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2014 Sustainability Report 2 of 68

At P&G, sustainability is part of NOTE TO PDF USER This PDF utilizes interactive elements. Click on contents and hyperlinks everything we do. for easy navigation. - A.G. Lafley, P&G President, CEO and Chairman of the Board

ABOUT THIS PUBLICATION This is the 16th Sustainability Report for Procter & Gamble’s worldwide operations. Data in this report cover the period from July 1, 2013, through June 30, 2014. 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 to promote 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 of this report, nor does it take a position on the reliability of information reported herein. For further information about the GRI, For the latest P&G news, in-depth information please visit: www.globalreporting.org on P&G’s brands and shareholder and career information, please visit: www.pg.com Contents 3 of 68

Contents...... 3 Environmental Sustainability ...... 26 Social Responsibility...... 43 Conservation of Resources...... 27 Social Responsibility Programs ...... 44 Introduction...... 4 Cold-Water Washing...... 27 Comforts of Home ...... 44 Leadership Statement...... 4 Packaging Reduction...... 28 Health and Hygiene...... 45 Our Goals...... 5 Energy and CO Social Responsibility Policies and Practices . .46 2020 Goals Progress...... 11 2...... 29 Water...... 31 Human Rights...... 47 P&G Profile...... 12 Renewable Resources...... 33 Human Resources...... 47 Our Purpose, Values and Principles. . . 13 Renewable Energy...... 33 Diversity & Inclusion ...... 48 P&G – A Company of Leading Brands. . .15 Renewable Materials...... 34 Global Medical...... 50 P&G at a Glance...... 16 Sustainable Forestry ...... 35 Worldwide Health, Safety Acquisitions...... 17 Responsible Forest Management and Environment Systems...... 52 Proceeds from Asset Sales...... 17 in Our Wood Pulp Supply Chains. . . . 36 Compliance with Laws and Regulations. .55 Global Purchases...... 17 Pulp for our Tissue/Towel Notices of Violation (NOVs)...... 55 Economic Development...... 17 and Absorbent Hygiene Products . . . .36 Air Emissions...... 55 Organizational Structure...... 18 Paper Packaging...... 37 SARA 313 Releases...... 55 Manufacturing and Outsourcing. . . . 19 Palm Oil ...... 38 Stakeholder Engagement ...... 56 P&G Plant Locations...... 20 Worth from Waste...... 39 Advertising and Promoting Governance...... 23 Manufacturing Waste...... 39 to Consumers Appropriately...... 57 Political Involvement...... 24 Zero Manufacturing Waste to Landfill. . 40 Eliminating Research Involving Animals. .57 Business Continuity...... 24 Consumer Waste...... 41 Sustainability Guidelines Product Safety...... 25 Resource and Waste Summary Table. . . . 42 for External Business Partners . . . . . 58 Supplier Diversity...... 59 Personal Information Privacy...... 59 Policies & Management Systems ...... 60 GRI Index...... 61 4 of 68 Introduction Leadership Statement

At P&G, our sustainability objective • Cold-water washing that conserves energy We have stretching goals before us for 2020. • We Pioneer. We use our innovation is to create industry-leading value and reduces CO2 emissions; With clear business unit ownership and full capability to create products that not only employee engagement at all levels and across work well every day, but also aim to preserve • The P&G Children’s Safe Drinking Water with brands and products that the entire Company, we know we can get natural resources throughout their life cycle. Program, which has delivered more than consumers prefer, while at the there. Toward that end, we are introducing We find new and more effective ways to 7 billion liters of clean drinking water and a three-pillar approach to our sustainability embed sustainability improvements into our same time conserving resources, helped save an estimated 42,000 lives; protecting the environment and efforts – aiming to ensure clarity, consistency business practices, systems and culture. • Brand programs that provide essential and engagement across the Company: With this focus and the full integration of improving social conditions for products to help thousands of people in our sustainability efforts into our business and those who need it most. need when disaster strikes around the world. • We Preserve. Every day, we look to design products and operations with less water, innovation plans, I am confident we will further These types of efforts have helped us meet energy and material waste to preserve accelerate progress over the coming year. We see success as creating value for consumers consumer needs and make a positive environ- resources. Through our brands, we focus and shareowners and leading the consumer mental and social impact. To continue making on preserving the health and comfort of products industry with effective and lasting progress over time, we need to ensure that what those in most need. solutions to environmental and social is good for sustainability also is good for business. sustainability challenges. • We Partner. We can make the biggest This belief is at the heart of my personal impact when we build partnerships with Martin Riant We believe in actions speaking louder than commitment as P&G’s new Global Sustainability experts in industry, government, NGOs Executive Sponsor, Global Sustainability words – ”Promises made, Promises kept” – which Executive Sponsor. I see major opportunities to and academic communities. The challenges Group President, Global Baby, Feminine & Family Care is why we consistently deliver products and incorporate sustainability more deeply into are complex and require collaboration programs that demonstrate progress on business strategy and planning, innovation, to develop effective and lasting solutions. environmental and social sustainability. For operations and communication. We improve the way we communicate example, we are innovating in: When sustainability goals and progress are led sustainability through our brands to help • Compacted laundry detergents, less bulky from within operating business units, and when consumers make more educated choices diapers, and products that reduce business leaders see sustainability as a choice for in how they choose and use products. materials, energy usage and waste; growth and profitability, investment and • Operations with zero manufacturing waste breakthrough innovation will follow. to landfills and less energy and water usage; 5 of 68

Our Goals

At P&G, when we set a goal, P&G Packaging Goals Palm Oil Goals sustainable palm oil sourcing for the long term. We will continue to issue updates on this work employees will work their hardest Packaging sustainability is another key priority Our commitment to zero deforestation in at pg.com/sustainability. not just to meet it, but to exceed it. for P&G. We are on track to reduce packaging our palm oil supply chain is unequivocal. by 20% per consumer use by 2020. Given this We believe that meaningful progress toward In April, we reinforced this commitment with progress, P&G is raising the bar to: demanding sustainability goals is right for the That is why we established P&G’s Global an announcement of goals calling for traceability planet and right for P&G’s business. We’re Sustainability Vision four years ago, backed • Double the use of recycled resin in of palm oil and palm kernel oil to our supplier committed to doing the right thing, in the right by a set of 14 goals driving work across all plastic packaging mills by December 31, 2015, and to plantations way, for those who use our products, live in our areas of our business. The goals are detailed by 2020. • Ensure 90% of product packaging is communities and work in our Company. We on page 11, along with results achieved so far. recyclable or that programs are in place To support these goals, we began the intensive thank you for your partnership on the journey. Looking ahead toward next fiscal year, in to create the ability to recycle it work of tracing our complete supply chain by October 2014 we added four new goals, with partnering with the Malaysia Institute for emphasis on water conservation and product Supply Chain Innovation (MISI), part of the Increase use of On track to reduce packaging. I wanted to share these so that Massachusetts Institute of Technology. MISI recycled resin by packaging by you can see where we are headed. is conducting two six-month in-field studies to understand the highly segmented supply Water Conservation Goals Len Sauers % % chain and the challenges facing farmers so Vice President, Global Sustainability Water conservation has been a long-standing 100 20 we can help them continue working while P&G priority. Our expanded commitment calls for: also protecting the environment. We also communicated our new goals and the • Reducing water use in our manufacturing Revised Renewable Materials Goal expectation that our supply chain will not facilities by 20% per unit of production, We also are working across our supply chain to contribute to deforestation with all our palm with a specific focus on conservation efforts develop the capability by 2020 to replace our oil suppliers. We continue to work with our at facilities located in water-stressed regions top petroleum-derived raw materials with industry peers and NGOs to develop consistent • Providing 1 billion people access to renewable materials, as cost and scale permit. industry standards and practices that will ensure water-efficient products 6 of 68

Sustainability Across A Product’s Life Cycle We incorporate sustainability into every aspect of our products – from initial design to manufacturing to packaging to social impact.

Pampers Global Tide Liquid North America 7 of 68

Environmental Sustainability

We use P&G’s core strength of innovation to design and manufacture products that meet important consumer needs while reducing materials and waste and conserving energy and water. We build partnerships with experts in industry, government, NGOs and academic communities because the challenges are complex and require collaboration to develop effective and lasting solutions.

MANUFACTURING: NEW GOALS: Making Zero Waste a Reality Palm Oil Our vision is to send no manufacturing waste manufacturing waste to less than 0.5% of A new set of palm oil goals put our teams in practices and challenges to ultimately help to landfill. It’s a stretching goal, but we have input materials by 2020. This year, only 0.4% the field working with large and small palm create innovative solutions to the problem. made tremendous progress in the last seven of all incoming materials were disposed of as plantation owners across Malaysia to ensure Our new goals call for traceability of palm oil years. We now have 70 zero manufacturing waste. All other material either left as finished full traceability of our palm oil and palm kernel and palm kernel oil to our supplier mills by waste to landfill facilities around the world. product or was recycled, reused, repurposed or oil supply while also helping small farmers December 31, 2015, and to plantations by 2020. That is nearly 50% of all our manufacturing converted to energy. We also have created more improve practices. The ultimate goal is to ensure facilities. This work has enabled us to exceed than $1.6 billion in value for the Company that we are not contributing to the destruction of our goal on waste reduction six years ahead through cost savings and revenue generation rain forests. Our teams are working with experts of schedule. Our goal was to reduce our in the last seven years. from the Malaysia Institute for Supply Chain Innovation to better understand farmers’ needs, Zero deforestation in palm oil 70 zero SUPPLIERS: GOAL REACHED: manufacturing Working in Partnership Renewable Resources waste to landfill facilities This year we upgraded our Supplier Sustainability We celebrate reaching and exceeding one of Scorecard, making data management more our key renewable resources goals a year ahead efficient and actionable. The Scorecard tracks of schedule: supplier performance on key environmental • Today, 54% of the virgin wood fiber used measures, enabling us to evaluate improvement in our tissue/towel products is certified by over time in terms of carbon, energy, water and Forest Stewardship Council®, exceeding our waste performance. Our aim now is to increase goal to have 40% certified by 2015. data collection, and thus our ability to work with key strategic suppliers in reducing our collective We reached the goal in collaboration with the environmental footprint. World Wildlife Fund’s Global Forest and Trade Network (GFTN) and its network of forestry experts from around the world. 8 of 68

Environmental Sustainability (cont ).

PACKAGING: PACKAGING: Innovating for Savings Enabling Recycling to Mr. Clean Liquid Muscle delivered two Increase Recycled Content innovations. Its 2.5x-concentrated formula As part of our goal to increase the amount of resulted in 45% less packaging and 64% less recycled materials in our packaging, we are water per bottle. Its unique single-dosing cap working with multiple partners to develop and is preferred by consumers and ensures people encourage the use of local recycling programs. don’t use too much. The cap design has won This year, we became a founding member of manufacturers to give consumers what they five global design awards, with judges for the the Closed Loop Fund, designed to give more want more packaging with recycled materials. DuPont Packaging Awards calling it “an consumers in the United States access to This is good for consumers and good for the amazing, award-winning package.” recycling by creating a multi-million-dollar environment,” said P&G President, CEO and fund to invest in low- and no-interest loans for Chairman of the Board A.G. Lafley. % % recycling. This will “enable a larger supply of 45 64 usable, recyclable content, which will enable less less water packaging per bottle

PRODUCT FORMULATION: Fabric Care Innovation We committed to another round of compaction Fabric Care also committed to eliminating in our liquid laundry detergents, pledging to 25% phosphates from all of its laundry detergents less water in every dose of detergents sold in (Tide, Ariel, Ace and Bonux) within the next North America by 2018. This means less plastic, two years, providing consumers with superior water and energy used to make, pack and ship cleaning performance while maximizing resource products – and fewer delivery trucks on the road. conservation. We have gradually been reducing We anticipate saving 50 million gallons of phosphates since 2005. water a year and reducing CO2 emissions by 50,000 metric tons. When we moved to a % 2x-concentrated formula in 2008, we reduced 25 0 plastic by more than 40%, reduced water use less water phosphates by 35% and increased truck capacity by 50%. by 2018 by 2016 9 of 68

Social Sustainability

Doing the right thing is the foundation of P&G’s Purpose, Values and Principles and includes investing in the communities in which we live, work and serve. P&G Social Sustainability provides programs and daily essential products when and where they are needed most and perform at their best, responding to disasters and other extreme needs.

Disaster Relief Children’s Safe Drinking Water In November 2013, when the strongest storm Here is a look at just some of our This year, The P&G Children’s Safe Drinking Water countries. Still growing, the program already ever to hit land whipped across the Philippines, work aimed at improving lives in Program provided its 7 billionth liter of clean has reached more than 50 million shoppers P&G teams around the globe responded. times of disaster: drinking water for children and families in need and raised funds to deliver an additional Pampers, Safeguard, Duracell, Pantene and more and helped save an estimated 42,000 lives. 80 million days of clean drinking water. than a dozen other brands joined together to July 2013 The program: • Expanded operations in 17 countries, help the 16 million people impacted and 4 million In India, thousands of people were impacted and including Myanmar, Vietnam and India, people left homeless. Together, P&G employees homes devastated by flooding that hit with fury in • Delivered the 7 billionth liter to a family of and launched in Brazil.Expanded operations and our brands sent more than $3 million in summer 2013. P&G responded by providing P&G six through a new community program in Purifier of Water packets and products such as in 17 countries, including Myanmar, Vietnam personal care supplies, cash and P&G Purifier southeastern Brazil with NGO partner Whisper, Oral-B, Tide and Pantene. and India, and launched in Brazil. of Water packets to help. ChildFund. September 2013 P&G also sent products and cash donations • Developed and expanded a shopper-facing Boulder, CO, and surrounding areas, P&G distributed to help with more than 20 major disasters, more than 4,000 personal care kits along with products promotion with Wal-Mart and its UK ASDA including massive flooding in the Balkans; such as Charmin, Bounty, Pampers and Dawn. Tide Loads stores to engage consumers in providing of Hope also helped by providing clean laundry for devastating tornadoes, flash floods and clean drinking water to developing hundreds of families. mudslides in the U.S.; wildfires in Chile; and earthquakes in Pakistan. October 2013 When floods also hit Mexico, P&G sent 2.5 million CSDW by the numbers P&G Purifier of Water packets and 6,000 disaster relief product kits. May 2014 +140 +7.5billion Deadly flooding in the Balkans impacted 1.6 million Global partners Liters to date people in Bosnia alone. P&G helped with product donations totaling $80,000 and a grant to rebuild 60,000 homes and a school. loads of laundry cleaned by the Tide Loads of Hope program since 2005 10 of 68

Social Sustainability (cont ).

Helping Through Our Brands Habitat for Humanity Always reached an additional 300,000 girls Safeguard’s Clean Hands Healthy Kids Campaign Over the course of the year, P&G teams with a wheelchair. P&G teams also brought their through its Protecting Futures Program, marked its 15th year of teaching hygiene to Habitat for Humanity have built or cleaned more traditional “welcome home” gift basket full providing girls ages 12-14 with education on prevent childhood illness, absenteeism and even than 30 homes around the world. The impact of P&G brands like Gillette, Safeguard, OralB, good personal hygiene, puberty, menstruation death. The program was launched in China of that work comes to life when we meet the and Pantene, to provide additional comforts and personal care tips. The program, started in based on global research that soap and water people who live in those homes. of home. 2006, helps girls attend classes during their washing can prevent nearly 4 million children a periods, and stay in school. The program has year from dying before their 5th birthday. Today, One person we met this year was Mr. Jaras, “He never stopped smiling. As difficult as expanded from Africa to the Middle East. the program is in schools across China, the who lived in the Prachinburi Province of life was for him, he remained optimistic,” Philippines, Pakistan and Mexico, reaching 4.5 Thailand. His community still had not recovered said P&G Corporate Contributions Senior Pampers – as part of its commitment to happy, million students a year. In many locations, the from the brutal flooding that ripped through Manager Brian Sasson. “We hope it healthy development of babies – created the brand has helped build hand-washing and scores of homes two years earlier. And the rainy changed his life. We know it did ours.” Pampers Mobile Clinic Program, providing free sanitation stations for children. season was on its way again. Mr. Jaras, 50, was basic health checks, health talks and products partially paralyzed from a recent motorcycle yrs to mothers and their babies. This year, the clinics Pantene launched a hair-donation program accident and could not repair the gaping holes 10 +50 mark their 10th anniversary, reaching more than called Beautiful Lengths eight years ago. This in his roof, floor and walls. 1.8 million mothers and children in Nigeria, cause encourages youth, adults and even Partnership with Projects we’ve been Kenya, Uganda and Pakistan. Also, the Pampers celebrities to grow, cut and donate their healthy In partnership with Habitat for Humanity, P&G Habitat for Humanity a part of around the world UNICEF vaccine program marked another year hair to help provide free wigs to women in need. employees came together to build a new home of working to eliminate neonatal tetanus, a Pantene funds the creation of these wigs for for Mr. Jaras, with a solid floor, strong roof and preventable disease that claims the life of cancer patients, and through their partnership 58,000 babies in developing countries each with the American Cancer Society, distributes year. The campaign, 1 pack = 1 vaccine, has them free of charge to female cancer patients. To donated more than 300 million vaccines and date, the program has collected 550,000 ponytail helped to eliminate the disease in 15 countries. donations, helping distribute more than 34,000 real-hair wigs across the U.S. and in Canada, 3,000 Australia and Israel in partnership with local P&G employees have cancer associations. worked to build and clean homes 11 of 68

2020 Goals Progress GOAL PROGRESS Conservation of Resources

We are working toward • Reduce energy use at P&G facilities and total CO2 (Scope 1 and Scope 2) by 20% • Since 2010, we have reduced our energy usage by about 7% and our total CO2 per unit of production by 2020.* emissions (Scope 1 and Scope 2) by about 14% per unit of production. our long-term vision of: •  Ensure 70% of all washing machine loads are washed in cold water. • Since FY10/11, our data indicates the percentage of global washing machine • Powering all our plants with loads washed in cold water increased from 38% to 53%. 100% renewable energy • Reduce truck transportation kilometers by 20% per unit of production.* • We continue to make progress by optimizing distribution routes and increasing the use of multi-modal transportation to reduce our truck-based kilometers per • Using 100% renewable or recycled unit of production.

materials for all products and • Reduce packaging by 20% per consumer use.* • Since 2010, we have reduced packaging by about 7% per consumer use. packaging • Reduce water use in manufacturing facilities by 20% per unit of production, • New goal announced October 13, 2014; we will report progress next year. • Having zero consumer and with conservation efforts focused on water-stressed regions.* manufacturing waste go to • Provide 1 billion people access to water-efficient products. • New goal announced October 13, 2014; we will report progress next year. landfills • Double use of recycled resin in plastic packaging.* • New goal announced October 13, 2014; we will report progress next year. • Designing products that delight • Ensure 90% of product packaging is either recyclable or programs are in place to create the ability to recycle it. • New goal announced October 13, 2014; we will report progress next year. consumers while maximizing the conservation of resources Renewable Resources

•  Ensure plants are powered by 30% renewable energy. • Our use of renewable energy is about 8%. We continue to evaluate and expand our portfolio of energy sources. Since 2010, we have established • Create technologies by 2020 to substitute top petroleum-derived raw materials • Revised goal announced October 13, 2014; we will report progress next year. 14 goals to help us reach our with renewable materials, as cost and scale permit. long-term vision. This year, • Ensure traceability of palm oil and palm kernel oil to our supplier mills by December 31, 2015, • We continue making progress against our goals for full traceability in our palm oil we’ve added four new goals and and to plantations by 2020 to ensure zero deforestation in our palm oil supply chain, with a supply chain. Please view details of our progress on pg.com/sustainability revised one of our existing goals. commitment to working with small farmers. Our 18 goals and progress are • Have 100% of the virgin wood fiber used in our tissue/towel and absorbent hygiene products be third-party • About 99% of our virgin wood fiber was third-party certified. certified by 2015. outlined here. • Have 40% of the virgin wood fiber used in our tissue/towel products be • 54% of the virgin wood fiber used in our tissue/towel products was FSC© Forest Stewardship Council® certified by 2015. certified – exceeding our 2015 goal one year ahead of schedule.

• Have 100% of our paper packaging contain either recycled or third-party-certified virgin content by 2020. • 96% of materials surveyed this year were either recycled or third-party-certified virgin content. Worth From Waste

• Conduct pilot studies in both the developed and developing world to understand how to eliminate landfilled/ • Feasibility studies have been completed for the lead pilot city for the Waste to dumped solid waste. Worth project in the Philippines. This year, P&G also became a founding member of the Closed Loop Fund, which will provide low- to no-interest loans to support projects intended to increase recycling in the U.S.

• Reduce manufacturing waste to landfill to less than 0.5% of input materials. • We reduced the manufacturing waste to landfill to 0.4% – exceeding our 2020 goal six years ahead of schedule. Social Programs

• Improve the lives of 50 million people each year through our social sustainability programs. • P&G has exceeded this goal for 2013/14, with a focus on providing programs and daily essential products when and where they are needed most and perform at their best.

• Save one life every hour by 2020. • The P&G Children’s Safe Drinking Water Program delivered 1.4 billion liters of clean water this year and is on track to meet our goal by providing 2 billion liters of drinking water each year by 2020. * vs 2010 baseline 12 of 68 P&G Profile

P&G serves nearly 5 billion merchandisers, grocery stores, people around the world with membership club stores, drug its brands. stores, department stores, salons, e-commerce and high-frequency The Company has one of the stores. The P&G community includes strongest portfolios of trusted, operations in approximately quality, leadership brands, including 70 countries worldwide and Always,® Ambi Pur,® Ariel,® Bounty,® approximately 118,000 employees. Charmin,® Crest,® Dawn,® Downy,® Duracell,® Fairy,® Febreze,® Gain,® P&G is a publicly traded company. Gillette,® Head & Shoulders,® Lenor,® Its stock is listed and traded on the Olay,® Oral-B,® Pampers,® Pantene,® New York Stock Exchange and NYSE SK-II,® Tide,® Vicks,® Wella® and Euronext – Paris. Whisper.® Our products are sold in more than 180 countries and territories around the world primarily through mass 13 of 68

Our Purpose, Values Our Values Ownership Trust P&G is its people and the values by which we • We accept personal accountability to meet the • We respect our P&G colleagues, customers, and Principles live. We attract and recruit the finest people business needs, improve our systems, and help and consumers, and treat them as we want in the world. We build our organization from others improve their effectiveness. to be treated. Taken together, our Purpose, Values and within, promoting and rewarding people Principles are the foundation for P&G’s without regard to any difference unrelated • We all act like owners, treating the Company’s • We have confidence in each other’s unique culture. Throughout our history to performance. We act on the conviction that assets as our own and behaving with the capabilities and intentions. of over 175 years, our business has grown the men and women of Procter & Gamble will Company’s long-term success in mind. and changed while these elements have • We believe that people work best when there always be our most important asset. endured, and will continue to be passed Passion for Winning is a foundation of trust. down to generations of P&G people Integrity • We are determined to be the best at doing to come. • We always try to do the right thing. what matters most. Our Purpose unifies us in a common cause and • We are honest and straightforward • We have a healthy dissatisfaction with the growth strategy of improving more consumers’ with each other. status quo. lives in small but meaningful ways each day. It inspires P&G people to make a positive • We operate within the letter and spirit • We have a compelling desire to improve and contribution every day. of the law. to win in the marketplace. Our Values reflect the behaviors that shape the • We uphold the values and principles of tone of how we work with each other and with P&G in every action and decision. our partners. Consumers • We are data-based and intellectually And Our Principles articulate P&G’s unique honest in advocating proposals, including approach to conducting work every day. recognizing risks. P&G Values Our Purpose Leadership Integrity We will provide branded products and services • We are all leaders in our area of responsibility, Leadership of superior quality and value that improve the with a deep commitment to deliver leadership Ownership Passion for Winning lives of the world’s consumers, now and for results. Trust generations to come. • We have a clear vision of where we are going. P&G P&G As a result, consumers will reward us with Brands People leadership sales, profit, and value creation, • We focus our resources to achieve leadership allowing our people, our shareholders, and objectives and strategies. the communities in which we live and work • We develop the capability to deliver our to prosper. strategies and eliminate organizational barriers. 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. 14 of 68

Our Principles Innovation Is The Cornerstone of We Value Personal Mastery Our Success • We believe it is the responsibility of all These are the Principles and supporting • We place great value on big, new consumer individuals to continually develop themselves behaviors that flow from our Purpose innovations. and others. and Values. • We challenge convention and reinvent • We encourage and expect outstanding We Show Respect for All Individuals the way we do business to better win in technical mastery and executional excellence. • We believe that all individuals can and want the marketplace. to contribute to their fullest potential. We Seek to Be the Best We incorporate • We value differences. • We strive to be the best in all areas of Sustainability into our strategic importance to the Company. • We inspire and enable people to achieve high products, packaging, expectations, standards and challenging goals. • We benchmark our performance rigorously and operations. versus the very best internally and externally. • We are honest with people about their • We learn from both our successes and performance. We Are Externally Focused our failures. • We develop superior understanding of The Interests of The Company consumers and their needs. and the Individual Are Inseparable Mutual Interdependency Is a • We create and deliver products, packaging Way of Life • We believe that doing what is right for the and concepts that build winning brand equities. business with integrity will lead to mutual • We work together with confidence and trust across business units, functions, categories, success for both the Company and the • We develop close, mutually productive and geographies. individual. Our quest for mutual success relationships with our customers and our ties us together. suppliers. • We take pride in results from reapplying others’ ideas. • We encourage stock ownership and • We are good corporate citizens. ownership behavior. • We build superior relationships with all • We incorporate sustainability into our the parties who contribute to fulfilling our products, packaging and operations. We Are Strategically Focused on Corporate Purpose, including our customers, Our Work suppliers, universities, and governments. • We operate against clearly articulated and  To learn more about our Purpose, aligned objectives and strategies. Values and Principles, please go to: • We only do work and only ask for work that www.pg.com/en_US/company/purpose_ adds value to the business. people/pvp.shtml

• We simplify, standardize and streamline our current work whenever possible. 15 of 68

P&G – A Company of Leading Brands

P&G has 23 brands with annual sales of $1 billion to more than $10 billion, and 14 with sales of $500 million to $1 billion — many of those with billion-dollar potential. Nearly all of our 23 billion-dollar brands and the vast majority of our $500 million to $1 billion brands hold the number one or two position in their category or segment, and they all have significant growth and value creation potential.

Baby, Feminine and Family Care Beauty

Fabric and Home Care Health and Grooming 16 of 68

P&G at a Glance

Financial Highlights (unaudited) 2014 Net Sales

By Business Segment (2) Amounts in millions, except per share amounts 2014 2013 2012 2011 2010 Beauty Grooming Net Sales $83,062 $82,581 $82,006 $79,385 $75,785 25% 24% Health Care Operating Income 15,288 14,330 13,035 15,233 15,306 Fabric Care and Home Care Net Earnings Attributable to Procter & Gamble 11,643 11,312 10,756 11,797 12,736 10% Baby, Feminine and 32% Family Care Net Earnings Margin from Continuing Operations 14.1% 13.7% 11.2% 14.5% 14.0% 9% Diluted Net Earnings per Common Share from Continuing Operations (1) $ 3.98 $ 3.83 $ 3.06 $ 3.80 $ 3.38 Diluted Net Earnings per Common Share (1) 4.01 3.86 3.66 3.93 4.11

Dividends per Common Share 2.45 2.29 2.14 1.97 1.80 By Geographic Region North America (1) Diluted net earnings per share are calculated on net earnings attributable to Procter & Gamble. 7% 10% Europe Asia 39% Latin America 16% % of % of Net India, Middle East Reportable Segment Net Sales* Earnings* GBUs (Categories) Billion-Dollar Brands and Africa (IMEA) 28% BEAUTY 24% 23% Beauty Care (Antiperspirant and Deodorant, Cosmetics, Head & Shoulders, Olay, Personal Cleansing, Skin Care); Hair Care and Color; Pantene, SK-II, Wella Prestige; Salon Professional

GROOMING 10% 17% Shave Care (Electronic Hair Removal, Female Blades and Razors, Fusion, Gillette, By Market Maturity Pre- and Post-Shave Products, Other Shave Care) Mach3, Prestobarba Developed HEALTH CARE 9% 9% Personal Health Care (Gastrointestinal, Rapid Diagnostics, Crest, Oral-B, Vicks Developing Respiratory, Vitamins/Minerals/Supplements, Other Personal Health Care); Oral Care (Toothbrush, Toothpaste, Other Oral 39% Care) 61% FABRIC AND HOME CARE 32% 26% Fabric Care (Laundry Additives, Fabric Enhancers, Laundry Ariel, Dawn, Downy, Detergents); Home Care (Air Care, Dish Care, P&G Professional, Duracell, Febreze, Gain, Surface Care); Personal Power (Batteries) Tide BABY, FEMININE AND FAMILY CARE 25% 25% Baby Care (Baby Wipes, Diapers and Pants); Feminine Care Always, Bounty, Charmin, (2) These results exclude net (Adult Incontinence, Feminine Care); Family Care Pampers sales in Corporate. (Paper Towels, Tissues, Toilet Paper)

*Percent of net sales and net earnings from continuing operations for the year ended June 30, 2014 (excluding results held in Corporate).

For more financial details, please see P&G’s 2014 Annual Report, available at: www.pg.com/en_US/investors/financial_reporting/annual_reports.shtml

As part of P&G’s initiative to optimize resources to fit a growing global business and accelerate innovation and growth, the Company operates its business as described under Organizational Structure on page 18. 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. 17 of 68

Acquisitions Global Purchases Economic Development Shareholder Information

Acquisition activity was not material in 2014. Total external spend was approximately Innovation is a fundamental driver of P&G’s As of June 30, 2014, there were approximately Acquisitions used $1.1 billion of cash in 2013 $58 billion in FY 13/14, up slightly from the growth. We invest about $2 billion a year 2,372,000 common stock shareowners, primarily for the acquisition of our partner’s $56 billion we reported last year. This is spent in research and development. This level of including shareholders of record, participants interest in a joint venture in Iberia. with over 80,000 business partners worldwide investment is multiplied by our global network in the P&G Shareholder Investment Program, and offers a significant opportunity to drive of external innovation partners, which leads to participants in P&G stock ownership plans and sustainable supply in every region and across an effective investment in innovation that far beneficial owners with accounts at banks and Proceeds from multiple industries. exceeds the reported spending. brokerage firms. Asset Sales We continue to leverage the use of our External Contact Business Partner Sustainability Scorecard across a Our External Business Development group and The Computershare Trust Company serves as Proceeds from asset sales contributed to broad range of partners. Specific partner results the Connect + Develop organization manage transfer and dividend paying agent for P&G $570 million in cash in 2014 due to minor are a key component of the Company’s external thousands of active connections with other Common Stock and Administrator of the Procter brand divestitures, including MDVIP, the Pert business partner performance management companies and institutions. These include a & Gamble Shareholder Investment Program. business in Latin America and the bleach process. wide variety of partnership structures, including Registered shareowners and Program participants business in CEEMEA and Latin America. licensing, sale, technology development, joint We are working with our critical and innovative needing account assistance with share transfers, Proceeds from asset sales contributed $584 ventures and more. P&G’s goal is to be the suppliers and agencies to develop bio-alternative plan purchases/sales, lost stock certificates, etc., million in cash in 2013 mainly due to the partner of choice in working with others to materials for use in our products, develop divestitures of our bleach business in Italy and improve the lives of the world’s consumers. should contact Computershare at: the Braun household appliances business. alternative energy solutions to fuel our plants, and provide sustainable alternatives to packaging, For more information, please visit: • Website: www.computershare.com/pg transportation, storage and operations. Our www.pgconnectdevelop.com external business partners are fully committed to • Email: [email protected] collaborate and innovate with Procter & Gamble • Phone: (M – F, 8am – 8pm Eastern): to improve our products, supply chains and 1-800-742-6253; 1-781-575-4399 operations in a sustainable way. (outside U.S. and Canada)

• Financial information request line (24 hours): 1-800-742-6253 $2 billion invested in research and development 18 of 68

Organizational the consumers, channels, customers and markets we serve: Structure • Asia We have made P&G’s organization structure • Europe an important part of our capability to grow. It combines global-scale benefits with a local focus • India, the Middle East and Africa (IMEA) to win with consumers and retail customers in each country where P&G products are sold. • Latin America

P&G’s four industry-based sectors are focused • North America on common consumer benefits, share common technologies and face common competitors.

• Baby, Feminine and Family Care Global Business Services (GBS) utilizes P&G talent and expert partners to provide best-in-class • Beauty, Hair and Personal Care business support services at the lowest possible costs to leverage P&G’s scale for a winning • Fabric and Home Care advantage.

• Health and Grooming Lean Corporate Functions ensure ongoing functional innovation and capability We’ve changed the name of our go-to-market improvement. organizations from Market Development Organizations to Selling and Market Operations (SMOs). This is more than a name change. It To learn more about our Organizational clarifies the work SMOs need to do and the Structure, please go to: www.pg.com/ work they do best – superior, effective and en_US/company/global_structure_ efficient selling, distribution, shelving, pricing operations/corporate_structure.shtml execution and merchandising – every day, every week, in every store. The SMOs are focused on 19 of 68

Manufacturing and Sometimes we use contract manufacturers on a longer-term basis for reasons of cost- Outsourcing effectiveness. In these instances, we are usually manufacturing in the region and for the region, P&G has over 130 manufacturing facilities in as almost all of our third-party manufacturers over 40 countries. These facilities handle the are regional. In addition, many of our products majority of P&G’s production. simply do not lend themselves to shipping long distances. The exception to this would be where Our primary focus is delighting consumers. To unique manufacturing capability exists in one ensure that our products deliver superior value, region and we are able to economically ship our manufacturing facilities must provide the across regions. most efficient option for the Company. We conduct regular reviews to ensure that our The percentage of P&G production supplied by facilities are highly competitive, and this process contract manufacturers varies according to the includes benchmarking versus third-party needs of the business and the ability of P&G manufacturers. When it makes sense for the facilities to compete and win production based business and it is the most competitive solution, on providing the best value. Currently, our plants we may decide to use contract manufacturers. do this extremely well, and we rely on third- For example, when entering a new market, party manufacturers for only 10% to 15% of introducing a new product, or accessing a our total manufacturing volume. technology or process we don’t currently have, we may rely on contract manufacturing prior to investing in new capacity at a P&G facility.

To ensure that our products deliver superior value, our manufacturing facilities must provide the most efficient option for the Company. 20 of 68

P&G Plant Locations Fiscal Year 13-14

COUNTRY CITY PLANT NAME COUNTRY CITY PLANT NAME Argentina Pilar Pilar France Amiens Amiens Argentina Villa Mercedes Villa Mercedes France Blois Blois Belgium Aarschot Aarschot France Sarreguemines Sarreguemines Belgium Mechelen Mechelen Germany Berlin Berlin Brazil São Paulo Anchieta Germany Cologne Cologne Brazil Louveira Louveira Germany Crailsheim Crailsheim Brazil Manaus Manaus Germany Euskirchen Euskirchen Brazil Rio De Janeiro Rio Germany Gross-Gerau Gross-Gerau Canada Belleville Belleville Germany Hünfeld Huenfeld Canada Brockville Brockville Germany Kronberg Kronberg Chile Santiago Santiago Germany Marktheidenfeld Marktheidenfeld China Beijing Beijing Germany Rothenkirchen Rothenkirchen China Chengdu Chengdu Germany Walldürn Wallduern China Dongguan Dong Guan Germany Worms Worms China Guangzhou Huangpu Guatemala Escuintla Escuintla China Luogang Luogang Hungary CsÖmÖr Budapest China Minhang Minhang Hungary Fgyongyos Gyongyos China Shanghai Shanghai India District Solan Baddi China Taicang City Taicang India Baddi Baddi B&R China Tianjin Tianjin India Bhiwadi Bhiwadi China Tianjin Xiqing India Ponda Goa Colombia Medellín Medellín India Hyderabad Hyderabad TS Czech Republic Rakovnik Rakona India Bhopal Mandideep Egypt Cairo Cairo Indonesia Jakarta Jakarta 21 of 68

COUNTRY CITY PLANT NAME COUNTRY CITY PLANT NAME Ireland Nenagh Nenagh Philippines Cabuyao Cabuyao Ireland Newbridge Newbridge Poland Aleksandrow Lodzki Aleksandrow Italy Gattatico Gattatico Poland Lodz Lodz-LMC (Jozefow Street) Italy Pescara Pescara Poland Lodz Lodz-PLMC (Wodna Street) Italy Rome Pomezia Poland Warsaw Targowek Japan Akashi Akashi Puerto Rico Cayey Cayey Japan Yasu Shiga Romania Timişoara Timişoara Japan Takasaki Takasaki Romania Urlaţi Urlaţi Malaysia Kuantan Kuantan Russia Dzerzhinsk Capella Mexico Naucalpan Alce Blanco Russia Novomoskovsk Novomoskovsk Mexico Apizaco Apizaco Russia St. Petersburg St. Petersburg Mexico Apaseo El Grande Mariscala Saudi Arabia Dammam Dammam Mexico Irapuato Milenio Saudi Arabia Jeddah Jeddah Mexico Naucalpan Naucalpan Singapore Singapore Singapore Pioneer Mexico Mexico City Talisman South Africa Johannesburg Johannesburg Mexico Tepeji Tepeji South Korea Ch’onan Ch’onan Mexico Mexico City Vallejo Spain Jijona Jijona Morocco Casablanca Casablanca Spain Mataró Mataró Morocco Mohammedia Mohammedia Spain Mequinenza Mequinenza Netherlands Coevorden Coevorden Spain Montornès del Vallès Montornès Nigeria Ibadan Ibadan Thailand Bangkok Bangkok Nigeria Lagos Lagos Turkey Gebze Gebze Pakistan Karachi Hub Ukraine Boryspil Boryspil Pakistan Karachi Port Qasim Ukraine Ordzhonikidze Ordzhonikidze Peru Lima Materiales United Arab Emirates Dubai Dubai 22 of 68

COUNTRY CITY PLANT NAME COUNTRY CITY PLANT NAME United Kingdom London London United States Kansas City Kansas City F&HC United Kingdom Manchester Manchester United States LaGrange LaGrange United Kingdom Reading Reading United States Lancaster Lancaster United Kingdom Whitley Bay Seaton Delaval United States Leipsic Leipsic United States Albany Albany United States Lima Lima United States Pineville Alexandria United States Mehoopany Mehoopany United States Andover Andover United States North Chicago North Chicago United States Auburn Auburn United States Oxnard Oxnard United States Augusta Augusta United States Russellville Russellville United States Aurora Aurora United States Sacramento Sacramento United States Avenel Avenel United States St. Louis St. Louis United States Boston Boston Venezuela Barquisimeto Barquisimeto United States Bear River City Box Elder Venezuela Guatire Guatire United States Jackson Cape Girardeau Vietnam Tan Uyen District Ben Cat United States Cincinnati Cincinnati Vietnam Binh Duong Binh Duong United States Cleveland Cleveland United States Dover Dover United States Fremont Fremont United States Green Bay Green Bay United States Greensboro Greensboro United States Henderson Henderson United States Cockeysville Hunt Valley United States Iowa City Iowa City United States Iowa City Iowa City (Oral Care) 23 of 68

Governance Management’s Responsibility for responsible for maintaining an effective system Financial Reporting of internal controls over financial reporting to deliver those characteristics in all material Everything we do is done with our At The Procter & Gamble Company, we take respects. The Board of Directors, through its commitment to “doing the right thing” great pride in our long history of doing what’s Audit Committee, provides oversight. We have in mind. right. If you analyze what’s made our Company engaged Deloitte & Touche LLP to audit our successful over the years, you may focus on Consolidated Financial Statements, on which We believe that good governance practices our brands, our marketing strategies, our they have issued an unqualified opinion. contribute to better results for shareholders. organization design and our ability to innovate. Our objective is to maintain corporate But if you really want to get at what drives our To learn more about our commitment governance principles, policies, and practices Company’s success, the place to look is our to providing timely, accurate and that support management and the Board of people. Our people are deeply committed to understandable information, please Directors accountability. These are in the best our Purpose, Values and Principles. It is this see our Annual Report available at: interest of the Company and our shareholders, commitment to doing what’s right that www.pg.com/en_US/investors/ and they are consistent with the Company’s unites us. index.shtml Purpose, Values and Principles. This commitment to doing what’s right is To learn more about our Governance embodied in our financial reporting. High- structure, policies, and procedures, quality financial reporting is our responsibility, please go to: www.pg.com/en_US/ one we execute with integrity, and within both company/global_structure_operations/ the letter and spirit of the law. High-quality governance/index.shtml financial reporting is characterized by accuracy, objectivity and transparency. Management is 24 of 68

Political Involvement Business Continuity

Guided by our Purpose, Values and Principles, P&G’s Global Business Continuity Program P&G participates in the political process to ensures that all critical sites and work processes help shape public policy and legislation. This evaluate their risk mitigation programs, exposure engagement ensures that the interests of our to catastrophic events at P&G sites and sites of employees, consumers and shareholders are our key suppliers and service providers that fairly represented at all levels of government could significantly interrupt business operations, around the world. We are committed to being as well as the business impact of such events. transparent about our political involvement Site and business unit leaders then develop globally. contingency plans to minimize business interruption if a disabling event should occur. You can read more about our efforts Crisis Management team structures are defined here: www.pg.com/en_US/company/ to manage business recovery using the global_structure_operations/governance/ predefined contingency plans. Tests are governance_political.shtml conducted annually to ensure that the contingency plans are sufficient and up-to-date.

Principal Industry and Business Continuity Plans are audited regularly, Business Associations and a report of the Business Continuity Program’s status is made annually to the P&G holds membership in many industry, Audit Committee. business and environmental associations whose activities are related to the Company’s. These include the associations listed in the following link: Associations List 25 of 68

Product Safety Being Safe, Feeling Safe and For more information on these Ingredient Choices ingredients and P&G’s approach for ingredient-related decisions, please visit the Safety is at the heart of everything we Our Commitment to Your Safety following section of pg.com, which also includes do – ensuring our products are safe for their a two-minute video designed to inform the Begins with You intended use before they go to market. public about the safety of our product Since Procter & Gamble was founded over 175 Simply put, that is being safe. years ago, ensuring the safety of people who ingredients: www.pg.com/en_US/sustainability/ But feeling safe can be a different matter use our products, and the safety of the world safety/ingredients/index.shtml altogether. We also work to help you to feel we all live in, has been at the heart of what safe by openly sharing information about we do. This commitment to safety is both our ingredients where you may have questions or heritage and our future, so we have ~ 700 would like more details, including our updated in-house experts devoted globally to human and product safety section on www.pg.com. environmental safety and regulatory compliance of all our products and ingredients. Ingredient Use Update Our safety standards for all of our products We would like to share two ingredient use and ingredients are the same throughout updates that reflect decisions P&G made several the world. We ensure that our products are years ago – to phase out the use of the safe for their intended use before they go phthalates (DEP) and triclosan in our products. to market – complying with all laws and • While the only phthalate we use in regulations where they are sold. our product formulations is safe (diethyl Constant Diligence phthalate, or DEP), we also know that there is the potential for people to confuse Our commitment to safety doesn’t stop this ingredient with other phthalates that are once our products go to market. We remain banned from certain product types. We want diligent in ensuring your safety by continually people to feel safe about our products and investigating new scientific information and not have any misperceptions about the collaborating with external scientists and product ingredients we use. So we decided regulatory agencies on new safety methods. We to remove DEP from our formulated products also listen to the people who use our products and our goal is to eliminate it from our to confirm they are performing as expected. products by the end of 2014.

• Triclosan is also known to be safe through numerous studies and regulatory reviews. However, there are ongoing discussions about how effective it is for reducing bacteria compared to regular soap. Since we have limited use of triclosan, our goal is to eliminate it from our products by the end of 2014. 26 of 68 Environmental Sustainability

P&G’s sustainability objective is to THREE CORE FOCUS AREAS: create industry-leading value with consumer-preferred brands and Conservation of Resources products while conserving resources, protecting the environment and Renewable Resources improving the social conditions for those who need it most. Worth from Waste

In this section we provide an update on our efforts to advance our environmental sustainability efforts across three core focus areas: Conservation of Resources, Renewable Resources and Worth from Waste.

To learn more about our commitment to operate sustainably, please go to www.pg.com/en_US/sustainability/ policies_practices/enviroquality.shtml 27 of 68

Conservation of in 2014, our data indicate a global average of technologies that provide greater performance In the coming fiscal year, we will maintain our 56% if we account for both cold water and in cold, and we talk to consumers about them. communication efforts globally, leveraging many Resources high-efficiency, low-energy cycles. We have worked with AISE, a detergents trade media channels, including TV, and on-pack. We association in Europe, on a major industry will continue our partnership with washing We consider this great progress, and while Our work in conservation is simply about doing consumer education campaign called “I prefer machine manufacturers to further drive the use other stakeholders clearly played a role in more with less. We are trying to reduce the 30˚C” to drive low-temperature washing. of cold-water, high-efficiency and quick cycle helping drive this result, we believe our intense amount of energy, water and materials that go machines. We will also maintain our focus on consumer education efforts on cold-water We also continue to partner with washing into the making and use of our products, while R&D efforts to continue to further extend washing and our continuous focus on ensuring machine manufacturers on three key areas: still delivering the high-quality product product performance in cold-water and great product performance in cold water have 1) place information about the benefits of performance our consumers expect. high-efficiency cycles. made a significant contribution to this result. cold-water washing on new washing machines reaching millions of consumers, 2) encouraging Cold-Water Washing Progress to date has been mainly driven the use of quick cycles where time saving is a by an increase of cold-water washing in Getting consumers to wash their clothes in low great consumer motivator to switch to this cycle Western Europe, where we launched strong temperatures represents a significant opportunity and 3) design detergents that perform at their communication programs. All versions of Ariel, to reduce energy consumption and associated best in the new high-efficiency machines in our leading laundry detergent in Europe, carry greenhouse gas emissions. This is why we have North America. established a goal that by 2020, we want to a “30˚C” icon to encourage consumers to wash have 70% of all machine wash loads done in in cold. We have partnered with suppliers such cold water. as Novozymes and DuPont to design

Our current data indicates the percentage of global washing machine loads washed in cold water increased from 38% to 53% between 2010 and 2014. That trend is encouraging, and we are also seeing other relevant trends in consumer habits such as an accelerating shift to more sustainable high-efficiency washing machines with low-energy cycles. As both trends contribute to the objective of reducing energy consumption during machine washing, we have started to track not only cold cycles, but also high-efficiency, low-energy cycles. Accordingly 28 of 68

Packaging Reduction against our packaging reduction goal. Every We continue to make good progress on year it becomes a bigger challenge to identify Expanding Our Commitment to designing and shipping more efficient packaging, optimization opportunities as more brands having achieved a total reduction of and packages achieve very efficient designs. Packaging Stewardship approximately 7% per consumer use since 2010. Packaging has many important functions, Consumers moving to more efficient products including, but not limited to, protecting As shared earlier in this report, P&G announced two new packaging goals and packages, reductions in packaging used to the product, delivering the product to the in October 2014: consumer and communicating the benefits ship product, and new innovative materials and 1. Double our use of recycled resin in our plastic packaging by 2020 designs have all contributed to reducing our to the consumer. Our packaging needs to packaging use. Fabric Care PODS continue to be continue to deliver these benefits while 2. Ensure 90% of our packaging is either recyclable or programs are in place a major contributor to our packaging reduction becoming more efficient. Innovations in to develop the ability to recycle it. goal as more consumers move to this very materials and forms will be critical in the efficient product and package. Designing future to make this happen. We will continue While we have a long history of working on source reduction, recycled content products and packages that delight the consumer to focus on the biggest brands and categories and recyclability, our new packaging goals will drive our progress even further. AND help deliver on our sustainability goals will where very small changes in efficiency deliver We plan to report progress on all three goals in next year’s report. continue to lead to large environmental impacts. big benefits for the environment while delighting our consumers. Moving forward, we will need to continue to focus on innovation and breakthrough technologies that will continue to deliver 29 of 68

Energy and CO2 CO2 Energy We continue to exceed our glidepath on CO2 Overall, we achieved an approximate 7% Combined Heat with an additional reduction of 3% per unit of reduction in energy per unit of production, In 2010 we established a goal to reduce total production this year. Overall, we have reduced which is slightly below our current glidepath and Power energy use and total CO2 emissions (Scope 1 our CO2 emissions by approximately 14% versus of 8% (2% per year). The main driver was the During fiscal year 13-14, our and Scope 2) at P&G facilities by 20% per unit 2010 and are aggressively working to achieve startup of our new cogeneration systems in Mehoopany plant completed installation of production by 2020. Our current program our goal well ahead of schedule. In addition to Mehoopany, Pa., and Pescara, Italy. While these of a Rolls Royce Trent 60 Gas Turbine focuses on three elements: meeting the production normalized targets, our systems are more efficient overall (and lead to conservation and improvement efforts have reduced CO emissions), when P&G switches and Heat Recovery Steam Generator. 1. Conservation – eliminating defects, 2 also allowed P&G to decrease our absolute from direct purchased electricity to onsite This state-of-the-art power plant uses systematic reapplication, and daily CO2 emissions since 2010 as well. generation, the efficiency losses related to management one of the most efficient aeroderivative generation moves inside our footprint, thus This year, in accordance with WRI/WBCSD gas turbines in the world (essentially 2. Cogeneration – using on-site generation increasing our overall on-site energy Green House Gas accounting protocol, we are the same family of engines found on to make efficient use of waste heat consumption. reporting biogenic CO2 separately from Scope 1 an Airbus A380 aircraft). This new 3. Renewable energy – moving away from fuels and Scope 2 emissions. During FY 13/14, P&G To learn more about our efforts on unit, along with the plant’s existing that create Scope 1 and Scope 2 emissions had 257,352 metric tons of biogenic CO2 climate change, please see www.pg.com/ combined heat and power unit, enables emissions across the company. en_US/sustainability/policies_practices/ Mehoopany to self-generate 100% of climate.shtml Total Greenhouse Gas Charts the site’s electrical needs in addition to Total Greenhouse Gas Emissions Total Greenhouse Gas Emissions by GBU Reduction in Energy Consumption a significant amount of steam and hot (Percent reduction versus FY09/10, per unit of production) (Millions of metric tons) (Percent reduction versus FY09/10, per unit of production) air that is used to dry our Bounty and

12 -8% 12 5.6 12 -5% Charmin products. This project, which

13 -11% 13 5.5 13 -7% was three years in the making, allows 14 -14% 14 5.4 14 -7% P&G’s largest facility to move from purchased electricity (that comes from Scope 1 Greenhouse Gas Charts a utility supply heavily dependent on Scope 1 Greenhouse Gas Emissions* Scope 1 Greenhouse Gas Emissions* Energy Consumption by GBU coal) to substantially cleaner electricity (Percent reduction versus FY09/10, per unit of production) (Millions of metric tons) (Millions of gigajoules) produced from natural gas. This project

12 -8.5% 12 2.6 12 72.8 helped reduce CO2 emissions by over 13 -12.1% 13 2.5 13 72.4 120,000 metric tons per year. 14 -7.7% 14 2.7 14 73.2

* CO2 from fuel combustion sources. Rolls Royce Trent Technical Centers Distribution Centers 60 Turbine Health Care Beauty Scope 2 Greenhouse Gas Charts Grooming Baby, Feminine and Scope 2 Greenhouse Gas Emissions Scope 2 Greenhouse Gas Emissions Fabric and Home Care Family Care (Percent reduction versus FY09/10, per unit of production) (Millions of metric tons)

12 -8% 12 3.0 13 -10% 13 2.9

14 -20% 14 2.7 30 of 68

Truck Transportation Natural-Gas Trucking Our 2020 goal is to reduce truck transportation In addition to optimizing our networks, Mehoopany Onsite CNG Filling Station kilometers by 20% per unit of production versus last year P&G announced an ambitious goal our 2010 baseline. We continue to make to work across our transportation carriers to P&G has begun construction of a new over-the-road compressed natural gas progress against this goal, with a major focus convert up to 20% of our North America truck (CNG) filling station at our Mehoopany, Pa., facility. This onsite filling station on optimizing distribution routes and driving loads to natural gas vehicles. One year into will enable over 60 trucks per day to utilize lower-emission natural gas to increased use of multi-modal transportation. the journey, we are making solid progress with deliver Bounty, Charmin, Pampers and other P&G products to the Northeast approximately 12% of our NA trucking volume One example of this is our raw pack material market. This work, combined with strategic CNG lanes across the Midwest being awarded to natural-gas carriers. Most of (RPM) optimization project being piloted in and Southeast, have enabled P&G to award approximately 12% of our North the loads are actively being hauled today using Europe. Typically, P&G’s primary focus is on the compressed natural gas (CNG) trucks, with the American transportation business to carriers with natural gas-operated trucks. efficiency of our finished product (FP) shipments remaining trucks to be online in late December while the distribution system for incoming raw 2014 when the final equipment is in place. This materials is left to the discretion of our suppliers. 12% conversion represents over 5.8 million Within a typical transportation lane, finished diesel gallon equivalents being converted to product may be traveling in one direction while natural-gas per year, reducing overall CO2 RPM materials are traveling in the opposite and particulate emissions. direction. Historically, we have looked for optimization opportunities between FP and RPM As P&G and others build momentum within shipments, but typically on a limited lane-by- this space, more natural-gas filling stations lane basis. This new project takes a more holistic and more advanced trucking technologies approach, utilizing P&G’s modeling and are becoming available, enabling broader simulation tools to analyze both FP and RPM distribution lanes. P&G is also leaning in shipments not only for specific lanes, but across by strategically installing onsite CNG filling a geographic region. This approach allowed the stations at some of our high-volume sites or, team to partner with trucking and intermodal in other cases, working with external CNG companies, along with our material suppliers to companies as an anchor tenant for new help eliminate empty truck miles and improve stations along key shipping lanes. vehicle fill rates. This benefited the trucking companies with more round-trip lanes while driving transportation efficiencies for P&G and our material suppliers. Last year, this pilot project was able to reduce empty truck miles in the region by approximately 5%, reducing CO2 and congestion in our communities while also delivering tangible transportation savings. Mehoopany, Pa., CNG filling station, progress as of 10/24/14 31 of 68

Water 2. Reduce water used in P&G manufacturing Water Consumption by GBU (Millions of cubic meters) P&G is committed to sustainable water facilities by 20% per unit of production by 2020, with a specific focus on conservation management. Our corporate water strategy 12 78.8 efforts at facilities located in water-stressed focuses on two key areas where we believe we 13 74.4 regions. can have most immediate impact: water used by 14 70.6 consumers when using our products and water Water conservation at our global facilities has Technical Centers Distribution Centers used in our manufacturing processes. been a focus for many years, and we have Health Care Beauty achieved significant water savings as a result. Grooming Baby, Feminine and As referenced in the introduction of this report, We have combined R&D, Engineering and Fabric and Home Care Family Care P&G recently announced two new water goals: Manufacturing teams to develop water-saving innovations around both cleaning/sanitization 1. Provide 1 billion consumers with access Wastewater COD* Disposed by GBU and filtration/reuse. In addition, we have (Thousands of metric tons) to water-efficient products by 2020 implemented programs such as rigorous For several of our product categories, the benchmarking and reapplication to ensure good 12 19.9 overall Life Cycle Analysis shows that the ideas and successes are traveling across the 13 17.7 consumer use phase is often the most globe and that our new sites are built with the 14 19.4 important in terms of water consumption. best available water-efficiency technologies. Therefore, providing consumers with products Technical Centers Distribution Centers Health Care Beauty that allow them to achieve the same or better We also continue our water reuse efforts with the multi-disciplinary E4Water consortium. This Grooming Baby, Feminine and performance while using less water, can have Fabric and Home Care Family Care a major impact. To achieve our goal, we will partnership across academia and a wide range * Chemical oxygen demand. continue efforts to develop water efficient of industries has been a key enabler for products that enable reduced water usage qualifying new membrane technology to recycle without any tradeoffs for our consumers. We treated washwater back into our manufacturing will place an initial focus on categories that process. Initial testing was very successful, and require the most water in the use phase, such the first industrial-scale units are being built for as Fabric Care, Dish Care and Personal Care. installation in summer 2015. To learn more about the E4Water consortium, please visit: We will also seek to leverage partnerships www.e4water.eu/ to help drive progress. For example, we are Our new water goal will help us drive further already working with the CONSENSUS Research progress on reducing water consumption within Program in Ireland to study the impact of operations. To encourage filtration, recycling water-efficient hair and personal care products and reuse, the scope of our goal will focus on on household water consumption. The fresh water intake, which includes tap water, outcome will help inform where our product ground water from site wells and surface water development efforts can best contribute to (e.g., from rivers, creeks, lakes). more sustainable water consumption patterns.

P&G’s Taicang Plant was designed to include some of our most advanced water recycling and reuse technologies 32 of 68

Water Risk Assessments P&G Water Risk Assessment Framework Because water is a local issue, we have developed a Tiered Water Risk Assessment process to help us focus our efforts in areas where it matters most. This process was built Water Risk Screening on methodologies and data developed by global experts, including the World Resource Institute Identify risk level of sites based on: (WRI) and the World Wildlife Fund (WWF). • Baseline Water Stress Score – WRI We have already put the methodology into 1 practice and are on track to complete the Tier 1 • Gross National Income per Capita – World Bank ALL SITES SCREENED assessment by January 2015. Using results from • P&G Site Water Use per Year – P&G the Tier 1 process, we will prioritize future • Access to Water – WHO/UNICEF analysis on high-risk sites.

Stakeholder Engagement Partnerships have been and will continue to be a critical element in driving progress against P&G Tailored Site Questionnaire our goals. As mentioned before, we engage with expert organizations such as E4Water, Prioritize sites based on outcome of responses CEFIC (EU Chemical Industry), Water Matters, PRIORITY SITES FROM 1 WBCSD (World Business Council for Sustainable 2 • The P&G questionnaire was built upon the facility Development), WRI (member since 2010) and questionnaire in WWF’s Water Risk Filter WWF. Both WRI and WWF have been key partners in helping us develop our water risk assessment process.

While our new goals will drive continued focus on water conservation related to our plants and In-depth Site Water Analysis products, our P&G Children’s Safe Drinking Water Prioritize risks for mitigation and develop site specifi c Program continues to be one of our major social sustainable water management plan responsibility programs. You can read more about 3 PRIORITY SITES FROM 2 that effort on page 45 of this report. • GEMI Local Water tool or equivalent

To learn more about our Water Policy, please see www.pg.com/en_US/ sustainability/policies_practices/water. shtml 33 of 68

Renewable Resources primarily from hydroelectric sources. On each of the above projects, our teams Partnering to Power Progress have found innovative approaches to drive A key component of making our business both sustainability and cost savings, driving We continue to look to leverage partnerships as much as we can to drive sustainable is ensuring that we have the right reductions in our overall footprint while at materials and energy supply to continue our progress efficiently and effectively. With that in mind, we joined forces with the same time creating financial savings for operations in the long term. This is why we the World Wildlife Fund, the World Resource Institute and several other our shareholders. focus on renewable resources – because they leading companies to launch the Renewable Energy Buyers Principles. The can be sustainably replenished over time. At the end of FY 13/14, our renewable intent of these principles is to open up new opportunities for collaboration energy use was approximately 8%. While we with utilities and energy suppliers to increase the overall use of renewable Renewable Energy are proud of that progress, we recognize those energy. We view these principles as a powerful tool to unleash additional results are below our glidepath target of 12% In 2010, P&G announced a compelling vision to onsite and offsite renewable energy partnership, accelerating P&G’s journey power our plants with 100% renewable energy. (3% per year). Several factors contributed to We understand that this may take decades to this, including long lead times for key projects toward powering our sites with 100% renewable energy. You can read more accomplish, so we have put in place a short- in our portfolio and the fact that historically about this work at the following website: www.worldwildlife.org/pages/ term goal to obtain 30% of our total energy low natural-gas prices impacted the economic powering-businesses-on-renewable-energy from renewable sources by 2020. We developed feasibility of advancing some projects. However, aggressive strategies and are making progress we continue to build strong partnerships with toward that goal. Over the last four years, we leading companies and university experts to have implemented: prioritize technologies and projects that are both economically and environmentally sustainable. • Five onsite solar PV projects Going forward, we anticipate having a diverse • An onsite wind project mix of renewable energy sources, both onsite and offsite, that will help deliver progress • An offsite wind purchase against our goal. Most recently, P&G is proud to announce that in collaboration with our utility partners in Poland, we are now powering all four of our plants in that country with 100% renewable electricity 34 of 68

Renewable Materials Four years ago we announced a goal of replacing Ultimately, our core work continues – we Bioplastic Feedstock Alliance 25% of our petroleum-derived raw materials will have our teams, in collaboration with our P&G has joined with seven other consumer brand companies and the with renewable materials. We implemented external partners, work to find ways to substitute World Wildlife Fund to the form the Bioplastic Feedstock Alliance (BFA) development programs and worked with external our top petroleum-based raw materials with partners, resulting in some innovative packaging renewable materials by 2020. Then, we will to support the responsible development of plastics made from plant breakthroughs, including making some Gillette work to implement them in fiscally responsible material. The primary focus of BFA will be on guiding the responsible packaging from bamboo and some Pantene ways – providing updates on our progress each selection and harvesting of feedstocks – such as sugarcane, corn, bulrush bottles from sugarcane. While we are proud year via our annual Sustainability Report. and switchgrass – used to make plastics. To learn more about BFA, of our efforts to date, one major challenge to please go to www.bioplasticfeedstockalliance.org commercializing large volumes of renewable We also remain committed to ensuring material replacements has been the ability to find renewable materials are carefully assessed cost-effective replacements at the scale we need. to ensure they are sourced and used in an environmentally sustainable way. Similar to the In October 2014 we revised our renewable last four years, we will continue to work with material goal to provide greater clarity and our supply chain partners and external experts transparency on the need for renewable in evaluating potential renewable material technologies to be economically viable and replacements. scalable. Our commitment to develop technologies to replace our top petroleum- based raw materials with renewable materials has not changed – we are simply acknowledging that we can only integrate these materials into our supply chain as cost and scale permit. 35 of 68

Sustainable Forestry The world’s forests play a role in supporting A Dedication and Commitment Spanning 45 Years virtually all life on earth. The good news is that Over 45 years ago, P&G opened our Mehoopany, Pa., manufacturing and in 2012 worked with GFTN they are one of our most renewable resources. However, in a world of increasing population its first pulp mill to support its site in 1999, sustainable forestry to announce a target of having at ® and economic well-being, the world’s forests growing bath tissue and paper remains a key component of our least 40% FSC -certified fiber in our are under increasing pressure, especially in the towel businesses. That also is when pulp procurement commitments. tissue and towel products by 2015. tropical regions where deforestation and loss we began employing registered To ensure that we remain a leader in With the release of this Sustainability of high-conservation-value areas are already foresters and actively managing our commitments, we joined World Report, we are pleased to announce occurring. forest resources. These were building Wildlife Fund’s Global Forest & Trade that we have exceeded our 2015 Although we do not own or manage forests, blocks to the company’s responsible Network-North America program goal one year ahead of schedule by many of our products and packages are fiber sourcing journey. While we sold (GFTN-NA) in 2008. We adopted a achieving 54% FSC® certification for dependent on raw materials from the forest- our stand-alone pulp mills in 1992 preference for Forest Stewardship the virgin fiber used in our tissue/ based supply chain. Therefore, we recognize the ® key role we can play, through our procurement and shut down our sulfite pulp mill at Council (FSC )-certified fiber in 2009, towel products. practices, to ensure the sustainability of the world’s forest resources. For example, P&G “WWF commends Procter & Gamble “The Forest Stewardship Council and other members of the Consumer Goods for exceeding its FSC goal for tissue applauds Procter & Gamble’s Forum have committed to help achieve zero and towel products,” said Linda remarkable progress in FSC®-certified net deforestation in our supply chains by 2020. Walker of WWF, who is director of fiber procurement for its tissue and % At P&G we have identified three strategic GFTN-NA. “Action by companies to towel products,” said Corey Brinkema, 54 commodities where our sourcing practices ® ® FSC certification can have the greatest impact on ensuring increase the volumes of FSC -certified President of Forest Stewardship for tissue and towel responsible use of the world’s forest resources: and recycled material in their supply Council - US. “P&G is proof positive products wood pulp for tissue and absorbent hygiene chains plays an integral role in that setting robust sustainability products, wood pulp used in paper packaging and palm oil for our laundry and beauty products. ensuring the world’s forests are goals and a commitment to The supply chains for these materials are managed sustainably. By meeting implementation can bring significantly different, and as a result, we have and exceeding its goal a year ahead great results.” established focused programs for each one as of its commitment, Procter & Gamble described on the following pages. Ultimately, however, all of these programs are tied to our is demonstrating its ongoing commitment to ensuring the sustainability of dedication to the advancement the world’s forests. of sustainable forestry.”

Sustainable forestry wall display at the Mehoopany, Pa., plant in the 1970s. 36 of 68

Responsible Forest Management in • Ensuring that wood is legally harvested and Pulp for our Tissue/Towel and Source Region/Country FY13/14 that all legal requirements are met. P&G will Our Wood Pulp Supply Chains Absorbent Hygiene Products Latin America 34% not knowingly use illegally sourced materials There are a number of third-party forestry in our products. P&G purchases wood pulp for use in our Canada 30% certification systems that are now available tissue/towel and absorbent hygiene products. United States 36% around the world. P&G relies on the use of • Ensuring that our supply chain is incorporating In 2012 we set two goals related to our use the principles of sustainable forest Total 100% these systems within our supply chain of wood pulp: management and continuous improvement wherever possible: The third-party-certified fiber used as a percent in their own operations and that these are • By 2015, 100% of the virgin wood fiber ® verified by independent forest and chain-of- of supply are: • Forest Stewardship Council (FSC – global) used in our tissue/towel and absorbent custody certification. • Sustainable Forestry Initiative (SFI – North hygiene products will be third party certified Tissue/Towel and Absorbent Hygiene Products America) • Ensuring that trees are not harvested from to one of the aforementioned standards. (1 66. million metric tons) high-conservation-value forests. P&G supports Third-Party Certification System % of Total • Programme for the Endorsement of Forest • By 2015, 40% of the virgin wood fiber multi-stakeholder efforts to develop Forest Stewardship Council (FSC) 36 Certification (PEFC – global) information sources and tools that will help used in our tissue/towel products will be ® Sustainable Forestry Initiative (SFI) 61 • Brazilian National Forestry Certification suppliers identify these areas on their own FSC certified. forestlands and in their procurement of wood Program for the Endorsement of 2 Scheme (CERFLOR) We will also utilize FSC®-controlled wood as part raw materials from third parties (e.g., www. Forest Certification (PEFC, includes of a stepwise approach to progressively increase • Canada’s National Standard for Sustainable hcvnetwork.org). CSA and CERFLOR) Forest Management (CSA-SFM) the amount of pulp from FSC-certified sources. FSC-Controlled Wood 1 • Ensuring that there is no sourcing from We also require that all pulp come from sources We give preference to pulp from Forest genetically modified trees. that have undergone an FSC® Controlled Wood Total 100 Stewardship Council (FSC®)-certified forests • Ensuring that supplier practices reflect our Risk Assessment. when it is available and meets product social values and support of universal human Tissue/Towel Products (1 .13 million metric tons) performance requirements and competitive This year, P&G exceeded our FSC® target one rights through work with local governments Third-Party Certification System % of Total market conditions. FSC has the world’s most and communities to improve the educational, year ahead of schedule by achieving 54% FSC® Forest Stewardship Council (FSC) 54 widely recognized forest certification scheme cultural, economic and social well-being of certification for the virgin wood fiber used in and is supported by internationally recognized those communities. our tissue/towel products. We also achieved Sustainable Forestry Initiative (SFI) 43 environmental nongovernmental organizations Program for the Endorsement of 3 • Ensuring that our supply chain does not an overall third-party certification level of 99% (NGOs). Forest Certification (PEFC, includes contain fiber from conflict timber (timber across our tissue/towel and absorbent hygiene CSA and CERFLOR) P&G is committed to the following core that was traded in a way that drives violent products and are on target to hit our 2015 principles: armed conflict or threatens national or goal of 100% third-party certification. Additional Total 100 regional stability). details on our pulp sourcing can be found in For more information on FSC® • Ensuring the safety of forestry and the following tables at right. manufacturing operations for employees Controlled Wood Assessments and and the environment. Pulp Sources their role in sustainable forestry, visit: www.fsc.org In FY 13/14, P&G bought approximately 1.66 million air-dried metric tons of pulp for use in For more information on World Wildlife our tissue/towel, diaper and feminine hygiene Fund’s Global Forest & Trade Network- products. The pulp was sourced from the North America program please visit: following regions: www.worldwildlife.org/gftn-na

Our policy on Wood Pulp Procurement can be found at the following link: www.pg.com/en_US/sustainability/ policies_practices/woodpulp.shtml 37 of 68

Paper Packaging Our paper-based packaging is derived Total Metric Tons Reported by Paper Packaging Suppliers surveyed in FY 13/14: ~ 990,000 P&G continually strives to optimize the design from wood fiber and, as a result, we have a responsibility through our procurement practices % of Virgin Fiber That % of Total Paper Packaging That Was of our packaging to use the minimum amount % Recycled % Virgin Was Third-Party Certified Recycled or Third-Party-Certified Virgin to ensure the wood fiber in our packaging has and type of material that will ensure adequate 77 23 82 96 protection, delivery and safe use of our been responsibly sourced. P&G has made a products. As part of our overall efforts on specific commitment that by 2020, 100% of our paper packaging will contain either recycled or packaging stewardship, we strive to identify Third-Party-Certified Virgin Fiber % of Total* Over the course of the next year, we plan third-party-certified virgin content. Over the last to focus our efforts in the following areas: source reduction opportunities to decrease Sustainable Forestry Initiative (SFI) 58 overall material usage and to use recycled year, we have expanded our efforts to collect Forest Stewardship Council (FSC) 33 • Close gaps for virgin fiber that was not paper when it offers the best option to meet data from our suppliers to assess progress Program for the Endorsement of 10 third-party certified. This year, 96% of the performance requirements and competitive against this goal, and more important, to Forest Certification (PEFC, includes volume reported by our suppliers was either market conditions. develop action plans to close any gaps. This year, we have received data from over 90 major CSA and CERFLOR) recycled or third-party-certified virgin content. suppliers that represent approximately 90% of *Approximate values – may not add to 100 That means 4% of the reported volume was our global paper packaging spend. This data, due to rounding. virgin material that was not third-party which were self-reported by our suppliers, are certified. We will place a focus on closing summarized in the following tables: that gap. • Continue to expand data collection efforts to cover a greater percentage of our total packaging volume. The data we collected this year covered materials procured directly by P&G. Next year, we will begin to expand coverage to include contract manufacturing and custom packaging operations. 38 of 68

Palm Oil 3. Work with suppliers, industry peers, NGOs, academic kernel oil supply chain. To help advance progress, during Palm oil is an important and versatile vegetable oil that is used experts and other stakeholders to promote consistent industry FY 13/14, we announced a collaboration with the Malaysia as a raw material by both food and non-food industries. In some standards and practices in palm oil sourcing with the aim of Institute for Supply Chain Innovation (MISI – part of the MIT regions of the world, the rapid expansion of palm oil production achieving full traceability and eliminating deforestation. Supply Chain and Logistics Excellence Network) to establish a project to improve the practices, productivity and livelihoods of has threatened environmentally sensitive areas of tropical forests Our Actions: and peat lands and has resulted in some incidents where the the small farmers in our palm kernel oil supply chain. The initial 1. Palm Oil and Palm Oil Fractions rights of workers and indigenous peoples have been infringed. focus of this project will be to map our largest PKO supply chain The following actions will apply to our purchases of palm oil and develop a model that will ultimately enable RSPO certification P&G uses relatively little palm oil, but we do use a byproduct and palm oil fractions: and supply chain practice improvements. To help guide this effort, of palm oil production called palm kernel oil. We are committed • Establish traceability to palm oil mills by early in FY 14/15, we convened an expert panel consisting of to ensuring that our sourcing of palm oil, palm kernel oil and December 31, 2015. representatives from NGOs, academia and the palm oil supply derivatives does not contribute to deforestation and respects chain to evaluate and refine our project plans. We will continue the rights of workers and indigenous peoples. P&G is a member • Require suppliers to submit plans by to report progress on this effort throughout FY 14/15. of the Roundtable on Sustainable Palm Oil (RSPO), and we December 31, 2015, to demonstrate how continue to support RSPO standards as a key mechanism to they will ensure no deforestation in their In addition to the MISI project, we will continue our ongoing drive responsible palm practices across the industry. Given the supply chain by 2020. efforts with our broader supply chain to drive progress against continued pressure on tropical forests and peat lands, in April our new commitments. This included a supplier summit early • As we advance progress against the goals above, 2014 we announced that we would take additional steps beyond in FY 14/15 to ensure key suppliers understood our new we also will continue to purchase 100% RSPO RSPO certification to confirm the palm-derived materials we commitments and supply chain expectations. certified palm oil. purchase are not contributing to deforestation. 2. Palm Kernel Oil We also continue to drive progress on RSPO certification. Our Commitments: The following actions will apply to our purchase of palm During FY 13/14, 100% of our palm oil and palm oil fractions 1. Develop a traceable supply chain kernel oil: were RSPO certified via the purchase of Green Palm Certificates. 37% of our Palm Kernel Oil was RSPO certified via a mix of 2. Ensure our suppliers meet RSPO criteria and have policies and • Establish traceability to palm kernel oil mills by Green Palm Certificates and Mass Balance Oil. 37% of derivatives procedures in place to ensure: December 31, 2015. (palm oil and palm kernel oil) was RSPO certified via Green Palm • No development of high conservation value (HCV) areas • Invest in and work with palm kernel oil suppliers, Certificates. During FY 14/15 we will continue to maintain 100% and high carbon stock (HCS) forests. and the smallholders who supply them, with the aim RSPO certification for palm oil and palm oil fractions and will seek to increase the percentage of palm oil, palm oil fractions, PKO • No new development of peat lands regardless of depth. of improving both practices and livelihoods to establish zero deforestation in our supply chain by 2020. and derivatives that are RSPO physically certified oil. • No burning to clear land for new development or replanting. 3. Palm Oil Derivatives and Palm Kernel Oil Derivatives Tonnage of Palm Oil and Palm Kernel Oil Purchased in FY 13/14: Material Type Volume (metric tons) % of Total • Compliance with P&G’s existing Sustainability Guidelines • Require suppliers to put forward time-bound plans by for External Business Partners. end of 2016 to demonstrate how they will ensure no Palm Oil and PO Fractions 85,581 16 deforestation in their supply chains. Palm Kernel Oil 318,068 60 • Respect for human and labor rights. Update on Progress PO and PKO Derivatives 128,945 24 • Respect for land tenure rights, including rights of PKO represents our largest and most complex supply chain. Total 532,594 100 indigenous and local communities to give or withhold We have achieved 80% of our palm kernel oil volume being their free, prior and informed consent for development sourced from known palm kernel crushing mills in our supply of land they own legally, communally or by custom. To learn more about our efforts on palm oil, please go to: chain network. Ultimately, we want to trace back to the source www.pg.com/en_US/sustainability/policies_practices/ plantations, including the thousands of small farmers in our palm palmoil.shtml 39 of 68

Manufacturing Waste Waste Disposed Non-Hazardous Waste by GBU Worth from Waste (Percent reduction versus 2010, per unit of production) (Thousands of metric tons) We continue to make excellent progress toward

We believe that all materials have value, our manufacturing waste reduction goals, to 12 -46% 12 162 even if they have traditionally been defined as the point that we have exceeded our target well 13 -55% 13 132 waste and disposed as trash. At the end of ahead of schedule. Our 2020 goal is to ensure 14 -70% 14 79 life – whether that’s after a product has been manufacturing waste to landfill is less than 0.5% Technical Centers Distribution Centers used or after a material has gone through our of input materials. In FY 13/14, we reduced Disposed Waste by GBU Health Care Beauty (Thousands of metric tons) manufacturing process – we believe there is a manufacturing waste to 0.4% of input materials, Grooming Baby, Feminine and way to create worth from what’s left – through meaning 99.6% of all input materials were Fabric and Home Care Family Care 12 207 reuse, recycling, composting or converting beneficially used in products or via recycling, 13 172 waste to energy. The content in this section reuse or energy conversion of waste materials. 14 117 Hazardous Waste by GBU includes our work to reduce our manufacturing This phenomenal progress is a direct result of (Thousands of metric tons) waste and to pilot ways we can find worth in the internal and external partnerships being Technical Centers Distribution Centers 12 14 consumer waste. lead by our Global Asset Recovery & Purchases Health Care Beauty team (GARP), our manufacturing plants, our Grooming Baby, Feminine and 13 12 Family Care distribution centers and our recycling vendors, Fabric and Home Care 14 6 which all continue to find new, innovative and Technical Centers Distribution Centers cost-effective solutions for our manufacturing Health Care Beauty waste. As we look to the future, we will Grooming Baby, Feminine and continue to look for stretching ways to Fabric and Home Care Family Care challenge our internal teams.

Incoming Material Utilization % of input (% Beneficially Used) 0.4 materials % 99.6% 99.60 In FY 13/14, we reduced

manufacturing waste to landfill 99.5% GOAL to 0.4% of input materials – exceeding our 2020 goal six 99.4% 99.37% years ahead of schedule 99.3% 99.23% 99.2%

11 12 13 40 of 68

Zero Manufacturing Waste to Landfill Over the past three years, P&G has increased the number of zero manufacturing waste to landfill (ZMWTL) sites from 10% to nearly 50% of manufacturing sites globally. We now have over 70 sites that have achieved ZMWTL criteria. During the last fiscal year, we also reached several country/regional milestones, 70 with all facilities in Germany and Poland and all manufacturing sites in Japan reaching ZMWTL. zero The teams in these countries are driving manufacturing breakthrough solutions and setting a high bar for their peer sites to follow. waste to landfill sites One example of innovative thinking to drive progress is reuse of scrap absorbent materials from our Feminine Care plant in Belleville, Canada. One of our external partners blends our high-tech absorbents with other raw materials that make up emergency spill containment and control products. Last year, the plant was called upon to help provide additional material above and beyond our typical supply to help the local community with emergency response and oil cleanup after the Lac-Megantic train disaster.

To learn more about how we define zero manufacturing waste to landfill, please see: www.pg.com/en_US/ downloads/sustainability/reports/ ZeroManufacturingWaste.pdf.

Spill containment materials manufactured using recycled materials from our site in Belleville, Canada 41 of 68

Consumer Waste Closed Loop Fund We continue to evaluate consumer waste As highlighted earlier in this report page 8, reduction pilot opportunities in both developed during FY 13/14 P&G also became a founding and developing regions. One of our key pilot member of the Closed Loop Fund. The Closed programs is our Waste to Worth project in the Loop Fund has been formed to provide Philippines. Waste to Worth is an effort focused municipalities and private firms engaged in on developing an integrated, profitable and public-private partnerships access to capital at replicable waste management business model below-market rates in order to spur investments that extracts value from waste. In partnership in municipal recycling programs. The goal of the with the Asian Development Bank, our Fund is to divert valuable raw materials from recommended owner/operator (SURE Global landfill by helping to provide 100% of U.S. W2Wi) has completed base feasibility studies in consumers access to recycling where and when the lead pilot city and begun negotiations with they need it. In turn, this should help drive the municipal officials to construct a treatment following outcomes: facility there. We have further initiated feasibility • Create economic value for cities by reducing studies for a second site in which a private landfill disposal fees and increasing revenue landfill in the Philippines (currently receiving from the sale of recyclable commodities. waste from 14 cities) would convert to a Waste to Worth facility. Given strong support from the • Create local jobs and community engagement. national government, the National Solid Waste • Increase supply and use of affordable Management Commission and the private post-consumer recycled (PCR) materials in investment community, the Waste to Worth consumer goods. model is already beginning to replicate beyond the initial pilots with feasibility studies initiated • Preserve our natural resources. at sites encompassing waste from eight • Facilitate innovative private sector investment additional cities. to support recycling.

To learn more about the Closed Loop Fund, please go to: www.closedloopfund.com 42 of 68

Resource and Waste Summary Table

The table below reports environmental statistics for Manufacturing Operations in the Global Business Units, Technical Centers and Distribution Centers.

Totals (absolute units x 1,000) 2014 Global Business Unit Detail (1) (absolute units x 1,000)

Baby, Feminine Fabric and Technical Distribution 2014 2013 2012 and Family Care Beauty Home Care Grooming Health Care Centers Centers

Production (metric tons) Product Shipped (2) 28,331 26,570 25,618 5,399 2,023 19,075 806 1,028 N/A N/A Raw Materials from Recycled Sources (3) 859 592 618

Waste (metric tons) Generated Waste 909 933 977 351 115 290 40 72 13 29 Percent Recycled / Reused Waste 87% 82% 79% 93% 73% 87% 97% 86% 69% 83%

Disposed Waste (metric tons) Waste Disposed 117 172 207 24.70 20.19 52.01 1.08 10.02 4.09 4.77 Solid Waste — Non-Hazardous 79 132 161 13.08 16.22 33.53 0.16 9.14 2.92 4.35 Solid Waste — Hazardous 6 12 14 0.20 0.74 3.84 0.06 0.06 0.24 0.41

Effluents(excluding water) (4) 19 18 20 4.45 2.72 10.66 0.58 0.53 0.41 N/A Air Emissions (5) 13 11 12 6.97 0.51 3.97 0.28 0.29 0.51 N/A Other

Energy Consumption (gigajoules ) 73,177 72,406 72,762 45,300 3,786 15,663 2,621 2,669 2,577 563

Direct Greenhouse Gas Emissions (metric tons) 2,685 2,521 2,576 1,806 115 471 69 79 128 18

Total Greenhouse Gas Emissions (metric tons) 5,353 5,503 5,574 2,890 386 1,269 214 248 295 52

Water Consumption (cubic meters ) 70,610 74,417 78,760 43,020 6,160 16,439 1,355 1,480 2,156 N/A

SARA Releases (metric tons) (6) 3 .67 2.37 2.19 0.008 0.020 3.294 0.346 0.001 N/A N/A

Numbers listed in italics have been updated since the 2013 report was issued. Updates were generally minor corrections based on updated totals. For reference, the data that was originally reported in 2013 can be accessed via our 2013 sustainability report which is available at www.pg.com/sustainability. 1 metric ton = 1,000 kg = 2,205 lbs. (1) For 2014, Baby, Feminine and Family Care includes Baby Care, Feminine Care and Family Care. Beauty includes Beauty Care, Prestige, Salon Professional and Personal Beauty Care. Fabric and Home Care includes Fabric Care, Home Care, Batteries and Chemicals. Grooming includes Blades and Razors and Devices. Health Care includes Personal Health Care, Oral Care and Pet Care. Technical Centers includes each of the technical and research centers that support the business units. Distribution Centers includes facilities that distribute finished product. Numbers do not include production from contract manufacturing operations. (2) Estimated from shipment figures (3) Data is tracked at a corporate level. (4) Wastewater chemical oxygen demand (COD)

(5) Air emissions include particulates, SO2, NOx, CO and VOC. (6) Releases defined in the U.S. Superfund Amendments and Reauthorization Act (SARA) by the U.S. Environmental Protection Agency 43 of 68 Social Responsibility

Doing the right thing is the Doing the right thing also includes foundation of P&G’s Purpose, investing in the communities in which Values and Principles. we live, work and serve. At its core, P&G Social Responsibility programs It is naturally woven into the way we aim to improve lives by providing work every day – paying competitive superior performing products and wages, working consistently with our brands where and when they are retailers and suppliers, preventing needed most and perform at their conflicts of interest, ensuring best, responding to disasters and consumer privacy and maintaining other extreme needs. financial stewardship. This approach to business is at the heart of all we In this section, we provide perspective do at P&G. on our Social Responsibility Programs, as well as our policies and practices. 44 of 68

Social Comforts of Home Disaster Relief Responsibility Programs In November 2013, when the strongest storm Habitat for Humanity ever to hit land whipped across the Philippines, P&G teams around the globe responded. Over the course of the year, P&G teams with Pampers, Safeguard, Duracell, Pantene and Habitat for Humanity have built or cleaned more more than a dozen other brands joined together than 30 homes around the world. The impact of to help the 16 million people impacted and 4 that work comes to life when we meet the million people left homeless. Together, P&G people who live in those homes. Consistent with P&G’s strengths, employees and our brands sent more than $3 One person we met this year was Mr. Jaras, we focus our work on providing million in personal care supplies, cash and P&G who lived in the Prachinburi Province of Purifier of Water packets to help. the Comforts of Home and Thailand. His community still had not recovered P&G also sent products and cash donations to improving Health & Hygiene from the brutal flooding that ripped through help with more than 20 major disasters, including scores of homes two years earlier, and the rainy for people around the world. massive flooding in the Balkans; devastating season was on its way again. Mr. Jaras, 50, was tornadoes, flash floods and mudslides in the U.S.; Through this work, we are partially paralyzed from a recent motorcycle wildfires in Chile; and earthquakes in Pakistan. leveraging the Company’s core accident and could not repair the gaping holes competencies to address critical in his roof, floor and walls. social needs. In partnership with Habitat for Humanity, P&G Here is a look at just some of the work P&G employees came together to build a new home did to improve lives in times of disaster: for Mr. Jaras, with a solid floor, strong roof and wheelchair. P&G teams also brought their July 2013: In India, thousands of people were October 2013: When floods also hit Mexico, traditional “welcome home” gift basket full of impacted and homes devastated by flooding P&G sent 2.5 million P&G Purifier of Water P&G brands such as Gillette, Safeguard, Oral-B that hit with fury in summer 2013. P&G packets and 6,000 disaster relief products kits. and Pantene to provide additional comforts of responded by providing P&G Purifier of Water May 2014: Deadly flooding in the Balkans home. packets and products such as Whisper, Oral-B, impacted 1.6 million people in Bosnia alone. Tide and Pantene. ”He never stopped smiling. As difficult as P&G helped with product donations totaling life was for him, he remained optimistic,” September 2013: When flash flooding hit $80,000 and a grant to rebuild 10 homes said P&G Corporate Contributions Senior Boulder, Colo., and surrounding areas, P&G and a school. Manager Brian Sasson. “We hope it distributed more than 4,000 personal care kits changed his life. We know it did ours.” along with products such as Charmin, Bounty, Pampers and Dawn. Tide Loads of Hope also helped by providing clean laundry for hundreds 10-year partnership of families. with Habitat for Humanity

3,000 P&G employees who have volunteered to help

30 projects we’ve been a part of around the world 45 of 68

Health and Hygiene Helping Through Our Brands Safeguard’s Clean Hands Healthy Kids CSDW by the Numbers Always reached an additional 300,000 girls Campaign marked its 15th year of teaching hygiene to prevent childhood illness, Children’s Safe Drinking Water through its Protecting Futures Program, providing girls age 12-14 with education on absenteeism and even death. The program was +140 This year, the P&G Children’s Safe Drinking good personal hygiene, puberty, menstruation launched in China based on global research that Water Program provided its 7 billionth liter of Global partners and personal care. The program, started in soap and water washing can prevent nearly 4 clean drinking water for children and families 2006, is aimed at helping girls attend classes million children a year from dying before their in need and helped save an estimated 42,000 during their periods, and thus stay in school. 5th birthday. Today, the program is in schools lives. The program has expanded from Africa to the across China, the Philippines, Pakistan and +7.5billion Mexico, reaching 4.5 million students a year. In The program also: Middle East. many locations, the brand has helped build Liters to date • Expanded operations in 17 countries, Pampers – as part of its commitment to happy, hand-washing and sanitation stations for including Myanmar, Vietnam and India, healthy development of babies – created the children. and launched in Brazil. Pampers Mobile Clinic Program, providing free basic health checks, health talks and products to Pantene launched a hair-donation program • Delivered the 7 billionth liter to a family mothers and their babies. This year, the clinics called Beautiful Lengths eight years ago. This of six through a new community program mark their 10th anniversary, reaching more than cause encourages youths, adults and even in southeastern Brazil with NGO partner 1.8 million mothers and children in Nigeria, celebrities to grow, cut and donate their healthy ChildFund. Kenya, Uganda and Pakistan. Also, the Pampers hair to help provide free wigs to women in UNICEF vaccine program marked another year need. Pantene funds the creation of these • Developed and expanded a shopper-facing of working to eliminate neonatal tetanus, wigs for cancer patients, and through their promotion with Wal-Mart and its UK ASDA a preventable disease that claims the life of partnership with the American Cancer Society, stores, sharing directly with consumers the 58,000 babies in developing countries each distributes them free of charge to female cancer need for clean drinking water. Still growing, year. The campaign, 1 pack = 1 vaccine, has patients. To date, the program has collected the program already has reached more donated more than 300 million vaccines and 550,000 ponytail donations, helping make more than 50 million shoppers and raised funds helped to eliminate the disease in 15 countries. than 34,000 real-hair wigs across the U.S. and in to deliver an additional 80 million days of Canada, Australia and Israel in partnership with clean drinking water. local cancer associations. 46 of 68

Social Responsibility Policies and Practices Social Responsibility Policies and Practices

Responsible business practices are important responsibility we have embedded within P&G’s culture, to operate ethically, in accordance beginning with our Purposes, with the law and with respect for Values and Principles. all individuals. The following pages share our approach to responsible We believe the interests of the operations within the area of social company and the individual are responsibility. inseparable. We recognize the

Policies and Practices • Human Rights • Stakeholder Engagement • Human Resources • Advertising and Promoting • Diversity & Inclusion to Consumers Appropriately • Global Medical • Eliminating Research • Worldwide Health, Safety Involving Animals – Our and Environment Systems Latest Contributions • Compliance with Laws • Sustainability Guidelines for and Regulations External Business Partners • Notices of Violation (NOVs) • Supplier Diversity • SARA 313 Releases • Personal Information Privacy 47 of 68

Human Rights address the issue or dilemma, including seeking Human Resources potential. We will not tolerate harassment to prevent or mitigate the adverse impact. of anyone by anyone – including employees, suppliers, customers, contractors and agencies. Last year, we obtained top management Human Resources ensures that P&G has We will continue to update our risk-based Every employee is expected to be proactive in approval to deploy our Human Rights Policy the employees, organizational design and auditing process of our external business ensuring that the work environment is free from Statement. Our Statement demonstrates our work culture to deliver business productivity partners, as needed, using third-party risk- harassment of any kind. Managers of others are support for the U.N. Guiding Principles for and to continually improve consumer, management tools (e.g., Maplecroft human responsible for setting clear expectations for Business and Human Rights, which respects employee and shareholder value. They rights map) to enable the identification of acceptable behavior in the workplace. and honors the principles of internationally provide recruiting, training, development, in-scope external business partners and recognized human rights consisting of those diversity, benefits and compensation remediation of non-compliance in a timely rights expressed in the International Bill of coordination for the Company. Wages manner. We will also continue to raise Human Rights (i.e., Universal Declaration of P&G supports paying employees a competitive awareness of our Human Rights Policy Human Rights and the International Covenants It is the Company’s intent to develop all wage, as benchmarked against other leading Statement through internal training programs. on Economic, Social and Cultural Rights and employees to their full potential. To achieve this companies. Consistent with our principle of goal, the following support systems are in place: Civil & Political Rights) and the principles P&G has continued its involvement in a number valuing personal contribution and mastery, we provide employees the opportunity to develop concerning fundamental rights as set out of human rights and other related social • Career discussions, performance appraisals, their skills and capabilities to enhance their in the International Labor Organization (ILO) responsibility initiatives: assignment plans, transfer and promotion ability to succeed in their career, consistent Declaration on Fundamental Principles and plans Rights at Work. 1. Continued to monitor the work of the with the needs of the business. U.N. Working Group on Business and Human • Informal network support groups Respect for human rights is implemented Rights. • Mentoring to provide informal support and Benefits through our Policies, Practices and Due Diligence 2. Member of U.N. Global Corporate guidance, in addition to coaching and training P&G is a recognized leader in employee benefits. Systems (e.g., Employee Rights; Employee Community of Practice. provided by each employee’s direct manager The Company’s benefits have been developed to Benefits; Worldwide Health, Safety and help protect the financial security of employees. Environment Systems; Health Services; 3. Member of U.S. Council for International Employee Privacy These benefits include comprehensive coverage Worldwide Business Conduct Manual; Business. Procter & Gamble is committed to maintaining for health care, vacation and holiday time, and Sustainability Guidelines for External Business 4. Participated in the annual Human Rights the principles of integrity and trust with respect other work/family balance benefits, including Partners; Social Responsibility programming). seminar, sponsored by The Coca-Cola to our employees’ privacy. We will only collect flextime, child care leave and less-than-full-time For example, this past year, we renewed Company. personal information about our employees schedules. Sustainability Guidelines for External Business where it is necessary to carry out legitimate Partners to emphasize our respect for human 5. Continued leading the Human Rights Work business objectives and to provide employee rights by establishing clear expectations to Stream effort within AIM-Progress. services. Access to employee data will be limited respect internationally recognized human rights, Our Human Rights policy can be to only those who have a legitimate business comply with all applicable laws, and conduct downloaded at: www.pgsupplier.com/ need or to fulfill a legal requirement. business ethically and responsibly. Because en/_downloads/Human_Rights_Policy_ P&G’s external business partners are expected to Statement.pdf Harassment Policy conduct their business with P&G in a way that respects the Human Rights Policy Statement, P&G is committed to providing a harassment- should P&G become aware of an adverse free work environment. This is the right thing to human rights impact from a external business do not only from a social perspective, but also partner’s operation, we would be able to from a business perspective. It enables our effectively engage to be part of the solution to diverse workforce to contribute to its highest 48 of 68

Diversity & Inclusion Diverse Talent Throughout P&G’s affinity groups began in the early 1960s P&G is a build-from-within Company. Just as and have continually evolved, formalizing in the 1990s, and continuing on a journey to help P&G Diversity & Inclusion has always been a part of our consumers are global and diverse, so are our further foster a culture of high inclusivity. our DNA and all we do. It is part of our Purpose, employees. By design, we ensure that leadership Values and Principles and critical to business has broad, global perspectives. We recruit top We want to foster a culture of inclusion so that growth. And as we continue on our journey, we talent from diverse backgrounds and cultures everyone is valued, included and performing at have become more deliberate with our diversity around the world. Our employees need to their peak. efforts to ensure that inclusion is a key focus reflect the diverse markets and consumers we area. And we want to be recognized as a serve. P&G employees represent more than 140 Embedded in Our Culture Global Leader for Diversity and Inclusion. nationalities worldwide, and we have the most for Lasting Change globally diverse and experienced leadership As a Company, our business model is built on Diversity & Inclusion capabilities aim to foster team in the Company’s history. and driven by consumers. Consumers are at the and grow an open and inclusive culture through heart of everything we do. We cannot create a blended learning approach (classroom, Trusting, Open and brands and products to improve the lives of the webinars, assessment tools and employee Inclusive Culture world’s consumers unless we understand and interest groups). Topics include flexibility, cultural value the diversity of those we serve and those At the core of our strategy, we want to foster a competency, affinity (people with disabilities, we work with. culture of inclusion so that everyone is valued, gender and lesbian/gay/bisexual/transgender), included and performing at their peak. To generations, and understanding differences in To do so, we have a mission to ensure Everyone support our diverse and global workforce, we working and thinking styles. Understanding Valued, Everyone Included, Everyone Performing have seven corporate affinity groups. P&G’s differences enables employees to build at Their Peak.® affinity groups offer an internal forum for collaborative diverse relationships to We strive to develop a workforce that reflects employees to connect and build a strong sense successfully drive business growth. the markets and consumers we serve and to of community as well have the opportunity to Foundational Diversity & Inclusion capability fully value and leverage their experiences, be in service to the Company to deliver better focuses on key concepts such as microinequities, insights and talents. And we are respectful of all business results. Affinity groups also aim to unconscious bias, benefits in leveraging diversity employees regardless of race, gender, color, ensure we attract, develop and maintain a and intent versus impact on others. By religion, national origin, age, sexual orientation, diverse workforce. understanding these types of differences, it gender identity and expression, disability, or any Structurally, each group is sponsored by a senior enables our employees to be in touch and build other non-job-related personal characteristic. leader in the Company and regularly meets with collaborative diverse relationships so that we executive leadership on key areas and can all successfully grow our business together. opportunities. Additionally, there are also numerous grassroots employee resource groups throughout the Company, representing a large variety of diverse interests throughout our entire employee population. 49 of 68

Diversity Metrics External Recognition P&G continues to focus on diversity as a global strategy and expects its workforce to become P&G’s commitment to creating a diverse workplace has been recognized by Diversity Inc., including increasingly diverse, enabling us to serve more of the world’s consumers. Global data on enrollment a #7 ranking on its Top 50 Companies for Diversity and a #6 ranking on its Top Ten Companies for by gender is shown in the following table: Global Diversity.

Global Enrollment 2014 2013 2012 Working Mother named P&G among the Top 5 Best Companies for Multicultural Women and one of its Working Mother 100 Best Companies. % Female For the fourth consecutive year, the National Association for Female Executives recognized P&G as Management 43.9 43.6 43.0 one of the Top 10 Companies for Executive Women. The Human Rights Campaign (HRC) has recognized P&G as among a select group of companies All Other Employees (1) 35.7 35.9 36.9 scoring a perfect 100 on the Human Rights Campaign’s Corporate Equality Index.

For additional information on our Diversity & Inclusion efforts, The percentages of minority and female employees in the United States are shown please see our Diversity & Inclusion Annual Report, available at: in the following table: www.pg.com/en_US/company/purpose_people/diversity_inclusion.shtml

U .S . Enrollment 2014 2013 2012

% Minorities

Management 24.2 24.0 23.9

Non-Management (1) 18.4 18.0 18.1

% Female

Management 42.0 42.0 41.7

Non-Management (1) 35.9 36.0 38.3

(1) Administrative, Technical and Plant Technicians 50 of 68

Global Medical During the past year, Global Medical delivered Since P&G is a principles-driven company, We ensure consistent global delivery of in times of regional crisis, assisting our the following Global Medical Priorities drive high-quality health systems via our Health employees and local health providers with all of our health systems worldwide: Systems Key Elements (HSKE) site audit process. We touch and improve the lives of our medical guidance, supplies and support. HSKE defines the corporate governance, country employees with focused delivery of our five 1. Save a Life (Protect Our People) legal and clinical governance standards and Global Medical Priorities. Our programs are making a difference. Our P&G 2. Obey the Law (Protect Company Reputation) requirements for our health systems worldwide. Health Services/Vibrant Living Health Centers The P&G Medical vision “Healthy People, Last year, we renewed and updated all standard sites worldwide had over 373,000 visits by 3. Protect Key Technologies Healthy Business” reflects the importance of operating procedures and added standards and employees in the past fiscal year. Over the last (Protect Brand Integrity) the wellness, productivity and innovativeness requirements to build strong customer focus four years, we have seen an annual increase in of employees. Our global Employee Health 4. Enhance Speed to Market (Support into our services. This year, successful employee visits to our Health Centers sites. and Wellness Policy insures that we deliver: Emerging Technologies and New deployment of the new HSKE audit tool was Many of these employee visits are proactive, Business Development) delivered through a comprehensive training • The same corporate health and wellness including use of preventive health services such platform, which included global, regional and standards at all P&G locations consistently as travel health consultations, influenza 5. Inspire Health and Wellness (Vibrant Living, site trainings; monthly global newsletter updates around the world, assuring that sites provide immunizations, and personal health and Travel Medicine Support, Global WorkLife addressing just in time questions; and the first employees with the appropriate level of wellness consultations. Solutions and EAP Programs medical qualification program of 30 auditors, occupational health assurance programs Vibrant Living Health Center Visits who then conducted over 200 globally and services. calibrated audits. 11 250,000 • Comprehensive and effective emergency care 12 336,000 GLOBAL MEDICAL SYSTEMS for our employees, onsite contractors and 13 364,000 visitors at all our facilities. 14 373,000 Protect Enhance Inspire Save a Obey Key Tech- Speed to Health and • Compliance with related laws and regulations Life the Law Employees who utilized Health Services or onsite nologies Market Wellness and share this expectation with all of our Health Programs reported better personal business partners. well-being scores of 12 percentage points or Employee-centered Care • A culture of health and actively involve higher compared to those not using these Vibrant Living Health Centers employees in protecting and promoting their services and programs as measured by the 2014 own health and wellness by providing high- P&G Employee Survey. Also, employees who quality health services and programs such as utilized WorkLife Solutions and Employee Vibrant Living. Assistance Programs had personal well-being scores of 13 percentage points higher than • WorkLife Solutions and Employee Assistance those who did not use these services. Programs (EAP) to support employees and their families. 51 of 68

P&G Vibrant Living Highlights of our progress include:

In 2014, we continued to focus on our P&G Vibrant Living branded programs have been Over 334 Vibrant Living Health Coaches The Vibrant Living Site Certification Program has Vibrant Living initiative, with the intent to rolled out to 204 P&G sites in 55 countries (see (nurses and physicians) and Champions have quickly expanded globally to 58 sites, and more support our employees to live healthy lives and map for Vibrant Living program countries). been trained and qualified across all five regions applications are currently under review. This achieve peak performance. (Asia, IMEA, Latin America, North America and ensures that our Culture of Health goals are met Europe). by offering healthy choices and programs in the In April, we had a global celebration of health areas of nutrition, fitness, tobacco cessation and with over 50% of our sites joining in our first more. Global Vibrant Living Awareness Day.

Our vision is to have the Healthiest, Most Sites with Vibrant Living Branded Programs Vibrant Living Health Coaches and Champions Vibrant Living Certified Sites

Engaged People in the World. 11 126 11 80 11 2 12 168 12 152 12 11 P&G’s Vibrant Living strategy reflects these three 13 198 13 259 13 33 focus areas: 14 204 14 334 14 58 Culture of Health – emphasizes nutrition, fitness, easy access to our health information, and an environment that encourages healthy choices and personal management of health risks.

Health Education and Training – through programs like Corporate Athlete. We have expanded the reach of WorkLife Solutions/EAP to over 84% of our employees globally to strengthen the foundation for the launch of our newest Vibrant Living program, Managing Stress and Building Resilience.

Employee Engaged Health Care – provides greater understanding of local health care resources and enables informed individual health choices. 52 of 68

Worldwide Health, Worldwide Health, Safety & Assessment process is designed to enable high-speed innovation. Safety and Environment Environment Organization Health, Safety & Environment (HS&E) is a global P&G has verified that the HS&E program at all Systems community of resources responsible for ensuring of our manufacturing facilities meets the intent that all sites worldwide — including Innovation of the Global Health and Safety Management Centers, Distribution Centers, acquisitions and standards OSHAS 18001 and ISO 14001. In Health and Safety Policy established plants – are operated safely and addition to our own internal reviews, in 2006, P&G is committed to having safe and healthy legally; that process hazards are minimized or P&G worked with Environmental Resources operations around the world. The goals are to eliminated; that health risks are identified and Management (ERM), a highly respected protect the lives and health of its employees and managed or eliminated; and that waste from international consulting firm in the field of the communities surrounding its operations, as sites is reduced as much as possible. Several environment, health, safety and sustainability well as to protect its assets, ensure business thousand employees spend all or a portion of to conduct an independent equivalence study. continuity and engender public trust. their time on HS&E management. This year, This ERM report, and a secondary P&G internal To accomplish this, P&G will: 1,731 full-time equivalents (FTEs) were involved followup audit in 2010, both reaffirmed we are in HS&E activities. This is down 3% from 1,776 following the overall principles defined within • Operate facilities safely and ensure that FTEs last year and reflects the reorganization of these standards. processes are safe and healthy for our P&G HS&E systems into a more focused support employees and residents of the surrounding structure. communities. We will accomplish this by following uniform corporate safety standards HS&E total costs for existing sites, which around the world. Safe operations have been includes costs for personnel, operations and a longstanding part of Company culture, contractor expenses for HS&E activities in fiscal reflecting the belief that our employees are year 13-14, were ~ $129 million. Efforts to our most important asset. reduce the amount of waste disposed have increased our overall quantity of recycling, and • Construct our facilities so as not to revenue generated from these recycling activities compromise on the safety and health features was ~ $44 million. designed into them. There are three major components to a site’s • Monitor progress toward our objective of HS&E organization: Environmental, Technical preventing injuries, illnesses and incidents. We Safety and Industrial Hygiene & Safety leaders; will continually assess and improve our safety Fire Protection Systems leaders; and an overall and health technologies and programs. HS&E leader. The HS&E site organization also • Have every employee understand and be closely partners with the site Health Service, or responsible for incorporating safe behavior in Medical leader. P&G uses a phased, detailed Risk daily business activities. Every employee is Assessment process to evaluate the safety of trained to work in a safe and healthy manner. processes and initiatives being introduced at its own manufacturing operations as well as at • Have operating standards, practices, systems contractor manufacturing operations. The Risk and resources in place to implement this policy. 53 of 68

Industrial Health and Safety The Company tracks and reports two metrics Total Incident Rate Audit Programs (Injury and illness per 100 employees) The health and safety of P&G employees are for worker safety: total incident rate (TIR) and P&G’s internal HS&E audit programs are total lost workday case rate (LWDC). TIR includes paramount in the principles of the Company: 12 0.36 designed to ensure compliance with national, all cases that result in loss of consciousness, 13 0.34 state and local regulatory requirements as well • Nothing we do is worth getting hurt. lost workdays, restriction of work or motion, 14 0.31 as corporate standards and procedures. Audit • Safety can be managed. medical transfer to another job or medical findings are reported promptly to the business treatment beyond first aid. LWDC includes all Total Lost Workday Case Rate management teams, which must address and • Every illness and injury could and should have (Lost and restricted workday cases per 100 employees) cases that involve days away from work or days correct all issues in a timely manner. P&G’s audit been prevented. of restricted activity beyond the day of injury or 12 0.19 programs apply to all plants, innovation centers onset of illness. The TIR target for sites is to be • Safety and health are everyone’s responsibility. 13 0.19 and distribution centers, worldwide. The below 0.5 cases per year per 100 employees. 14 0.16 fundamental philosophy is to use standards

To achieve such rates, programs to address worldwide, implemented by trained professionals employee safety, such as safe behaviors, P&G has over 66 manufacturing plants and at facilities and audited each year using a ergonomics and confined space entry have been technical centers that are celebrating over consistent, comprehensive approach. The metrics implemented. No target has been set for LWDC. 1 million safe work hours without a lost used are consistent with that philosophy. Audits Instead, incidents that potentially could lead to workday injury. The charts below highlight measure performance against a mandatory set lost workdays are managed. The following data some of our top facilities ranked by number of standards and standard operating procedures. is based on criteria established by P&G for use of safe work hours. The target performance is 8.0 or better on a at all sites, including acquisitions, plants and 10-point scale. The percentage of sites assessed technical centers. This year’s TIR was lower this year was 100%. versus last year, at 0.31 versus 0.34 incidents per 100 employees, while the lost workday rate Sites Conducting Annual Audits (Percentage) was down to 0.16 versus 0.19 cases per 100

employees one year ago. Both are lower than 12 97% industry averages. 13 99%

14 100%

Top 5 sites with highest number of safe working hours Manufacturing Sites Technical Centers Site Safe Hours* GBU Region Site Safe Hours* GBU Region Boston 14,400,000 Grooming NA Kobe Innovation Center 19,800,000 Technical Centers Asia

Ibadan 10,800,000 Fabric and Home Care IMEA Sharon Woods Technical Center 17,800,000 Technical Centers NA

Auburn 7,800,000 Feminine Care NA Beijing Innovation Center 9,900,000 Technical Centers Asia

Rakona 7,800,000 Fabric and Home Care Europe Winton Hill Business Center 9,100,000 Technical Centers NA

Shiga 6,100,000 Beauty Asia Fabric and Home Care Innovation Center 6,700,000 Technical Centers NA

*Rounded down to the nearest 100,000 54 of 68

HS&E Audit Scores Fire Protection Fire Protection Audit Scores Site HS&E Leadership Training P&G HS&E resources have been working P&G operates its fire protection program on The fire protection assessment program was A key indicator of HS&E systems capability is the through a rigorous calibration exercise across all the basic principle that each facility is unique changed significantly in 2011, even though we percentage of sites with trained and qualified geographies to ensure an appropriate calibration and should have a program designed to meet had a historically low number of fire losses and leaders. Leadership candidates train onsite for and focus on high-priority areas. This calibration its specific requirements. Working with the no regulatory issues. The new audit process was an extended period after attending a week-long exercise is helping to ensure we are holding Insurance division, HS&E has developed a designed to be much clearer and calibrated seminar where their knowledge and ability to ourselves to the highest standards and has checklist-based assessment process that relative to our internal fire protection standards. handle specific situations are assessed. For full resulted in a decrease in the number of sites evaluates the fire protection equipment, These process changes resulted in a more qualification, the candidates must complete a achieving scores of 8.0 or higher. In addition, maintenance and inspection, and emergency rigorous and globally calibrated approach to qualification project at their own plant. Since over the last few years, we added several response capability of a site versus the conducting these assessments. This 2011 2012, we have seen a decrease in the number acquisition sites. As is typical with many appropriate level of fire protection required at process change decreased the number of sites of qualified leaders due to acquisitions and acquisitions, it takes time for them to reach an that site. Each plant, innovation center and with scores of 8.0 or higher. However, since that normal attrition. Short-term gaps are covered via HS&E audit score of 8.0 or higher, and several major distribution center is assessed annually. intervention, we have been making steady corporate resources while we accelerate training sites are still short of that target. However, The target performance is 8.0 or higher on progress and this year, 66% of sites had Fire plans. The additional training has been a success through robust action plans, over the last year a 10-point scale. Protection audit scores of 8.0 or higher. Sites over the last year, with the number of sites that we have closed the gaps from previous audits will continue to work against action plans to have qualified HS&E leaders climbing from 65% and returned to over 75% of our global sites improve scores over the course of the next year. to 76% and the number of qualified fire scoring of 8.0 or higher. protection leaders climbing from 76% to 85%. Sites with Fire Protection Audit Scores This training and qualification program applies of 8.0 or higher Sites with HS&E Audit Scores of 8.0 or higher to all sites, including Technical Centers and (Percentage) (Percentage) acquisitions. 12 52 12 66 13 69 13 61 Sites with HS&E Qualified Leaders (Percentage) 14 66 14 76 12 92 13 65

14 76

Sites with Fire Protection Qualified Leaders (Percentage)

12 87 13 76

14 85 55 of 68

Compliance with Laws Notices of Violation Air Emissions SARA 313 Releases and Regulations (NOVs) (United States only) Each site assesses total suspended particulates, Within the United States, P&G plants report volatile organic compounds (VOCs), carbon There are numerous health, safety and In 2013, we saw an increase in total penalties. annually on the release of toxic chemicals into monoxide (CO), nitrogen oxides (NO ), and environmental requirements worldwide. This was primarily due to a single penalty X the air, water and land. These releases are sulfur oxides (SO ). Overall, the total air Plants are subject to safety rules and emission received for a third-party vendor improperly X defined in the U.S. Superfund Amendments emissions remained relatively flat over the limits with operating requirements that may handling our waste products. Using what and Reauthorization Act (SARA) by the U.S. last few years. be embodied in sources such as statutes, we learned from this incident, we have put Environmental Protection Agency. The purpose regulations, laws and permits. It is P&G’s intent additional focus on evaluating how third parties Air Waste by GBU of this documentation (referred to as section (Thousands of metric tons) to comply with both the letter and the spirit are handling our waste materials. We continue 313) is to publicly report the releases and of statutes, regulations, laws and permit to strive for zero notices or penalties, and this transfers of hazardous chemicals as defined 12 12.2 requirements. Identified compliance issues are year we saw a meaningful reduction in both. by the agency. 13 11.3 treated seriously, and all noncompliance matters 14 12.5 This year we experienced an increase in overall 2014 2013 2012 are resolved as expeditiously as possible. SARA emissions, primarily due to the startup Number 34 43 34 Technical Centers Distribution Centers of a new high-speed battery production line. Health Care Beauty Fines $95,460 $709,061 $93,760 The additional scrap from commissioning Grooming Baby, Feminine and Fabric and Home Care Family Care activities counts toward our overall SARA results; A breakdown of Notices of Violations (NOVs) is however, most of the materials were able to be provided below: beneficially recycled. SARA 313 U.S. Number (Total metric tons released or transferred) of NOVs Fines

Water-based 8 $80,060 12 2,190 13 2,367 Air-based 4 $2,667 14 3,669 Solid waste-based 4 $1,660 * The 11/12 and 11/13 data previously reported in the 2013 Paperwork 2 $170 Sustainability Report have been updated to reflect actuals. Transportation-based 4 $1,693 Other 2 $0 Worker safety 10 $9,210 Total 34 $95,460 56 of 68

Stakeholder Comforts of Home. It also enables us to build for the public. Consumer organizations exist in media, in addition to our established Carelines. alliances with strategic partners to achieve a many countries. These organizations contact Many of the people in our Global Consumer Engagement better result than we could alone. We look to our companies to compare products and voice Relations team are now responsible for employees in the area to work with their local comments they receive from their members. establishing online communities in which P&G works hard to be a good corporate communities and government officials to learn P&G continuously provides consumer consumers can ask questions about our neighbor and to improve lives in the where we can make the biggest difference. organizations with information on new Company and our products. This has been a communities where we live and work. initiatives and cooperates with them in huge success and has actually enabled us to Authorities: answering consumer questions. interact with even more of P&G’s consumers Communities Local – Regional – Global than in the past, which ultimately provides Consumers more insights for our Product Development Each P&G production facility has site-specific P&G communicates with local, regional and and Marketing teams to help further improve activities to build constructive relationships global authorities directly, both as a Company At P&G, we are committed to providing our products and services. with local authorities, industry associations, and through industry associations. P&G scientists products and services that can help improve residential and business neighbors, action and legal experts review existing and proposed the lives of our consumers all over the world. We are also innovating in how we ensure that groups, thought leaders, and news media. regulations that are relevant to the Company In developing and marketing our products, these important insights from our consumers Depending on the cultures and interests of and work with authorities to ensure that policies we adopt a “Consumer Is Boss” approach to get to our business teams. Consumers who take individual communities, this can range from take the needs and experience of business into ensure that we delight consumers by launching the time to contact a company for advice or ask regular official meetings, during which new account. This is done via meetings with the only new products and product improvements for help to resolve a problem provide valuable information is shared or questions are answered, authorities and comments on their position that genuinely meet their needs. Before insights into our products, which can really help to more informal meetings. These could include, papers and industry position papers. Activities establishing a project for a new product or us to improve our brands. So we need to make for example, a reception for immediate like these can help ensure that the Company’s product improvement, P&G researchers strive to sure that our consumers’ voices are heard in neighbors, where information about the past needs are understood and considered when understand consumer needs, in detail, in order to P&G. We do this by using a range of tools and year and plans for the new year are discussed. decisions are being made that can impact P&G’s identify those needs that are not fully met today. technologies that provide our business teams P&G ensures continuity in community interaction business and our ability to meet the needs of Once a product is launched, our commitment with key learnings from consumer comments. by meeting regularly with local authorities our global consumers. to our consumers does not stop there. For In Global Consumer Relations, we recognize to update them on plant news. In the P&G, every consumer’s experience in choosing, that the world is changing and we are investing neighborhoods of many P&G operations, the NGOs: Local – Regional – Global buying or using one of our products can provide in innovative technology to better serve our Company cooperates with and sponsors local P&G frequently enters into dialogue with vital insights to help us further improve our consumers. We feel very privileged that events, so the whole area benefits from the nongovernmental organizations (NGOs) to products and services. So we actively encourage consumers care enough about our products presence of a P&G site. understand their concerns and cares. In order to consumers to contact our Global Consumer to contact us. P&G recognizes the importance of improving the work constructively with stakeholders, we feel it Relations team. We want to hear about our quality of life in our local communities, and we is essential to have their confidence and be seen consumers’ experiences with our products – both support local initiatives and encourage employee as a reliable and open discussion partner. By good and bad. involvement. The most valuable community building an open relationship, we can approach Each year, we hear from millions of consumers support we provide usually involves not only our NGO partners when issues arise. There is a who want to ask us something about our writing a check, but also taking advantage of wide range of NGOs that vary by area of interest products or our Company. We proactively offer the intellectual capabilities and energy of P&G (e.g., environmental, consumer, animal welfare), “traditional” contact channels – phone, letter, people. We look for areas where we can make a by attitude (from extreme to moderate) and by e-mail – to consumers, but we are also very significant, long-term, systemic difference. This their geographic links (from local to global). aware that consumers’ lives are changing. leads us to focus on disaster relief and programs Depending on their characteristics, a number of As a result, we have invested to enable our in our areas of focus: Health & Hygiene and NGOs can be seen as the vocal spokespeople consumers to engage with us through social 57 of 68

Advertising and Eliminating Research We are passionate about continuing our For additional information on the progress in alternatives to research involving non-animal alternative to skin allergy Promoting to Involving Animals animals so that animal testing can be eliminated. tests, please go to: www. Consumers Highlights of our progress include: cosmeticsdesign-europe.com/ P&G strongly believes that ending animal Formulation-Science/P-G-develops-first- • We are a widely respected leader in Appropriately testing is the right thing to do. Our goal is approved-non-animal-alternative-for-skin- developing alternatives to animal testing. to stop animal testing completely. We are fully allergy-testing The Company does not permit its advertising committed and passionate about our goal and • We actively share our discoveries so that For details of our policy and practices, or promotions for its products to be false or believe the only way to stop animal testing is others can benefit from our progress; our please go to: www.pg.com/en_US/ misleading. P&G’s Worldwide Business Conduct to develop alternatives to animal testing. work has appeared in more than 1,000 sustainability/policies_practices/ Standards for Responsible Sales and Marketing Alternatives help us to innovate more ethically scientific publications. animal_welfare.shtml Practice states: and are often cheaper, faster and more effective • We attended and top-sponsored the scientific means to assess ingredient safety. We are Or visit: pgbeautyscience.com/animal- We are expected to compete vigorously World Congress on Alternatives. proud of the work that we have led in finding testing-alternatives.php and effectively, but never unlawfully. alternatives. We have developed more than 50 • Our focus on developing non-animal test For this reason, we are truthful in all of our non-animal testing methods and invested more methods has led to even more predictive sales and marketing. We must make only than $350 million in research and development approaches using human cell lines, genomics truthful statements about our Company in finding these alternatives. We’ve also and the latest in computer modeling and and its products and services. All marketing published our results so that others can benefit informatics. claims must be substantiated and live up from our research. We attended and top- to their promises. • We invented the first non-animal alternative sponsored the scientific World Congress on to skin allergy testing, which was officially Alternatives, where top scientists from around For additional information, please see approved by key regulatory authorities. the world come together to discuss latest P&G’s Worldwide Business Conduct progress in alternatives development. • We collaborate with universities, scientists Manual, available at: www.pg.com/ from other companies, governments and en_US/downloads/company/governance/ In 2013/14, the first ever non-animal alternative scientifically engaged animal welfare groups Policy_Worldwide_Business_Conduct_ to skin allergy tests was officially approved by to develop and promote acceptance of Manual.pdf European authorities. This test, known as DPRA alternative test methods and to change (Direct Peptide Reactivity Assay), was invented regulations that still require testing with by P&G scientists. Skin allergy is a complex animals. process and an important safety question for almost all ingredients. As a result, this alternative marks a milestone in overcoming the need for animal testing.

Our engagement has helped eliminate the need for testing and has significantly reduced the need for others in the industry to use animals in research. Today, we do not test on animals unless required by law, where no accepted alternatives are available yet. 58 of 68

Sustainability Guidelines Summary of Our Renewed • Treat their employees with dignity In our business award decisions, we will Guidelines and respect and have systems in continue to place substantial value upon for External Business place to prevent, detect and resolve incumbent and potential external business 1. External business partners must conduct unacceptable worker treatment such partners that consistently respect these human Partners business with integrity and in full compliance as harassment, inappropriate use of rights. with the law. External business partners and discipline, discrimination, physical or The foundation of our Sustainability Guidelines their employees must ensure they 4. External business partners must comply with mental punishment, or other forms of for External Business Partners is our Statement understand how these standards and the law all applicable environmental laws, rules and intimidation or abuse. of Purpose, Values and Principles. This leads apply to their work on behalf of P&G. regulations. P&G recognizes that we must be consumers to place their trust in us, our • Do not tolerate discrimination based on responsible for environmental stewardship 2. External business partners must not give, customers and business partners to do business race, color, gender, age, national origin, and using resources wisely. We strive to be agree to give, offer or receive anything of with us, our shareholders to invest in us, our religion, sexual orientation, gender socially responsible in the use of Company value to influence the behavior of another external stakeholders to respect us, and the best identity and expression, marital status, resources for the long-term benefit of business partner or government official in talent to join us in working for P&G. We actively citizenship, disability, veteran status, society. External business partners are order to obtain an improper benefit or seek business relationships with external medical condition (e.g., HIV/AIDS expected to share P&G’s commitments and advantage. partners that share our values and promote the status, pregnancy), or any other legally maximize the value and quality of their application of these high standards among 3. P&G respects internationally recognized protected factor. products by using resources responsibly, those with which they do business. human rights as defined by the Universal preserving the environment and reducing the • Respect their employees’ right to Declaration of Human Rights and Associated environmental footprint of their operations. During the past year, we launched a renewal of choose to join or not to join a trade Covenants and the International Labor our guidelines and end-to-end auditing process. union, or to have recognized employee The Sustainability Guidelines for Organization (ILO) Declaration on the Our renewed guidelines place emphasis on representation in accordance with local External Business Partners (EBP) can be Fundamental Principles and Rights at Work. respect for human rights by establishing clear law. downloaded at: www.pgsupplier.com/en/ We expect our external business partners to expectations for our external business partners pg-values/sustainability.shtml respect these internationally recognized • At a minimum, comply with all to respect internationally recognized human human rights. Examples of specific required applicable wage and hour laws and rights, comply with all applicable laws, and behaviors include: rules and regulations, including conduct business ethically and responsibly. By minimum wage, overtime and using third-party risk-management tools (e.g., • Do not use child labor, prison labor, maximum hours. Maplecroft human rights maps), we have refined indentured or bonded labor, human our end-to-end auditing process in selecting trafficking or modern-day slavery or use • Comply with all applicable health and external business partners for third-party corporal punishment or other forms of safety laws, rules, regulations and auditing. Our risk-based auditing process mental and physical coercion. industry standards. We expect a provides us with a more succinct list of in-scope commitment to and the support of the external business partners, which enables the improvement of the health and safety review and remediation of non-compliance in a of their operations, employees and the timely manner. surrounding community. 59 of 68

Supplier Diversity Personal Information P&G places high priority on safeguarding For more information on P&G’s global people’s personal information. Even in countries privacy principles, please visit: www.pg. Privacy without privacy legislation, we still adhere to our com/en_US/company/privacy/ Supplier diversity is a business strategy for P&G privacy policy. We want to have the trust of that we have focused on since the mid-1970s. Advances in computer technology have made it consumers and all others who do business with P&G adheres to U.S./European Union When we invest with diverse suppliers, we not possible for detailed information to be compiled us, including employees, shareholders, retail Safe Harbor principles and participates only strengthen our innovation and go-to- and shared more efficiently than ever around customers and recruitment candidates. in the Better Business Bureau’s EU Safe market capabilities, but also touch and improve the globe. That can be good news for society as Harbor Program. For more information, the lives of the women and men who work in a whole and for individual consumers. P&G’s robust privacy program is managed by a visit: www.bbb.org/council/eusafeharbor/ these companies – and through them, their Global Privacy Council. Our first objective is to bbb-eu-safe-harbor-dispute-resolution- families and the communities in which they live At the same time, as personal information protect an individual’s personally identifiable program/ and work. This is an important way we fulfill becomes more accessible, each of information as if it were our own. All outside P&G’s Purpose. us – companies, associations, government companies handling data on our behalf are In the United States, P&G is an active participant in the Better Business Bureau’s P&G makes a significant and ongoing agencies, consumers – must take precautions required to abide by our privacy principles. Accredited Business Program. For more investment in supplier diversity, spending against misuse of that information. Several Externally, P&G has been a strong advocate of information, visit: www.bbb.org/online/ more than $2 billion with minority- and countries already have laws protecting work within the industry to protect the privacy consumer/cks.aspx?ID=292000103 women-owned suppliers in fiscal year 13-14. consumers from misuse of their personal of consumers. For example, P&G has been a This is the seventh consecutive year we have information, and many others are following suit. leader in the effort to make privacy notices more Third-party companies can access exceeded $2 billion in supplier diversity consumer-friendly and has made our online our privacy and security guidelines spending. P&G is one of just 20 corporations on marketing statement available in 45 languages. on: www.pgsupplier.com the Billion Dollar Roundtable, an exclusive group of companies that invest a billion dollars a year or more with minority- and women-owned agencies, suppliers or external businesses. 60 of 68

Policies and Management Systems Process for Data Collection 2020 Goal P&G’s Management Systems ensure that P&G’s data collection systems have been in Management Systems the Company’s policies are implemented in a place for many years. They are designed to be Measurement Systems consistent manner throughout the world. These simple enough so that the people closest to Reporting Boundaries Management Systems align with the Company’s the work can use the tools, regardless of their We go to great lengths to ensure rigor, Our Sustainability Report provides HS&E data policies and promote a regular flow of location. This simplicity enables the Company accuracy and transparency in our Policies & for 137 manufacturing sites and 26 distribution information that helps the Company better to collect data and update systems annually reporting. Below, we share additional centers, 20 R&D facilities and 8 of our largest manage its progress on elements of sustainable at a relatively low cost. Each business unit is information on our some of our 2020 offices, over which we have operational control. development. responsible for the accuracy and consistency Goal Measurement Systems to help ensure Human Resources data covers all P&G facilities, of its data. clarity and transparency on the data we unless otherwise stated. Financial data covers Performance are reporting: All data is reported on a global basis. In order to The Procter & Gamble Company and its P&G measures operational performance in achieve consistency and to ensure a common Packaging Reduction controlled subsidiaries. order to drive continuous improvement. A understanding throughout the organization, The average packaging reduction is calculated Management Systems companywide system of measuring performance employees are trained in how to report and using products that represent the top 70% (by Policies has been developed. This approach enables the document data. Data is presented in metric units volume) of the categories that have the largest Company to report data on a wide range of While P&G competes hard to achieve leadership and published in English, with local translation impact on packaging use (Fabric Care, Home operational categories. Our actions are not just and business success, the Company is concerned performed where necessary. To ensure the Care, Baby Care, Fem Care, Family Care, Oral profit-driven but also progress-driven, to ensure a not only with results but also with how those standard collection of data, the Company Care, PCC, Shave Prep, Hair Care and Hair better quality of life for everybody, now and for results are achieved. We will never condone or established the following processes: Color). While a subset of overall data, we generations to come. Our extensive consumer tolerate efforts or activities to achieve results believe it is representative of overall corporate research related to our brands also helps us through illegal or unethical dealings anywhere • Key terms are defined. data and focuses resources on the biggest SKUs in the world. identify ways we can best address sustainability. • The data to be collected are identified. and categories that have the biggest impact on packaging. Data is currently reported 1 year in Acquisitions • Flow sheets are agreed upon regarding who arrears, so data reported represents progress Acquisitions have been included in the collects data and on what systems. through June 20, 2013. metrics presented herein. Acquisitions differ • Technically sound methods are used by in performance expectations in that we allow facilities to estimate data and validate Renewable Energy a six-year glidepath to meet the HS&E audit year-to-year results. When calculating the renewable energy performance score of 8.0 on a 10-point scale. powering our plants, we include the renewable A midpoint expectation of 6.5 is expected to • Personnel are trained on the work process energy level of the local electrical grid that be achieved within three years. Typically, as appropriate. provides power to the plant. acquisitions exceed those expectations.

Paper Packaging Data for calculating progress versus our paper packaging goal was self-reported by our suppliers. The data collected this year covered materials procured directly by P&G and covered over 90% of our global spend. 61 of 68

GRI Index

GRI Indicator Description Page(s)

1 . STRATEGY AND ANALYSIS 1.1 Statement from the most senior decision-maker of the organization. 4 1.2 Description of key impacts, risks, and opportunities. 5 – 59

2 . ORGANIZATIONAL PROFILE

GRI Index 2.1 Name of the organization. 12 2.2 Primary brands, products, and/or services. 15 – 16 2.3 Operational structure of the organization. 18 – 22 2.4 Location of organization’s headquarters. 17 The Procter & Gamble Company P.O. Box 599 Cincinnati, OH 45201-0599 2.5 Number of countries where the organization operates, and names 12, 20 – 22 of countries with either major operations or that are specifically relevant to the sustainability issues covered in the report. Also see Global Locations www.pg.com/en_US/contact_us/index.shtml 2.6 Nature of ownership and legal form. 12 2.7 Markets served. 12 2.8 Scale of the reporting organization. 12, 15 – 17 2.9 Significant changes during the reporting period regarding size, 17 structure, or ownership. 2.10 Awards received in the reporting period. 8, 49 Also see www.pg.com/en_US/company/external_recognition.shtml 62 of 68

GRI GRI Indicator Description Page(s) Indicator Description Page(s)

3 . REPORT PARAMETERS 4 . GOVERNANCE, COMMITMENTS AND ENGAGEMENT

Report Profile Governance 3.1 Reporting period. 2 4.1 Governance structure of the organization. 23 3.2 Date of most recent previous report (if any). FY12/13 4.2 Indicate whether the Chair of the highest governance body is also 4, 23 3.3 Reporting cycle (annual, biennial, etc.). Annual an executive officer. 3.4 Contact point for questions regarding the report [email protected] 4.3 For organizations that have a unitary board structure, state the 23 or its contents. number of members of the highest governance body that are independent and/or non-executive members. State how the Report Scope and Boundary organization defines ‘independent’ and ‘non-executive.’ 3.5 Process for defining report content. 2, 5 –11 Also see Proxy Statement available at www.pginvestor.com 3.6 Boundary of the report. 2, 60 4.4 Mechanisms for shareholders and employees to provide 17 recommendations or direction to the highest governance body. 3.7 State any specific limitations on the scope or boundary of the report. 60 Also see www.pg.com/en_US/investors/investor_contacts.shtml 3.8 Basis for reporting on joint ventures, subsidiaries, leased facilities, 42, 60 4.5 Linkage between compensation for members of the highest 23 outsourced operations, and other entities that can significantly affect governance body, senior managers, and executives (including comparability from period to period and/or between organizations. departure arrangements), and the organization’s performance. 3.9 Data measurement techniques and the bases of calculations. 60 www.pg.com/en_US/downloads/company/governance/ Corporate_Governance_Guidelines.pdf 3.10 Explanation of the effect of any re-statements of information 60 Proxy Statement available at www.pginvestor.com provided in earlier reports. 4.6 Processes in place for the highest governance body to ensure conflicts 23 3.11 Significant changes from previous reporting periods in the scope, 17, 60 of interest are avoided. boundary, or measurement methods applied in the report. Also see www.pg.com/en_US/downloads/company/governance/ GRI Content Index Corporate_Governance_Guidelines.pdf 3.12 Table identifying the location of the Standard Disclosures 61 – 67 4.7 Process for determining the qualifications and expertise of the members 23 in the report. of the highest governance body for guiding the organization’s strategy on economic, environmental, and social topics. Assurance Also see www.pg.com/en_US/downloads/company/governance/ 3.13 Policy and current practice with regard to seeking external assurance for 2 Corporate_Governance_Guidelines.pdf the report. 4.8 Internally developed statements of mission or values, codes of 13– 14, conduct, and principles relevant to economic, environmental, 23 – 60 and social performance and the status of their implementation. 63 of 68

GRI GRI Indicator Description Page(s) Indicator Description Page(s) 4.9 Procedures of the highest governance body for overseeing the 23 5 . ECONOMIC PERFORMANCE INDICATORS organization’s identification and management of economic, environmental, and social performance. Economic Performance Also see www.pg.com/en_US/downloads/company/governance/ EC1 Direct economic value generated and distributed, including revenues, 16 Governance_and_Public_Responsibility_Committee_Charter.pdf operating costs, employee compensation, donations and other 4.10 Processes for evaluating the highest governance body’s 23 community investments, retained earnings, and payments to capital own performance. providers and governments. (Core) Also see www.pg.com/en_US/downloads/company/governance/ EC2 Financial implications and other risks and opportunities for the 27 – 38, Corporate_Governance_Guidelines.pdf organization’s activities due to climate change. (Core) 44 – 45 Commitments to External Initiatives EC3 Coverage of the organization’s defined benefit plan obligations. (Core) 47 4.11 Explanation of whether and how the precautionary approach 25 Also see financial report www.pg.com/investors/annualreports.jhtml or principle is addressed by the organization. EC4 Significant financial assistance received from government. (Core) N/A 4.12 Externally developed economic, environmental, and social charters, 36, 47, 52 See financial report www.pg.com/investors/annualreports.jhtml principles, or other initiatives to which the organization subscribes Market Presence or endorses. EC5 Range of ratios of standard entry-level wage compared to local 47 4.13 Memberships in associations. 24 minimum wage at significant locations of operation. (Additional) Stakeholder Engagement EC6 Policy, practices, and proportion of spending on locally-based suppliers 17, 19, 59 4.14 List of stakeholder groups engaged by the organization. 24, 56 at significant locations of operation. (Core) 4.15 Basis for identification and selection of stakeholders with 56 EC7 Procedures for local hiring and proportion of senior management hired 47 – 49 whom to engage. from the local community at significant locations of operation. (Core)

4.16 Approaches to stakeholder engagement. 24, 56 Indirect Economic Impacts 4.17 Key topics and concerns that have been raised through 7-10, 31-38, EC8 Development and impact of infrastructure investments and services 43 – 45 stakeholder engagement. 41, 43-45, provided primarily for public benefit through commercial, in-kind, 47, 56, 57-59 or pro bono engagement. (Core) EC9 Understanding and describing significant indirect economic impacts, 43 – 45 including the extent of impacts. (Additional) See financial report available at www.pginvestor.com 64 of 68

GRI GRI Indicator Description Page(s) Indicator Description Page(s) EN15 Number of IUCN Red List species and national conservation list N/A 6 . ENVIRONMENTAL species with habitats in areas affected by operations by level of Materials extinction risk. (Additional) EN1 Materials used by weight or volume. (Core) 42 Emissions, Effluents and Waste EN2 Percentage of materials used that are recycled input materials. (Core) 11, 37, 42 EN16 Total direct and indirect greenhouse gas emissions by weight. (Core) 29, 42

Energy EN17 Other relevant indirect greenhouse gas emissions by weight. (Core) 29, 42 EN3 Direct energy consumption by primary energy source. (Core) 29, 33, 42 EN18 Initiatives to reduce greenhouse gas emissions and reductions achieved. 11, 27, 29, (Additional) 30, 33 – 42 EN4 Indirect energy consumption by primary source. (Core) 29, 33, 42 EN19 Emissions of ozone-depleting substances by weight. (Core) 42, 55 EN5 Energy saved due to conservation and efficiency improvements. 11, 29, 33 (Additional) EN20 NOx, SOx, and other significant air emissions by type and weight. (Core) 42, 55 EN6 Initiatives to provide energy-efficient or renewable energy based 11, 27 EN21 Total water discharge by quality and destination. (Core) 31, 42 products and services, and reductions in energy requirements as EN22 Total weight of waste by type and disposal method. (Core) 39, 42 a result of these initiatives. (Additional) EN23 Total number and volume of significant spills. (Core) 55 EN7 Initiatives to reduce indirect energy consumption and reductions 11, 27, 28, EN24 Weight of transported, imported, exported, or treated waste 39 – 42 achieved. (Additional) 29, 30, 33, deemed hazardous under the terms of the Basel Convention 42 Annex I, II, III, and VIII, and percentage of transported waste Water shipped internationally. (Additional) EN8 Total water withdrawal by source. (Core) 31, 42 EN25 Identity, size, protected status, and biodiversity value of water N/A bodies and related habitats significantly affected by the reporting EN9 Water sources significantly affected by withdrawal of water. (Additional) N/A organization’s discharges of water and runoff. (Additional) EN10 Percentage and total volume of water recycled and reused. (Additional) N/A EN26 Initiatives to mitigate environmental impacts of products and services, 5 – 8, 11, Biodiversity and extent of impact mitigation. (Core) 26 – 41 EN11 Location and size of land owned, leased, managed in, or adjacent N/A EN27 Percentage of products sold and their packaging materials 39 – 42 to, protected areas and areas of high biodiversity value outside that are reclaimed by category. (Core) protected areas. (Core) EN28 Monetary value of significant fines and total number of non- 55 EN12 Description of significant impacts of activities, products, and services 34 – 38 monetary sanctions for noncompliance with environmental on biodiversity in protected areas and areas of high biodiversity value laws and regulations. (Core) outside protected areas. (Core) EN29 Significant environmental impacts of transporting products and other 30 EN13 Habitats protected or restored. (Additional) 31 goods and materials used for the organization’s operations, and transporting members of the workforce. (Additional) EN14 Strategies, current actions, and future plans for managing 34 – 38 impacts on biodiversity. (Additional) EN30 Total environmental protection expenditures and investments 52 Also see www.pg.com/productsafety/downloads/Environmental_ by type. (Additional) Quality_Policy.pdf 65 of 68

GRI GRI Indicator Description Page(s) Indicator Description Page(s)

7 . LABOR PRACTICES AND DECENT WORK Training and Education LA10 Average hours of training per year per employee-by-employee 51, 54 Employment category. (Core) LA1 Total workforce by employment type, employment contract, 12, 49 LA11 Programs for skills management and lifelong learning that support the 47, 51 and region. (Core) continued employability of employees and assist them in managing LA2 Total number and rate of employee turnover by age group, N/A career endings. (Additional) gender, and region. (Core) LA12 Percentage of employees receiving regular performance and career 47 Note: We do not track this information globally development reviews. (Additional) LA3 Benefits provided to full-time employees that are not provided to N/A temporary or part-time employees, by major operations. (Additional) Diversity and Equal Opportunity LA13 Composition of governance bodies and breakdown of employees per 49 Labor / Management Relations category according to gender, age group, minority group membership, LA4 Percentage of employees covered by collective bargaining N/A and other indicators of diversity. (Core) agreements. (Core) Also see Proxy Statement available at www.pginvestor.com LA5 Minimum notice period(s) regarding significant operational changes, N/A LA14 Ratio of basic salary of men to women by employee category. (Core) 47 including whether it is specified in collective agreements. (Core) Note: We abide by local legislation and our PVPs. 8 . HUMAN RIGHTS

Occupational Health and Safety Investment and Procurement Practices LA6 Percentage of total workforce represented in formal joint management- 52 – 54 HR1 Percentage and total number of significant investment agreements that 47, 58 worker health and safety committees that help monitor and advise on include human rights clauses or that underwent human rights occupational health and safety programs. (Additional) screening. (Core) LA7 Rates of injury, occupational diseases, lost day’s, absenteeism and total 53 HR2 Percentage of significant suppliers and contractors that have undergone 47, 58 number of work-related fatalities, by region. (Core) screening on human rights and actions taken. (Core) LA8 Education, training, counseling, prevention and risk-control programs in 50 – 51 HR3 Total hours of employee training on policies and procedures concerning 47 place to assist workforce members, their families, or community aspects of human rights that are relevant to operations, including the members regarding serious diseases. (Core) percentage of employees trained. (Additional)

LA9 Health and safety topics covered in formal agreements with 52 – 54 Non-discrimination trade unions. (Additional) HR4 Total number of incidents of discrimination and actions taken. (Core) 48 – 49 Also see www.pg.com/en_US/company/purpose_people/diversity_ inclusion.shtml 66 of 68

GRI GRI Indicator Description Page(s) Indicator Description Page(s)

Freedom of Association and Collective Bargaining 9 . SOCIETY HR5 Operations identified in which the right to exercise freedom of 58 Community association or collective bargaining may be at significant risk, and actions taken to support these rights. (Core) SO1 Nature, scope, and effectiveness of any programs and practices 56 that assess and manage the impacts of operations on communities, Child Labor including entering, operating, and exiting. (Core) HR6 Operations identified as having significant risk for incidents of 58 Corruption child labor, and measures taken to contribute to the elimination of child labor. (Core) SO2 Percentage and total number of business units analyzed for risks related 20 to corruption. (Core) Forced and Compulsory Labor Also see Worldwide Business Conduct Manual HR7 Operations identified as having significant risk for incidents of 58 www.pg.com/en_US/company/ethics.html forced or compulsory labor, and measures taken to contribute Governance structure, policies, and procedures to the elimination of forced or compulsory labor. (Core) www.pg.com/en_US/company/global_structure_operations/ governance/index.shtml Security Practices SO3 Percentage of employees trained in organization’s anti-corruption 23 HR8 Percentage of security personnel trained in the organization’s polices N/A policies and procedures. (Core) or procedures concerning aspects of human rights that are relevant to Also see Worldwide Business Conduct Manual operations. (Additional) www.pg.com/en_US/company/ethics.html Governance structure, policies, and procedures Indigenous Rights www.pg.com/en_US/company/global_structure_operations/ HR9 Total number of incidents of violations involving rights of indigenous N/A governance/index.shtml people and actions taken. (Additional) SO4 Actions taken in response to incidents of corruption. (Core) 23 Also see Worldwide Business Conduct Manual www.pg.com/en_US/company/ethics.html Governance structure, policies, and procedures www.pg.com/en_US/company/global_structure_operations/ governance/index.shtml 67 of 68

GRI GRI Indicator Description Page(s) Indicator Description Page(s)

Public Policy Product and Service Labeling SO5 Public policy positions and participation in public policy development 24 PR3 Type of product and service information required by procedures, and 25 and lobbying. (Core) percentage of significant products and services subject to such SO6 Total value of financial and in-kind contributions to political parties, 24 information requirements. (Core) politicians, and related institutions by country. (Additional) PR4 Total number of incidents of noncompliance with regulations and N/A voluntary codes concerning product and service information and Anti-Competitive Behavior labeling, by type of outcomes. (Additional) SO7 Total number of legal actions for anti-competitive behavior, anti-trust, N/A PR5 Practices related to customer satisfaction, including results of surveys 56 and monopoly practices and their outcomes. (Additional) measuring customer satisfaction. (Additional)

Compliance Marketing Communications SO8 Monetary value of significant fines and total number of non-monetary 55 PR6 Programs for adherence to laws, standards, and voluntary codes related 57 sanctions for noncompliance with laws and regulations. (Core) to marketing communications, including advertising, promotion, and sponsorship. (Core) 10 . PRODUCT RESPONSIBILITY PR7 Total number of incidents of noncompliance with regulations and N/A Consumer Health and Safety voluntary codes concerning marketing communications, including PR1 Life cycle stages in which health and safety impacts of products and 25 advertising, promotion, and sponsorship, by type of outcomes. services are assessed for improvement, and percentage of significant (Additional) products and services categories subject to such procedures. (Core) Customer Privacy PR2 Total number of incidents of noncompliance with regulations and N/A PR8 Total number of substantiated complaints regarding breaches of N/A voluntary codes concerning health and safety impacts of products and customer privacy and losses of customer data. (Additional) services, by type of outcomes. (Additional) Compliance PR9 Monetary value of significant fines for noncompliance with laws N/A and regulations concerning the provision and use of products and services. (Core) Note: We do not track this information Globally 68 of 68

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