Creating a more delicious world OUR 2010 REPORT Message from Our Chairman and a2 b Chief Executive Officer Ever since my first “job” selling As a global food company, we can help raise people up—out of hunger, out of poverty, toward Girl Scout cookies, I believed healthier lifestyles—through what we make and that business could be a force how we make it. Millions of times a day … in ways big and small … quite literally around the world, for good. Today, I know it is. we’re doing just that. And we do it at multiple points in our supply chain … from our agriculture Business is a vital part of the success of most sourcing initiatives that have made us a leading nations. From Chile to China. The United States purchaser of sustainable cocoa, coffee and to Ukraine. Well-run businesses contribute to cashews to our finished products, like Biskuat society in so many ways: Providing jobs, creating and Tiger fortified biscuits that helpI ndonesian robust supply chains, revitalizing communities, moms ensure their kids get the right vitamins innovating solutions for some of the world’s and minerals to grow to their full potential. toughest challenges, contributing to public coffers and delivering shareholder returns that “Creating a more delicious world” is a lofty I rene B. Rosenfeld enable further investment. But companies that goal to be sure. But we make it achievable by Chairman and can successfully and simultaneously balance taking a pragmatic approach. First, we focus Chief Executive Officer the short- and long-term interests of the our efforts where we can make the greatest multiple constituents they serve can do the difference. Our global priorities are food safety, most good. They can, indeed, change the health and well-being, and sustainability. Next, world for the better. we agree on the goals, strategies and actions to achieve each priority. That’s one of the reasons I’m so proud to be leading Kraft Foods, where we say that Our goals, whether financial or philanthropic, “delicious is our difference.” Yes, our products are designed to be ambitious, but achievable. taste delicious. But to us, it’s more than that. Our strategies are long term, spanning Delicious is also our corporate purpose … the decades in some cases. But the targets we mindset and spirit we apply to everything we set to evaluate our progress are measured in do and how we do it. It’s also why we titled increments of five years or less.T hat way, the this report, “Creating a more delicious world.” same people who set the targets can also be M ESSAGE FROM OUR CHAIRMAN AND CHIEF EXecUTIVE OFFICER INDEX CR EATING A MORE DELICIOUS WORLD | OUR 2010 REPORT a3 b held accountable for delivering them. Finally, We’re not perfect, and we’re not finished. But our actions focus on what we call the “Three Ps” by focusing on what matters most and where for creating lasting change: Products, Policies we can make the biggest difference, I am and Partnerships. All three are important, but confident we’re on the right path. We’re working I want to elaborate a bit on Partnerships. Even to support healthier lifestyles and sustainable though there is a lot we can do as the world’s agriculture. Seeking solutions that, by design, second-largest food company, many of the benefit our business and our society. Working issues we’re tackling are so big that we can for outcomes that are sustainable and scalable. only achieve lasting change when we work And sharing our progress and setbacks along with others. So together with our suppliers, the way. We can’t do everything, but we are customers and consumers … with governments, doing a great deal. We’re proud of what we’ve multilateral organizations and nongovernmental accomplished and how it is helping consumers organizations (NGOs) … we look for innovative and communities around the world live more ways to combine our inherent strengths and deliciously every day. capabilities to achieve the kinds of significant I rene Rosenfeld helps build change we all want—for ourselves, for our a playground in Chicago’s Washington Park, one of children and for generations to come. 13 playgrounds built as part of our partnership with KaBOOM! In the following pages, I encourage you to during Delicious Difference take a look at what we’re doing and what we’ve Week in 2010. During this accomplished, on our own and in partnership week, nearly 25,000 employees with others around the world. This report covers Irene B. Rosenfeld in 56 countries engaged in community activities to help both the legacy Kraft Foods and Cadbury Chairman and Chief Executive Officer fight hunger and promote businesses and summarizes our 2010 progress Kraft Foods Inc. healthy lifestyles. in the areas of highest societal interest. May 2011 M ESSAGE FROM OUR CHAIRMAN AND CHIEF EXecUTIVE OFFICER INDEX CR EATING A MORE DELICIOUS WORLD | OUR 2010 REPORT a4 b T able of Contents TABLE OF CONTENTS INDEX CREATING A MORE DELICIOUS WORLD | OUR 2010 REPORT a5 b Delicious @ Work Highlights Since 1999 in the U.S. D uring the last five years, In 2010, we reduced sodium In 2010, women made alone, we’ve helped we’ve improved the nutrition in 340 North American up 35% of management provide more than profile of more than products—removing nearly worldwide. 1 billion servings 5,500 products 3 million kilograms 43% of our of food (6.5 million pounds) salaried employees to those in need of salt were women T oday, we’re helping to Since 2005, we’ve significantly increased our purchases of We’ve cut improve the livelihoods certified coffee and cocoa (measured in metric tons) of more than Kraft Foods certified coffee and cocoa bean buying p97 million 1 million farmers Rainforest Alliance 50,000 * Certified™ coffee kilometers through partnerships Fairtrade sugar 24,000 (60 million miles) from our that support sustainable Fairtrade cocoa 19,000 Rainforest Alliance 11,000 global transportation network agriculture Certified™ cocoa 2005 2006 2007 2008 2009 2010 W e’ve cut greenhouse gas emissions W e’ve reduced We’ve reduced water W e’ve cut our packaging and energy use by our waste by consumption by by nearly p * p * p * p * p100,000 18% 16% 42% 30% * greenhouse energy metric tons gases use (200 million pounds) *Data normalized to production with a 2005 baseline. DELICIOUS @ WORK HIGHLIGHTS INDEX F rom Our Partners a6 b “INMED Partnerships for Children is proud to work with the Kraft Foods Foundation toward our shared goals to fight hunger and malnutrition, and to help youth put health into action. Together, we are creating hope and opportunity for the next generation, providing more than 100,000 of Brazil’s most vulnerable youth with the foundation of knowledge and good health they need to transform their futures.” Linda Pfeiffer, Ph. D., President and CEO, INMED Partnerships for Children “As the numbers of hungry increase, we need private companies like Kraft Foods to join us in the fight against hunger. It’s a fight too big for any one player, but together we can find new ways to dramatically reduce malnutrition.” Josette Sheeran, Executive Director, “ Kraft Foods Foundation is helping to make World Food Programme nutritious food available in schools and communities to combat the high rates of malnutrition in young children. Families are also learning the skills they need to make healthy choices to improve the nutritional status of their children. The Foundation’s impact will be felt for generations.” Charles MacCormack, President and CEO, Save the Children FROM OUR PARTNERS INDEX CR EATING A MORE DELICIOUS WORLD | OUR 2010 REPORT a7 b “We are all responsible “CARE is pleased to be working alongside Kraft Foods to improve for ensuring the long- the lives of people living in poor communities. Through savings, term health of our education, entrepreneurship and innovative technologies, thousands planet. As the leading of cocoa farmers are benefiting from more sustainable cocoa purchaser of coffee and farming systems. Together, we are making a real difference in the cocoa from Rainforest lives of many rural families around the globe.” Alliance Certified™ Helene D. Gayle, MD, MPH, President and CEO, CARE farms, Kraft Foods is doing its part by helping farmers earn a good living as they conserve wildlife habitats and the vital natural resources on which we all depend.” Tensie Whelan, President, The Rainforest Alliance “Soon, 9 billion people will seek to improve their lives in the context of a single planet. And every business in every industry will be forced to grapple with finding ways to meet their needs while using less water, carbon and land. We work with companies like Kraft Foods that are willing and able to influence the future of the planet by working to positively advance the way agricultural commodities are produced, bought and sold.” “Kraft Foods’ commitment to Fairtrade is helping to build a better future for many Carter Roberts, President and CEO, World Wildlife Fund, U.S. thousands of cocoa farmers, their families and their communities. Through this commitment, farmers can enjoy more secure, sustainable livelihoods. We look forward to building on this partnership to create a better future for even more farmers.” R ob Cameron, Chief Executive, Fairtrade Labelling Organizations (FLO) International FROM OUR PARTNERS INDEX CR EATING A MORE DELICIOUS WORLD | OUR 2010 REPORT a8 b H EALTH AND WELL-BEING HEALTH AND WELL-BEING: T oday, the world faces the paradoxical challenge of addressing both hunger and obesity. According to the World Health Organization, one in six people in the world EAT DELICIOUS, doesn’t get enough to eat.