12202 SYSCO AR PROD 5 19 · Toni Watson, Vice President of Human Resources and Customer Service, SYSCO Central Florida ... Participants also receive study materials that help them

SYSCO

DIVERSITY AND INDUSTRY RELATIONS REPORT®

Annual ReportMAKING A WORLD OF DIFFERENCE

®

There’s an ancient Chinese proverb that says, “May you live in interesting times.” While some scholars say this expression was originally a curse, we at SYSCO see it differently. We celebrate the many interesting changes that have come our way over the last 35 years—especially when it comes to the people we work with.

Our society is more diverse today than at any time in the past, a rich tapestry that comprises countless different backgrounds, ethnicities and attitudes. At SYSCO werecognize that, just as the right blend of seasonings can give a dish its own unique taste,the many differences among us are what give life its fascinating flavor.

In this spirit, we’ve created a plan that integrates best business practices in four distinctareas to create a workplace that reflects the unique diversity of American life.

■ In our workforce, we’ve implemented programs that help us recruit the best and brightest from a broad range of cultures—and that help our employees live up to their full potential while helping our customers be more successful.

■ In our supplier relationships, we’ve built successful partnerships with minority- andwoman-owned businesses to offer our customers an even greater variety of choices.

■ In our leadership, we’ve committed ourselves to ensuring diverse representationat all levels of our company, all the way to the top.

■ In the communities in which we live and work, we’ve come to be known as asupportive partner dedicated to helping build stronger neighborhoods, promotehigher education among minorities and encourage greater diversity all acrossour industry.

By supporting and embracing diversity, we all gain new ideas and learn new ways toapproach challenges. This allows us to make better business decisions that will have far-reaching and lasting benefits for everyone our business touches: our customers, ourshareholders and our associates.

It also lets us look forward to many, many more interesting times to come.

Message From Chairman and CEO Rick Schnieders

Diversity…A COMMITMENT FROM THE TOP

SYSCO DIVERSITY AND INDUSTRY RELATIONS REPORT

OUR PEOPLE TELL THE STORY

“There are always lots of opportunities. You could make acareer here until you retire and never be bored, because youcan move around and do so many new things.” Twila Day, Assistant Vice President ofTechnology and Applications, SYSCOCorporation

“There’s a culture of success within our organization. It’s notabout just reaching the numbers; it’s also about wanting toachieve bigger and better things.”Larry G. Pulliam, Executive Vice President ofMerchandising Services, SYSCO Corporation

“I believe that by helping [our employees] succeed, we’re contributing to SYSCO’s mission—helping our customers succeed.”Toni Watson, Vice President of Human Resources and Customer Service, SYSCO Central Florida

“It’s not work for me—it really isn’t.When the alarm clock rings in themorning, I can’t wait to go to work.”Saul Adelsberg, ExecutiveVice President, SYSCOFood Services of Los Angeles

“Integrity in our business dealings is justas—if not more—important today aswhen Mr. Baugh established this keyvalue 34 years ago.”Diane Day Sanders, SeniorVice President of Finance and Treasurer, SYSCOCorporation

“SYSCO's a great company for individuals of all backgrounds, because here, it's all about the people.”Micheal J. Helm, Senior Director of Merchandising, Bakery, Convenienceand Manufactured Products, SYSCO Corporation

SYSCO DIVERSITY AND INDUSTRY RELATIONS REPORT 1

W OR K FOR C E

Workf

DIVERSITY IN OUR WORKFORCEAt SYSCO, we’re proud of the significant—and growing—presence ofwomen and people of color in our workforce. Over one quarter of ouremployees are people of color, and one fifth are women. We’re proud ofthe fact that talented professionals of all backgrounds see SYSCO as aplace of unlimited opportunity where they can make a difference.

KEEPING IN S.T.E.P.When we encourage career advancement among our diverse workforce, it not only helps individual people succeed—it creates a richer workenvironment for everyone and inspires employees across the organization.That’s why SYSCO created the System to Entry-Level Promotion, orSYSCO S.T.E.P. Sponsored by the Corporate Diversity Department,S.T.E.P. is designed to help motivated associates advance their careers atSYSCO as far as their abilities will take them.

Through the SYSCO S.T.E.P. program, career-minded associates throughoutSYSCO operating companies are paired with experienced managers, orcoaches, who provide the one-on-one advice and professional guidance theyneed to succeed. Participants also receive study materials that help themdevelop awareness of the skills needed to succeed as a supervisor, evaluatetheir motivational fit for a supervisory position and identify the skills thatneed further development.

The SYSCO S.T.E.P. program has been anoutstanding asset in our mission to improve

diversity among our supervisors andmanagers. The participation of women

and people of color in the programcontinues to grow year by year. Andit’s clear that those who participateare reaping the rewards: In 2004,these two groups made up about 52 percent of S.T.E.P. participantswho advanced into District SalesManager (DSM) and Front-LineSupervisor (FLS) positions.

Through programs like SYSCO S.T.E.P., we

encourage advancement among our associates by

providing them with the training, the guidance

and the opportunities they need to reach their

career goals.

SYSCO DIVERSITY AND INDUSTRY RELATIONS REPORT2

kforce

At SYSCO, we know that to build a truly diverse workforce,particularly among our Marketing Associates (MAs), we needto actively recruit the very best candidates from a wide varietyof cultural, economic and social groups.

SYSCO REGIONAL RECRUITING WORKSHOPSAny effort to improve diversity among our MAs would beincomplete if it didn’t involve our most important partners in this mission: our operating companies. The DiversityDepartment conducts a series of informative RegionalRecruiting Workshops for our operating companies’ HRmanagers and other key personnel. Coordinated by SeniorDirector of Diversity Lori Wolner and Senior Manager of DiversityCora Robinson, these diversity-focused seminars are organized aroundthree distinct goals:

■ Sharing business practices that can improve the diversity ofSYSCO’s qualified MA candidate pool

■ Helping our operating companies develop a strategic approach tothe selection of diverse MAs

■ Giving our operating companies the tools they need to build their own customized recruitmentaction plans

Our attendees also enjoyed a great deal of “training” from their own peers. Events like the RegionalRecruiting Workshops offer managers from our operating companies unique opportunities to sharebest practices in targeted recruiting strategies, as well as in the analysis and utilization of their data,with their counterparts from other operating companies. SYSCO is committed to encouraging thisopen sharing of information among peers, which helps spread the wealth of our associates’ expertisethroughout our organization.

MARKETING ASSOCIATE RECRUITING TOOLSAs part of our commitment to attracting diverse associates to our workforce, SYSCO has created aseries of recruiting ads, radio commercials and other effective tools designed to increase our visibilityamong women and people of color. Each communication features a prominent, appealing messagethat demonstrates the diversity of our organization and highlights the career opportunities we offerand the support we provide our employees on their journeys to success.

THE RIGHT PEOPLE FOR THE RIGHT TEAM

3

Regional Recruiting Workshop attendees learn from the

SYSCO diversity team—and from each other—about

improving diversity in their organizations.



Workf

MARKETING ASSOCIATE RETENTIONAsk any number of recruiting professionals which isthe most difficult area to retain qualified people andthe answer will be the same: sales. But at SYSCO, wepride ourselves on the excellent retention among ourMarketing Associates. From our new recruits in theirfirst 13 weeks to our more seasoned associates with a year or more behind them, our retention ratesconsistently exceed 80 percent year after year.These results are a tribute not only to our operatingcompanies’ ability to recruit the right people, but alsoto the rewarding, fulfilling environment our new MAsdiscover at SYSCO once they’re part of the team.

W OR K FOR C E

4

HOUSTON BUSINESS JOURNAL RECOGNIZES SYSCO AS ONE OF ITS “BEST PLACES TO WORK”For three consecutive years, SYSCO has been recognized by the Houston Business Journal as one of the area’s “BestPlaces to Work” among businesses with over 500 employees.

In order to qualify for this distinction, a company must embody certain characteristics that help each and everyemployee feel wanted, appreciated and above all, motivated to come to work every day and do it all over again. Inother words, it must reflect the values of a truly diverse organization like SYSCO.

To obtain the information that allows it to select its winners, the Houston Business Journal uses the simplest—and alsothe most reliable—approach. They ask the employees themselves.

As one SYSCO associate wrote, “I like the fact that even though SYSCO is a large corporation, it still has the small family business atmosphere. Everyone wants to know everyone, you see the upper managementregularly in the course of a week, and the people are fun to work with.”


kforce

PERFECT PARTNERSHIPS: OUR SUPPLIERSNow more than ever, supplier diversity matters at SYSCO. Partnering withminority- and woman-owned suppliers isn’t just good business—it’s good forbusiness. Diverse suppliers help SYSCO meet the changing demands offoodservice operators while supporting strategic alliances that enable thecontinued success of SYSCO, our customers and our supplier partners. Ourcommitment to the success of those who sustain our industry, including oursupplier partners, is strong—and it’s the reason why we seek to engage and retainsuppliers as diverse as the product lines we offer.

At SYSCO, we do business with over 300 minority- and woman-owned suppliers,and each year this base continues to grow. Our total purchases from thesesuppliers have grown from $280 million in fiscal year 2003 to $330 million in2004—and we’re already on track to exceed $350 million in fiscal year 2005.

SUPPLIERS

5

Roger Lin, SYSCO supplier and owner

of Ocean Duke Seafood Company, is one

of many minority suppliers who help

SYSCO—and our customers—succeed.

SYSCO President and Chief Operating Officer

Tom Lankford (right) discusses supplier diversity

with Curtis Sullivan, CEO of Omni Custom Meats.

Purchases from Diverse Suppliers

$280 million

$330 million

$350 million$400

$300

$200

$100

$0

Purc

hasin

g Do

llars

SYSCO DIVERSITY AND INDUSTRY RELATIONS REPORT6

S U P P L I E R S

Suppl®

DIVERSITY IN OUR BRANDSThe diversity among the people who make SYSCO work—from

our suppliers to our operating companies to our corporatedepartments—has allowed us to create the industry’s

widest-ranging arrays of products. From the richMediterranean zest of our Arrezzio line to the

south-of-the-border flair of Casa Solana, we offercustomers the opportunity to broaden theirhorizons—and boost their profits—with some of the most authentic ethnic flavors around.

We’ve discovered that diversity in our brandsisn’t just good for our image; it’s also good for

business. In just the last year, SYSCO specialtybrands have grown 8.7 percent in the number of

cases ordered—and an astounding 20 percent in totalsales dollars. Additionally, during the same time period,

SYSCO’s traditional, or nonspecialty, brands grew 3.3percent in case sales and 10.6 percent in dollar sales.

G R OW I NGSYS C O B R A N D S

SYSCO is proud of the diverse array of supplier

partnerships that allows us to offer our customers

the finest products available.


Our suppliersknow us as a solidpartner who is ascommitted totheir success as weare to our own.

pliers7

HERITAGE SUPPLIER DIVERSITY AWARDTo show our appreciation for the outstanding contributions of our diverse suppliers, SYSCO presents itsHeritage Supplier Diversity Awards to three minority- or woman-owned supplier partners each year. Suppliersare judged for excellence across various service areas, including new products, sales growth, promotionalsupport, service and administrative efficiencies. It’s our pleasure to recognize the suppliers who contribute somuch in helping us meet the changing demands of the foodservice industry.

In October, SYSCO announced our 2004 Supplier DiversityAward winners:Gold: Carla’s PastaSilver: Renaissance Man InternationalBronze: All Round Foods

GREATER HOUSTON MINORITY

SUPPLIER PARTNERSHIP PROGRAMSYSCO Corporate is also an active

supporter of the Houston MinorityPartnership Task Force, an initiative

of the Greater Houston Partnership.As a proactive corporate citizen of the city of Houston, we doeverything we can to support thearea’s minority-owned businesses.This includes encouraging our

corporate procurement departments to purchase goods and services from

minority-owned firms, providing access to key decision makers and establishing a

process to recognize successful partnerships.Carla Squatrito, founder

and owner of Carla’s Pasta,

prides herself on the business

that won SYSCO’s Gold

Heritage Supplier Diversity

Award in 2004.

Renaissance Man International, represented by CEO—and former NFL star—

Herschel Walker (center) and President Bill Richardson (second from right), receives

the 2004 Silver Heritage Supplier Diversity Award from SYSCO executives ( l–r)

Larry J. Accardi, Executive Vice President, Merchandising Services and Multi-Unit

Sales; Albert L. Gaylor, Assistant Vice President, Industry Relations; and Larry

Pulliam, Executive Vice President of Merchandising Services.


L E A DE R S H I P

Leade

LEADING THE WAY TO THE FUTUREAll of us at SYSCO have seen for ourselves the benefits of a diverse workplace, both for our successas a company and for our personal growth as individuals. To ensure that we all continueto enjoy these benefits, we must ensure that the spirit of diversity endures in theattitudes of our employees—particularly in the future leaders who will guide thecompany for years to come.

DIVERSITY FORUMOur workforce is our most important partner in our ongoing efforts toencourage diversity—as well as the source of our future leadership. In thisspirit, the SYSCO corporate office hosted a series of diversity forumswith our corporate associates to solicit their input on how we can improvein this area.

Five forums were conducted with Chairman and CEO Rick Schniedersand Director of HR/Corporate Office Sanita Paul. Approximately 100associates—who represented recent hires, long-tenured associates, people ofcolor, women and Caucasian men—were invited to attend.

Through these forums, our associates brought several key issues to our attention;following is a list of the initiatives we’ve identified to address each of them:

■ Communicate our leadership’s commitment to diversity■ Consistently deliver performance management■ Enable advancement of diverse talent throughout the organization■ Highlight and communicate partnerships and relationships with diverse organizations.

In a follow-up to the forums, Chairman and CEO Rick Schnieders hosted an all-employeesession to explain the results as well as the related initiatives. In addition, a

Leadership Development series module called “The Business Case for Diversity”has been created to be shared with all associates at the corporate office.

8


Our commitment to promoting diversityextends throughout our organization—all the way to the top.

dership9

Growth of People of Color and Women

in Senior Positions at SYSCO Corporate

DIVERSITY IN OUR LEADERSHIPAt SYSCO, we’re committed to building an environment whereevery employee can reach his or her full potential. In just the lastyear, we’ve seen 2 percent growth in the number of women insenior positions—and an inspiring 13 percent growth among peopleof color.

SUCCESSION PLANNINGWhen we look for the men and women who will carry our promiseof diversity into the future, we know exactly where to start—in ourown organization. That’s why we’re committed to offering ouremployees every opportunity to reach their career goals throughmanagement development programs, continuing education and thechance to experience a variety of different responsibilities.

No wonder the average tenure among our senior executives is 20 years, with a 95 percent retention rate. And no wonder ChiefExecutive magazine has ranked SYSCO in the top 20 companies for developing leaders.


C OM M U N I T Y

Commu

SUPPORTING OUR NEIGHBORSAt SYSCO, we know we can’t promote diversity in our future leadership from behind our officedoors; we must be active citizens of the communities in which we live, work and serve. Throughcorporate donations, employee volunteer initiatives and fundraising partnerships, SYSCO’scommitment to social responsibility is making a difference every single day in our diversecommunities across the country.

FIGHTING HUNGERAs the nation’s top foodservice supplier, SYSCO is proud to support a wide array of causes dedicatedto fighting hunger across our country.

Share Our Strength: SYSCO is an enthusiastic partner of Share Our Strength, the nation’s leadingnot-for-profit organization dedicated to the elimination of childhood hunger.

Taste of the Nation: Through this Share Our Strength initiative, we’re the official foodservicemarketer and distributor for these important fundraising events, which include more than 100 foodand wine tastings, seated dinners, brunches, and barbecues across the United States and Canada.

The Great American Bake Sale™: Each year SYSCO associates participate in this event thatencourages all Americans to host a bake sale in their communities, with all proceeds going to Share Our Strength’s fight against childhood hunger.

Food Bank Volunteerism: Several times a year, SYSCO associates volunteer their time to supportlocal area food banks where they perform a variety of services, including pulling and sorting productsfor distribution.

Taste of the NFL: SYSCO is an official corporate sponsor of this annual event, which pairs top chefsand NFL players to serve gourmet cuisine and sign autographs in an effort to raise awareness andfunding in the fight against hunger.

Kids Café: We’ve partnered with many of our suppliers to raise funds for Kids Café, which helps at-risk youth change their eating behaviors—and their lives—by combining important, kid-friendlynutritional information with the fuel children need to build strong and healthy futures.

10

( photo at left) Twila Day, Assistant Vice President of Technology and Applications ( left)

and Debbie Ulrich, Executive Vice President of SYSCO Food Services of Central

Pennsylvania, pitch in to feed the hungry at the Houston Food Bank.


From nutritious meals to educational opportunities,SYSCO is helping make sure our neighbors have what they need to live healthy, happy, successful lives.

munity

ENCOURAGING EDUCATIONThe most vital link between our present and our future is education—the nourishing of young minds that will empower our youth to becomethe leaders of the future. At SYSCO, our commitment to diversity isthe inspiration behind our enthusiastic support of numerous minority-focused scholarship programs—which includes over $60,000 incorporate contributions to minority scholarship efforts within the last12 months.

United Negro College Fund Scholarships: We’re a proud corporatesponsor of the UNCF, the nation’s largest, oldest, most successful andmost comprehensive minority higher education assistance program.

Hispanic Association of Colleges and Universities: Through our alliance with the HACU, SYSCO helps contribute to thedevelopment of the nation’s youngest and fastest-growing population.

Organization of Chinese Americans: SYSCO is an enthusiasticsupporter of the OCA, which aims to better the lives of more than 10 million Asian Pacific Americans living in the United States.

American Indian College Fund: Through our partnership with theAICF, SYSCO helps provide scholarships and other support for thenation’s 34 tribal colleges, which play a vital role in preparing our NativeAmerican students for a brighter tomorrow.

11

“It gives me great confidence in myself ”Annesha Webster-Taylor always wanted tobecome a nurse to help others. After becoming amom, she decided it was time to pursue herdream at Salish Kootenai College in Pablo,Montana. “When I was in labor,” Webster-Taylor recalls, “the nurse I had changed my lifein so many ways. I told myself that I want tohave that type of impact on people’s lives.”

Webster-Taylor, who plans to specialize inwomen’s health, is one of 15 American Indianstudents at seven tribal colleges who have beennamed SYSCO Corporation Scholars by theAmerican Indian College Fund, a distinctionthat awarded her a $1,000 scholarship for theSpring 2004 term.

“I would like to give back to my elders for theknowledge that they have given me throughoutmy life,” she affirms. “I want to help people whoare less fortunate and who don’t have the meansto get good medical attention. I want to be able to touch their lives in a good way.”

With SYSCO’s help, she will.


LEADING OUR INDUSTRYBy taking on leadership roles in our industry’s most active organizations, SYSCO iscommunicating to our peer organizations both the benefits of workforce diversity and themeans of achieving it.

Multicultural Foodservice and Hospitality Alliance: SYSCO has been a gold-levelcorporate sponsor of MFHA since 1998 as well as a strong supporter of the organization’svision of multiculturalism in the food and hospitality industry.

Women’s Foodservice Forum: Besides being an enthusiastic contributor to the WFF formany years, SYSCO was also recognized at the organization’s 2002

conference as the outstanding organization with respect toincreasing new membership.

National Restaurant Association ProStart Program: SYSCOis a proud supporter of this school-to-career program,which focuses on building awareness among high schoolstudents of future employment opportunities in therestaurant and hospitality industry. ProStart chapters arelocated in suburban and inner-city high schools.

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INDUSTRY CONNECTIONS

Emily DeRocco, Assistant Secretary

of Labor for Employment and

Training for the U.S. Department

of Labor, chats with Chicago-area

ProStart students.

SYSCO Assistant Controller Jesse Morris chats with a Texas Southern

University graduate student at the MFHA’s “Showcase of Stars.”


AT SYSCO, WE KNOW IT TAKES MORE THAN WORDS TO BUILD A TRULY

DIVERSE COMPANY. IT TAKES THE HARD WORK AND COMMITMENT OF

THOUSANDS OF PEOPLE ACROSS OUR ORGANIZATION. WE'RE PROUD OF OUR

ACHIEVEMENTS AND WE LOOK FORWARD TO MANY MORE SUCCESSFUL YEARS

OF HELPING OUR CUSTOMERS SUCCEED.

GUIDED BY OUR VISION, OUR MISSION AND OUR STRATEGY, WE CONTINUE

TO BUILD STRONG PARTNERSHIPS WITH THE STAKEHOLDERS—THE SYSCO

ASSOCIATES, THE SUPPLIERS AND THE COMMUNITIES—WHO WILL SHAPE

THE FUTURE OF OUR INDUSTRY.

OUR VISIONSYSCO WILL BECOME THE MOST EFFECTIVE GLOBAL NETWORK FOR THE

MARKETING AND DISTRIBUTION OF SAFE AND HEALTHY, HIGH-QUALITY FOODS. WE PLACE SPECIAL EMPHASIS ON THE DEVELOPMENT OF FOOD PRODUCTS THAT

MEET THE DIVERSE AND RAPIDLY CHANGING DEMAND OF CUSTOMERS AROUND

THE WORLD. IN ADDITION, SYSCO PROVIDES THE RELEVANT BUSINESS

SOLUTION SYSTEMS FOR OUR CUSTOMERS.

OUR MISSIONHELPING OUR CUSTOMERS SUCCEED

OUR STRATEGYSYSCO IN BUSINESS FOREVER

■ BUILD CUSTOMER LOYALTY

■ IDENTIFY GROWTH CHANNELS

■ OPTIMIZE SUPPLY CHANNELS

■ DELIVER OPERATIONAL EXCELLENCE

■ LEVERAGE THE SYSCO BRAND

SYSCO

DIVERSITY AND INDUSTRY RELATIONS REPORT®

Documents

12202 SYSCO AR PROD 5 19 · Toni Watson, Vice President of Human Resources and Customer Service, SYSCO Central Florida ... Participants also receive study materials that help them