In 2005 we focused on some specific targets. Here's how we performed against them:

1. Continue to advance in key indices of social responsibility. We again improved our score in the Dow Jones Sustainability Indices 2005. We also moved forward again in the 2004 Business in the Community Corporate Responsibility Index and have been included in the FTSE4Good Indices since inception. And for the second year, Pearson was ranked as a top 100 company in the Most Sustainable Companies in the World listing by Innovest.

2. Commission an independent review of social, environmental and ethical (SEE) processes. With an independent consultancy, we carried out a review of the SEE risk processes in our UK businesses. The review found that overall the current processes were appropriate, but made some recommendations to strengthen our approach which we are now implementing.

3. Work with UK media companies and industry bodies to benchmark measurements of good practice. We continue to work with the CSR media forum. This group consists of many of the major media companies in the UK and meets regularly throughout the year. We also presented our sustainable paper sourcing policy in the UK to other national newspaper publishers through the Newspaper Publishers Association.

4. Introduce independent verification for targeted areas of social responsibility activities. Our environmental review was independently verified and the statement can be viewed at www.pearson.com/environment. Pearson also joined with several UK publishing groups under the auspices of Publishers Resolution for Ethical International Manufacturing Standards (PRELIMS) to introduce a social accountability audit of the printers we use around the world. From 1 January 2007, none of the signatories to PRELIMS will use a printer who has not satisfactorily engaged in this process, by either achieving the standard or having in place an acceptable plan for improvement.

5. Complete the register of the environmental performance of our key printers. We have added further printers to our register during the year and this objective is broadly complete. This register is updated regularly.

6. Map the sources of wood, certification methods used and recycled content for the paper supplied to us for our books and newspapers. We have established a new process to receive annual returns data from our main global paper suppliers on the source, certification and recycled content of the paper we use. This information is helping us meet our commitments on improved certification of the paper we use. We continue to work with WWF UK Forest and Trade Network as we enhance our responsible paper sourcing practice.

7. Continue to assess key printers and paper suppliers against UN Global Compact standards. Our programme of supplier visits in China, India and elsewhere continued in 2005. Some existing plants were revisited, particularly where we had concerns, and the programme was extended to include South Korea.

8. Continue to reduce energy used in our buildings. We achieved progress towards our target of a 10% reduction in electricity and gas usage per square metre of our space, from 2003 to 2008. Energy use figures are included in our environmental review at www.pearson.com/environment.

9. Continue to recruit and promote people from diverse backgrounds as well as increase the number of women in senior management roles. In 2005 we created and circulated our 'diversity mid career hiring strategy' to senior managers in the UK and the US. Each company has been asked to develop an approach to encourage more recruitment from diverse backgrounds, especially in areas which are currently under-represented. Pearson hosted the first main event for the National Newspaper Diversity Forum (NNDF) in 2005 - the prize-giving ceremony for the School Journalism Competition. NNDF was set up in 2004 to generate more interest in journalism among under-represented groups in society and is chaired by David Bell.

10. Develop a strategic community partnership in the UK. Pearson is piloting a new community programme in the UK, giving a free book to every five year old in Warwickshire and Southwark in their first term of primary school. The programme aims to promote the pleasure of reading, encouraging children and parents to take time to read together. Pearson is working on the programme with Booktrust, an independent national charity. If the pilot is successful, the programme will be extended more widely across the UK in 2006.

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