Directors' Report: Group performance 28Glanbia plc Annual Report 2011Our responsibilitieswww.glanbia.comOur People StrategyThe Group actively fosters a dynamic and results oriented corporate culture by continuing to make Succession Management the way of working throughout the organisation. We encourage our people at all levels of the organisation to "make a difference" through clear accountability and the delivery of performance and innovation with high energy and personal integrity. Our Succession Management process ensures that those employees who perform well will be rewarded and provided with exciting opportunities for career development in Glanbia's expanding global business.The clear identification of employee performance and of potential future leaders through the succession management process is a Key Performance Indicator (KPI) for Human Resources (HR). The Group is committed to providing continued development to these future leaders through defined development initiatives. Graduate programmeGlanbia continues to attract and recruit talent to sustain the future development of the organisation. Our Graduate programme has been a key element for many years in recruiting top talent to support the operations, commercial and innovation functions throughout the Group. Many of these graduates are now developing successful careers across the global organisation.Employee communicationA key HR imperative is to have strong clear communication throughout the organisation. Regular team briefs continued in 2011 to provide all employees with relevant Group messages and updates on local business specific issues.Additionally, a two day management conference was held in 2011 for the senior management teams of all global business units and Group functions. This was an excellent opportunity to outline the Group strategy, clarify the roles and responsibilities of each business unit in that context and to fully integrate this key senior management group.4,572The average number of people employed with Glanbia in 2011 In 2011, 25 high potential managers from across Glanbia's global community attended the Glanbia Management Development Programme. This programme is designed to develop leadership and strategic capability in high potential managers. Participants are also challenged with business critical projects providing the opportunity to put their newly learned skills to the test in cross functional teams.Management Conference Excellence AwardsAchievement Awards were presented during the 2011 Glanbia Management Conference to celebrate success  within the Group. Presentations were made to:  > Global Nutritionals and Group Business Services - for a complex, collaborative IT project between the Glanbia Nutritionals team at Customised Premix Solutions, California and Group Business Services.> Consumer Products - for supply chain management under extreme, adverse weather conditions during the winter of 2010/2011.> Southwest Cheese - for the capacity expansion project, an example of "on time and on budget delivery."

Directors' Report: Group performance Glanbia plc Annual Report 2011Our responsibilitieswww.glanbia.com29Global HR systemWe continue to develop our Global HR system to underpin our performance and reward policies and to deliver a highly professional performance and succession management process. In 2012 we move to a new development phase of key metrics measurement to further empower managers with the information required for efficient people management.Operational HR Glanbia employed an average of 4,572 people in 2011, including Joint Ventures & Associates. Employee numbers in US Cheese and Global Nutritionals increased by 289 in 2011. This was largely due to the acquisition of BSN®. In addition, Global Nutritionals continued to recruit key sales and business development people across its global business to strengthen and reorganise management teams to enable the future delivery of our growth strategy. Dairy Ireland employee numbers were largely unchanged reflecting the completion of the 2009-2011 rationalisation programme when 358 employees left the business. We continue to examine our Dairy Ireland cost base to ensure we optimise our competitiveness in a challenging Irish economic environment, while also being adequately resourced to take advantage of the business opportunities arising from the current positive global dairy outlook.Pension schemeDuring 2011, the strategic review of the Group's defined benefit pension scheme arrangements in Ireland was finalised. Changes were necessary as a consequence of significant funding deficits experienced by these schemes. As a result, funding proposals were agreed with the Pensions Board for the Group's main pension schemes. This resulted in members' benefits being reduced in conjunction with significantly increased Group contributions to the schemes and it is anticipated that the changes will place the defined benefit pension schemes on a firmer platform for the future.Irish pay agreementIn 2012, Glanbia enters the final year of a 51 month pay agreement with our Irish based employees. The Group will review, with employee representatives, future compensation policy in the light of the evolving Irish economic and commercial climate and our competitive cost position.Health and safetyGlanbia continues to extend and deepen the investment in health and safety (H&S) in all our operational sites. We measure our effectiveness through independent third party H&S audits as part of the Glanbia Risk Management System (GRMS). H&S and legislative compliance is a cornerstone of the GRMS and are embodied in 11 sections of the audit programme including risk assessment, planned inspections, occupational health, training, personal protective equipment, communications and recruitment. Among many initiatives in 2011, one novel innovation was the roll out of 'Behavioural Based Safety' at our cheese production facilities in Idaho. This is a process whereby an employee conducts a workplace safety review on an aspect of a colleague's role resulting in improved safety recommendations, where required.Another key initiative was in the Consumer Products business where supply chain has been incorporated into the GRMS audit framework. In 2011, 25 high potential managers from across Glanbia's global community embarked on the first stage of the custom designed programme, 'Glanbia Management Development Programme.'The Consumer Products team responsible for achieving GRMS accreditation for supply chain function in 2011. GRMS is the 'Glanbia Risk Management System' which governs the health and safety standards and procedures required to operate safely.