here - P&O Cruises

sustainabilityreport2011publishedaugust 2012‘ sea thechange’cruisingthe pacific

SYDNEYNoumeaMareIsle ofPines2011community leaders from some ofthe most beautiful pacific islandswere brought together for the first time inmany years in 2011 to help the leaders of Mare addressthe potential economic opportunities of cruising to theircommunity.P&O Cruises engaged community leaders from Lifou,Noumea and the Isle of Pines as part of the preparationfor the arrival of the first P&O Cruises’ ship. Overcomingprevious disunity between the communities, the meetingenabled Mare’s community leaders to understandthe experiences of others in the development of newbusinesses, running shore tours and offering shopping andentertainment to passengers.The meeting followed the preparation of a RemoteDestination Management Plan to identify sustainableoptions for cruise ship tourism to Mare. The need fora special jetty and boardwalk to protect the pristineenvironment of Tadine Harbour was identified during theplanning phase, with its construction funded by LoyaltyIslands Province. The jetty will be completed by NewCaledonian tradespeople in preparation for the arrival ofthe Pacific Jewel on the first port call in April 2012.fourisland communities

contentssustainability at P&O Cruises 5about P&O Cruises 6key achievements 2011 8a message from ann sherry 10our approach to sustainability 12opening up the pacific - 1930s 16ECONOMIC SUSTAINABILITY the economics of cruising 18• Economic contribution • Sharing the benefits• Our suppliers• 2012 Goals• Impacts in portjourneys of discovery - 1933 to 2011 22PRODUCT SUSTAINABILITY the passenger experience 24• Passenger satisfaction • Our passengers ashore• Health, safety and security • 2012 Goals• Onboard healthcareafter the war and across the pacific - 1940s to 1960 28cruisingthe pacificPEOPLE SUSTAINABILITY the P&O people 30• Our workforce• Performance management• Supporting and improving • Rights and representationour workforce• Employee health and safety• Development and training • 2012 Goalscruise season comes to the pacific - 1960s to 1980 36ENVIRONMENTAL SUSTAINABILITY reducing our impact 38• Protecting our destinations • Energy & carbon• Onboard improvements • Water• Environmental standards • Waste• Roles onboard• 2012 Goalsthe pacific playground - 1980 to 2000 44SOCIAL SUSTAINABILITY citizen P&O 46• Make-A-Wish• Other support• Lifeline Australia• 2012 Goals• Cathy Freeman FoundationCover image:Trobriand Islands,Papua New Guinea.Courtesy of DavidKirkland.21st century cruising - 2000 to 2012 50goals and commitments 52GRI INDEX 56

Mark kCollar, Class of 1971Xavier High School Achievements• Class Salutatorian• 7 Varsity Letters in Football,Basketball, Track and Golf• Miller & Tennyson Award Winner• All‐Conference Football; CaptainSenior Year• All‐Conference Basketball; CaptainSenior YearMark Collar (42) out‐leapshis Fox Valley opponents foranother of many rebounds.

292,000 passengers2.6 million passenger cruise days411,156 nautical miles travelled607 calls in 58 different ports563 different shore excursionsPacific JewelBuilt 1990 – joinedP&O Cruises in 2009WeightLengthWidthDraftDecksSpeedPropulsionPassengers 1,900Crew 73470,310 tonnes245 metres32.2 metres8 metres14 in total;11 passenger decks22.5 knotsDiesel-electricPacific Sun 3Built 1986 – joinedP&O Cruises in 2004WeightLengthWidthDraftDecksSpeedPropulsionPassengers 1,850Crew 68047,678 tonnes233 metres28 metres7.6 metres11 in total;9 passenger decks21 knotsDiesel3Pacific Sun will leave the P&O Cruises fleet in July 2012.7 | P&O Cruises 2011 Sustainability Report

keyachievements2011cruisingthe pacificWe are dedicated to thesustainable developmentof cruising in the PacificIslands and understand theimportance of deepeningour relationship with thecommunities where weoperate.40%increase inunique shore tours27.5%increase in passenger numbersonboard crew members from the Pacifi2288 | P&O Cruises 2011 Sustainability Report

5%reduction infuel used peravailable lowerberth kilometre7%14% reduction incarbon emissions perpassenger cruise dayreduction in daily water consumption per personc Islandscruisingthe pacific89%44%30%increase in port calls31%increase innautical miles travelledcruisingthe pacificincrease in passenger cruise days4customer satisfaction$828millioncontributionto theAustralianeconomy bythe Australiancruise sector4The total of passengersmultiplied by the number ofdays they spent cruising.ourvision issustainablegrowth

a message fromann sherrycruisingthe pacificWelcome to P&O Cruises’ third annualSustainability Report covering activitiesin 2011 to address our environmental,economic and social impact in Australia,New Zealand and the Pacific Islands.It comes as P&O Cruises is poised tocelebrate a major landmark in 2012 – theeightieth anniversary of cruising in a regionthat is now at the heart of the world’sfastest growing cruise market.This document is more than a progressreport on sustainable tourism in theSouth Pacific, an area where for yearsisland communities have welcomed ourpassengers like members of their extendedfamilies.It certainly provides a benchmark againstwhich we can record measurable outcomesand achievements from year to year.There is also a human dimension to theP&O Cruises’ Sustainability Report.Central to it is a commitment to make areal difference in the lives of Pacific Islandcommunities and the other communitieswhere we visit.It is there for all to see in our recruitmentof onboard staff from the region and thepossibility of career opportunities forgraduates from the University of the SouthPacific.Again it is there in partnerships withinternational agencies and local authoritiesto build cruise facilities and help islandcommunities develop businesses linked tocruise tourism.The people dimension also comes to thefore as these communities increasingly seethese ventures as a way to stop the drift oftheir young people away from their islandhomes.At an operational level, we have furtherreduced our environmental footprint whileincreasing capacity in terms of cruises andpassenger numbers.In 2011, we achieved a 27.5% increasein passengers, a 44% increase in passengercruise days, a 31% increase in nautical milestravelled, a 30% increase in port calls and a40% increase in unique shore tours.But at the same time we madeconsiderable savings in the fuel consumptionrate across an expanded fleet, reduced blackwater discharge at sea and vastly increasedthe recycling of hazardous waste.We are pleased with this improvement forsuch important environmental measures butwe are similarly proud of the positive impactwe are having on the lives of communitieswhom we value so greatly.By 2013, nearly a quarter of a millioncruise passengers will visit the PacificIslands, many on them on ships in theP&O Cruises’ fleet.By our actions and partnerships, we wishto ensure that the warm welcome ourguests have received for nearly 80 yearswill continue for new generations of cruisepassengers.Ann Sherry AOChief Executive OfficerCarnival Australia@pacificann12310 | P&O Cruises 2011 Sustainability Report

...a commitmentto make a realdifference in thelives of pacific islandcommunities and theother communitieswhere we visit

our approach tosustainabilityat P&O Cruises, sustainabilityis a way of doing businesscruisingthe pacificAfter 80 years in the Pacific, we knowoperating in a sustainable and transparentmanner is the only way we can continue toprovide passengers with memorable cruiseholidays in some of the world’s most idyllicand hard-to-reach locations.We understand that our success relies onpreserving the environment, respecting ouremployees and supporting the communitieswhere we operate. To us, sustainablemanagement means remaining a strongand successful business that fulfils ourobligations as a responsible employer,business partner, customer and neighbour. Itmeans operating as a responsible citizen ina global community in a way that minimisesour environmental footprint and deliverspositive benefits to Australia, New Zealandand the Pacific Islands.We act with integrity and accountability,working in partnership with others. Ourgoal is to exceed the relevant laws andsurpass community expectations throughethical work practices and good corporategovernance. Again in 2011, P&O Cruises didnot receive any fines or sanctions for noncompliancewith laws or regulations.Code Of ConductOur Code of Business Conduct and Ethicsrequires that every employee is responsiblefor adhering to business practices thatare in line with the letter and spirit ofthe law and with ethical principles thatreflect the highest standards of corporateand individual behaviour. All P&O Cruises’employees (100%) received Code ofBusiness Conduct and Ethics training during2011, covering the purpose and applicationof the Code, employee responsibilities,sustainability and commitment to guests,vendors and each other.All employees at manager level orabove in relevant departments, such asfleet operations, hotel, logistics, trainingand corporate affairs, also receive specifictraining in anti-corruption covering dealingswith port agents, vendors and otherthird parties, gifts and sponsorships, andfacilitating and duress payments such aspolitical and charitable contributions.Training in anti-trust laws is also providedfor all employees at Director level andabove and all employees in the sales andmarketing departments. Eighty-sevenemployees, comprising 24.3% of ourshoreside workforce, received this trainingin 2011.On an ongoing basis, all employeeshave access to the following policies andguidelines through the company’s intranet:• Policy against Improper Payments andBribes• Anti Bribery and Corrupt Practices Policy• Antitrust Policy and Guidelines• Code of Business Conduct and Ethics• IT Security Policy• Password Policy• Confidentiality PolicyStakeholdersOur stakeholders include those with whom12 | P&O Cruises 2011 Sustainability Report

GOVERNMENTSCOMMUNITIESCHARITIESSPECIAL INTEREST GROUPSourpassengersourstakeholdersouremployeesoursuppliersIMPACT}SOCIALECONOMICENVIRONMENTALwe have direct relationships such as ourpassengers, employees and suppliers, aswell as the governments, communities,charities and special interest groups inplaces where we operate. We acknowledgethe social, economic and environmentalimpact we have on these stakeholdergroups and take seriously the considerationof these impacts in our decision making andoperations.P&O Cruises engaged with governmentsat varying levels in Australia and NewZealand, and across the Pacific, in 2011.We contributed to public policy throughconsultations at a senior level, directsubmissions and through key industryassociations, and addressing some of thekey challenges facing our industry.Our Code of Business Conduct and Ethicssets minimum standards in relation tovendor selection, intellectual propertyand commercial rights. Details regardingour performance in relation to theeconomic contribution of P&O Cruises,our environmental and social impact, andperformance in relation to key workforcemeasures are contained within the relevantsections of this report.PrivacyOur Code of Business Conduct and Ethicsincludes requirements in relation to thesafeguarding of property and information.We do not require passengers to discloseany personal information beyond what isstrictly necessary to make a cruise booking.Where personal information is collectedfor marketing or promotional purposes, weoffer the choice to unsubscribe as requiredby legislation. Before providing any thirdparty with access to personal or otherwiseconfidential information, a non-disclosureagreement is required to be signed anddue diligence is carried out to ensure thatthe third party’s data handling practices areprivacy compliant. Policies are in also placeregarding IT security and confidentiality.No substantiated complaints regardingbreaches of customer privacy and losses ofcustomer data were received during 2011.Anti-discriminationThe P&O Cruises’ Code of Conduct for allshipboard employees covers discrimination,bullying and harassment. All employeesare made aware and receive training onthese policies and, by signing the CrewAgreement, each crew member agrees toconform with them.The Code outlines the basic rules ofreasonable behaviour expected fromall staff. The Company’s policy prohibitsdiscrimination based on gender, colour,race, age, national origin, ancestry, maritalstatus, religion, sexual orientation or otherprotected status.The company comment procedure givescrew the ability to report a commentverbally or in writing onboard either totheir supervisor, the People & PerformanceManager or Head of Department. Complaintscan also be addressed to shoresidecruisingthe pacific13 | P&O Cruises 2011 Sustainability Report

our approach tosustainabilitycruisingthe pacificmanagement via the Compliance Hotline.Shoreside employees work under our EEO,Discrimination, Bullying and HarassmentPolicy. The policy defines discrimination,the expected conduct of employees inthe workplace, employee and employerresponsibilities and how P&O Cruises dealswith EEO, discrimination, bullying andharassment in the workplace.No incidents of discrimination occurredeither shipboard or onshore at P&O Cruisesduring 2011.Safety and securityThe safety and security of our passengersand crew is paramount. No incidents of noncompliancewith regulations and voluntarycodes concerning health and safety impactsof products and services were reported in2011.We support and adhere to all of therelevant international safety standardsfor ocean-going cruise ships setby the International Conventionfor the Safety of Life at Sea(SOLIS). We also comply witha comprehensive set ofCorporate Safety Standardsestablished by CarnivalCorporation that go beyondregulatory requirements tofurther ensure the safety ofour guests, ship personnel andships.Boat and fire drills, safetyvideos, regular testing of onboardequipment and procedures are allpart of our approach to passengersafety. All shipboard personnel aretrained to competently perform their safetyfunctions and support passengers in bothroutine and emergency situations.Our ships are also subject to internationalregulations and guidelines of theInternational Ship and Port Facility Security(ISPS) Code. We are proud to report thatall of our ships meet or exceed theseregulations.We also meet or exceed the domesticsecurity regulations of the countries we visit,and work closely with police in Australia,New Zealand and the Pacific Islands toimplement clear protocols for managingcrimes at sea. Additional measures toaddress safety and security onboard ourships include the use of CCTV cameras,a zero tolerance approach to excessive14 | P&O Cruises 2011 Sustainability Report

we recognise ourresponsibility toprovide industryleadership and toconduct our businessas a responsiblecitizenbehaviour and ‘Responsible Service ofAlcohol’ policies including closing bars inthe early hours of the morning, banningcrew commissions for alcohol sales, andcompulsory training for all crew.Security personnel responsible formonitoring and enforcing security policiesare employed on each ship. Access to ourships is strictly controlled and all people,parcels, and supplies boarding a ship mustpass through a screening checkpoint toensure no prohibited items are broughtonboard.Senior officers and crew onboard ourships have also received training incorporate manslaughter, focusing onthe responsibilities of the company andindividuals to ensure passenger and crewsafety and access to medical care in theevent of an incident.Managing risksP&O Cruises actively manages for risk.As a cruise line, our business faces risksthat include weather conditions, marinerisks, political unrest in one or more of ourdestinations, and strategic business risks.We have a range of risk mitigation policiesand procedures. These include, but are notlimited to:• Operational and marine risk policiesrelating to ship maintenance;environmental protection; health,safety and security; food handlingand preparation; crowd managementprocedures and route planning. These risksand policies are assessed and analysedevery month, and include our DisasterRecovery Plan, Emergency ResponseTeam and CARE Team deployed to providespecialist support to passengers, crew andtheir families if incidents occur.• Strategic risk management is overseen byour Risk Management Committee, whichmeets monthly to assess emerging risks.We monitor our external environmentand respond where necessary to changesin legislation or port operations that mayhave an impact on our business.We manage risk by ensuring that ourpolicies meet or exceed legal requirements,that the training, skills and staffing areavailable to ensure they are implemented;and that our performance in risk mitigationis constantly reviewed.The risks associated with climate changefor P&O Cruises include changing weatherpatterns, rising sea levels and increasedenvironmental pressure on Pacific Islandsand other coastal communities. We areresponding to these risks by reducing ourown carbon footprint (see page 41) wherepracticable and engaging in the relevantpolicy discussions. Carnival Corporationreports separately on the global risks and itsresponse in relation to climate change.Another external risk with the potential tohave an impact on our business and thosewho rely on us is political unrest at any ofour destinations. We monitor the social andpolitical stability of our destinations and, ifrequired, would re-route ships to avoid anyareas of potential risk. This not only impactsthe communities we visit and the passengerexperiences, but also poses the risk ofincreased fuel consumption to avoid troublespots. During 2011, we were not required tore-route any cruises due to political unrest.cruisingthe pacific15 | P&O Cruises 2011 Sustainability Report

AlotauSamarai &Kwato IslandsDoiniIslandCooktownCairns(Yorkeys Knob)P&O Cruises brochure, 1930P&O Cruises itinerary, 2012Brisbanetaking the RMS Niagara to Fiji, where herecommended Suva, Lautoka and Savusavuas possible ports of call, being mostimpressed with the local band in Suva,which played the ships in and out of port –hired at the cost of £8.Travelling through Samoa to the FriendlyIslands – named for the friendly receptionextended to Captain James Cook in 1773 butnow known as Tonga – Butler recommendedboth Vava’u and Nukualofa for theirattractions and friendliness, but stronglywarned against extreme navigationalproblems, currents and winds. In Vanuatuhe considered Santo and Vila to be idealdestinations with further development, aview confirmed by their popularity today.Butler’s journey of discovery is repeatedeach time P&O Cruises opens up a newdestination. His 1934 assessment ofSamari Island was repeated in 2011 whenP&O Cruises investigated opportunitiesto return to Papua New Guinea. Butler’sassessment – a place of excellent diving,swimming and magnificent scenery butdifficult to access due to sunken reefs – issimilar to the findings of our explorationparty this year. Our party saw it as a placewith “potential to be a quality destination”but with works required to enable adequateaccess for today’s superliners.Butler found the Trobriand Islands in PapuaNew Guinea “unsuitable due to the dangersto ships with 30 foot draughts as islandswere ten miles east of charted positions”.But today those barriers have beenovercome and the Trobriand Islands willfeature for the first time on a P&O Cruises’itinerary in 2012, offering amazing culturalexperiences as well as swimming andsnorkelling.cruisingthe pacific17 | P&O Cruises 2011 Sustainability Report

ECONOMIC SUSTAINABILITYP&O Cruises is the largest cruise line in theworld’s fastest growing cruise marketcruisingthe pacificThe Australian cruise industry grewby 34% to 623,294 passengers in 2011, 5tripling in just five years putting Australiasecond only to the United States in termsof market penetration. Australians spent6.5 million days at sea in 2011, up 36% on2010. Cruise passenger numbers have grownby more than 23% annually on averagebetween 2007 and 2011, with the Australiancruise industry well on target to reach onemillion passengers by 2020.It’s a similar story for New Zealanders,with the numbers of people taking a cruisemore than doubling in the past five yearsto 56,479 in 2011. 6 Almost70% of all cruises takenby Australians and NewZealanders are to regionaldestinations, with thePacific Islands remainingthe top drawcard withover 40% growth inpassenger numbersto more than 250,000in 2011. This growth inpassengers is matchedby significant growth in theeconomic contribution of the cruiseindustry.Economic contributionWe estimate that every time a ship turnsaround in port, it delivers an estimateddirect and indirect economic impact ofmore than $A500,000. For the Australianeconomy in 2011, this meant a value-addedcontribution of $828 million from cruising, up44% from $570 million in just three years.The economic contribution of thecruise industry is broad and far reaching.The industry employs more than 7,200employees, paying over $470 million inwages to both local and internationalstaff and crew. Along with vessel-relatedexpenditure such as port charges, towagecharges and passenger-related expendituresuch as security and baggage handling,the industry makes a direct economiccontribution to the Australian economyalone of over $790 million.Our economic contribution also includesthe meals, tours, entertainment andshopping activities undertaken by ourpassengers and crew onboard and at eachport we visit.Our suppliersThe purchase of food and beverageconsumed onboard, hotel supplies, safetyand operational equipment, and themarketing and promotion of cruises in ourhome markets of Australia and New Zealandensure the economic contribution extends toboth small and medium enterprises as wellas large suppliers.Indirectly, the demand for goods andservices generated by the Australian cruiseindustry contributed another $178 million inwages paid to almost 2,700 FTE employeesin other sectors.The spectacular growth of the cruiseindustry in Australia, New Zealand and18 | P&O Cruises 2011 Sustainability Report

eaching the cruise industry’s potential economiccontribution requires appropriate port infrastructure to meet the needs of increasingpassenger numbers and larger ships. Infrastructure limitations, particularly in Sydney andBrisbane, and rising port and fuel costs, may limit the future growth of the sector.P&O Cruises is actively working with governments across Australia, NewZealand and the Pacific Islands to identify the best ways to meetthese future needs to ensure the economic sustainability ofthe sector and the businesses, employees andcommunities that rely upon it.2011 pacific islands economic initiatives:Development of a Remote Destination Management Plan for Mare in the Loyalty Islands, including•new economic opportunities for the local community.Completionof an amenities block and jetty on Mystery Island, and planning for a bbq areaAssessment of potential new destinations to increase tourist access to Papua New Guinea,•including options for replanting native vegetation.A new partnership with the New Zealand Aid Programme to promote local development bydeveloping a model to ensure local communities in the Pacific can takeadvantage of opportunities arising from cruise ship visits, with income usedfor community development. The partnership also involves surveys to update navigational charts toenable cruise ship operators to open up new routes in the Pacific; and rolling out the South PacificRegional Handicrafts Project to help women handicraft providers better match demand and supply,and improve marketing of their products.the Pacific Islands, and its impact on theeconomies of the region, is forecast tocontinue with one million passengersexpected by 2020. Increasing passengernumbers, vessel numbers, port calls andsea days will continue to support the stronggrowth in the cruising industry despiteforecasts of a generally weaker tourismmarket.With around half of all Australian andNew Zealand cruisers travelling withP&O Cruises in 2011, our economiccontribution is significant, and is matchedby our firm commitment to making a longtermcontribution to the Australian andNew Zealand economies and to protectingthe economic interests and unspoiltenvironments of the Pacific Islands.5International Cruise Council of Australasia 2011 AustralianCruise Industry Report. Includes all Australians taking cruiseholidays worldwide.6International Cruise Council of Australasia 2011 NewZealand Cruise Industry Report.portthe growthin economiccontribution tothe Australianeconomy between2007-08 & 2010-11:44%$A500,000every time a ship turnsaround in port, it deliversan estimated direct andindirect economic impactof $A500,000.19 | P&O Cruises 2011 Sustainability Reportcruisingthe pacific

cruisingthe pacificAs the largest cruise line in the Pacificregion – carrying more passengers moreoften to more Pacific Island ports than anyother operator – P&O Cruises’ economicimpact travels far beyond the decks of ourships or the ports we visit.Eighty years since the first P&O Cruises’ship arrived in Noumea, Pacific Islandersnow find their island homes at the heart ofone of the world’s fastest growing cruisemarkets, with cruising rapidly becoming anintegral part of the economic sustainabilityof their communities.Impacts In portIn 2011, P&O Cruises ships made 607 portcalls to 58 different ports in the region,including a number of Pacific island locationssuch as Wala and Pentecost that are notvisited by any other cruise company.Our visits are critically important to thelocal economies. Each time a P&O Cruisesship visits, these ports receive an economiccontribution through port fees and directtourist spending, that translated to around$34 million in direct spending as a resultof cruise ship visits to the Pacific Islandsin 2011 and an estimated further $15-$20 million in indirect spending to touroperators, bus drivers, stall holders andother local businesses. The direct economiccontribution of all cruising to the PacificIslands is expected to reach $A100 millionwithin 10 years, and up to $A150 millionthrough the multiplier effect of additionaljobs and related business activity.Sharing the benefitsWe believe the economic benefitsof cruising should be shared with thecommunities of the places we visit, and theyshould have the key role in determining thebest ways to balance these new economicopportunities for their benefit.Forging effective relationships withgovernments and communities, P&O Cruiseshas advanced towards sustainable tourismin the Pacific, providing financial and in-kindsupport to develop viable tourism-relatedbusinesses and to generate jobs in theregion including crew positions on our ships.Destination management plans have beenproduced for key remote ports identifyingthe current and potential environmental,social and cultural impact of cruise ship visitsand recommending mitigation measuresand infrastructure requirements to supportcruise operations, and offering guidance forpotential business opportunities.Partnerships have also been establishedwith organisations such as the AustralianGovernment’s AusAID organisation,Australian Business Volunteers and the NewZealand Aid Programme to both implementthe recommendations of these plans anddevelop new initiatives.We contributed $1.5 million for initiativesunder AusAID’s Enterprise Challenge Fundprogram in Vanuatu. Concluding at theend of 2011, these funds have been usedto upgrade landing jetties, build amenityblocks and to help communities establisheconomically viable small businesses.Early successes, most notably at MysteryIsland in Vanuatu where the Aneityumcommunity has worked with the supportof P&O Cruises and the AusAID fundedEnterprise Challenge Fund to developa series of local shore tours, are setto be replicated in other Pacific Island20 | P&O Cruises 2011 Sustainability Report

communities.Beyond our business operations and ourwork in specific Pacific Island communities,our economic contribution includes financialsupport for community-based organisations(see pages 46-49). During 2011, almost$300,000 in cash and in-kind support wasprovided to charitable organisations.2012 economicsustainability goals•maintain and increase Carnival Australia’seconomic contribution to Australia and New Zealand– Increase the capacity and potential of the cruise industry in Australia– Maintain dialogue with relevant government authorities to ensure the future growthof the cruise industry is supported through the provision of adequate and appropriate•infrastructureWork with Pacific Island communities to help achieve sustainable economicgrowth through cruise tourism– Quantify the economic impact of the cruise industry on Pacific Island communities toidentify current impacts and future opportunities– Prepare Remote Destination Management Plans for Alotau and the Trobriand Islands inPapua New Guinea; and for Ouvea in New Caledonia– Continue working with communities in Vanuatu and Fiji to develop their opportunitiesfor improved economic sustainability– Appoint a general manager to help develop shore tour ventures on Mystery Island forthe Aneityum community (in partnership with the New Zealand Aid Programme)21 | P&O Cruises 2011 Sustainability Report

journeys ofdiscoveryPapua New Guinea1933 to 2011just a few years after remote highlandtribes had their first encounter with whiteexplorers, P&O was taking passengersto discover a mysterious paradise forthemselvescruisingthe pacificPapua New Guinea was one of themost popular early Pacific Island cruisedestinations. Port calls were made at PortMoresby, Samarai Island in Milne Bay, andRabaul during the 1930s. Although popularwith passengers, these cruises presentedsome navigational problems for the officersand crew.The arrival of the P&O Maloja in PortMoresby in 1933 was heralded as “Australiavisits Papua”. 7 Passengers experienceddisplays of native dancing, fire-making andan outrigger race.The Orient Line’s Otranto was the firstpassenger ship to call at Rabaul in 1934.The 450 passengers onboard were treatedto scenic car trips organised by a localentertainment committee in the morning,an afternoon race meeting and an eveningdance with the expatriate community. 8The P&O and Orient Line ships signalleda new era for tourism in Papua and NewGuinea. The ships were larger than the mailstreamers that had previously called, notonly making navigation more difficult, butdelivering hundreds of passengers at eachcall.The local community was quick torecognise the potential economic benefitsof cruise tourism, with some practicesdescribed by the then Lieutenant-Governorof Papua, Sir Hubert Murray, as “a generaltendency among adults as well as childrento ask ridiculously exorbitant prices forinsignificant services”.Expressing his concerns to the Captain ofthe P&O Strathaird, the Lieutenant-Governorsought support to warn “tourists to thedangers of this thoughtless liberality, andask them to join with the Government, theMissionaries, and the older men among thenatives themselves, in helping to keep thecharacter of these people unspoiled by suchpractice”.Today, ensuring a positive impact fromcruise tourism on local communities isa priority for P&O Cruises, particularly inplanning for a return to Papua New Guinea,the last frontier for superliner cruising.Four potential destinations in Milne BayProvence were assessed during 2011 aspart of P&O Cruises’ desire to re-establishPapua New Guinea as a Pacific Islands cruisedestination. Existing tourism operators andthe local communities have been consultedso any shore tours can be planned with dueregard to cultural sensitivity.The result is a return to Alotau from 2013,one of P&O Cruises’ first destinations in the1930s, and the opening of new destinationsDoini Island, Kiriwina/Kaileuna and Kitava.The cruise schedule has been planned22 | P&O Cruises 2011 Sustainability Report

Milne Bay Canoe Festival, 2011Native Chief, Port Moresby, 1933around existing events such as the ancientCanoe and Kundu Festival when 18 islandcommunities descend on Alotau to competein canoe races, canoe design and bestcostume and cultural performance. Shoretours are also being offered to significantWorld War II sites around Milne Bay.Bringing superliners to Papua New Guineafor the first time, P&O Cruises is helpingto re-establish the country on the PacificIslands cruise route and potentially openingup Papua New Guinea to further economicgrowth as cruising in the region reachesrecord levels.cruisingthe pacific7Journal of Tourism Studies, James Cook University,Vol 7, No.2 December 1996. P&O’s Pacific, NgaireDouglas & Norman Douglas8Cruise Ship Tourism, edited by Ross K Dowling;CABI Publishing 2006AlotauSamarai &Kwato IslandsDoiniIslandCooktownCairns(Yorkeys Knob)

PRODUCT SUSTAINABILITYthe passengerexperienceP&O Cruises has always aimed to providepassengers with memorable cruise holidaysin some of the world’s most idyllic andhard-to-reach locationscruisingthe pacificFor 80 years, our success has relied onthe way we deliver comfortable cabins,the widest variety of cuisine, world-classentertainment and an almost endless rangeof activities for our customers in a safeenvironment – all served up with friendlyand efficient service. It is the stories of ourpassengers that form our history of cruisingthe Pacific.We aim to meet or exceed passengerexpectations from the moment of their firstcontact with us when considering a cruisethrough to their final disembarkation whenthey return home and beyond.We are committed to truth in sales andmarketing and strive to ensure that wedeliver the product we promise each andevery time for every single passenger.Our new Vision program, launched in2011, is enhancing customer service qualityand training among cruise consultantsto ensure they can answer customers’questions as quickly and thoroughly aspossible and help guide them towards thecruise that best meets their needs. Realtimecall monitoring and customer surveysenable us to now review our performanceeach month to strive for continuousimprovement.Ensuring passenger satisfaction onboardhas always been a priority for P&O Cruises.Maintaining our reputation for excellentservice and safe, healthy shipboardenvironments is enshrined in our Code ofConduct. Providing quality and dependableservices not only includes ensuringpassenger cabins are spotless and servicein our restaurants is first class, but to alsoensuring everything from accurate billingpractices to onboard security and maritimesafety.Passenger satisfactionAll adult passengers are asked to completean evaluation survey before they disembarkto track customer satisfaction and to identifyareas for immediate action or longer-termimprovement. The survey covers both theoverall cruise experience and key areas suchas onboard food, service and entertainment.The survey results are reviewed onboardwhere any immediate issues such as cabinproblems can be addressed before the nextcruise departs. Passengers may be contactedby the ship’s crew to address any majorissues before they disembark.Comment volumes, trends, handlingtimes and key categories of complaints arereported monthly to the Executive team toensure senior support for the resolution ofany issues and the monitoring of passengerexperience and trends across all ships.Passenger feedback is also used for ongoingperformance management and the settingof departmental key performance indicators(KPIs).24 | P&O Cruises 2011 Sustainability Report

it is the stories ofour passengersthat form ourhistory of cruisingthe pacificCustomer feedback is also received viaour Customer Relations team. In 2011,P&O received 3,288 post cruise comments,which represented 1.5% of total passengerscarried. The Customer Relations teamacknowledges comments received within48 hours and aims to resolve cases within10 days of receipt. The Customer RelationsManager meets with relevant departmentseach week to discuss performance andensure that any service failures are quicklyrecognised and addressed.“Cruised on the Pearl in February this year.She is a wonderful ship with a fantastic crew,great entertainment and food to die for! Lovedevery minute of our cruise. Cruising on theJewel next April. Can’t wait!”Cecilia, social media post, passenger 2011Passenger Feedback 2011 2010Overall satisfaction withthe cruise holiday89% 89%How valued and respecteddid the crew make you feel92% 92%Overall satisfaction withonboard food88% 87%Overall satisfaction withonboard entertainment87% 87%“It was a marvellous experience. We hadlots of activities during the cruise includingdeck games, fancy dress ball, dancingevery night.” Isobel Bennett, passengeraboard Strathaird, 193225 | P&O Cruises 2011 Sustainability Report

the passengerexperience“Amazing scenery and relaxing atmosphere is how I’d describe Lifou… thesnorkelling around the coral, it doesn’t get better than that. But remember not toput on sunscreen before you go as a request from the locals to protect the fish.”Vicki, social media post, passenger 2011cruisingthe pacificHealth, safety and securityEnsuring the health, safety and securityof passengers and crew is paramount forP&O Cruises. We support and abide by allof the relevant Australia, New Zealand andinternational laws and regulations relatingto maritime safety, onboard and shoresidesecurity and health care standards. Noincidents of non-compliance with any ofthese laws, regulations and voluntary codesconcerning health and safety impacts ofproducts and services were reported in 2011.We support and adhere to the stringent,internationally agreed safety standardsfor ocean-going cruise ships set by theInternational Convention for the Safety ofLife at Sea (SOLAS). We also comply witha comprehensive set of Corporate SafetyStandards that go beyond regulatoryrequirements to further ensure the safety ofour guests, ship personnel and ships. Boatand fire drills, safety videos, regular testingof onboard equipment and proceduresare all part of our approach to passengersafety. Shipboard personnel are trained tocompetently perform their safety functionsand support passengers in both routine andemergency situations.Our ships are also subject to internationalregulations and guidelines of theInternational Ship and Port Facility Security(ISPS) Code. We are proud to report thatall of our ships meet or exceed theseregulations. We also meet or exceedthe domestic security regulations of thecountries we visit, and work closely withpolice in Australia, New Zealand and thePacific Islands to implement clear protocolsfor managing crimes at sea. Additionalmeasures to address safety and securityonboard our ships include the use of morethan 500 CCTV cameras on each ship,a zero tolerance approach to excessivebehaviour, adherence to the relevantregulatory frameworks and guidelines inrelation to the operation of onboard casinos,and ‘Responsible Service of Alcohol’ policiesincluding closing bars in the early hours ofthe morning, no staff commissions for alcoholsales, and compulsory training for all crew.Security personnel responsible formonitoring and enforcing security policiesare employed on each ship. They maintainstrict control over access to our ships and allpeople, parcels, and supplies boarding a shipmust pass through a screening checkpointto ensure no prohibited items are broughtonboard.Onboard healthcareP&O Cruises operates under acomprehensive set of Corporate HealthStandards employed worldwide by CarnivalCorporation that go beyond regulatoryrequirements to ensure the health of ourpassengers and crew.On each of our ships, the onboard medicalteam includes two doctors and three nurses,all of whom are registered in Australia, NewZealand, the United Kingdom or South Africa.They operate two clinics daily for routinecases, but are on call at all hours to providequality medical care for both passengers andcrew.P&O Cruises’ onboard medical centreshave Intensive Care Unit facilities, wards andtreatment rooms. Most medical emergenciescan be dealt with, and any illness or injurythat cannot be managed on the ship forvarious reasons is referred to an onshore26 | P&O Cruises 2011 Sustainability Report

THOUSAND35030025020015010050passengersby destination2005200620072008200920102011P&O Cruises passengers to Pacific IslandsP&O Cruises passengers to other destinationstertiary medical facility.Any injuries among passengers or crew,whether onboard or ashore, are reportedto the management of Carnival Australia,and all major and serious injuries are alsoreported to Carnival Corporation & plc andthe relevant authorities.Our passengers ashoreOur approach to delivering the bestcustomer experiences extends ashore,where we work with local communities todevelop shore tours that inspire, educateand relax our passengers – whatever theirfancy may be.In 2011, our passengers enjoyed 563unique shore tours across 61 different portsof call. The number of shore tours on offerwas up by 40% on the previous year, a clearindication of P&O Cruises’ commitment tooffering passengers new experiences thatprovide greater insights into the uniquecultures and stunning environments of thePacific Islands.The vast majority of these tours are nowoperated either by or in conjunction withthe local communities at each destination(see pages 20-21) and we are continuingto work with communities in Vanuatu,New Caledonia and Papua New Guinea todevelop more experiences so they can sharethe economic benefits from cruising.Our passenger behaviour and guidanceprogram, including onboard brochuresand presentations, and shore signage,encourages passengers to respect and helppreserve the natural environment and therich culture of the places they visit. Fromwearing appropriate clothing to limitingaccess to sensitive areas, we work toensure that our passenger experiences aresustainable in the long term.cruisingthe pacific2012 product sustainability goals•improve destination management– Ensure the impact of our passengers’ visits is addressed through RemoteDestination Management Plans for all new destinations– Introduce new shore tours showcasing a greater diversity of natural andcultural experiences for passengers– Reintroduce Papua New Guinea as a cruising destination with at least threenew ports of call•– Accommodate reduced capacity 9 with the sensitive reduction of port callsimprove passenger satisfaction and feedback mechanisms– Enhance channels of passenger feedback including online customer surveys– Maintain our customer satisfaction level at 89% or above– Reduce the rate of customer complaints to below 1.4% of all passengers– Maintain the numbers of passengers who recommend P&O Cruises to theirfriends and family at 86%9Pacific Sun will leave the P&O Cruises fleet in July 2012.27 | P&O Cruises 2011 Sustainability Report

after the war andacross the pacific1940s to 1960australian cruising was brought to anabrupt halt with the outbreak of worldwar II in 1939cruisingthe pacificMany P&O ships, including the Strathaird,were requisitioned by the BritishGovernment for wartime duties with aconvoy leaving Sydney in January 1940carrying Australian and New Zealand troops.The Strathaird went on to play a key rolein the evacuation of Dunkirk, carrying6,000 troops and refugees along withgold retrieved by British banks just beforeGerman troops marched into Paris.Many ships were lost due to the hazardsof wartime service. The Strathaird survivedbut required a long and costly refit beforeit became the third P&O ship to return topassenger service, almostimmediately takingthe Australian cricketteam, known as “TheInvincibles”, to England in1948.Cruising in the postwarperiod was moreabout immigration thanrecreation. P&O played amajor role in carrying overone million ‘Ten PoundPoms’ to Australia as partof the assisted passagescheme created by theAustralian Government to provide labour forthe country’s growing post-war economy.For many migrants, their voyage with P&Owas the first time they had left Britain, letalone travelled on a luxury ocean liner.To meet demand and replace their lostand aged fleets, P&O and its sister companyOrient Line embarked on a major buildingprogram from 1946. The Orcades was thefirst of the post-war ships launched in1948, followed shortly afterwards by theHimalaya, Chusan, Oronsay, Iberia, Orsovaand Arcadia. By 1961, P&O had boughtout the remaining stake in Orient Line andrenamed its passenger operations asP&O-Orient Lines.Kept busy carrying immigrants, it wasn’tuntil December 1952 when Orcades beganpost war cruising from Australia, sailing fromSydney for the first Pacific Islands cruisesince 1939. With every cabin full, she carriedthe largest number of passengers ever tosail from an Australian port in peace time.Reports at the time spoke of the “unreal”scene of “thousands of friends and relatives,some even tearful, who had crowded thecabins and decks to give passengers afarewell large enough for a 12 month trip,would be welcoming them all home again injust two weeks”. 10By the mid-1950s, the Pacific Islands wereagain receiving regular visits from P&O, withships such as the Oronsay and Orsova reopeningthe Pacific Service from Sydney toSan Francisco via Auckland, Suva, Honoluluand Vancouver.10Sydney Morning Herald, December 1952.28 | P&O Cruises 2011 Sustainability Report

in 2011, over56,000 passengersarrived inFiji aboard aP&O Cruises shipmust-see destinationAs Pacific Island cruising recommenced inthe 1950s, one of the must-see ports wasSuva. Although still a British colony at thattime, the Fijian capital has always been acentre of government and commerce forthe Pacific, a place renowned for its uniqueblend of Pacific, European, Indian andChinese cultures, as well as its colonial-erabuildings and colourful markets.The popularity of Fiji was establishedbefore the war, with passenger ships in the1930s greeted with brass bands on arrival.And it hasn’t waived since the 1950s. In2011, over 56,000 passengers arrived in Fijiaboard P&O Cruises’ ships, and enjoyed arecord 14 different shore tours.In line with P&O Cruises’ increasedemphasis on offering cultural experiences,new tours this year are Nausori FarmersMarket and Scenic Drive, Sight SeeingHistoric Suva, Ancient Molituva Historic Siteand the Rewa Delta Tour to Sawani Village.

PEOPLE SUSTAINABILITYour people are our greatest assetcruisingthe pacificThe officers and crew onboard our ships whoensure passengers have a safe and enjoyablecruise are supported by hundreds of peoplebehind the scenes – planners, logistics experts,procurement specialists, customer servicerepresentatives, and destination experts.Our workforce of 3,350 people is diversein age, gender, cultural background,educational opportunity and work location.P&O Cruises recruits from around the worldwith the majority of our crew coming fromthe Philippines (44.5%), India (16.7)%and the rest of Asia (9.5%). As the leadingcruise line in the Pacific Islands, 8.7% ofour crew are from the region, including 134Ni-Vanuatu people, 23 Fijians and 71 fromother Pacific Islands. We have a long-termcommitment to have at least 10% of ourcrew from the Pacific Islands and activelyrecruit from the region through agents,by attending careers fairs and buildingpartnerships with training colleges anduniversities.Our long-standing relationship withthe University of the South Pacific (USP)was consolidated further in 2011 witha commitment to provide six 12-monthinternships for students studying theirBachelor of Commerce Hotel Managementdegree at the university from 2013. Studentswill gain relevant industry experience withinour Hotel Department teams before theygraduate, with the possibility of full-timeemployment if successful. The partnershipwith USP is part of P&O Cruises’ pledge toensure Pacific Island communities share theeconomic benefits of the surge in cruising tothe region.With an equally strong commitment togender equity, P&O Cruises has a healthyrepresentation of women in senior roles,from Carnival Australia’s CEO Ann Sherryto the first female cruise ship captain tosail in Australasian waters. Captain SarahBreton took the helm of Pacific Pearl in June2011, joining Hotel Director Jane Herron,Cruise Director Zoltina-J Medwick-Daley andAdministration and Revenue Director Martinatotalshipboard shoresideemployees 113,3502,992 3582,347males871females22.7% 62%77.3% 38%30 | P&O Cruises 2011 Sustainability Report

in june 2011,Captain Sarah Breton(third from left)took the helm ofPacific PearlDamonte to form the largest group of femaleofficers on any cruise ship in the region.Our workforceShipboard crew are employed on contractsranging from four to 10 months. Thesecontracts include industry standardsregarding working hours and rest periodsand follow the International LabourOrganization (ILO), a global body responsiblefor drawing up and overseeing internationallabour standards. P&O Cruises is committedto compliance with all applicable ILOconventions and flag state regulations.We conduct our recruitment processto ensure compliance with all relevantstatutory requirements including thoserelating to the age of employees and crew.Our minimum hiring age for crew is 21years, with the exception of some cadetsand entertainment crew who must be 18.In 2011, the rate of employee turnoverfor shoreside personnel was approximately28%, primarily due to redundancy as a resultof restructure. 13 Almost 60% of shoresidepersonnel who left P&O Cruises were female,with the turnover spread across all age groups.shipboardnumber percentageshoresidenumber percentagecruisingthe pacificage group 1250 108 4% 44 12%workloadFull time 2,992 100% 306 85%Part time 0 0% 52 15%employment typePermanent 359 12% 332 93%Contract 2,633 88% 26 7%31 | P&O Cruises 2011 Sustainability Report

cruisingthe pacificSupporting and improving ourworkforceWhile our workforce has become morediverse, our commitment to supporting ourpeople and giving them opportunities todevelop remains unchanged.We are determined to ensure thatP&O Cruises remains a great place to workand we offer a range of financial and nonfinancialbenefits to our employees.Our onboard Crew Club organises activitiesto help our crew achieve a good work-lifebalance while onboard. Each ship has acrew gym, recreation area, library and freeinternet facilities, and coupon schemesprovide discounts for use onshore breaks.There is also a Crew Welfare Committeemade up of senior company representatives.Our shoreside employees are ableto access our Working from Home andEmployee Assistance schemes to help thembalance their professional and private needs.Flexible hours and paid maternity andpaternity schemes are available, as well asa range of health and wellbeing benefits,and discounted cruising, airfares, hotels andtravel insurance. In 2011, we trialled a ninedayfortnight and introduced a new careerdevelopment program, Chart Your Course,open to all shoreside employees.We aim to understand and meet theneeds of our workforce through regularstaff surveys and an Open Door Charterencouraging employees to provide feedbackdirectly to any member of the Executiveteam.Employee feedback is taken seriouslyand acted on. In 2011, quarterly employeefeedback through our formalised GaugeProgram led to increased communicationfrom the executive team, and greaterrecognition of employee performance.The Globe Awards, recognising andrewarding shoreside employees forexcellent performance, was strengthenedwith greater executive involvement, andthe new Length of Service Program waslaunched to recognise and reward longtermcontributions to P&O Cruises. Withrecognition for service for five years or more,the first recipients in June 2011 includedCustomer Flights Coordinator, Francis Bower,who has worked with P&O Cruises for 30years. We are also continuing our onboardcustomer service program PROUD, launchedin 2010, to support the pride our crew havein their work with rewards and opportunitiesin response to direct feedback frompassengers.In periods of significant operationalchange, we understand the importance ofkeeping employees informed about anychanges that may affect them and, althoughnot required under any formal agreements,we aim to inform employees about relevantchanges as soon as practicable.Development and trainingP&O Cruises promotes continuousdevelopment of our people in leadershipand management as well as technical skills.11Excludes 132 Marine & Technical officers who rotate acrossthe P&O Cruises and Princess Cruises fleet. Total workforceexcluding these officers is 3,218.12ibid13Turnover figures for shipboard employees are not availablefor the reporting period due to changes in reporting linesand data collection from CUK to Princess Cruises from 1September 2011.14Partial data only. Not all training data is available forshipboard employees for the reporting period due tochanges in reporting lines and data collection from CUK toPrincess Cruises from 1 September 2011.15Includes training in the International Labour OfficeConvention 180 training (Seafarer’s hours of work andrest), and dress codes.16Includes Proud customer service and passenger CAREtraining.17Includes safety inductions 1, 2 & 3.18Data not available for shipboard employees in 2011 due tochanges in reporting lines and data collection from CUK toPrincess Cruises from 1 September 2011.32 | P&O Cruises 2011 Sustainability Report

crew areproudto wear adoubleflag pinI’m Proud of my ship/company I’m Proud of myself I’m Proud ofmy work I’m Proud of my team I’m Proud of my passengerstotalshipboard 14 shoresideHours 50,500 2781Participants 2,992 278Hours per employee (FTE) 17 8cruisingthe pacificparticipants & hoursby categoryshipboardparticipants hoursshoresideparticipants hoursCorporate induction 1,000 500 46 295Product & system 15 2,992 8,500 110 1986Technical & service 16 2,992 15,000 17 127.5Career & managementdevelopment 17 500 1500 99 360.5Safety 2,992 25,000 6 12hours by categoryper employee 18shoresideCorporate induction 0.87Product & system 5.85Technical 0.37Career & management development 1Safety 0.03533 | P&O Cruises 2011 Sustainability Report

cruisingthe pacificIn 2011 our people undertook acombined total of over 53,000hours of training.Performance managementPerformance managementenables us to provide clarityfor our people and their roles,and opportunities for personalsuccess and development. All shipboardstaff (100%) receive a written appraisalwhilst onboard for each contract. Alleligible shoreside employees receiveformal performance appraisals twice ayear, supplemented with regular informalemployee and manager catch-ups.Rights and representationJust over half (57%)of P&O Cruises’shoreside employees are covered by acollective bargaining agreement approvedby the Australian Industrial RelationsCommission in 2009. The remaining 43% ofshoreside employees are employed underindividual employment contracts. Employeesare able to make trade union contributionsthrough payroll deductions and to have atrade union representative present at anydisciplinary or grievance hearings.Over 85% of shipboard employees areemployed under the Princess Cruise LinesLimited (PCLL) Employment Contract. 19Shipboard staff working under PCLL contractsare also covered by the relevant unionagreements or union approved terms andconditions. Under the PCLL contracts, the44.5% of our workforce from the Philippinesare covered by the terms and conditionsrequired by the Philippines OverseasEmployment Administration (POEA), with“P&O always puts theircustomers (cruisers) first.Thank you P&O.”Chris, social media post,passenger 2011the PCLL also recognised as a full collectivebargaining agreement with the ItalianFederation of Transport Workers and theItalian Transport Federation. Just under7% of employees, mostly working inentertainment, retail and onboard activities,work under concession agreements withthe businesses operating these servicesonboard.P&O Cruises complies with internationalagreements such as the International LabourOrganization conventions, for example, ILON.180, Seafarer’s Hours of Work and theManning of Ships Convention. They providea standardised table showing shipboardworking arrangements, a standard formatfor records of seafarer’s daily hours of workand rest and guidelines for monitoringcompliance. There are no risks to forcedor compulsory labour, rights to exercisethe freedom of association or collectivebargaining.Employee health and safetyThe Health, Environment, Safety andSecurity (HESS) Steering Committee meetsat least once a month onboard each ship.The Committee – including the Captain,Staff Captain, Hotel General Manager andChief Engineer – is responsible for ensuringcompliance with all procedures related tohealth, environment, safety and security.The HESS Action Team implements shipboard34 | P&O Cruises 2011 Sustainability Report

policies and procedures, manages theday-to-day HESS functions of the ship andorganises safety training. The HESS CrewDepartmental Representatives are theprimary point of contacts for crew regardingHESS issues and includes an elected crewmember from the deck, technical, food &beverage, accommodation, customer serviceand entertainment departments. All creware made aware of their representatives.In accordance with relevant legislationshoreside, the occupational health andsafety of all shoreside employees isrepresented by a company appointedOccupational Health and SafetyRepresentative.In 2011, there were no fatalities dueto accident or injury among onboard orshoreside employees.Onboard, there were 338 recorded injuriesof which five required hospitalisationonboard or ashore for more than 24 hoursfollowing the injury, and 20 were reportableinjuries. The increase in numbers can beattributed to the addition of Pacific Pearl atthe beginning of the reporting period andwider reporting criteria.Shoreside, P&O Cruises complies withall relevant Australian legal requirementsgoverning health and safety. During 2011,there were four injuries relating to workshoreside, representing 1% of the shoresideworkforce. Including injuries occurringoutside of the workplace (20), a total of 52days were lost to injury shoreside duringthe year. The total 2011 absenteeism rate forP&O Cruises shoreside employees was 2.62%.19These include contracts previously issued by Fleet MaritimeServices India under the same conditions as PCLL contracts.FMSI contracts are being replaced by PCLL contracts.2012 peoplesustainability goals•ensure diversity in recruitment– Continue to increase representation ofwomen among senior officers.– Further our support for tourism educationin the Pacific Islands.– Increase the number of crew recruitedfrom the Pacific Islands to at least at 10%•as our overall workforce grows.provide industry-leadingtraining and developmentopportunities and flexible workarrangements– Increase onboard training andperformance management.– Increase employee recognition.– Introduce new career developmentinitiatives for shoreside employees.– Rollout a nine-day fortnight for shoresideemployees.cruisingthe pacific35 | P&O Cruises 2011 Sustainability Report

cruise season comesto the pacific1960s to 1980married life started witha 10-day honeymoontravelling to Noumea, Suva, Lautokaand Auckland aboard the Himalaya in1972 for Sydney couple Kerry and SylviaLam. Despite rough and stormy weatheroff Noumea, and a bout of seasickness,hunting out new experiences and exoticfoods across the Pacific made it a tripthey’ll never forget.cruisingthe pacific

1960s: thestart of anew era forP&O Cruisesin thepacificthe 1960s – miniskirts, hippies,women’s rights, jet air travelIn less than a decade, boarding a shipbecame less about getting from onedestination to another, and more aboutcruising for pleasure.The rigid pre-war mail contracts thatrequired weekly sailings from and toAustralia were gradually replaced withaircraft contracts with the introduction ofthe Boeing 707 jet aircraft. Passengers soonstarted opting to fly to England in one day aswell, rather than travel by ship for four to sixweeks.The changes spelt doom for many longhaulpassenger liners, but also heralded thestart of a new era for P&O Cruises in thePacific.Officially merged with the Orient Line in1960, P&O started the first Pacific Islandcruise season in 1968 with the Himalaya,its first new passenger liner of the postwarperiod, based in Sydney from March toOctober. Abandoning the Sydney-Londonroute to undertake eight consecutive cruisesto the South Seas, the Himalaya travelledto exotic ports like Pago Pago and Noumea,also calling into other Australian ports suchas Melbourne and Brisbane.By the late 1960s, new ports, such asNuku’alofa and Vava’u in Tonga, hadbecome passenger favourites, hosting upto 30 calls in a year, and by the end of the1970s, over 50,000 cruise ship passengerswere visiting Tonga each year.Cruise season had arrived in the Pacific.In 1966 just nine cruises were offered tothe Pacific. By the mid-1970s that numberhad exceeded 30 with thousands of cruisepassengers estimated to spend$40 per day each in ports suchas Suva, Noumea and Port Vila.For many Australians, thiswas their first taste of cruisingand the romance of the seawas alive and well.Pacific Islands cruises also becamesynonymous with great value holidays. Inthe mid-1970s, passengers could enjoy a 12-day cruise from Sydney to Amedee Island,Noumea, Isle of Pines, and Vila from just$740, or 11 days out to Noumea, Henghene,Vila and Lautoka from $810.islandshoppingcruisingthe pacific37 | P&O Cruises 2011 Sustainability Report

ENVIRONMENTAL SUSTAINABILITYreducing ourimpactthe pacific islands are among themost bio-diverse regions in the worldcruisingthe pacificNot only stunningly beautiful, the plants,animals and marine life are essential for thelivelihoods of many Pacific people and haveshaped culture and tradition for thousandsof years.As the leading cruise line operating inthe Pacific region, we are determined tocontribute to positive environmental change,working hard to protect the places ourpassengers love to visit and to minimisingthe impact of our operations whereverpossible.Protecting our destinationsFrom our first destinations in the PacificIslands 80 years ago, to places we’re visitingfor the first time this year, we work hard toachieve a balance between providing ourguests with the opportunity to explore newplaces with our responsibility to manage theimpact of our operations.Focusing on new destinations or thosewhere the frequency of port calls isexpected to increase, we prepare RemoteDestination Management Plans usingscientific assessments and communityconsultation to identify the current andfuture impacts of cruise tourism on both theenvironment and culture of the area.Through these plans, we work with localcommunities to identify the constraints andopportunities for cruise tourism, and developand implement strategies to mitigate anynegative impacts.In 2011, we developed a plan for Marein the Loyalty Islands (see right) andalso undertook preliminary exploratorywork in Papua New Guinea, identifyingthe necessary works to minimise anyenvironmental impacts of tenderstransporting passengers to shore. Closer tohome, we are monitoring the impact of ourshort-stay cruises to the Jervis Bay MarinePark (off the NSW South Coast) on localdolphins and migrating whales, to ensurethey are not being disturbed by the ships’presence in the area.We also continued to implementenvironmental protection initiatives fromearlier plans. On Mystery Island in Vanuatu,the amenities block and jetty required toreduce the impact of passengers werecompleted. Implementation of the plandeveloped for New Caledonia’s Lifou in 2010started, with the P&O Cruises driving theconstruction of a walkway into Jinek Bay tomake it safer for visitors and to protect thearea by limiting the number of visitors atany time.The biggest potential impact on thedestinations we visit is passengeractivity ashore. For this reason, weprovide passenger education about theenvironmental sensitivity of remotelocations, encouraging them to stick todesignated areas, return waste to the shipand leave only their footsteps behind. Shipcrew always check destinations and ensureall rubbish is removed prior to departure.P&O Cruises is now working with theLifou community to address these impactsthrough improved litter collection, improved38 | P&O Cruises 2011 Sustainability Report

our fleet regulations include procedures toavoid collisions with sea birds andmarine mammals such as whalescaring for a new destinationA former coral atoll lifted from the sea, Mare is a spectacular combination of tall cliffs,colourful reefs, limestone caves, grottos, dark forests, and a natural aquarium. Part of the biodiversityhotspot centred on New Caledonia, its waters are filled with abundant marine life.It is also a new destination for P&O Cruises’ passengers following the completion of ourfifth Remote Destination Management Plan in 2011.Prepared before the arrival of any ships on the island, the Mare Remote DestinationManagement Plan identified the most environmentallyresponsibleoptions for a ship-to-shore jetty location,passenger staging and day-use areas.Anticipating the potential demands fromup to 2000 passengers arriving in oneday, the plan involved site inspections,consultations with local communitymembers and assessments of thelocal aquatic environment to ensurethat any plans did not impactsensitive terrestrial or aquatichabitats.The study recommendedthe construction of a specialjetty and boardwalk at TadineHarbour to allow cruise shiptenders to dock with minimalenvironmental impact and toprovide access to passengersfor swimming and snorkellingactivities. The jetty is to becompleted before the first shiparrives in April 2012.signage to indicate wherepassengers should and shouldnot go, more tour options to avoidovercrowding of Jinek Bay, andincreased passenger education aboutterrestrial and marine habitats.goalreduction inthe intensity ofcarbon dioxideemissions by 2015:20%cruisingthe pacific

educing ourimpactcruisingthe pacificOnboard improvementsThe standards we set for our environmentalperformance get higher every year,particularly in relation to fleet and technicaloperations.From the bridge to the engine room, weare constantly striving to reduce our fuelconsumption, emissions, water usage anddisposal, and waste generation. Despitethe extraordinary growth in the number ofpassenger cruise days, in the past year wehave improved our fuel efficiency by morethan 5%, reduced the volume of black waterbeing discharged to sea by 33% and, whileour overall waste has increased, we havedoubled the volume of hazardous wastebeing recycled.Environmental standardsAs part of Carnival Corporation & plc, weoperate under ISO 14001 environmentalmanagement system certification, anenvironmental management systemfor avoiding negative effects from ouroperations. These standards are stringentand comprehensive, and in most casesexceed the applicable international, federaland local environmental regulations thatapply to cruise ships.Globally, the International MaritimeOrganization (IMO) stipulates the standardsof the International Convention for thePrevention of Pollution from Ships (knownas MARPOL), which applies to all shipsto prevent ship-generated pollution. Wealso abide by regulations such as theGreat Barrier Reef Marine Park Act 1975prohibiting the discharge of all food waste.We follow rules about discharge of waterwaste in the Great Barrier Reef MarinePark and in Victorian State waters, anddo not discharge any waste water in theNew Zealand Fiords. Once again in 2011,there were no significant spills, fines ornon-monetary sanctions imposed againstP&O Cruises relating to environmentalincidents.Roles onboardAll officers and crew have a role to play inprotecting the environment. Senior crew areresponsible for training and implementationof our company environmental policiesand practices onboard. Every P&O Cruises’ship has an Environmental ComplianceOfficer onboard who oversees and verifiesour environmental management andcompliance. All crew receive environmentalawareness training, as well as anycontractors who have the potential to causean environmental impact.Passengers are encouraged to be awareof the environment (see pages 24–25).Environmental information is included intheir boarding information packages andcommunicated as part of the passenger drillon the first day at sea. We provide guestswith many opportunities to care for theenvironment such as by waste recycling andby reusing their towels.Energy and carbonAs part of Carnival Corporation & plc, we areworking towards a 20% reduction in theintensity of carbon dioxide emissions fromall shipboard operations by 2015 from our2005 baseline.The energy consumption and carbonemissions from our fleet increased overallin 2011 with the addition of Pacific Pearlfrom December 2010. Despite increasing thenumber of passenger cruise days by 44%,we have managed to keep our increasein total energy consumption to 18% andcarbon emission increase to 21%, achievinga 14% reduction in carbon emissionsper passenger cruise day. This has beenachieved through a range of efficiency40 | P&O Cruises 2011 Sustainability Report

our seadischarge of blackwater is down by33% and greywater is down by26%LITRES1008570554094.3measures including itinerary optimisation,increased hull and propeller cleaning, theuse of high-performance paints on our ships’hulls and increased efficiencies across ourheating, ventilation and air-conditioningsystems. We are continuing to harness thewaste heat generated by our engines toproduce fresh water onboard each day.GRAMS19015011070blackwaterdischarge tosea per person,per day78.38522009 2010 2011%100182.6fuel used peravailablelower berthper kilometre101.3596.32009 2010 20117550250.05hazardouswaste recycled37.387.52009 2010 2011cruisingthe pacificWaterThe volume of water used onboard our shipshas risen by 21.5% from 2010, less than halfthe rate of the increase in passenger cruisedays. We are now producing over threequartersof the water we use onboard fromseawater using the reverse osmosis andevaporation plants onboard our ships.There has been an overall reduction in thevolume of water discharged, and we haveachieved significant reductions in the seadischarge of black and grey water. Our seadischarge of black water 20 is down by 33%and grey water 21 down by 26%.20Black water (sewage) is treated to standards in excess ofthose specified by MARPOL through onboard MembraneBio-Reactors (MBRs) and discharged according to relevantregulations.21Grey water is water collected from showers, sinks, laundryand galleys. It does not contain any oil or sewage and isdischarged according to the relevant regulations.

educing ourimpactcruisingthe pacificINDICATORdirect energy consumptionTotal energy consumptionShip energyShoreside energyTotal ship fuel consumptionFuel OilMarine Gas OilFuel used per ALB-kilometre 22indirect energy consumptionTotal energy purchased (shoreside)emissionsGreenhouse gas (GHG) emissions – CO2 equivalent 23Total GHG emissions (ship & shore, direct & indirect)Indirect GHG emissions (total)Indirect GHG emissions (shoreside)Indirect GHG emissions (shipboard)Direct GHG emissionsDirect GHG emissions (shoreside)Total direct GHG emissions shipboardGHG emissions from ship fuelGHG emissions from ship refrigerantsShip fuel GHG emission rateTotal NOx emissionsNOx emissions per nautical mileTotal SOx emissionsSOx emissions per nautical mileTotal particulate matter (PM) emissionsPM2.5 emissions per nautical mileOzone-depleting substances (direct and indirect)Ship refrigerant gases fugitive emissions CO2e 24CFC-11 equivalentPERFORMANCE4,708,843 gigajoules4,707,898 gigajoules945 gigajoules115,424 tonnes114,356 tonnes1,068 tonnes96.3 g569 MWh373,818 tonnes640 tonnes640 tonnes0 tonnes373,178 tonnes70 tonnes373,108 tonnes362,944 tonnes10,164 tonnes303 grams CO2e per ALB-km7,503 tonnes18.25 kg5,658 tonnes13.8 kg139 tonnes0.34 kg10,164 tonnes141 kg22Data is normalised to take into account the passenger carrying capacity of the ships in available lower berths (ALB), and thedistance travelled by the ships in kilometres (km). ALB refers to the available number of berths on the floor of all cabinsonboard a ship. It is does not include upper bunks or pull-down beds in cabins with berth capacities in excess of two people,so does not therefore include all passengers travelling on P&O Cruises during the time period. The ALB measure is used as aninternational industry standard.23Greenhouse gas emissions for the 2011 year were verified by LRQA Americas Sustainability, Inc. (LRQA) as part of an overallverification of data for Carnival Corporation & plc (Carnival) during the first half of 2012. That verification confirmed thegroup’s GHG emissions as conforming to International Standard ISO 14064-1:2006 core principles of relevance, completeness,consistency, accuracy and transparency.24Data not comparable to 2010 due to internal change in data collection processes.42 | P&O Cruises 2011 Sustainability ReportNon-hazardous waste Hazardous wastewaste (tonnes)Recycled 2,396 6,512Sea discharge (food waste only) 17,394 -Shore disposal 3,748 872Incineration 1,676 47Total 25,214 7,431Percentage recycled 9.5% 87.5%

INDICATORPERFORMANCEwater consumptionTotal 811,043Sourced from land (bunkered) 190,625 tonnes (23.5%)Produced from sea water (withdrawn) 620,418 tonnes (76.5%)Water used per person (guests and crew) per day 234 litres 25water discharge (tonnes)Total water discharged924,890 tonnesDISCHARGED AT SEA DISCHARGED TO SHORETotal 911,839 13,051Ballast water 41,994 297Bilge water 12,145 2,262Biomass and sewage sludge 3,910 116Untreated grey water and permeate 820,148 6,933Treated black water 33,602 1,331Untreated black water 40 2,11225Due to changes in data measurement, the comparable figure for 2010 is 242.5 litres per person per day, representing a fallin consumption of 7%.2012 environmental sustainability goals•continue working towards reducing the co2 intensity from shipboardoperations by 20% corporate-wide by 2015 from the 2005 baseline– Reduce fuel consumption by 1% across the fleet– Improve energy efficiency with Ship Energy Efficiency Management Plans (SEEMPs) in place for•all ships by January 2013improve onboard environmental management– Audit our environmental management system to maintain the requirements of ISO 14001:2004– Improve crew environmental awareness and competence through increased training– Reduce hazardous waste including evaluation of fluorescent tube alternatives, and reducing•the number and volume of chemicals onboardenhance and protect the environment of the places we visit– Complete at least two new Remote Destination Management Plan in the Pacific Islands– Continue to advise local authorities on the completion of infrastructure works identifiedthrough existing plans to ensure sustainable cruise tourism•– Ensure effective handling of waste landed ashore with evaluation of waste vendorsprotect the maritime environment of the Pacific Ocean– Contribute to improved marine safety in the Pacific Islands by working with the Australian &New Zealand Hydrographic Services and Australian Maritime and Safety Authority (AMSA),encouraging compilation of modern charts and navigational aids in the Pacific Islands throughcapacity building program– Promoting whale avoidance in a safe manner with guidelines in place for all P&O Cruises ships,and whale scenarios included in the training of our captains and officerscruisingthe pacific43 | P&O Cruises 2011 Sustainability Report

the pacificplayground1980 to 2000P&O Cruises has been synonymous withexploring the pacific islands since the 1970scruisingthe pacificOver the final decades of the 20th century,ships such as the Orcades, Arcadia, SeaPrincess, Oriana, Fairstar and Fair Princessbecame part of the fabric of Pacific life,delivering a much-needed economic boostto many islands while taking passengers tosome of the most beautiful places on theplanet.In 1988, cruising to the Pacific contributedaround one-third of all tourist arrivals acrossthe region, and almost 75% of visitors toVanuatu. 26 By 1999, over 36,000 passengersdeparted Australia for the Pacific Islandsonboard a P&O Cruises’ ship.Along with the growth in passengers camenew destinations. The renowned captain ofthe Fairstar, Luigi Nappa, went in search ofidyllic islands on behalf of his passengers,adding Dravuni Island in Fiji (1981), MysteryIsland and Champagne Bay in Vanuatu in1983 and Lifou in New Caledonia in 1995.Other ports, such as Kioa in Fiji, were triedbut discontinued due to navigational barriersor concerns about the impact on the cultureand environment of the islands. 27For passengers, the white sands, crystalclear waters and cultural tours of these newdestinations combined with the traditionalPacific Islands sea ports to create newopportunities for discovery, relaxation andgood times.New destinations weren’t the only reasonfor the popularity of cruising, with more andmore emphasis placed on increasing therange of onboard entertainment throughoutthe 1980s and 1990s.While formal dining remained, casualpoolside buffets, late-night pizza barsand an ice-creamery were offered tohungry passengers. Music loverscould enjoy everything from apoolside duo or pianist in thecocktail bar to the nightlycabaret show, the jazzband in the lounge or thelatest new-wave musicin the nightclub. Therewas the option to catcha new release film inthe cinema, a stand-upcomedy performance,or indulge in some retailtherapy.For the active, thetraditional shipboardgames of deck quoits ora swim in the ship’s poolswere now complemented withaerobics and dancing classes,yoga, walking, shuffleboard andwaterpolo. Quieter pursuits includedtrivia games, arts and crafts, book swaps,sarong-tying demonstrations and cookingdemonstrations.For young, old and in-between, a cruiseto the Pacific Islands truly lived up to theslogan as the “time of your life”.26Journal of Tourism Studies, James Cook University, Vol 7,No.2 December 1996. P&O’s Pacific, Ngaire Douglas &Norman Douglas.27ibid.44 | P&O Cruises 2011 Sustainability Report

45 | P&O Cruises 2011 Sustainability Reportcruisingthe pacific

SOCIAL SUSTAINABILITYcitizenfrom a village of just 12 people to acity of 4.6 million, the communitieswe visit are vastly differentcruisingthe pacificBut in each and every case P&O Cruisesis committed to ensuring that we play apositive role in their social sustainability.Our Carnival Cares program supports ourcharity partners to make a difference in thelives of people of all ages. The program,established in 2009, supports three keycharities:Make-A-WishAs a Gold Supporter since 2009, P&O Cruisessupports various activities throughoutthe year including onboard fundraisingevents, donating cruises for fundraising,and granting wishes where possible if aWish Child’s dream is to go on a cruise. Wealso fund gift hampers and encourage ourstaff to work with Make-A-Wish to collectpublic donations on Wish Day. Our2011 support included $29,491in gifts-in-kind and a further$22,633 in cash donations.Lifeline AustraliaWe provide Lifeline withfunds to help operateits telephone counsellingservice through the sale ofgoods from our ships. In 2011,$43,440 was raised through thesale of 1320 curtains, 44 chairs, 37tables, 450 sun lounges, 28 cane chairs,100 blankets, 10 beds, 400 hair dryers,80 kettles and 53 pallets of other goodsincluding bedspreads, cupboards, bathrobesand Christmas decorations, as well as oursupport for other Lifeline initiatives such asthe Stress Down Day fundraiser. The amountraised through our partnership so far is$123,342.Cathy Freeman FoundationDonations from P&O Cruises’ passengersthrough our Walk the Decks fundraiser andproceeds from the onboard sale of cruisenavigational charts assist the Cathy FreemanFoundation (CFF) in its partnership with theAustralian Indigenous Education Foundationto provide education scholarships forchildren from Palm Island in northernQueensland. Over $60,000 was raised forCFF in 2011, bringing our total support toover $227,000 since our partnership beganin 2007.Other supportBeyond our support for these charitypartners, in times of crisis P&O Cruisesalso provides ad-hoc financial supportto the communities we touch. In 2011,these included significant donations to theQueensland Premier’s Flood Relief Appealand the Pike River Miners’ Relief Fund Trustin New Zealand. Further financial supportwas provided to UpsideDowns, an educationtrust to support children with DownsSyndrome in New Zealand.P&O Cruises also supports communitiesor groups in need through the provision ofcruise prizes and lunches hosted onboard46 | P&O Cruises 2011 Sustainability Report

our ships. In 2011, we expanded our supportfor programs that recognise communityinvolvement at the local level, by providingcruise prizes for Community Heroes fromregional NSW, adding to our support of theUnsung Heroes program in New Zealand.Every passenger, every employee,every destination – they’re all part of theP&O Cruises community.We actively educate our passengers on thecultural sensitivities of each of the PacificIsland destinations we visit, developingprograms about our destinations, theirpeople and their future. These are deliveredvia onboard TV, lectures and printedmaterial. We have also developed programsthat generate revenue for local communitiesby supporting local tour operators andpromoting the art, history and culture of theplaces we visit.We encourage respect for differentcultures and our crew and shore staff aregiven training about the communities,cultures and sites we visit to ensuresensitivity and sustainability is preserved.Our employees are encouraged tobecome involved in our support for localcommunities through payroll giving andvolunteering, and many of our passengersactively participate in giving to the PacificIsland communities we visit.Our commitment to our communitiesincludes maintaining the highest possiblestandards of ethical conduct. All newemployees are required to sign and“Last cruise in June gave schoolstuff (books, pencils etc) at Vilaand Pentacost island re theChildren Christmas Appeal.”Erin, social media post,passenger 2011“Yes, we are going to do theDawn’s Xmas cruise this year,will be in Vila for Xmas Eve, sohave started getting togethergifts for the kids in all the ports… I love your cruises P&O xx”Karen, social media post,passenger 2011acknowledge our Code of Conduct andBusiness Ethics policy when they join theorganisation, which explicitly addressesanticorruption, integrity, environmentalprotection and other standards expected ofthem as representatives of P&O Cruises.cruisingthe pacific47 | P&O Cruises 2011 Sustainability Report

citizencruisingthe pacificIn the Pacific Islands, our community supportincludes direct and indirect economicinvestment, working in partnershipsto develop sustainable tourism-relatedventures, and charitable donations.Cruise ship visits to the Pacific islandscurrently deliver about $35 million ineconomic benefit annually with thecombined direct spending of P&O Cruisesand its passengers (see pages 18-21).P&O Cruises works closely with manyPacific island governments and communitiesto ensure that the local population benefitsfrom the cruise ship trade.The programs encompass sustainableenvironmental initiatives (see pages 38-43), infrastructure works, the stimulationof the local economy through programsthat develop locally-owned businesses (seepages 20-21), and onboard employmentopportunities (see page 30-31).As well as working in partnership withgroups such as AusAid, the New ZealandAid Programme and Australian BusinessVolunteers to develop local infrastructureand skills, P&O Cruises actively encouragesthe development of the hospitality industryin the Pacific Islands. In addition to programswith the University of the South Pacific,in 2011 students from the Hospitality andTourism Training Centre in Rarotonga werewelcomed aboard the Pacific Pearl for a tourof the galley and dining areas to receiveinsights from our executive chefs about thescale and unique challenges of hospitalityaboard a modern superliner.We also support Australians HelpingAbroad, working with the Minster of Healthin Vanuatu, in their efforts to develop asustainable nationwide screening andvaccination program for cervical cancer.Work is being done to improve access tovaccinations for young girls and to trainlocal doctors and nurses in Vanuatu inpalliative care. In 2011, we sponsored theirmajor fundraiser, the Great Vanuatu DuckRace where ducks were dropped off theshores of Port Vila and raced to shore on theupcoming tides to raise much-needed funds.The Carnival Australia Children’s Christmaseverypassenger,every employee,every destination– they’re all partof the P&Ocommunity

P&O Cruises works closelywith many Pacific islandgovernments andcommunitiesAppeal is run annually and this year’sdonations from employees included 905gifts of toys, books and stationery deliveredto the islands. In 2011 we also partneredwith the Friends of Pango Ministry, a nondenominationalChristian organization inBrisbane, to transport 39 cartons of bookswhich will be used to establish three microlibrariesat schools in Vanuatu’s outerislands.2012 socialsustainability goals•increase the extent and impactof the charitable initiatives we•operate, particularly in the Pacific IslandsContinue to work with Pacific Islandcommunities to develop their opportunitiesfor improved economic, social andenvironmental sustainability– Finalise Remote Destination ManagementPlans for Alotau and the Trobriand Islandsin Papua New Guinea; and for Ouvea inNew Caledonia, including identificationof economic opportunities for the local•communityEnhance understanding and respectfor pacific island cultures among ourpassengerscruisingthe pacificP&O Cruises delivers vaccinesWith measles listed as a disease ofconcern in Vanuatu by the World HealthOrganisation, the decision by P&O Cruisesto deliver 500 units of measles, mumpsand rubella vaccine to Port Vila in 2011 wasan easy one.Vaccines are routinely carried onboardP&O Cruises ships as part of our medicalsupplies. When senior nurse Jenny Claphamrealised the 500 units of vaccine werelikely to reach their expiry date withoutbeing used, she arranged for them to bepresented to Ministry of Health officialMaleb Anicet on the dock at Port Vila in July2011.With access to quality health care limitedin many Pacific Island nations, and medicalcentres onboard set up like small hospitalsable to treat passengers and crew formost health conditions, P&O Cruises islooking for similar opportunities to sharemedical expertise and supplies with thecommunities we visit.49 | P&O Cruises 2011 Sustainability Report

21st centurycruising2000 to 2011today’s fleet of luxury liners are takingmore passengers to more destinations thanever dreamed possible 80 years agocruisingthe pacificBy the arrival of the new millennium, theFairstar and Fair Princess had given way tothe newer and more luxurious Pacific Sky(2000-06), followed soon afterwards by thePacific Sun (2004-12) and Pacific Star (2006-08). Forming the platform for the stunninggrowth of the cruise industry in Australiasince 2000, the Pacific Sky carried 275,000passengers on 200 cruises between 2000and 2006, with the Pacific Sun carrying over570,000 passengers and making 1,168 portcalls in 80 different destinations in her eightyear career from 2004 to 2012.But the real change came in 2007 whenAustralia’s first superliner, Pacific Dawn, waslaunched in Sydney by Australian Olympicgold-medallist Cathy Freeman. PacificDawn had been designed by renownedarchitect Renzo Piano and, at 70,000 tonsand carrying 2050 passengers, became thelargest and most luxurious ship ever to bebased in Australia.Pacific Dawn, virtually the same sizeas Cunard’s iconic QE2, set a whole newstandard in cruising for Australians. With795 staterooms, Pacific Dawn has all thefeatures passengers have some to expectof the world’s finest ships including agrand multi-level theatre, superb rangeof lounges and bars, pools and spa baths,multi-choice dinning and a superb range ofaccommodation including sumptuous suitesand mini suites.Cruising the Pacific Islands became evenmore luxurious with the arrival of PacificJewel in 2009. At 70,310 tonnes, PacificJewel carries up to 2053 passengers andfeature one of the largest spas at sea, anopen-air deck with aerial stage for circus andmusic performances, a three-storey atriumfoyer and almost 200 private balcony cabins,the most in P&O Cruises’ fleet.The launch of Pacific Pearl in December2011 by New Zealand Olympic goldmedallist Barbara Kendall, brought to fourthe number of P&O Cruises ships cruisingfrom Australia and New Zealand, carryingaround 8,000 passengers and 3,000 crew atany given time. With 11 passenger decks,sensational performances including theadult only ‘Sit down’ comedy, exquisitedining venues such as ‘Salt Grill’ by LukeMangan, and full use of the five star AquaHealthSpaFitness Centre, Pacific Pearlfeatures a giant pool-side entertainmentscreen, the largest ever teen centre and aswim-up bar.With larger and more luxurious ships,came new home ports in Auckland,Brisbane, Fremantle and Newcastle, as wellas P&O Cruises’ long-standing Sydney base.The options for cruising stretched from threedays to three weeks, with theme cruising forlovers of fine food, history and comedy.The number of destinations tripled from20 in 2003 to 59 in 201, and the options forcruising stretched from three days to threeweeks, with theme cruising for lovers of finefood, history and comedy.50 | P&O Cruises 2011 Sustainability Report

a wholenew standardin cruising foraustralianscruisingthe pacificCelebrations tomark 175 years ofP&O CruisesWorld Cruisingaboard the Oriana inSydney Harbour inFebruary 2012

goals andcommitmentsas the market leader in the australiancruise market, we have a responsibility tonot only set goals to constantly improve ourperformance but to publicly report on ourprogress towards those goalscruisingthe pacificeconomic sustainability2011 GOALSIncreasing the total number of passengers we carry.Maintaining and increasing the economic contributionwe make in Australia, New Zealand and the PacificIslands.Finalizing a Remote Destination Management Plan forour new destination Mare, including identification ofeconomic opportunities for the local community.Continue to work with Pacific Island Communities,especially Vanuatu and Fiji, to develop theiropportunities for improved economic sustainability.Maintaining dialogue with the Australian Governmentand NSW Government on the provision of port facilitiesin Sydney to support the future growth of the industry.Developing a partnership with New Zealand AidProgramme.Ethical behaviour and compliance: Implementation ofonline training courses for shipboard crew and shoresidestaff, including courses on our anti-corruption policy andon our Code of Business Conduct and Ethics.ACHIEVEMENTS27.5% increase in passenger numbers.Existing commitments continued and new initiativescommencedMare remote destination management plan completeand new opportunities identifiedWork ongoing and continuing to develop new shoretours operated by or in conjunction with the relevantcommunities in Vanuatu, Fiji and New Caledonia.Productive dialogue continuing with the Federal andNSW Governments regarding Sydney port facilitiesPartnership with New Zealand Aid Programme launchedEthical training and compliance training completed forrelevant employees.Program implemented with 100% of all P&O Cruisesemployees receiving training in Code of BusinessConduct and Ethics.2012 GOALSMaintain and increase Carnival Australia’s economic contribution to Australia and New Zealand.• Increase the capacity and potential of the cruise industry in Australia.• Maintain dialogue with relevant government authorities to ensure the future growth of the cruise industry issupported through the provision of adequate and appropriate infrastructure.Work with Pacific Island communities to help achieve sustainable economic growth through cruise tourism.• Quantify the economic impact of the cruise industry on Pacific Island communities to identify current impacts andfuture opportunities.• Prepare Remote Destination Management Plans for Alotau and the Trobriand Islands in Papua New Guinea; and forOuvea in New Caledonia.• Continue working with communities in Vanuatu and Fiji to develop their opportunities for improved economicsustainability.• Appoint a general manager to help develop shore tour ventures on Mystery Island for the Aneityum community (inpartnership with the New Zealand Aid Programme).52 | P&O Cruises 2011 Sustainability Report

product sustainability2011 GOALSIncreasing the number of destinations from 55 to 61 andnumber of ports of calls from 470 to 634 (up 25%).Ensuring the impact of out passenger visits areaddressed through Remote Destination ManagementPlans for all new destinations.Improving channels of passenger feedback includingonline customer surveys.Maintaining our customer satisfaction level at 89% orabove.Reducing the rate of customer complaints to below 1.4%of all passengers.Maintaining the number of passengers who recommendP&O Cruises to their friends and family at 86% or higher.ACHIEVEMENTSDestinations increased to 58 ports and port calls to 607.Remote destination management plans complete orunderway for new destinations.Online survey trial to be held in 2012.Satisfaction maintained at 89%.Customer complaints at 1.5% of all passengers.Passengers recommending P&O Cruises to family andfriends at 82% in 2011.2012 GOALSImprove destination management• Ensure the impact of our passengers’ visits is addressed through Remote Destination Management Plans for all newdestinations.• Introduce new shore tours showcasing a greater diversity of natural and cultural experiences for passengers.• Reintroduce Papua New Guinea as a cruising destination with at least three new ports of call.• Accommodate reduced capacity 28 with the sensitive reduction of port calls.Improve passenger satisfaction and feedback mechanisms.• Improve channels of passenger feedback including online customer surveys.• Maintain our customer satisfaction level at 89% or above.• Reduce the rate of customer complaints to below 1.4% of all passengers.• Maintain the numbers of passengers who recommend P&O Cruises to their friends and family at 86%.cruisingthe pacific28Pacific Sun will leave the P&O Cruises fleet in July 2012.

goals andcommitmentscruisingthe pacifichuman resources sustainability2011 GOALSIncreasing onboard training and performancemanagementIncreasing employee recognition, particularly lengthof service and personal achievements for shoresideemployeesIncreasing representation of women among seniorofficersDeveloping an internationally recognised HotelManagement Degree with the University of theSouth Pacific (USP), Suva Campus in the PacificIslands including practical experience onboard one ofP&O Cruises shipsGrowing the number of crew recruited from the PacificIslands as our overall workforce grows, maintaining atleast 10% by 2019.Introducing quarterly surveys of shoreside employees toidentify areas for improvementIntroducing new career development initiatives forshoreside employeesACHIEVEMENTSNot all training data is available for shipboardemployees for the reporting period due to changes inreporting lines and data collection from CUK to PrincessCruises from 1 September 2011.New Length of Service Program launched. PROUD(onboard) and Globe Awards (shoreside) employeerecognition programs in place.First female cruise ship captain to sail in Australasianwaters appointed, with the largest group of femaleofficers in the regionInternship program with USP launched.Crew from Pacific Islands at 8.7%Quarterly survey of shoreside employees introduced(Gauge program).Chart Your Course career development programintroduced for all shoreside employees.2012 GOALSEnsure diversity in recruitment.• Continue to increase representation of women among senior officers.• Further our support for tourism education in the Pacific Islands.• Increase the number of crew recruited from the Pacific Islands to at least at 10% as our overall workforce grows.Provide industry-leading training and development opportunities and flexible work arrangements.• Increase onboard training and performance management.• Increase employee recognition.• Introduce new career development initiatives for shoreside employees.• Rollout a nine-day fortnight for shoreside employees.54 | P&O Cruises 2011 Sustainability Report

environmental sustainability2011 GOALSWork towards reducing the CO2 intensity from shipboard operations by 20% corporatewideby 2015 from the 2005 baseline.Cut water consumption by 2% in 2011.Reduce fuel consumption by 1% through effective itinerary planning.Reduce the emissions from refrigerant gas loss by 15% from the 2010 baseline. 29Complete at least one new Remote Destination Management Plan in the Pacific Islands.Contributing to improved marine safety in the Pacific Islands we engage with theAustralian & New Zealand Hydrographic Services and Australian Maritime and SafetyAuthority (AMSA), encouraging compilation of modern charts and navigational aids inthe Pacific Islands through capacity building programmesContinue to advise local authorities in relation to the completion of infrastructure worksidentified through existing plans to ensure sustainable cruise tourism.ACHIEVEMENTS14% reduction in carbonemissions per passengercruise dayWater consumptiondown by 7% per personper day.Fuel used per ABL kmdown 4.9%.Plan completed for MareContinuing to work withrelevant authoritiestowards new charts andinfrastructure works.2012 GOALSEnsure diversity in recruitment.• Continue to increase representation of women among senior officers.• Further our support for tourism education in the Pacific Islands.• Increase the number of crew recruited from the Pacific Islands to at least at 10% as our overall workforce grows.Continue working towards reducing the CO2 intensity from shipboard operations by 20% corporate-wide by 2015 fromthe 2005 baseline.• Reduce fuel consumption by 1% across the fleet.• Improve energy efficiency with Ship Energy Efficiency Management Plans (SEEMPs) in place for all ships by January2013.Improve onboard environmental management.• Audit our environmental management system to maintain the requirements of ISO 14001:2004.• Improve crew environmental awareness and competence through increased training.• Reduce hazardous waste including evaluation of fluorescent tube alternatives, and reducing the number andvolume of chemicals onboard.Enhance and protect the environment of the places we visit.• Complete at least two new Remote Destination Management Plan in the Pacific Islands.• Continue to advise local authorities on the completion of infrastructure works identified through existing plans toensure sustainable cruise tourism.• Ensure effective handling of waste landed ashore with evaluation of waste vendors.Protect the maritime environment of the Pacific Ocean.• Contribute to improved marine safety in the Pacific Islands by working with the Australian & New ZealandHydrographic Services and Australian Maritime and Safety Authority (AMSA), encouraging compilation of moderncharts and navigational aids in the Pacific Islands through capacity building programs.• Promoting whale avoidance in a safe manner with guidelines in place for all P&O Cruises ships, and whale scenariosincluded in the training of our captains and officers.cruisingthe pacificsocial sustainability2011 GOALSIncrease the extent and impact of the charitableinitiatives we operateFinalised and Remote Destination Management Planfor our new destination Mare, including identification ofeconomic opportunities for the local communityContinue to work with Pacific Island Communities todevelop their opportunities for improved economic,social and environmental sustainability.ACHIEVEMENTSSupport for existing charities maintained and additionalad-hoc support provided.Mare plan completed and new opportunities identified.Work underway and continuing.2012 GOALSIncrease the extent and impact of the charitable initiatives we operate, particularly in the Pacific Islands.Continue to work with Pacific Island communities to develop their opportunities for improved economic, social andenvironmental sustainability.• Finalise Remote Destination Management Plans for Alotau and the Trobriand Islands in Papua New Guinea; and forOuvea in New Caledonia, including identification of economic opportunities for the local community.Enhance understanding and respect for Pacific Island cultures among our passengers.292011 data notcomparable to2010 due tointernal changein data collectionprocesses.

GRI INDEXThis Sustainability Report was compiled for P&O Cruises in accordancewith the G3.1 Guidelines of the Global Reporting Initiative (GRI).cruisingthe pacificGRI IndicatorPagenumberlabour practices and decent workLA1 Total workforce by employment type, employment contract and region, broken down bygender30-33LA2 Total number and rate of new employee hires and employee turnover by age group, genderand region31LA4 Percentage of employees covered by collective bargaining agreements 34LA5 Minimum notice period(s) regarding operational changes, including whether it is specified incollective agreements32LA6 Percentage of total workforce represented in formal joint management-worker health andsafety management- worker health and safety committee that help monitor and advise on 34-35occupational health and safety programsLA7 Rates of injury, occupational disease, lost days, and absenteeism, and total number of workrelatedfatalities, by region and by gender35LA8 Education, training, counselling, prevention, and risk-control programs in place to assistworkforce members, their families, or community members regarding serious diseases.33-35LA9 Health and safety topics covered in formal agreements with trade unions 35LA10 Average hours of training per year per employee by gender, and by employee category 33LA11 Programs for skills management and lifelong learning that supports the continuedemployability of employees and assists them in managing career endings32-34LA12 Percentage of employees receiving regular performance and career development reviewed,by gender34LA13 Composition of governance bodies and breakdown of employees per employee categoryaccording to gender, age group, minority group membership, and other indicators of diversity 30-33human rights performance indicatorsHR3 Total hours of employee training in policies and procedure concerning aspects of humanrights that are relevant to operations, including the percentage of employees trained12HR4 Total number of incidents of discrimination and corrective actions taken 13HR5 Operations and significant suppliers identified in which the right to exercise freedom onassociation and collective bargaining may be violated or at significant risk, and actions taken 34to support theseHR6 Operations and significant suppliers identified as having significant risk of incidents of childlabour, and measures taken to contribute to the effective abolition of child labour31HR7 Operations and significant suppliers identified as having significant risk for incidents of forcedor compulsory labour, and measure to contribute to the elimination of all formed of forced or 34compulsory labourHR8 Percentage of security personnel trained in the organization’s policies or proceduresconcerning aspects of human rights that are relevant to operations12-14social performance indicatorsSO1 Percentage of operations with implemented local community engagement, impactassessments, and development programs3, 20,38, 48SO3 Percentage of employees trained in organization’s anti-corruption policies and procedures 12SO5 Public policy positions and participation in public policy development and lobbying 13SO8 Monetary value of significant fines and total number of non-monetary sanctions for noncompliancewith laws and regulations12Covered inthis report56 | P&O Cruises 2011 Sustainability Report

GRI Indicatorproduct responsibility performance indicatorsPR1 Life cycle stages in which health and safety impacts of products and services are assessedfor improvement, and percentage significant products and services categories subject tosuch proceduresPR2 Total number of incidents of non-compliance with regulations and voluntary codesconcerning health and safety impacts of products and services during their life cyclePR5 Practices related to customer satisfaction, including results of surveys measuring customersatisfactionPR8 Total number substantiated complaints regarding breaches of customer privacy and losses ofcustomer dataeconomic performance indicatorsEC1 Direct economic value generated and distributed, including revenues, operating costs,employee compensation, donations and other community investments, retained earnings,and payments to capital providers and governmentEC2 Financial implications and other risks and opportunities for the organization’s activities dueto climate changeEC6 Policy, practices, and proportion of spending on locally-based suppliers at significantlocations of operationEC7 Procedure for local hiring and proportion of senior management hired from the localcommunity at locations of significant operationEC8 Development and impacts of infrastructure investments and services provided primarily forpublic benefit through commercial, in kind, or pro bono engagementEC9 Understanding and describing significant indirect economic impacts, including the extent ofimpactsenvironmental performance indicatorsPagenumber15,24-27148,24-261318-211520, 45302018-21,43EN3 Direct energy consumption by primary energy 42EN4 Indirect energy consumption by primary source 42EN6 Initiatives to provide energy-efficient or renewable energy based products and services andreductions in energy based products and services, and reductions in energy requirements as 42a result of these initiativesEN8 Total water withdrawal by source 43EN13 Habitats protected or restored 38-39EN16 Total direct and indirect greenhouse gas emissions by weight 42EN18 Initiatives to reduce greenhouse gas emissions and reductions achieved 42EN20 NO, SO, and other significant air emissions by type and weight 42EN21 Total water discharge by quality and destination 43EN22 Total weight of waste by type and disposal method 43EN23 Total number and volume of significant spills 40EN26 Initiatives to mitigate environmental impacts of products and services, and extent of impactmitigation38-39EN28 Monetary value of significant fines and total number of non-monetary sanctions for noncompliancewith environmental laws and regulation12Covered inthis reportcruisingthe pacific57 | P&O Cruises 2011 Sustainability Report

cruisingthe pacificfurther informationFor further information on P&O Cruises’ approach tosustainability please contact us at sustainability@pocruises.com, or see www.pocruises.com.au/aboutus/pages/sustainability.aspximagesCarnival Australia image library.Image this page: Trobriand Islands, Papua NewGuinea. Courtesy of David Kirkland.thanksP&O Cruises thanks Rob Henderson and Doug Cremerfor their assistance with P&O Cruises archive libraryinformation and images.Thanks also to Professor Ross K Dowling of EdithCowan University and Ngaire and Norman Douglasof James Cook University for invaluable workdetailing the history of cruising in the Pacific.

cruisingthe pacificwww.pocruises.com.auThis report has been provided in digitalformat only. Please consider theenvironment before printing.