voiced support for practical solutions, such as
the benefits of recycling and energy recovery,
ways to implement curbside collection forrecovering recyclables, and ways to compost
biodegradable materials.

Packaging Progress
We continually look for opportunities toreduce packaging while maintaining consumer
needs and product integrity — an effort that
forms the cornerstone of our solid waste
efforts. We are also shifting some materials
to renewable sources, with several efforts
underway.

Solutions for the Developing WorldIn Thailand, Brazil, Mexico, and China, wehave been founding members of industry
coalitions to promote Integrated Solid Waste
Management solutions.
One such example is P&G’s cooperation in
Thailand with TIPMSE — Thailand Instituteof Packaging Management for Sustainable
Environment — and the Ministry of Natural
Resources and Environment to introduce
recyclable work banks in more than 200
communities countrywide. The program
allows citizens to exchange recyclable
materials for money that is deposited into
a personal account. These funds can bewithdrawn as needed.
The results are not only good for theenvironment, but these programs provide
a needed source of income for participants.
These efforts will be further extended and
it is expected that in 2009 the projects will
cover 400 more Thai communities, 10 more
universities and colleges, and 15 more municipalities and administrative organizations.

“TIPMSE has set an important milestone
towards environmental protection andsocial responsibility in Thailand. TIPMSE
has established strong partnerships withgovernment, academia, industries andcommunities. The concept of Integrated
Waste Management is efficient for
managing packaging.”
Yuthtapong Wattanalapa
Director General• Stakeholders • GRI Index

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Climate Change
Climate change is a serious issue facing the world today. P&G is not an energy-intensive
business, but as a global citizen we are concerned about the negative consequencesof climate change. We believe that industry, government, and consumers all have a roleto play in addressing climate change and that prudent and cost-effective actions to
reduce greenhouse gas emissions are necessary. We have endorsed the Copenhagen
Communiqué on Climate Change calling for an effective and equitable internationalframework to address climate change, and internally we are focusing our efforts in twoareas: reducing our own emissions and innovating and educating to impact consumer
behavior. The challenges posed by climate change are significant, but P&G is committed
to making progress. We will continue to disclose data on our absolute CO2 emissions
and energy use, reporting achievements against our goals on an ongoing basis.
Reducing Greenhouse Gas Emissions
from Our Own Operations
The most significant greenhouse gas associatedwith manufacturing our products is the CO2
created from on-site fuel combustion andexternally purchased electricity. Even though
our business has more than doubled in size
since 2002, we have managed to reduce direct
CO2 emissions from our facilities by over 10%
in that time. Our goal is to achieve a 20%
reduction of bothWoodstone-led
lighting upgrades have CO 2 emissions andreduced CO2 emissions by energy consumption
per unit of production
by 2012, compared
to a 2007 baseline.
METRIC TONS LAST

10,000YEAR ALONE

To meet this target,
we will need help
from partners like Woodstone Energy.
Woodstone has led multiple lighting upgrade
projects and will be the lead partner for ourSouth Boston plant’s 2010 upgrade to a moreenergy-efficient electricity-generating turbinethat will reduce CO2 emissions by over
130,000 metric tons annually.

“P&G is committed to improving energy
efficiency and reducing greenhouse gas
emissions. We are happy to be a key
partner in their efforts.”
Doug Woodward
President

Innovating to Enable More Efficient
Consumer Product Use and Energy
Consumption
As the lifeblood of our Company, innovation
plays a critical role in helping consumers
reduce their own greenhouse gas emissions,
whether through product innovations or
education programs.
After examining the life cycles of our biggest
product categories, we found that the energy
used to heat water during laundering had themost potential for positive impact. In fact,
if every U.S. household used cold water for
laundry, the energy
Cool Clean campaign
helped savesavings would
amount to roughly
3% of the nation’s
METRIC TONS OF
total household
CO2 EMISSIONS
energy consumption.
This insight led to thedevelopment of laundry detergents specificallyformulated to deliver great cleaning performance in cold water.

58,000“The leading role we were able to playin the ‘Cool Clean’ campaign has successfully persuaded consumers to reduce
washing temperatures and help theenvironment — a win-win for us, P&G,
and consumers.”
Philip Sellwood
Chief Executive Officer

Of course, realizing the benefits of cold water
washing requires consumers to change their
behavior. A key partner for P&G in these
efforts has been the Energy Saving Trust, an
independent not-for-profit organization basedin the U.K. In partnership with our Ariel brand,
they developed and executed the Ariel Cool
Clean campaign, which has helped consumers
reduce their environmental impact by enablingthem to get their clothes brilliantly clean atlower washing temperatures.
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Water
Availability of adequate quality water is essential to life. It is also hard to imagine any
economic activity where water does not play a prominent role. For P&G, water is of
crucial importance to both the production and use of our products, so our approach
to water aims at responsible use by both our Company and our consumers. And because
a lack of safe drinking water is a leading cause of debilitating disease and death indeveloping countries, especially for young children, we also want to help provide safe
water to children in need.
Sustainable Water Management

Social Commitment

P&G has formed a multidisciplinary Water
Council internally. The group examines risks
and oppor­tunities related to our products
and plants, and is renewing our corporate
water strategy.

P&G’s Children’s Safe Drinking Water program
helps address the critical need for safe drinking
water. P&G is committed to long-term,
not-for-profit provision of our PŪR Purifierof Water technology in the developing worldin an effort to reduce illness and death,particularly in children. Through June 30, 2009,
we have provided more than 1.6 billion litersof safe drinking water since inception of thisprogram in 2004.

Product Innovation
Water efficiency is an important element inour product innovation. We are working ontechnologies that require less water when
the consumer uses our products. In addition,
we collaborate with external partners, like theJapan Water Forum, to educate consumers
about opportunities to save water.

Operational Improvement
Within our plants and other sites, we continue
to work on increasing our water efficiency andsavings. We also focus on continually improving
the quality of the water leaving our plants.

External Engagement
As a member of the Working Group WATERof the World Business Council for Sustainable
Development (WBCSD), we support external
efforts to better understand key water-related
issues. WBCSD is a founding member of theWater Footprinting Network, which is working
on developing cross-sector relevant water
footprint methodologies. Also, through
WBCSD, P&G is involved in the recently started
development of an ISO standard looking at
harmonizing terminology and parameters forwater footprinting initiatives.

“The vision of Japan Water Forum is tomake a substantial contribution to thesolution of global water issues byengaging people and societies throughdynamic movement, innovative ideas, andresolute actions. P&G Japan has been agreat partner in helping reach children
in schools.
P&G’s water education program inelementary schools promotes children’s
understanding about the meaning ofwater for life, international water issues,and how Japan depends on water fromother countries through its imports.
We continue to work together with P&G
to drive water education in schools,
training the next generations to takeaction in solving water-related issues
and building a sustainable society.”
Kotaro Takemura
Secretary Generalwww.pg.com/sustainability

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Product Safety
In today’s media environment, concerns
have heightened around the safety of
consumer products and their ingredients.
So it’s not surprising that many of ourconsumers look for reassurance that P&G
treats their concerns seriously.
Every day, over four billion consumers use our
products, so there is nothing more important
to us than assuring the safety of our products
for our consumers and the environment. Ourcommitment to safety is reflected in the morethan 700 in-house experts devoted globally toensuring the environmental and human safetyof all our ingredients and products before they
go to market. P&G also consistently promotes
research that enhances understanding ofproduct safety. Our scientists have helped todevelop numerous new methods andapproaches to advance the science of safetyassessment, and they are currently leading
new research in the application of genomics
to that field.

Safety doesn’t stop once a product is in themarketplace. We also conduct extensive
studies to understand real consumer use of
our products. Through consumer e-mail andtelephone hotlines, we are available to help
address any consumer questions or concernsthat arise.
And we believe that transparency helps
the consumer make better decisions, so
we keep consumers informed through sites
such as www.pgbeautyscience.com.

“As a member of P&G’s scientific External
Advisory Board, I’ve seen firsthand P&G’s
commitment to safety and leading
research. Safety is a key componentof every P&G product, even thoughmost consumers just see outstanding
and trustworthy products that work
every time.”
Kimberly Thompson
Adjunct Associate Professor of
Risk Analysis and Decision Science
Harvard School of Public Health

Animal Research
Many of our consumers also want to know
our position on animal research. P&G firmly
believes that ending animal research isbeneficial for consumers, animal welfare,and industry. P&G has invested more than$250 million inMorehelping to develop
thanmore than 50
OF SAFETY ASSESSMENTS non-animal
UTILIZE ALTERNATIVE, alternative methods.

99%

NON-ANIMAL METHODS

Today, more than
99% of our safetyassessments are done with alternatives. By
continuing to innovate, we are able to assess
acute effects of most new ingredients withalternatives only.
P&G is working with many partners andlawmakers globally (e.g., CAATs (The Johns
Hopkins Center for Alternatives to Animal
Testing), EPAA (The European Partnershipfor Animal Alternatives), etc.) to continue toadvance science and technology in this area.
For example, in the U.S., the EPA is working
with P&G and other companies to pilot a
new program to evaluate the usefulness of

non-animal alternative testing approaches
for the labeling of antimicrobial cleaningproducts. If the program is successful, theEPA will update its product registration
requirements to allow manufacturers to use
non-animal alternative tests in assessing theeye irritation potential of these products.
We are committed to continuing our leadership in developing non-animal alternatives,
which we believe will ultimately result in theelimination of all animal research.
To read more about our ongoing efforts,
visit our website: http://www.pgbeauty
science.com/animal-testing-alternatives.html.

“The Humane Society of the United States
has collaborated with P&G for nearlytwenty years to successfully press fornational and international changes inanimal testing regulations and practices.
Working together, animal protectiongroups and committed corporations canmake eliminating animal testing a reality.”
Andrew Rowan
Executive Vice Presidentof Operations

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Stakeholder Engagement
P&G works hard to be a good corporateneighbor and to improve lives in thecommunities where we live and work.
Communities
Each P&G production facility has site-specificactivities to build constructive relationships
with local authorities, local industry associations, residential and business neighbors, local
action groups, thought leaders, and news
media. Depending on the cultures andinterests of individual communities, this canrange from regular official meetings, during
which new information is shared or questions
are answered, to more informal meetings. This
could be, for example, a reception for
immediate neighbors, where information on
the past year and plans for the new year are
discussed. P&G ensures continuity in community interaction by meeting regularly with local
authorities to update them on plant news. In
the neighborhoods of many P&G operations,the Company cooperates with and sponsors
local events, so the whole area benefits fromthe presence of a P&G site.
P&G recognizes the importance of improving
the quality of life in our local communities,
and we support local initiatives and encourage
employee involvement. The most valuablecommunity support we provide usually involves
not only writing a check but also taking
advantage of the intellectual capabilities andenergy of P&G people. We look for areas
where we can make a significant, long-term,
systemic difference. This leads us to focus
heavily on education and health, with special
emphasis on youth. It also allows us to build
alliances with strategic partners to achieve a

better result than we could alone. We look to
our people in the area to work with their local
communities and government officials to learn
where we can make the biggest difference.

Authorities: Local — Regional — Global
P&G communicates with local, regional, andglobal authorities directly, both as an individualcompany and through industry associations.
Scientists and legal experts in the P&G External
Relations organization review existing andproposed legislation that is relevant to theCompany and work with authorities to ensurethat policies take the needs and experience ofbusiness into account. This is done via meetings
with the authorities and comments on theirposition papers and industry position papers.
Activities like these can be very important toensure that the Company’s needs are understood and considered when decisions are being
made that can influence P&G’s business.

NGOs: Local — Regional — Global
P&G frequently enters into dialogue withnongovernmental organizations (NGOs) tounderstand their concerns and cares. In order
to work constructively with stakeholders, it isessential to have their confidence and be seen
as a reliable and open discussion partner. Bybuilding an open relationship, we can approach
our NGO partners when issues arise. There is awide range of NGOs that vary by area ofinterest (environmental, consumer, animal
welfare, etc.), by attitude (from extreme tomoderate), and by their geographic links (fromlocal to global). Depending on their characteristics, a number of NGOs can be seen as the
vocal spokespeople for the general public.

Consumer organizations exist in many countries.
These organizations contact companies tocompare products and voice comments theyreceive from their members. P&G continuously provides consumer organizations withinformation on new initiatives and cooperates
with them in answering consumer questions.

Consumers
At P&G, we are dedicated to meeting the needsof our consumers by providing products andservices that can help improve their lives. The
concept of “Consumer is Boss” is fundamental
throughout the development and marketing ofour products. We set out to delight consumers
by launching only new products and productimprovements that genuinely meet their needs.
Before establishing a project for a new productor product improvement, P&G technologists
research consumer needs in depth to identify
and understand those needs that are notadequately met today.
Once a product is launched, our commitment to our consumers does not stop there.
For P&G, every consumer’s experience inchoosing, buying, or using one of our
products can provide vital insights to help
us further improve our products and services.
So we encourage consumers to contact our
Global Consumer Relations team. We want
to hear about our consumers’ experienceswith our products — good and bad.
Last year we heard from over 8 million
consumers who wanted to ask us something
about our products or our Company.
We proactively offer “traditional” contact
channels — phone, letter, e-mail — toconsumers, but we are also very aware that
consumers’ lives are changing (we are consumers too!). Life is getting busier, and we want
to be able to access the right information on
our terms, which may be very early in themorning, or in the middle of the night. So wehave invested in technology, which has alreadybeen deployed for some of our major brands,
where consumers can access key information
on a 24/7 basis, i.e., on their terms. Of course,
we continue to offer the well-established
Careline Services where consumers can talk toor communicate with an experienced advisor,
but we also enable consumers to find vital
information on our brands using e-mail andtelephony technology “out of hours.” Thishas been a huge success, and has actuallyenabled us to interact with even more of
P&G’s consumers in the last fiscal year, which
provided more insights for our ProductDevelopment and Marketing teams to help
further improve our products and services.
We are also innovating in how we ensure thatthese important insights from our consumers
get to our business teams. Consumers whotake the time to contact a company for advice
or ask for help to resolve a problem provide
valuable insights into our products, which canreally help us develop our business by improving
our brands. So we need to make sure that ourconsumer’s voice is heard in P&G. We do
this by using a range of different tools andtechnologies — whatever best meets thebusiness team’s need, and therefore gives
our consumer the best chance to be heard.
We use reports and data, but we also use
carefully edited sections of some actual

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Stakeholder Engagement(continued)
consumer calls, e-mails and letters — edited toensure that none of the consumer’s personal
information is disclosed — so we feel thepower of a “real” consumer’s voice.
In Global Consumer Relations, we recognizethat the world is changing and we areinvesting in innovative technology to better
serve our consumers. We are privileged that
consumers care enough about our products
to contact us.

•

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Advertising andPromoting to Consumers
Appropriately

Principles for Developing
Environmental Sustainability Claims

The Company does not permit its advertising or promotions for its products to
be false or misleading. What are somesituations that raise concerns?

These principles are intended to provide
guidance for the development of environmental sustainability claims.

• Exaggerated or unsupported advertisingclaims are made to compete with acompetitor that is doing the same.
• Incomplete, inadequate or misleading
disclosures in Company advertising leading
consumers to infer an incorrect, unsupported conclusion.
• Advertising is distributed to the public
before testing supporting the claims madein the advertising has been completed.
What are P&G’s Worldwide Business Conduct
Standards for Advertising?
• Do tell the truth in Company advertisingand promotions.
• Don’t make a substantive claim about aCompany product, or a competitor’s
product, or a comparison with a competitor’s
product, that has not been substantiatedthrough objective product testing based on
sound statistical and scientific principles.
• Don’t run any advertisement or promotionthat has not been reviewed by appropriate
Company Legal personnel.

1. Claims must be truthful, data based, anddefensible. Claims must be supported bysound and transparent assumptions andgood science, and have sufficient data to
substantiate the claim.
2. Claims should be a specific statement offacts and should not exaggerate attributes
or benefits. The use of broad, unqualified,and hard-to-define claims should be
avoided.
3. Claims should reflect life cycle thinking. The
claimed benefit should not be outweighedby other environmental burdens or negative
attributes of the product/packaging
elsewhere in its life cycle.
4. Any environmental benefit claimed on a
product must be a meaningful benefit for
consumers, customers, or external
stakeholders.
5. Claims should not misleadingly exploit
environmental requirements needed forregulatory or legal compliance.

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7. Environmental benefits may be translated
into other indicators which are more tellingfor consumers, as long as the translation isbased on factual equivalents and does not
exaggerate the benefit the product actuallyprovides.
8. The claim must not be worded in a way that
denigrates products not carrying the claim(including other P&G brands).
9. Presence/absence of specific ingredients
may be used only when claims do notdenigrate products carrying the ingredientsand only when presented in a neutral andinformative way.
10. The product carrying an environmental
claim must not be labeled as dangerous
for the environment.
11. Claims must avoid sensitive External
Relations issues.
12. All claims must comply with relevant local
regulatory / legal requirements.
13. All environmental sustainability claims
must pass through the normal claim
approval systems.

6. Claims should be supported by data on
both recommended and actual usage ifthese are known to differ.

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Sustainability Guidelines
for Supplier Relations
The foundation of our Sustainability
Guidelines for Supplier Relations is
our Statement of Purpose, Values andPrinciples. We operate within the spirit
and letter of the law and maintain highethical standards wherever we conductbusiness. We will actively seek business
relationships with suppliers who share
our values and promote the applicationof these high standards among thosewith whom they do business.
The Sustainability Guidelines for Suppliers
can be downloaded at: www.pgsupplier.
com/sustainability-guidelines.

Summary of Our Supplier Guidelines:
1. We expect our suppliers to comply with allapplicable laws of their country, includinglaws relating to employment, discrimination, environment, and health and safety.
Suppliers who knowingly violate laws or
have repeated problems conforming tothem will not receive our business.
2. Commercial bribery is illegal and subject tocriminal penalties in many countries,
including the United States. Any personal
payment or bribe to individuals employed
by P&G’s customers or suppliers — or receipt
of a bribe or personal payment by P&G
employees — is strictly prohibited. Even inlocations where such activity may not,technically speaking, be illegal, it isabsolutely prohibited by Company policy.

3. P&G supports universal human rights,
particularly those of our employees, thecommunities within which we operate,
and the parties with whom we do business.
In our business award decisions, we willcontinue to place substantial value upon
incumbent and potential suppliers who
consistently respect basic human rights.
4. P&G utilizes fair employment practices,striving to provide a safe, healthy, andproductive work environment for its
employees. The Company respects
employees’ right to freedom of association,
third-party consultation, and collective
bargaining where allowed by law. The
Company expects suppliers to uphold thesame standards. Specifically:• We will not conduct business with suppliers
employing child, prison, indentured, orbonded labor, or using corporal punishment
or other forms of mental and physicalcoercion as a form of discipline.
• We expect suppliers to conduct their businesswithout unacceptable worker treatment suchas harassment, discrimination, physical ormental punishment, or other forms of abuse.
• At a minimum, we expect our suppliers
to comply with all applicable wage andhour laws, and rules and regulations,
including minimum wage, overtime, andmaximum hours.
• We expect suppliers to provide a safe work
environment, to prevent accidents and injury,
and to minimize exposure to health risks.

• We seek to do business with suppliers whoshare our concerns for and commitment topreserving the environment. At a minimum,
suppliers must meet all current applicable
environmental rules, regulations, and laws
in their countries.
The management system is owned by the
Global Vice President – Purchasing and has
three components:
Communicate: All purchasing personnel who
interface with suppliers are trained on the
supplier guidelines and how to conduct
supplier assessments. We communicate theguidelines to our suppliers once a year andreinforce our expectations in our contracts.
This makes compliance with the guidelines
a condition of business and therefore makes
noncompliance grounds for disqualification
for all new and ongoing supply agreements.

Correct noncompliance: When potential
noncompliance issues are identified, they
are communicated to the supplier as partof the closing meeting. Corrective actions,
including formal notification and a remediation action plan, are then implemented. In
some cases, we require immediate action
to achieve compliance, or we halt business.
These include child labor or forced labor,
and egregious health and safety violations
presenting immediate danger to humanhealth. If a compliance issue is not resolvedin a timely manner, the business relationshipis terminated.

Check: Ongoing periodic performanceassessments are done as part of regularcommercial and technical supplier visits.
Emphasis is placed on suppliers that are
high-risk because of country of operation or
potential hazard. During 2008 we participatedin a benchmarking assessment of our programwith other multinational companies. There
were several areas of improvement which
we are taking steps to address. Some of
the changes we are implementing will be atransition to third-party auditors as well as
subscribing to a database where audit results
and corrective action plans are shared withother companies.

www.pg.com/sustainability

Contents • Introduction • P&G Profile •Product Innovation

Supplier Diversity Program
In 1976, P&G established a program to
identify and work with minority-owned
businesses in the United States. Today, theSupplier Diversity Initiative is a fundamental
business strategy which identifies andworks with minority- and women-owned
businesses. The Global Vice President –Purchasing serves as Executive Sponsor.
Minorities continue to become a more
substantial part of America’s population
and women continue to be P&G’s key
consumer base.
As such, P&G is committed to remain at aleadership level because it is good for ourbusiness and good for the health of the U.S.
economy. In 2008 – 2009, spending was over
$2 billion with more than 1,000 minority- andwomen-owned suppliers. Since 2005, P&G has
been a member of the Billion Dollar Roundtable,
a forum of 16 corporations that spend morethan $1 billion annually with diverse suppliers.

•

Operational Improvement•

Social Responsibility•

Employee Engagement• Stakeholders • GRI Index

71 of 81

Personal
Information Privacy
Advances in computer technology havemade it possible for detailed information
to be compiled and shared more easily
and cheaply than ever around the globe.
That can be good news for society as awhole and for individual consumers.
At the same time, as personal information
becomes more accessible, each of us — companies, associations, government agencies,
consumers — must take precautions against
misuse of that information. Several countries
already have laws protecting consumers frommisuse of their personal information, andmany others are following suit.
P&G places a high priority on safeguarding
people’s personal information. Even incountries without privacy legislation, we still
adhere to our privacy policy. We want to havethe trust of consumers and all others who
do business with us, including employees,
shareholders, retail customers, and recruitment candidates.

Externally, P&G has been a strong advocate
of work within the industry to protect theprivacy of consumers. For example, P&G has
been a leader in the effort to make privacy
notices more consumer-friendly and has
recently made our online marketing statement available in 39 languages.
For more information on P&G’s global
privacy principles, please visit:www.pg.com/company/our_commitment/
privacy_policy/privacy_policy.shtml.
P&G adheres to U.S./European Union
Safe Harbor principles. For more
information, visit: www.export.gov/safeharbor/.
In the United States, P&G is an active
participant in the Better Business Bureau’s
Accredited Business Program.

P&G’s robust privacy program is managed by a
Global Privacy Council. Our first objective is toprotect an individual’s personally identifiable
information as if it were our own. All outsidecompanies handling data on our behalf are
required to abide by our privacy principles.
Third-party companies can accessour privacy and security guidelines
on www.pgsupplier.com.

www.pg.com/sustainability

Contents • Introduction • P&G Profile •Product Innovation

Principal Industry andBusiness Associations•

Operational Improvement•

HAPCO — European Industry of Hygiene
Paper Products• Pet Food Industry Associations: PFMA —Pet Food Manufacturers Association

P&G holds membership in many industry,business, and environmental associations
whose activities are related to theCompany’s.

• Pharmaceutical Associations: AESGP/OTC
Manufacturers Association;
FPIA — Pharmaceutical Industry Association

Europe, Middle East and Africa

North America• Advertising Associations: WFA — World
Federation of Advertisers• American Chemical Society• Chemical Industry Associations:
CEFIC — European Chemicals Industry
Association; DUCC — Coalition of
Downstream Users• American Legislative Exchange Council• Cosmetics Industry Associations:
COLIPA — Cosmetics & Fragrances Industry• Business Roundtable• Detergent Industry Associations:
AISE — Association Internationale de la
Savonnerie de la Detergence et desProduites d’Entretien• American Chemistry Council• A ssociation of National Advertisers• Business for Social Responsibility• Canadian Consumer Specialty Products
Association• Canadian Cosmetic, Toiletry and Fragrance
Association• Consumer Specialty Products Association• Employer Associations: Business-Europe• Consumer Health Products Association• Environmental Associations:
ECETOC — European Center for Ecotox and
Toxicology of Chemicals; EUROPEN — The
European Organization for Packaging andthe Environment• CSR Canada — Corporations Support
Recycling• Euro/American Business Associations:
AECA — American European Community
Associations; EU Committee of AmCham• Food and Consumer Products Manufacturersof Canada• Global Environment Management Initiative

Social Responsibility•

Employee Engagement• Stakeholders • GRI Index• The Council of State Governments• U.S. Council for International Business• Water Environment Research Foundation

Latin America• ABIPLA — Brazilian Association of Household
Cleaning Products• ANALJA — Colombian Soaps and Detergent
Manufacturers Association• CONAR — Chilean Advertising SelfRegulation and Ethics Council• Chamber of the Cosmetic Industry of Chile• C ANIPEC — Mexican Association of the
Cosmetics and Perfumes Industry• Cámara Nacional de la Industria de Aceites,
Grasas, Jabones y Detergentes, Mexico• Cámara Nacional de las Industrias de la
Celulosa y del Papel• Confederación Patronal de la República
Mexicana• AmCham — Chilean American Chamberof Commerce• Chilean — Brazilian Chamber of Commerce• ANDA — National Advertisers Association
Chile• Latin America Federation of Waste
Management• Peru — Sociedad Nacional de Industrias• CONCAMIN — Confederación de Cámaras
Industriales

Asia• A sociación Nacional de la Industria Química,
Mexico• A sia/Pacific Economic Cooperation• AMECE — Asociación Mexicana deEstandares para el Comercio Electronico• National Environmental Development
Association• CONAR — Consejo de Autorregulación y Etica
Publicitaria, Mexico• National Governors Association• Grocery/Brand Associations: AIM — European
Brands Association• Personal Care Products Council• COMCE — Consejo Mexicano de Comercio
Exterior• Pharmaceutical Researchers andManufacturers of America• CONMEXICO — Consejo Mexicano de la
Industria de Productos de Consumo• Soap & Detergent Association• C AVEME — Venezuelan Pharmaceutical
Products Association• Soap & Detergent Association of Canada• CONINDUSTRIA — Industrial Confederationof Venezuela• A SOQUIM — Venezuelan Association of the
Chemical Industry• National Conference of State Legislatures• Paper Associations: EDANA — European
Industry of Non-Woven Products;• ANDA — Venezuelan Association ofAdvertisers• SOFOFA — Manufacturers Industry
Association• Food Associations: CIAA — European Food
Industry Association; CIES — Food BusinessForum• Multistakeholder Associations:
EPE — European Partners for the Environment• CEVEDES — Venezuelan Business Council for
Sustainable Development• Argentinian National Industry Association• A sociación Mexicana de Fabricantes dePañal Desechable y Similares, A.C.
(AMPADE)• Grocery Manufacturers of America

72 of 81• State Committee of Cosmetic Industry• Australian Consumer & Specialty Products
Association• China — AmCham• China — CC of Foreign Invested Enterprises GZ• China — Academy of Environment Science• China — Association of Enterprises with
Foreign Investment• China — Association of Fragrance, Flavor
and Cosmetic Industry• China — Daily Use Groceries Association• China — Detergent Products Industry
Associationwww.pg.com/sustainability

Contents • Introduction • P&G Profile •Product Innovation• China — Environmental Health Safety
Roundtable• China — Association of Surfactant, Soap andDetergent Industries• China — Hygiene Supervision Magazine• China — Hygienic Material & Technology
Association•

Operational Improvement•

Branch of Foreign Investment• China — Living Use Paper Specialized
Committee of China Paper Making Institute• China — National Bar Code Association• China — National Environment HygieneStandard Specialized Committee (MOH)

Social Responsibility•

Employee Engagement• Stakeholders • GRI Index

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• Indonesia — Indonesian Pulp & Paper
Association• Malaysia — Malaysian International Chamberof Commerce and Industry — MICCI• Indonesia — Indonesian Tissue Paper
Association• Malaysia — The Cosmetic, Toiletry &Fragrance Association of Malaysia — CTFA

• Indonesia — National Standardization Body

• Philippines — Soap & Detergent Associationof the Philippines• China — Perfume / Fragrance Magazine• Indonesia — Pharmaceutical Industry
Association• China — Quality Management Association• Japan — Japan Cosmetic Industry Association• Philippines — Cosmetic, Toiletry & Fragrance
Association of the Philippines• China — Standardization Association• China — State Committee of Cosmetics
Industry Standardization (SBQTS)• Japan — Japan Health and Nutrition Food
Association• Singapore — The Cosmetic, Toiletry &Fragrance Association of SIngapore — CTFAS• China — Standardize Technological
Consulting Service Center• China — State Technical Committee of Paper
Making Industry Standardization• Japan — Japan Hygiene Product Industry
Association• Taiwan — Taiwan Cosmetic Industry
Association• China — China Toothpaste Industry
Association• China — State Technology Committee ofFood Industry Standardization• Japan — Japan Soap and Detergent
Association• Taiwan — Taiwan Paper Industry Association• China — GD Associated Net for AntiCounterfeit & High-Quality Protection• China — Tianjin Association of Enterprises
with Foreign Investment• Japan — Pharmaceutical Association of Japan• Taiwan — Taiwan Soap & Detergent Industry
Association• Korea — American Chamber of Commerce• Thailand — Federation of Thai Industries• China — GD Fragrance Flavor Cosmetic
Branch of GD Light Industry Association• Hong Kong — The Cosmetic and Perfumery
Association of Hong Kong

• Korea — Association for Fair Trade of Tissue& Hygiene Products• Thailand — Thailand Soap & Detergent
Association• China — Guangdong Quality Magazine• Hong Kong — The Hong Kong Associationof the Pharmaceutical Industry• Korea — EU Chamber of Commerce

Worldwide• Korea — Korea Chemical Management
Association• Conference Board• Korea — Korea Cosmetics Industry
Association• Society of Environmental Toxicology andChemistry• World Business Council for Sustainable
Development• China — National Household Paper Industry
Association• China — Guangdong Quality Management
Association• China — Guangzhou Municipal Foreign
Trade Investment Law Association• India — Associated Chambers of Commerceand Industry of India• India — Confederation of Indian Industry• China — Guangzhou Municipal Lawyers’
Association• India — Federation of Indian Chambers ofCommerce and Industry• Korea — Korea Food Industry Association• China — Guangzhou Quality Inspection
Association• India — Feminine & Infant Hygiene
Association• China — Guangzhou Trademark Association• Korea — Korea Hygiene Paper Product
Association• India — Indian Soap & Toiletries Makers’
Association• Korea — Korea Paper Manufacturers’
Association• Indonesia — Indonesian Cosmetics
Association• Korea — Korea Pharmaceutical Trade
Association• China — GZ Education Fund Association• Indonesia — Indonesian Food & Beverage
Industry Association• Malaysia — American Malaysian Chamberof Commerce (AmCham)• China — GZ Industry & Commerce
Administration Management Institute• Indonesia — Indonesian Moslem Scholar
Association• Malaysia — Federation of Malaysian
Manufacturers — FMM Food Manufacturer• China — GZ “Three” Associations of Economic& Technological Development District• China — GZ Association of Enterprises with
Foreign Investment• Korea — Korea Food Traders Association• International Chamber of Commerce

www.pg.com/sustainability

Contents • Introduction • P&G Profile •Product Innovation•

Operational Improvement

P&G has been a member of the FTSE4Good and Dow Jones Sustainability Index(DJSI) since their inception. In addition, P&G was added to the Global 100 list of
the world’s most sustainable corporations in 2009.

•

Social Responsibility•

Employee Engagement• Stakeholders • GRI Index

Index

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INDICATOR

Product Innovation•

Operational Improvement

DESCRIPTION•

PAGE(S)

1.1

Statement from the most senior decisionmaker of the organization.

1.2

Description of key impacts, risks, and opportunities.

Employee Engagement

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• Stakeholders • GRI Index

DESCRIPTION

PAGE(S)4

3.5

Process for defining report content.

5, 7 – 71

3.6

Boundary of the report.

19, 36

3.7

State any specific limitations on the scope or boundary of the report.

19, 36

3.8

Basis for reporting on joint ventures, subsidiaries, leased facilities,
outsourced operations, and other entities that can significantly
affect comparability from period to period and/or between
organizations.

36

3.9

Data measurement techniques and the bases of calculations.

19

3.10

Explanation of the effect of any re-statements of information
provided in earlier reports.

19

3.11

Significant changes from previous reporting periods in the scope,boundary, or measurement methods applied in the report.

11

2. Organizational Profile
2.1

Name of the organization.

2.2

Primary brands, products, and/or services.

8–9

2.3

Operational structure of the organization.

10 – 15

2.4

Location of organization’s headquarters.

7

2.5

Number of countries where the organization operates, and namesof countries with either major operations or that are specifically
relevant to the sustainability issues covered in the report.

7

12 – 15

2.6

Nature of ownership and legal form.

7

2.7

Markets served.

7

2.8

Scale of the reporting organization.

2.9

Significant changes during the reporting period regarding size,
structure, or ownership.
Awards received in the reporting period.

GRI
INDICATOR•

Report Scope and Boundary

1. Strategy and Analysis

2.10

Social Responsibility

7 – 115

GRI Content Index
3.12

11

Table identifying the location of the Standard Disclosuresin the report.

75 – 80

Assurance
48, 58, 74

3.13

Policy and current practice with regard to seeking external assurance
for the report.

2

3. Report Parameters
4. Governance, Commitments and Engagement

Report Profile
3.1

Reporting period.

3.2

Date of most recent previous report (if any).

2
Financial Year2007 / 2008

3.3

Reporting cycle (annual, biennial, etc.).

Annual

3.4

Contact point for questions regarding
the report or its contents.

sustainrep.im@pg.com

Governance
4.1

Governance structure of the organization.

16 – 18

4.2

Indicate whether the Chair of the highest governance body is also
an executive officer.

4

4.3

For organizations that have a unitary board structure, state
the number of members of the highest governance body thatare independent and/or non-executive members. State how theorganization defines ‘independent’ and ‘non-executive.’16

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INDICATOR

Product Innovation•

Operational Improvement•

Social Responsibility•

Employee Engagement

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• Stakeholders • GRI Index

DESCRIPTION

PAGE(S)GRI
INDICATORDESCRIPTION

PAGE(S)

4.4

Mechanisms for shareholders and employees to provide
recommendations or direction to the highest governance body.

16 – 17

4.16

Approaches to stakeholder engagement.

63 – 71

4.17

Linkage between compensation for members of the highest
governance body, senior managers, and executives (including
departure arrangements), and the organization’s performance.

16 – 17

Key topics and concerns that have been raised throughstakeholder engagement.

63 – 71

4.5

4.6

Processes in place for the highest governance body to ensure
conflicts of interest are avoided.

16 – 17

4.7

Process for determining the qualifications and expertiseof the members of the highest governance body for guiding
the organization’s strategy on economic, environmental,
and social topics.

16 – 17

4.8

Internally developed statements of mission or values, codes ofconduct, and principles relevant to economic, environmental,
and social performance and the status of their implementation.

4, 5, 6,54 – 55

4.9

Procedures of the highest governance body for overseeing theorganization’s identification and management of economic,
environmental, and social performance.

16 – 17

4.10

Processes for evaluating the highest governance body’s
own performance.

16 – 17

5. Economic performance indicators
Economic Performance
EC1

Direct economic value generated and distributed, including
revenues, operating costs, employee compensation, donations
and other community investments, retained earnings, andpayments to capital providers and governments. (Core)

10

EC2

Financial implications and other risks and opportunities for theorganization’s activities due to climate change. (Core)22, 38, 65

EC3Coverage of the organization’s defined benefit plan obligations. (Core)
Also see financial report www.pg.com/investors/annualreports.jhtml

56

EC4

Significant financial assistance received from government. (Core)See financial report www.pg.com/investors/annualreports.jhtml

N/A

Market Presence
EC5

Range of ratios of standard entry-level wage compared to local
minimum wage at significant locations of operation. (Additional)

Commitments to External Initiatives

56

4.11

Explanation of whether and how the precautionary approachor principle is addressed by the organization.

26

EC6

Policy, practices, and proportion of spending on locally-based
suppliers at significant locations of operation. (Core)11, 13

4.12

Externally developed economic, environmental, and social charters,
principles, or other initiatives to which the organization subscribes
or endorses.

55

EC7

Procedures for local hiring and proportion of senior
management hired from the local community at significant
locations of operation. (Core)

56 – 57

4.13

Memberships in associations.

72 – 73

Stakeholder Engagement
4.14

List of stakeholder groups engaged by the organization.

63 – 71

4.15

Basis for identification and selection of stakeholders withwhom to engage.

63 – 71

Indirect Economic Impacts
EC8Development and impact of infrastructure investments and services
provided primarily for public benefit through commercial, in-kind, or
pro bono engagement. (Core)

42 – 50EC9Understanding and describing significant indirect economic impacts,
including the extent of impacts. (Additional)

42 – 50

www.pg.com/sustainability

Contents • Introduction • P&G Profile •GRI
INDICATOR

Product Innovation•

Operational Improvement

DESCRIPTION•

PAGE(S)

6. Environmental
Materials
EN1

Materials used by weight or volume. (Core)

36

EN2

Percentage of materials used that are recycled input materials. (Core)

36

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DESCRIPTION

PAGE(S)

EN14

Strategies, current actions, and future plans for managing
impacts on biodiversity. (Additional)

25, 28, 29

EN15

Number of IUCN Red List species and national conservation list
species with habitats in areas affected by operations by level ofextinction risk. (Additional)

N/A

EN16

Total direct and indirect greenhouse gas emissions by weight. (Core)36, 38

EN17

Other relevant indirect greenhouse gas emissions by weight. (Core)36, 38

EN18

Initiatives to reduce greenhouse gas emissions and reductions
achieved. (Additional)

5, 6, 22,24, 65

EN19

Emissions of ozone-depleting substances by weight. (Core)36, 40EN20

36, 4022, 24, 32,
33, 34, 65

NOx , SOx , and other significant air emissions by type
and weight. (Core)

EN21

Total water discharge by quality and destination. (Core)36, 40

EN22

Total weight of waste by type and disposal method. (Core)36, 38,39, 4036, 40

EN23

Total number and volume of significant spills. (Core)

EN24

Weight of transported, imported, exported, or treated waste
deemed hazardous under the terms of the Basel Convention
Annex I, II, III, and VIII, and percentage of transported waste
shipped internationally. (Additional)

EN25

Identity, size, protected status, and biodiversity value of water
bodies and related habitats significantly affected by the reportingorganization’s discharges of water and runoff. (Additional)

EN26

Initiatives to mitigate environmental impacts of products andservices, and extent of impact mitigation. (Core)

EN27

Percentage of products sold and their packaging materials
that are reclaimed by category. (Core)

EN3

Direct energy consumption by primary energy source. (Core)36, 37

EN4

Indirect energy consumption by primary source. (Core)36, 37EN5Energy saved due to conservation and efficiency improvements.
(Additional)

36, 37, 38,
65

EN6

Initiatives to provide energy-efficient or renewable energy based
products and services, and reductions in energy requirements asa result of these initiatives. (Additional)
Initiatives to reduce indirect energy consumption and reductions
achieved. (Additional)

Water
EN8

Total water withdrawal by source. (Core)

EN9

Water sources significantly affected by withdrawal of water.
(Additional)

N/A

EN10

Percentage and total volume of water recycled and reused.
(Additional)

32, 36, 40

Biodiversity
EN11

GRI
INDICATOR•

Emissions, Effluents and Waste

EnergyEN7

Social Responsibility

Location and size of land owned, leased, managed in, or adjacent to,protected areas and areas of high biodiversity value outside
protected areas. (Core)

N/A

EN12

Description of significant impacts of activities, products, and services
on biodiversity in protected areas and areas of high biodiversity
value outside protected areas. (Core)25, 28, 29

EN13Habitats protected or restored. (Additional)

6, 22, 24, 31,
32, 33, 34,65

41
36, 39, 40

N/A

3, 5, 6, 21,
22, 23, 24
36, 39N/A

www.pg.com/sustainability

Contents • Introduction • P&G Profile •GRI
INDICATOR

Product Innovation•

Operational Improvement

DESCRIPTION

EN28

Monetary value of significant fines and total numberof non-monetary sanctions for noncompliance withenvironmental laws and regulations. (Core)

EN29

Significant environmental impacts of transporting products andother goods and materials used for the organization’s operations,and transporting members of the workforce. (Additional)

EN30

Total environmental protection expenditures and investments
by type. (Additional)•

PAGE(S)

Social Responsibility

GRI
INDICATOR•

Employee Engagement

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DESCRIPTION

PAGE(S)

41

LA8

Education, training, counseling, prevention and risk-control
programs in place to assist workforce members, their families,
or community members regarding serious diseases. (Core)58, 6222, 23, 24,
31, 34

LA9

Health and safety topics covered in formal agreementswith trade unions. (Additional)
Also see http://www.pg.com/company/who_we_are/ppv.shtml

59 – 61

60, 61

Training and Education
LA10

Average hours of training per year per employee-by-employee
category. (Core)52, 56, 61

LA11Programs for skills management and lifelong learning that support
the continued employability of employees and assist them inmanaging career endings. (Additional)

52, 56, 61

LA12Percentage of employees receiving regular performance and careerdevelopment reviews. (Additional)

56, 61

7. Labor practices and decent work
Employment
LA1

Total workforce by employment type, employment contract,
and region. (Core)

7

LA2

Total number and rate of employee turnover by age group,
gender, and region. (Core)
Note: We do not track this information globally

N/A

Benefits provided to full-time employees that are not provided totemporary or part-time employees, by major operations. (Additional)

N/A

LA13

Composition of governance bodies and breakdown of employees
per category according to gender, age group, minority groupmembership, and other indicators of diversity. (Core)
Also see Proxy Statement www.pg.com/investors/annualreports.jhtml

57

Percentage of employees covered by collective bargaining
agreements. (Core)
Also see http://www.pg.com/company/who_we_are/ppv.shtml

55

LA14

Ratio of basic salary of men to women by employee category. (Core)54, 56

Minimum notice period(s) regarding significant operational changes,
including whether it is specified in collective agreements. (Core)
Note: We abide by local legislation and our PVPs.

N/A

LA3

Diversity and Equal Opportunity

Labor / Management Relations
LA4

LA5

8. Human Rights
Investment and Procurement Practices
HR1

Percentage and total number of significant investment agreementsthat include human rights clauses or that underwent human rights
screening. (Core)

70

HR2

Percentage of significant suppliers and contractors that haveundergone screening on human rights and actions taken. (Core)

70

HR3

Total hours of employee training on policies and procedures
concerning aspects of human rights that are relevant to operations,
including the percentage of employees trained. (Additional)

N/A

Occupational Health and Safety
LA6

Percentage of total workforce represented in formal joint management-worker health and safety committees that help monitor andadvise on occupational health and safety programs. (Additional)

59 – 61

LA7

Rates of injury, occupational diseases, lost day’s, absenteeism andtotal number of work-related fatalities, by region. (Core)

59 – 60

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Contents • Introduction • P&G Profile •GRI
INDICATOR

Product Innovation•

Operational Improvement

DESCRIPTION•

PAGE(S)

Non-discrimination
HR4

Total number of incidents of discrimination and actions taken. (Core)

Operations identified in which the right to exercise freedom of
association or collective bargaining may be at significant risk,
and actions taken to support these rights. (Core)
Also see http://www.pg.com/company/who_we_are/ppv.shtml

Operations identified as having significant risk for incidents ofchild labor, and measures taken to contribute to the eliminationof child labor. (Core)

SO1

Operations identified as having significant risk for incidents of forced
or compulsory labor, and measures taken to contribute to theelimination of forced or compulsory labor. (Core)

Percentage of security personnel trained in the organization’s polices
or procedures concerning aspects of human rights that are relevant
to operations. (Additional)

Total number of incidents of violations involving rights of indigenous
people and actions taken. (Additional)

PAGE(S)Nature, scope, and effectiveness of any programs and practices
that assess and manage the impacts of operations on communities,
including entering, operating, and exiting. (Core)

41

Percentage and total number of business units analyzed
for risks related to corruption. (Core)
Also see Worldwide Business Conduct Manual
www.pg.com/company/our_commitment/corp_gov

16 – 17

SO3

Percentage of employees trained in organization’s
anti-corruption policies and procedures. (Core)
Also see Worldwide Business Conduct Manual
www.pg.com/company/our_commitment/corp_gov

16 – 17

SO4

Actions taken in response to incidents of corruption. (Core)
Also see Worldwide Business Conduct Manual
www.pg.com/company/our_commitment/corp_gov

16 – 17

70

70

N/A

Indigenous Rights
HR9

DESCRIPTION

SO2Security Practices
HR8

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Corruption

Forced and Compulsory Labor
HR7

Employee Engagement

Community

70

Child Labor
HR6GRI
INDICATOR•

9. Society
56

Freedom of Association and Collective Bargaining
HR5

Social Responsibility

Public Policy
SO5

Public policy positions and participation in public policy
development and lobbying. (Core)

18

SO6

Total value of financial and in-kind contributions to political parties,
politicians, and related institutions by country. (Additional)

18

N/A

Anti-Competitive Behavior
SO7

Total number of legal actions for anti-competitive behavior,anti-trust, and monopoly practices and their outcomes. (Additional)

N/A

Monetary value of significant fines and total number of non-monetary
sanctions for noncompliance with laws and regulations. (Core)

41

ComplianceSO8

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Contents • Introduction • P&G Profile •GRI
INDICATOR

Product Innovation•

Operational Improvement

DESCRIPTION•

PAGE(S)

PR8

Consumer Health and Safety

PR2

GRI
INDICATOR•

Employee Engagement

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DESCRIPTION

PAGE(S)

Customer Privacy

10. Product responsibility

PR1

Social ResponsibilityLife cycle stages in which health and safety impacts of products andservices are assessed for improvement, and percentage of significant
products and services categories subject to such procedures. (Core)

25 – 26

Total number of incidents of noncompliance with regulations andvoluntary codes concerning health and safety impacts of products
and services, by type of outcomes. (Additional)

N/A

Total number of substantiated complaints regarding breaches ofcustomer privacy and losses of customer data. (Additional)

N/A

Monetary value of significant fines for noncompliance with laws
and regulations concerning the provision and use of products andservices. (Core)
Note: We do not track this information Globally

N/A

Compliance
PR9

Product and Service Labeling
PR3

Type of product and service information required by procedures, andpercentage of significant products and services subject to suchinformation requirements. (Core)

10

PR4

Total number of incidents of noncompliance with regulations andvoluntary codes concerning product and service information andlabeling, by type of outcomes. (Additional)

N/A

PR5

Practices related to customer satisfaction, including results ofsurveys measuring customer satisfaction. (Additional)

68 – 69

Marketing Communications
PR6

Programs for adherence to laws, standards, and voluntary codes
related to marketing communications, including advertising,promotion, and sponsorship. (Core)

69

PR7

Total number of incidents of noncompliance with regulations andvoluntary codes concerning marketing communications, including
advertising, promotion, and sponsorship, by type of outcomes.
(Additional)

N/A

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Operational Improvement•

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Employee Engagement

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• Stakeholders • GRI Index

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