Sustainability Report
Executive Summary
2005

Linking Opportunity with Responsibility

P&G 2005 Sustainability Report
Executive Summary

CEO Statement

Improving the qualityof life for children inneed is a powerful andtangible way to bring
P&G’s Purpose to life
Touching Lives, Improving Life
P&G’s Purpose is to improve consumers’ lives day in and day out.
Fulfilling this Purpose sustains our Company’s growth year in andyear out. One of the most important ways we fulfill our Purpose –beyond our brands and products – is through the work we do, asa Company and as individuals, in communities around the world.
In 2004, P&G donated more than $100 million to support
philanthropic efforts. We’ve asked ourselves whether our efforts
and dollars are working as hard as they can. We’ve concluded that
we can make a bigger, more enduring difference by focusing P&G
philanthropy more sharply on helping children in need to Live,
Learn and Thrive.
We want to help children live by ensuring a healthy start; toprovide them with places, tools, and programs that enhance theirability to learn; and to help them develop skills for life so they
can thrive. Improving the quality of life for children in need is a
powerful and tangible way to bring P&G’s Purpose to life.
As you will read in this report, we are collaborating with global
partners such as UNICEF and the World Health Organization, withnational governments, and with NGOs to offer programs aroundthe world that support the development of children in need frombirth through age 13.
We have also established safe drinking water for children as P&G’s
corporate signature program of our Live, Learn and Thrive efforts.
With the U.S. Centers for Disease Control, we have developed
technology that can purify even heavily contaminated drinking
water with a single sachet that costs pennies and treats 10 litersof water. This is critical because 5,000 children die every day from
diseases caused by unsafe drinking water.

These are among the most visible examples of P&G’s commitment
to being a leader in global sustainable development. As you’llread in the letter that follows from George Carpenter, P&G
Director of Sustainable Development, we are making progress indeveloped and developing countries alike – and we are even moreencouraged by the opportunities we see in the years ahead.
We welcome your interest in our efforts and achievements andremain dedicated to touching lives and improving life in all that
we do. It’s our Purpose and our business.

A.G. Lafley
Chairman of the Board,
President, and Chief Executive

P&G 2005 Sustainability Report
Executive Summary

Vision

We continue to be
deeply committed tothe promise ofsustainable development

Corporate Social Opportunity – Fulﬁlling P&G’s Purpose
Six years ago, P&G embraced the concept of sustainable
development. We challenged conventional wisdom thatcompanies should limit their sustainability efforts to reducing
the negative impacts of pollution, waste, child labor, and poor
working conditions. We contended that these efforts werenecessary but not sufﬁcient – and we stepped up to a bigger
opportunity: to help achieve the U.N. Millennium Development
Goals of safe drinking water and sanitation, reductions in childand mother mortality and morbidity, and quality of life for slum
dwellers and women and girls in the developing world.
While we remain humbled by the scale of poverty and disease
and lost human opportunity that the world faces, we feel we aremaking progress toward our vision of sustainable development.
• Over the past year, P&G’s water puriﬁcation technology and
our Children’s Safe Drinking Water program have delivered
the equivalent of 220 million liters of safe drinking water into
both disaster relief situations and in new social markets. With
partners such as UNICEF, Samaritan’s Purse, World Vision,
International Rescue Committee, CARE, Red Cross, andAmeriCares, we have helped respond to some of the mostcritical global emergency situations, including the tsunami in
Asia, hurricanes in the Caribbean, ﬂoods in the Philippines
and Bangladesh, and the refugee crisis in Chad and Sudan.
Johns Hopkins University has shown that our technology
reduced diarrhea by more than 90 percent in a Liberian
refugee camp.
• We’re not just making donations of product and technology,
and then leaving. We are building market-based partnershipsthat will sustain the delivery of safe drinking water. We arepartnering with Population Services International (PSI), theU.S. and UK governments, and Johns Hopkins University
to create social markets in Haiti, Pakistan, and Uganda– countries where the emergencies may be less dramatic, butwhere the need for safe drinking water is equally severe. In
these countries, PSI is using its substantial distribution andmarketing capability to reach rural villages and urban slums.

Last year also saw a new developed-world execution of
our sustainable development model to provide social andenvironmental beneﬁts with high-performance products thatoffer good economic value.
• P&G launched Tide Coldwater in North America, Ariel
CoolClean in the UK, and Ariel Actif à froid in France, withcleaning technology to give consumers the performance
they want, energy savings, and environmental improvement.
This is an important innovation because washing clothes is
one of the most energy-intensive activities in the home, andheating water can be as much as 95 percent of that energy.
In Europe, washing clothes in cold water could save nearly
3 percent of household electricity use. In the United States,
cold-water washing could save 10 percent of the totalenergy consumed by all domestic appliances – and generate
26-34 million tons of greenhouse gas reductions.
We’re encouraged by the progress we are making but evenmore encouraged by the potential that remains. We continue
to be deeply committed to the promise of sustainable
development because we know that by improving lives in small
but meaningful ways day after day, we fulﬁll P&G’s Purpose
and sustain our Company’s growth year after year.

George D. Carpenter
Director
Corporate Sustainable Development

Visit www.pg.com/sr for the full report.

Visit www.pg.com/sr for the full report.

P&G 2005 Sustainability Report
Executive Summary

P&G Profile
For 167 years, P&G has been focused on providing branded
products of superior quality and value to improve the lives of theworld’s consumers. We believe this will result in leadership sales,
proﬁts, and value creation, allowing employees, shareholders,
and the communities in which we operate to prosper.
P&G’s worldwide headquarters is located in Cincinnati,
Ohio, U.S.A. The Company markets more than 300 branded
products in more than 160 countries. We have on-the-ground
operations in 80 countries and employ nearly 110,000 people.
P&G is a publicly owned company. Its stock is listed and tradedon the New York and Paris exchanges.
As of July 29, 2005, there were approximately 1,608,000
common stock shareholders, including shareholders ofrecord, participants in the Shareholder Investment Program,participants in P&G stock ownership plans, and beneﬁcial
owners with accounts at banks and brokerage ﬁrms.

This is the seventh Sustainability Report for P&G’s worldwide
operations. Data in this report covers the period from July 1,
2004, through June 30, 2005. Financial information is given in
U.S. dollars.
As part of P&G’s initiative to optimize resources to fit a
growing global business and to accelerate innovation andgrowth, the Company operates its business through Global
Business Units (GBUs):• P&G Beauty• P&G Family Health– Baby Care and Family Care
– Health Care
• P&G Household Care
– Fabric Care and Home Care
– Snacks and Coffee

Global Key Brands
Of P&G’s more than 300 branded products around the world, these are the ones we consider our key brands.
Global Business Unit

DetailKey Brands

P&G Beauty

Cosmetics, Deodorant, Feminine

Pantene, Always, Whisper, Olay, Head & Shoulders, Tampax, Herbal Essences,
Nice ‘n Easy, Natural Instincts, Wella, Koleston, Wellaﬂex, Shockwaves,
Cover Girl, SK-II, Rejoice, Hugo Boss, Max Factor, Old Spice, Safeguard,
Secret, Lines Feminine Care, Zest, Lacoste, Vidal Sassoon, Ivory, Aussie, Evax,
Camay, Infusium 23, Naturella, Ausonia, Noxzema, Infasil, Laura Biagiotti, Sure
Pampers, Charmin, Crest, Bounty, Iams, Eukanuba, Actonel, Vicks, Prilosec OTC,
Luvs, Asacol, Kandoo, Dodot, Puffs, Tempo, Metamucil, Fixodent, PUR, Scope,
Pepto-Bismol, ThermaCare, Didronel, Kukident, Blend-a-Med

Care, Fine Fragrances, Hair
Care, Hair Colorants, Personal
Cleansing, Professional Hair
Care, Skin Care

P&G Family HealthBaby Care, Family Care, Oral
Care, Personal Health Care,Pet Health and Nutrition,
Pharmaceuticals

P&G Household Care

Coffee, Commercial ProductsGroup, Fabric Care, Home Care,
SnacksTide, Ariel, Downy, Lenor, Pringles, Folgers, Dawn, Fairy, Joy, Gain, Ace, Swiffer,
Mr. Clean, Febreze, Dash, Bold, Cascade, Cheer, Bounce, Millstone, Bonux,
Linidor, Daz, Era, Flash, Dreft, Vizir, Salvo, Viakal, Myth, Alomatik

17
Billion-Dollar
BrandsBuilding for the Future

1837

1859
$1 Million
Net Sales

William Procter andJames Gamble, Founders,
Candle & Soap Business

1840

1850

1860

1863
Regional
U.S. Markets

1870

Key Indicators
Key Sustainability Focus Areas
At P&G, we proactively bring together innovative ideas andresources to create new products and services that improve thequality of people’s daily lives around the world, at all income levels.
P&G is particularly well positioned to do this because we are intouch daily with the needs of the world’s consumers.
To bring our sustainability efforts to life, we decided to focus onareas in which we can most effectively make a positive difference
and which can involve all our businesses and regions. After muchinternal and external discussion, we selected two areas:• Water• Health and Hygiene
P&G’s work in these areas entails• Reaching consumers we have never reached, such as in the ruralvillages and urban slums of the developing world.
• Creating new products responding to the needs, frustrations,and aspirations of those new consumers and selling those
products at an affordable price.
• Exploring new business models, often with new supply anddistribution systems to lower cost and extend reach.

Major Opportunities and Impacts
Associated with Products and Services
Environmental Protection• Resource Use• Water• Waste Reduction
Social Responsibility• Health• Hygiene• Education
Economic Development• Shareholder Value• Employment• Taxes, Fees, and Contributions

Manufacturing Resource & Waste Summary by Global Business Unit (GBU)
All waste units are in thousands ofmetric tonnes unless otherwise noted.†

Production
Product Shipped
Raw Materials from Recycled Sources
Waste
Generated Waste
Percent Recycled / Reused Waste
Disposed Waste
Solid Waste
Non-Hazardous
Hazardous
Effluents (Excluding Water)
Air Emissions**
Other
Energy Consumption (105 gigajoules)
Greenhouse Gas Emissions**
Water Consumption (million cubic meters)
SARA Releases (metric tonnes)***Totals

2005 Global Business Unit Detail*

2005

2004

2003

P&G B

P&G FHP&G HC

19,58071

18,471
102

17,055
119

2,547
0

5,265
71

11,768
0

831
58%

817
56%

793
52%

159
58%

480
61%

192
49%

280
22
22
26

300
21
21
16

317
9
35
24

56.0
3.3
6.7
1.1

165.0
3.2
7.4
9.8

59.0
15.2
8.2
15.5

816
3,282
83
1,722

731
2,937
79
1,843

758
3,122
86
1,567

100
456
6.0
40

524
2,188
55.8
349

192
638
21.6
1,333

†
*

1 metric tonne = 1,000 kg = 2,205 lbs.
P&G B = P&G Beauty.
P&G FH = P&G Family Health.
P&G HC = P&G Household Care.
** Air emissions include particulates, SO2, NOx, CO, and VOC whereas greenhouse gas emissions include CO2 from fuel combustion sources.
*** Releases defined in the U.S. Superfund Amendments and Reauthorization Act (SARA) by the U.S. Environmental Protection Agency.

1882
P&G Brand
Advertising

1880

1887
ProfitSharing

1890
Incorporated
Company

1910
Shortening &Oils Business

1891 Beginning of P&G
Research & Development

1890

1900

1910

1915
P&G Code ofRegulations

CanadaMarket19

920

P&G 2005 Sustainability Report
Executive Summary

Diversity Data – Global Enrollment
P&G continues to focus on diversity as a global strategy andexpects its work force to become increasingly more diverse. Global
data on enrollment by gender is shown in the following table:
2005
38.0
38.4

Global Enrollment % Female

Management
All Other Employees1

2004
36.7
36.9

2003
35.5
37.1

1 The category of “All Other Employees” continues to be an evolving global database as
more of P&G’s acquired plants are included.

The percentages of minority and female employees in the UnitedStates are shown in the following table:
Financial Highlights
Amounts in millions
except per-share amounts

Net Sales
Selling, General, andAdministrative Expenses
Income Taxes
Net Earnings
Basic Net Earnings
Per Common ShareTotal Assets
Long-Term Debt
Shareholders’ Equity

2005$56,741

2004$51,4072003$43,377

18,0103,182
7,257

16,504
2,869
6,481

13,383
2,344
5,186

2.83
61,527
12,887
17,477

2.46*
57,04812,554
17,278

1.95
43,706
11,475
16,186* Restated for two-for-one stock split effective May 21, 2004.

% Minorities
Management
All Other Employees2% FemaleManagement
All Other Employees2

2005

2004

2003

19.6
18.7

18.8
19.5

18.0
19.8

36.3
39.6

35.4
38.9

34.8
38.7

2 Administrative, Technical, and Plant Technicians

Occupational Health & Safety Data
Past three years’ global data on two key metrics for worker healthand safety:
Total Incident Rate

Philanthropic Contributions
P&G and its employees have a long-standing commitment tobeing good neighbors in places where we do business aroundthe world. We show our commitment through both financial
support and volunteerism.
This year alone, P&G and The P&G Fund contributed more than$100 million to support our communities.
Our commitment has evolved to now focus on a corporate cause
we call P&G Live, Learn and Thrive. P&G Live, Learn and Thrive
focuses on the development of children in need ages 0-13. It
does this by building on P&G’s range of competencies, products,
and existing programs to: help children in need live by ensuring
they have a healthy start; provide access to educational facilities,
tools, and programs that enhance their ability to learn; andprovide access to programs that build self-esteem and life skills sothey can thrive. P&G Live, Learn and Thrive comes to life througha number of programs benefiting children in need in local
communities around the world, including through our global
corporate signature program, Children’s Safe Drinking Water.

1925
Beginning of
P&G Market
Research

1930
SafetyProgramStarted1930

1932
Philippines 1935
and UK
Synthetic
Markets
Detergents

Injury and illness per 100 employees

2005
0.47

Total

1940

2003
0.54

2004
0.21

2003
0.22

Total Lost Workday Case Rate

Lost and restricted workday cases per 100 employees

2005
0.17

Total

Summary of Fines and Violations
The table lists global data on environmental, transportation, andworker health and safety violations over the past three years.
Number
Fines

2005
80
$147,400

2004
64$28,320

2003
67$154,756

The number of fines and violations increased over last year
due to one site. Plans are being implemented that will
eliminate a recurrence.

1946
Tide
Introduced
1948 Overseas
Division

1938
Oral Care
Business

2004
0.55

1950

1953
$1 Billion
Net Sales

1955
First Fluoride
Toothpaste

1961
Disposable
Diapers
Business

1960

P&G 2005 Sustainability Report
Executive Summary

Sustainability in Action

Cool-Water Washing Makes
New Energy Savings Possible

PUR and the Children’s Safe
Drinking Water Program
P&G’s PUR Puriﬁer of Water presents opportunities unlike other
P&G brands. PUR can clean even heavily contaminated water:
It kills viruses and bacteria that cause typhoid and cholera. It
effectively reduces parasites, pesticides such as DDT, heavy
metals such as arsenic, and other dangerous contaminants. In
short, PUR has the ability to improve and even save lives in thedeveloping world.
P&G’s main challenges regarding PUR are providing it where
it’s needed and ensuring its long-term use. This includes
teaching people how to use the product, and collaboratingwith public health organizations in the poorest parts of theworld. P&G teams with partners such as Population Services
International (PSI), which markets health care products indeveloping countries around the world on a nonproﬁt basis.
These partnerships help P&G make connections in communities,
distribute PUR at no cost in emergencies, and sell PUR at costfor everyday use.

There’s an energy-saving laundry revolution going on. With
Tide Coldwater in the United States and Canada and Ariel
Actif à froid (Ariel Cold Active) in France, both launched inearly 2005, plus Ariel CoolClean, launched mid-2004 in the
UK, P&G is making it possible for consumers to turn down thetemperature dial of their washing machines, as they no longer
need hot water to get the laundry clean.

Jemima Odo, in the Nyanza Province of western Kenya,thanks P&G for providing PUR Puriﬁer of Water for her village.
Odo has HIV/AIDS. “For people with HIV,” she says, “we areprone to stomach problems. Since I’ve used PUR, the stomach
problems have gone.”

Lowering wash temperatures can save signiﬁcant amountsof energy and cost. Estimates are that a North Americanhousehold can save up to 20 percent of the energy it uses toheat water. A French household can reduce its electricity usage
by up to 3 percent.

With her strength returned, Odo raises seven orphans wholost their parents to AIDS and visits churches and youth groups
to teach about HIV and safe drinking water. To support theorphans, she buys PUR at low cost from the Society for Womenand AIDS and sells it at a proﬁt to her neighbors.

Government agencies and NGOs are teaming up with P&G in
France and the United States to promote washing in cool water.

The global corporate
signature program for
P&G’s Live, Learn and Thrive
is Children’s Safe Drinking
Water. It addresses themore than 5,000 children
who die every day from
diseases caused by drinking
unsafe water.
Jemima Odo

1965
Affirmative
Action1970
Environmental
Audit Program

1970

1974
Toll-Free
Consumer
Hotline1978$10 Billion
Net Sales

1982
Feminine
Protection
Business

1980

1992
World Environment
Center Award
1987
Statementof Purpose

1993
1st Annual Global
Environment
Report1998 2001
1994 Opportunity Future Clairol
2000 Award
Shares Acquisition

1990

2000

2004
Wella
Acquisition

Sustainable development
is a very simple idea. It is
about ensuring a better
quality of life foreveryone, now and forgenerations to come.1

P&G’s Statement of Purpose
We will provide branded products
and services of superior quality andvalue that improve the lives of theworld’s consumers.
As a result, consumers will reward us
with leadership sales, profit and value
creation, allowing our people, ourshareholders, and the communities inwhich we live and work to prosper.

P&G 2005 Sustainability Report
Executive Summary

This report was prepared using the Global Reporting Initiative’s(GRI) July 2002 Sustainability Reporting Guidelines. The
mission of the GRI is to promote international harmonizationin the reporting of relevant and credible corporate economic,
environmental, and social performance information toenhance responsible decision making. The GRI pursues thismission through a multistakeholder process of open dialogue
and collaboration in the design and implementation of widely
applicable sustainability reporting guidelines. The GRI has notverified the contents of this report, nor does it take a positionon the reliability of information reported herein.
on theWeb

For further information about the GRI,
www.globalreporting.org
For the latest P&G news and shareholder
and career information,www.pg.com
For the full 2005 Sustainability Report,
www.pg.com/sr

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

Consumers

P&G Values
Leadership
Ownership
Integrity
Passion for Winning
Trust
P&G
BrandsP&G
PeoplePrinciples
We Show Respect for All Individuals
The Interests of the Company and the Individual Are Inseparable
We Are Strategically Focused in Our Work
Innovation Is the Cornerstone of Our Success
We Are Externally Focused
We Value Personal Mastery
We Seek to Be the Best
Mutual Interdependency Is a Way of Life

0013-6469

Global Editor
Cindy Mastin, U.S.A.
Core Report Team Ina Andreasen, Denmark
Angela Vanegas, Venezuela
Lucy Bogaerts, Belgium
Bea Buyle, Belgium
Eddy Linclau, Belgium
Dennis Darby, Canada
Chris Smith, UK
Robin Tollett, U.S.A.
Pam Wright, U.S.A.
Shinobu Yasutake, Japan
Copy Editor
Jan Sherbin, Cincinnati, Ohio, U.S.A.
DesignAndy Ruttle, RDG – Ruttle Design Group, Inc.
Cincinnati, Ohio, U.S.A.
The report team thanks all the individuals throughout the world
who contributed information, stories, and data to this report.
Special thanks to Greg Allgood, P&G U.S.A., for the use of his
photography on the cover and throughout the report.
Contact
Cindy Mastin
Corporate Sustainable Development
2 Procter & Gamble Plaza
Cincinnati, Ohio 45202 U.S.A.
E-mail sustainrep.im@pg.com
1 Definition from UK government report from Department for the Environment,

Transport and the Regions – 1998.
Note: Years listed in this report‘s data charts signify the fiscal year ending June 30.
© 2005 The Procter & Gamble Company. All Rights Reserved.
References to trademarked products in this report are to trademarks owned by andregistered to The Procter & Gamble Company.

This report was printed
on recycled paper.