Regular and open two-way communication with employees is vital to the success of the new Invensys. CEO Direct, a weekly message from the Chief Executive, is distributed to all employees and is complemented by 'ask.rick', an email channel by which employees can put their questions and concerns directly to Rick Haythornthwaite and receive a personal response.

In December 2001, an employee communications survey was completed by over 24,000 of our employees and we are acting on the findings. Communications skills training is being planned to ensure that employees are kept well informed by their local managers. The communications programme that accompanied the announcement of our new organisation began this process. Prior to the announcement, we gathered senior managers in Washington to explain the new strategy. These people were identified as key links to employees worldwide and worked with over 400 site managers to ensure that all employees received a full explanation of the strategy and its relevance to their roles. All presentation material was translated into ten languages, including a video message from the Chief Executive explaining his vision for the Group's future.

Our new strategy depends on building a strong customer culture and on developing the skills of our people. To help us define our existing capabilities, we carried out an assessment of the training needs of line managers and senior executives in late 2001. This information was then used in our strategy review. Following the strategy announcement, we began to develop the systems required to align our employees behind our corporate goals. These systems will reward results, foster skills and expertise and ensure that service levels are consistent. They include processes for leadership development, career structure and succession planning, including performance measures and targets for employees.

We continue to give strong support to the Invensys European Employees' Forum which was established in 2000 under the terms of the 1994 European Works Council Directive. This Forum serves as an important channel for debating major issues that affect the well-being of our employees.

In line with our commitment to the highest standards of ethical behaviour, our senior managers are required to report each year on legal and ethical compliance within their business units and the progress made in training and communicating these expectations to employees.