CEO Message

I am pleased to introduce Incitec Pivot Limited's 2011 Sustainability Report, the third such report we have published. This Report marks a step change in the level of our reporting, being the first to use the Global Reporting Initiative's Guidelines for sustainability reporting, with the corresponding emphasis on materiality, transparency and data accuracy. Preparing this Report using these Guidelines allows our sustainability performance to be compared against others' and provides stakeholders with the information they need to make decisions such as whether to invest in our Company, whether to work with us and whether to buy our products.

This Report also marks the end of the first full year that our sustainability strategy has been in place. I'm pleased to report that our sustainability agenda of Use Less; Get Close; Be Responsible is being embedded across the organisation and we are starting to deliver results in the five keystone sustainability projects that form a core part of the agenda. Continuing work on these projects will remain a sustainability priority for the medium term.

We recognise that we are at the start of our sustainability journey. We also recognise that embedding sustainability into our core business processes is an essential part of being an ASX50 company that has operations in multiple countries around the world. As part of embedding sustainability into our core business processes we completed an assessment of our sustainability risks and opportunities, as detailed in the 'Economic' section of this report. We will continue to manage these as part of our ongoing business operations.

I am encouraged that we are on the right track - this year for the second time we were included in the Australian SAM Sustainability Index (AuSSI), part of the Dow Jones Sustainability Indexes (DJSI) family - the leading reference point in the growing field of sustainability investing. Our score increased in 2011 compared with 2010, recognising the importance of sustainability performance to the overall financial performance of our Company.

Our sustainability achievements for the year include a nearly 19% decrease in our workplace injury frequency rate, a 16% score improvement in our Employee Engagement survey results, over 800 employees completed our Leadership Development program, our environmental incidents remained low and we received no fines for non-compliance with environmental laws.

In 2011, the Australian Government introduced the Clean Energy legislative package. As a large greenhouse gas emitter in Australia, responding to the introduction of carbon pricing will be a key sustainability priority for us in the short term.

Our other short to medium term priorities will include our continuing work on achieving our safety goal, Zero Harm as well as building a high performance organisation through effective leadership and people processes. We also plan to release our reduction targets for greenhouse gas emissions, water use and waste to landfill that will drive our operations to be more efficient, in environmental terms, at converting raw materials into final product. The diversity of our workforce and of our leadership will continue to be an area of focus as will the continuous improvement of our manufacturing and business processes with our new business system, 'BEx'.

I believe this Report provides a balanced and reasonable representation of the sustainability performance of Incitec Pivot. I invite you to read it and welcome any feedback you may have.

James Fazzino
Managing Director & CEO
Incitec Pivot Limited