This is the tenth time we’ve given an account of our performance across a range of issues relevant to our pursuit of a sustainable future.

We have made very clear the priority we allocate to this goal by adopting, as one of just four key strategies which guide our whole approach to doing business, our commitment to “ensure sustainability through responsible long-term management”.

I mention that because it underlines what I have said in these reports previously about the indisputable linkage between operating in a sustainable way and business success.

Our reliance on good management might not sound terribly ‘exciting’ but it goes to the heart of the challenge we face. When all’s said and done, the outcomes achieved rely very much on the decisions and actions we take – whether it’s our Board authorising an expansion or involvement in a new industry sector, the diligence of an operator at a chemical plant or the initiatives Bunnings pursues with respect to water and climate change. There’s just no escaping our personal and collective responsibilities.

To that end, two of our four key values – integrity and accountability – have great relevance to the way we manage these issues. Without integrity there is nothing else and the concept of accountability goes to the very heart of the Wesfarmers’ business model. The people working in the very diverse set of businesses we own are given are a lot of autonomy but with that goes a high degree of responsibility.

This applies as much to the way people work in sustainability-related areas as it does to more directly financially-focused endeavours. We rely on them to do their jobs in an efficient and dedicated way and to contribute to the data which enables us to produce this report.

The Last 12 Months

Since we last reported there’s been an intense public and political focus on climate change and this has been reflected internally, including a detailed update to the Board at the Directors’ Seminar in May.

Our participation again this year in the Carbon Disclosure Project provides a detailed account of our approach to climate change issues and includes a breakdown of greenhouse gas emissions for the Group.

We made a submission also to the Prime Minister’s Task Group on Emissions Trading in which we advocated the development of a truly global scheme to link national and regional schemes. Our contribution to the industry-led Coal21 Fund, aimed at developing technological answers to emissions from coal-fired power stations, has doubled to a likely $30 million over the next 10 years.

In a new initiative, we commissioned a Group-wide assessment of greenhouse risks and opportunities from a leading external consultant. This report will be considered in coming months and will provide a basis for future action.

Bunnings took a big step forward on sustainability during the year with a major upgrade to its water-focused strategies and the adoption of a goal to achieve carbon neutrality by 2015 or earlier.

Regrettably, we have not done well enough on safety. While some businesses improved, for the second successive year the Group-wide performance deteriorated. The accountability and responsibility to which I referred earlier is never more important than in the context of safe workplaces. While I don’t doubt for a moment the level of commitment of all our employees there simply has to be better implementation of our comprehensive safety systems.

Looking Ahead

As ever, we must continue to improve. But that’s an expected and exciting challenge for motivated people in a company that is always casting its eyes beyond the horizon.

My thanks to everyone at Wesfarmers for their efforts over the past year. I have no doubt that dedication will continue and I look forward to a very productive 2007/2008.

We would very much like to know what you think about our performance and its reporting through this document so please get in touch via the feedback form at the back or by making a comment on our website.