Corporate Social Responsibility: The Right Thing to Do

At Inco, our mission is to continue to make progress toward our goal of being the world’s most profitable nickel producer. We will do that by running our business effectively and efficiently – and by being an ethically and socially responsible company.

For Inco, this means being principled and transparent in our business dealings. It means being a fair and welcoming employer. It means operating in a manner that enhances the economy and respects the environment and society. And it means conducting our affairs in an inclusive fashion, one that recognizes and accounts for the needs of our wide-ranging Communities of Interest including, shareholders, indigenous peoples, customers, employees, host communities, governments and non-governmental organizations (NGOs) with a legitimate interest in our business.

In 2003, we were gratified to be included in the FTSE4Good and Storebrand Investments stock indices of socially responsible companies. At the same time, we recognize that we still have a long way to go – and we'll keep working to meet the stakeholders' expectations wherever we operate.

Put simply, our aim, as a responsible company, is to be a good neighbour and good citizen – wherever we operate in the world.

This, our first Social Responsibility Report, represents the third pillar in our efforts to inform our Communities of Interest about our various activities. Our Annual Report presents a picture of our business and financial results, challenges and prospects. Our Environmental, Health and Safety Report chronicles our ongoing commitment to continuously improving our environmental, health and safety performance.

It is the job of our Social Responsibility Report to document our efforts to serve the greater community. At Inco, we recognize that social responsibility is an ongoing commitment and an ongoing journey.

The Making of Our Report

This report, our 2003 Corporate Social Responsibility Report, highlights our progress and performance in meeting our social responsibility priorities at our global operations over the past two years.

During the development stages of this report, we reviewed emerging international guidelines for corporate social responsibility (CSR) reporting, including the Global Reporting Initiative (GRI) guidelines. We additionally consulted widely across our company and with external sources including San Francisco-based Business for Social Responsibility.

While this document reports on our CSR performance in many of the areas outlined by GRI, we have chosen to structure this report to reflect the social responsibility priorities facing our company. Specifically, we have focused the content on the critical areas of aboriginal relations, community development, our ongoing work with our Communities of Interest, product stewardship, responsibility to our employees and our overall socio-economic contribution. In this inaugural report, we are providing more of a historical compendium, or ìprimerî about our activities than we will provide in future annual social responsibility reporting initiatives. Similarly, we expect that this report will evolve and strengthen over time, including the scope of metrics and performance targets against which to assess our social responsibility performance in the future. We have included performance highlights for 2002 and 2003 in this inaugural report to capture the unique community initiatives and activities during our centennial year.

This our first corporate Social Responsibility Report focuses on our operations in Canada, the United Kingdom, the United States and Indonesia and our development projects in northern Labrador, Canada and in New Caledonia in the South Pacific. As part of our commitment to continuous improvement in our transparency and disclosure efforts, it is our intention to report on social responsibility activities pertaining to our ISO 14000-certified, smaller Asian joint venture operations, as they arise in the future.

• Signed Impact and Benefits Agreements with Innu Nation and Labrador Inuit Association that are providing extensive training, employment and business opportunities as well as other benefits to aboriginal people.
• Completed our $10 million (Cdn.$15 million) multi-year pledge to the Labrador Health Centre in Happy Valley-Goose Bay, Labrador.
• Donated $850,000 (Cdn. $1.2 million) to the Innu Healing Foundation Building Hope Campaign.
• Pledged $1.4 million (Cdn.$2 million) to the Heart and Soul Campaign for health care facilities in the Sudbury, Ontario region.
• Contributed approximately $3 million through PT Inco to local communities in 2002 and 2003, funding over 70 distinct community development programs in Sorowako and the Southeast and Central Sulawesi regions of Indonesia.
• Initiated discussions with local communities in New Caledonia for the development of a Good Neighbour Agreement at our Goro Nickel development project.
• Advanced a 10-year, $1.8 million (Cdn. $2.5 million) community development initiative to assist the Thompson, Manitoba, community plan for the future.
• Received listings on the FTSE4Good and Storebrand Investments stock indices of socially responsible companies.

All figures are in U.S. dollars unless otherwise stated.