Our definition of "doing the right thing" is also evolving. It is no longer enough for companies to do "less bad" by reducing their environmental footprint. At Alcan, we are Taking the Next Step by focusing our Corporate Sustainability framework on "doing more good". Whether it's through the design and application of innovative products or by building long-term partnerships through our stakeholder engagement efforts, we are working to integrate sustainability into all aspects of our business.

In 2003, we illustrated this commitment in a number of ways, including the formation of a cross functional, senior level Sustainability Steering Team to guide our efforts. We also joined the United Nation's Global Compact, which brings companies together with UN agencies, labour and civil society to support ten principles in the areas of human rights, labour, the environment, and anti-corruption.

Furthermore, we realigned our corporate Community Investment Program towards sustainability-related initiatives and we introduced the Alcan Prize for Sustainability, an annual US$1 million award to a not-for-profit, non-governmental, or civil society organization working to make the world a better place. We have received nearly 500 applications from 79 countries for this prize, which are now being reviewed by an independent panel of experts convened with the help of our managing partner, the Prince of Wales International Business Leaders Forum.

In a similar vein, we are the lead corporate sponsor of the +30 Network Sustainable Cities Project aimed at understanding the impact of today's urban planning decisions on the world one hundred years from now.

Alcan has been selected as a member of the Dow Jones Sustainability World Index for the fourth time in five years. The Index also recognized Alcan as leading the aluminum industry. As our efforts are acknowledged, it has become very clear to me that our governing objective of Maximizing Value more than increases profits and economic growth. It also maximizes the value we create for society. Altogether this has a positive long-term impact on our shareholder value.

Integrating sustainability into our business is not an easy path to take – it requires a senior-level commitment, the understanding, resourcefulness and dedication of our employees, and a consistent and long-term approach to partnering with our stakeholders. Our sustainability framework is firmly entrenched and supported at all levels of the organization through the three components of Alcan's Integrated Management System (AIMS): Maximizing Value, Continuous Improvement, and our commitment to environment, health and safety excellence through EHS FIRST.

Value creation, informed by our sustainability business model, drove our investment decisions in 2003 such as the agreement to acquire VAW's packaging business, the acquisition of Baltek with its balsa plantations in Ecuador and the successful completion of our purchase of Pechiney. You will find details on these important investments and major changes in the following pages. You will also see how sustainability at Alcan has evolved over the past three years through the various business group actions, innovations and relevant performance data.

The growth and changes in our portfolio of businesses inevitably present sustainability challenges. For example, because of the Pechiney combination and other restructuring, some employees have lost jobs. We are doing all we can to support these employees through the transition. As we pursue opportunities in new regions such as China, we see great promise and also challenges in applying our sustainability business model to rapidly changing and industrializing areas. Wherever and whenever these challenges arise, we try to manage them responsibly. In many cases we have exceeded expectations, in others we still have work to do.

Events over the past few years have underscored for me the necessity for governments, industry and concerned stakeholders to work together to protect and preserve our planet. No nation, company or individual has the right to create wealth at any cost. Corporations throughout the world have a unique role to play and an inescapable duty to the larger community to wisely manage their resources, ensure the health and safety of their workers and communities and, through their products and services, contribute to the improved well-being of our society.

Through Taking the Next Step, we hope to develop a better understanding of the link between sustainability and maximizing value. We are not simply "talking the talk" – we are on the fast track to "operationalize" sustainability throughout Alcan for the benefit of current and future generations and the company, today and tomorrow.