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Net Balance Management Group Pty Ltd
Level 1, 190 Queen Street, Melbourne
Victoria 3000 Australia
Tel +61 3 8461 6400 Fax +61 3 9600 1295
Web netbalancemanagement.com

INDEPENDENT ASSURANCE STATEMENT

To the Board of Directors, Management and Stakeholders of Woolworths Limited:

Woolworths Limited (Woolworths) commissioned Net Balance Management Group Pty Ltd (Net Balance) to provide independent assurance of the non-financial content within the Woolworths’ Corporate Responsibility Report 2008 (the Report). The Report presents Woolworths’ sustainability performance over the period 1 July 2007 to 30 June 2008. Woolworths was responsible for the preparation of the Report. As an independent assurer of the Report, the responsibility of Net Balance is to the Woolworths’ Board and Executive alone in accordance with the terms of reference agreed with them. Other stakeholders should perform their own due diligence before taking any action as a result of this statement.

Assurance Objectives

The objective of the assurance process is to provide stakeholders of Woolworths with an independent opinion on the quality of the Report. This is confirmed through verification of claims made, and a review of the organisation’s underlying systems, processes and competencies that support the Report with respect to the principles of materiality, completeness and responsiveness. Ensuring continuous improvement in data management systems and associated reporting processes is also a complementary objective.

Assurance Process

The assurance engagement was undertaken between July and October 2008. The process involved:

  • A review of Woolworths’ key sustainability strategies, policies, objectives, management systems, measurement and reporting procedures and background documentation.
    Interviews with key staff responsible for information contained within the Report to ascertain their views, understanding and response to material sustainable development issues faced by the business.
  • A series of interviews with key personnel responsible for collating and writing various parts of the Report to substantiate the veracity of selected claims.
  • An overview of how the key economic, environmental and social policies are embedded within the business.
  • An independent materiality check using the five part materiality test, including a comparison of Woolworths against its industry peers, a review of selected external media coverage, and an assessment of compliance performance.
  • A review of the Report for any significant anomalies, particularly in relation to significant claims as well as trends in data.
    Examination of the aggregation and/or derivation of, and underlying evidence for, over 115 selected data points and statements made in the Report.

Assurance Level and Limitations

The level of assurance provided is moderate as defined by the scope and methodology described in this assurance statement. The assurance process focused on systems and activities of Woolworths during the reporting period, with the following exceptions:

  • The scope of work did not involve the verification of financial data, other than that relating to environmental, social or broader economic performance.
  • The scope of work did not involve the verification of community investment data that was assessed by the London Benchmarking Group.
  • The verification process was conducted entirely at the Bella Vista Head Office and no other sites were visited as part of this assurance engagement.

Our Independence

Net Balance was not responsible for preparation of any part of the Report. Our team’s independence was ensured by selecting an assurance team that had no other involvement with Woolworths during the reporting period that could impair the team’s independence or objectivity. However, Net Balance completed Global Reporting Initiative (GR) G3 Application level check for the 2008 Report. This project was deemed complementary to the assurance function and therefore did not impact upon the team’s independence or objectivity.

Our Capacity

The assurance was carried out by a multi-disciplinary team of sustainability specialists, comprising individuals with expertise in environmental, social and economic performance measurement. Net Balance is a global leader in the use of the AA1000 Assurance Standard. The assurance team has collectively undertaken over 80 assurance engagements in Australia over the past 10 years and is led by a Lead Sustainability Assurance Practitioner (Lead CSAP), accredited by the International Register of Certified Auditors UK (IRCA UK).

Our Opinion

Based on the scope of the assurance process, the following represents the assurance provider’s opinion:

  • The findings of the assurance engagement provide confidence in the information contained within the Report. The level of data accuracy was found to be within acceptable limits. Data trails selected were identifiable and traceable, and the personnel responsible were able to reliably demonstrate the origin(s) and interpretation of data.
  • The statements made in the Report appropriately reflect environmental, social and economic performance achieved during the period.
  • All errors noted by the assurance provider were satisfactorily addressed by Woolworths prior to finalising the Report.

Conclusions and Recommendations

Overall, the assurance provider is satisfied that the Report is an appropriate representation of Woolworths’ sustainability performance during the reporting period. To ensure Woolworths builds on this Report in future reporting, Net Balance has provided a detailed management report to Woolworths. The key recommendations include: an earlier start to the assurance process to allow more time for a desktop review using the five part materiality test, completeness and responsiveness; integrating accountability for sustainability within the governance structure within Woolworths; including community investment data as part of the AA1000 assurance process, and; increased staff engagement on the assurance process to provide staff with a greater understanding of the assurance. This represents a summary statement. The more detailed assurance statement can be accessed at www.woolworthslimited.com.au

On behalf of the assurance team
21st October 2008
Melbourne, Australia

Terence Jeyaretnam

Director, Net Balance & Lead CSAP (IRCA UK)