Dear Shareholders,

Robert A. McDonald, Chairman of the Board, President, and Chief Executive Officer

P&G’s Purpose–to touch and improve lives, now and for generations to come–is inspiring and pervasive. Our Purpose is tightly and deliberately linked to our business and financial goals: P&G’s Purpose inspires our strategic choices; it leads us to bigger and better innovation; it drives brilliant execution; and it compels us to make a difference in areas such as sustainability and social responsibility not merely to be a good citizen, but more importantly, to create future opportunities to touch and improve lives–and, in so doing, to keep our Company growing.

Last year, we updated P&G’s growth strategy to connect it explicitly to our Company’s Purpose. We focused on three specific choices: to grow P&G’s core brands and categories with an unrelenting focus on innovation; to build our business with unserved and underserved consumers; and to continue to grow and develop faster-growing, higher-margin businesses with global leadership potential.

These strategic choices are unified by one simple, over-arching growth strategy: to touch and improve the lives of MORE CONSUMERS in MORE PARTS OF THE WORLD, MORE COMPLETELY. We’ve made this the centerpiece of our leadership agenda because we believe a Purpose-inspired growth strategy is intrinsically rewarding and motivating. It unleashes creativity, commitment and peak performance in P&G people. It attracts talent and partners. It builds goodwill with external stakeholders.

We are executing across all three dimensions of this growth strategy on all of our businesses around the world. The Company’s performance in the 2010 fiscal year, and the strength with which we have entered the 2011 fiscal year, demonstrate that our Purpose-inspired growth strategy is working.