Safe Working Conditions

At Pentair, safety is central to our PIMS operating system. In fact, we start each operating review with an analysis of our safety metrics. We know that every employee contributes to a safe working environment; that's why safety awareness is a cornerstone of Pentair's safety program. Awareness is created through highly visible safety metrics posted throughout our operations including down to small group work cells; regular safety talks among employees; regular posting of safety programs; and safety incentive programs which reward leaders and employees who create and maintain safe working conditions. Through these and other tools, such as internal newsletters, bulletin boards, and TV/computer monitor programs, Pentair employees are continuously reminded of their role in keeping themselves and their fellow co-workers safe.

Further, Pentair prioritizes management oversight of safety practices through monthly reporting systems of defined safety metrics (our "safety scorecard") which is led by a safety committee that reports to our COO and up through our Board of Directors. The committee scrutinizes individual plant safety through monthly management scorecards leveraging this supportive network. Leadership continuously emphasizes safety metrics and we closely monitor results and quickly implement corrective actions and preventive measures.

Pentair has defined a key set of metrics through which we rate the safety of all operations. Those metrics include standardized safety performance metrics established by the Occupation Safety and Health Administration (OSHA) of the U.S. Department of Labor as well as our own internal metrics, including days without incidents and lost time days. Through the PIMS lean philosophy of managing daily improvement, we rigorously track safety metrics and visibly display results in each manufacturing location, at the division, plant and work cell level. While we use U.S. OSHA reporting criteria, all of our facilities worldwide report their injuries using this criteria.

As a result of this focus, we have further improved workplace safety annually for the past three years, as measured in part by OSHA recordable incidents.

Pentair has a track record of improving the safety of acquired businesses. For example, Pentair acquired the McLean Cooling operations in Minnesota in late 2005. Working with the leadership team, Pentair's safety leaders quickly assessed the operation's safety practices and record. Based on that analysis, the team implemented Pentair's safety program of strong employee accountability, safety rewards, and safety leadership recognition programs. By 2007, lost time injuries at the McLean Champlin, Minnesota facility decreased 43 percent.