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Cummins Inc. 2007 Sustainability Report

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Ethics Cases — Quarterly Days-to-Close Trend<br />

70<br />

60<br />

50<br />

40<br />

30<br />

20<br />

10<br />

0<br />

Days-to-close<br />

Goal = 24 days<br />

2006 Q1 2006 Q2 2006 Q3 2006 Q4 <strong>2007</strong> Q1 <strong>2007</strong> Q2 <strong>2007</strong> Q3 <strong>2007</strong> Q4<br />

(many employees must take more than one course<br />

due to the nature of their work) with a 93 percent<br />

completion rate. The Company expects to offer nearly<br />

45,000 training subscriptions to its employees in 2008,<br />

and is working to improve its reporting system to<br />

ensure closer to 100 percent compliance.<br />

In addition, <strong>Cummins</strong> in <strong>2007</strong> began offering training<br />

courses to key employees at its Distributors in many<br />

locations outside the United States, and has plans<br />

to expand the compliance training offerings to these<br />

groups in 2008.<br />

Ethics Violations,<br />

<strong>Report</strong>ing and Investigations<br />

<strong>Cummins</strong> employees are encouraged to report<br />

suspected violations of the Company’s Code of<br />

Business Conduct or any type of misconduct, and are<br />

given several different means of sharing their concerns.<br />

The Company’s third-party reporting system,<br />

EthicsPoint, allows employees around the globe to<br />

report concerns either on-line or through toll-free<br />

numbers in multiple languages. Employees can<br />

report concerns anonymously where allowed by<br />

law. Still, more than half of all complainants in <strong>2007</strong><br />

identified themselves, showing a large degree of<br />

trust in the Company’s ethics investigation process.<br />

Those who report about any topic are protected<br />

under the Company’s anti-retaliation policy.<br />

<strong>Cummins</strong> has a global team of trained Master<br />

Investigators who investigate complaints and ensure<br />

that appropriate action is taken in a timely fashion.<br />

In <strong>2007</strong>, <strong>Cummins</strong> investigated 541 ethics-related<br />

complaints, compared to 264 in 2006. The numbers<br />

grew because of increased training and promotion<br />

of the reporting process. Of the cases investigated<br />

in <strong>2007</strong>, 46 percent resulted in a finding that the<br />

complaint had some merit – and of those<br />

28 percent (61) resulted in employee termination.<br />

Complaints of unprofessional behavior and those<br />

grouped into the Human Relations category<br />

accounted for more than half the total ethics cases<br />

investigated in <strong>2007</strong>.<br />

Governance<br />

25

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