This year we've implemented several
innovative campaigns to promote the
restoration of natural resources.

Environmental Sustainability

Our Environmental Commitment. Kellogg Company is committed to minimizing the environmental impact of our businesses while being socially and economically responsible.

At Kellogg we strive to conduct and grow our business in a manner that protects the environment and demonstrates good stewardship of the world's natural resources. We work toward continual improvement through the development of specific programs that address the environmental cost and impact of our activities, products and services. These programs include a commitment to use resources efficiently, minimize waste, and promote resource conservation.

Energy Improvements and Climate Change. In 2006 we implemented a global energy-management program to promote conservation, manage energy use, and investigate energy savings opportunities, including alternative fuels and renewable energy.

In the U.S., Kellogg joined the Environmental Protection Agency's (EPA) Climate Leaders program, a voluntary government-industry partnership designed to measure and reduce greenhouse gas (GHG) emissions. The EPA works closely with each company in the program to review its GHG Inventory and Inventory Management Plan and provide guidance in setting a GHG emissions reduction goal. Kellogg Company's primary source of GHG emissions is the use of energy at our manufacturing facilities and in our transportation fleet.

Focusing on efficiency improvements in our operations has helped reduce our energy consumption, thereby reducing our GHG emissions. Our energy use per pound of product produced has declined by more than 15% during the past 10 years.

Our Global Logistics team aggressively searches for ways to deliver more products with fewer vehicles and less energy use. Casesize adjustments, use of intermodal transport, and product sourcing choices all contribute to our saving thousands of gallons of fuel annually. For example, 8 million truck miles have been eliminated by making a case-size change for several cereal products. In addition, our fleet vehicles automatically shut down after five minutes of idle time.

Packaging Efficiency. Our packaging serves many important functions, such as protecting our products, maintaining freshness and providing a means to communicate to consumers.

Using advances in technology, our packaging team has proactively minimized packaging, reduced liner weight and paperboard quantity by millions of pounds annually. For example, 25 million pounds of paper packaging have been eliminated through a waste reduction initiative associated with bulk material shipping. By taking out the board on Special K bars, we've eliminated 4 million pounds of packaging, and liner reductions in 2006 eliminated more than 3 million pounds of plastic packaging.

Donna Banks
Senior Vice President
Global Innovation and Chief
Environmental Officer
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