We remain committed to our founders’ values of quality, service and fair dealing. This has contributed to our success. Although business conditions change with time, our high ethical standards remain constant.

To secure the trust of our shareholders, employees and other interested parties we must manage our business responsibly. This means identifying and managing risks to our success as well as seizing opportunities.

Our board of directors and senior management are accountable for ensuring good corporate governance. K-C’s board of directors has 11 independent members, in accordance with the New York Stock Exchange listing standards. Our Chairman and CEO is the only board member not considered independent. Our Audit, Nominating and Corporate Governance, and Management Development and Compensation Committees consist entirely of independent board members. The Nominating and Corporate Governance Committee periodically reviews our Corporate Governance Policies. Our Code of Conduct and corporate policies inform our employees that we expect consistent, ethical behavior and compliance with applicable laws. The Code and policies apply worldwide.

Employees can report violations on our intranet website. Employees in 56 countries can also report possible violations of the Code using an anonymous, 24-hour telephone hotline. Each year, we send out a notice to employees to remind them of the Code. In 2007, we received 31 reports via the Code of Conduct telephone hotline or our intranet website. All were investigated; 16 were classified as founded, 15 as unfounded. Appropriate disciplinary action ranging from a reprimand to employee termination was taken for all founded violations.