News Release

BAXTER HIGHLIGHTS ECONOMIC, SOCIAL AND ENVIRONMENTAL PROGRESS IN ITS THIRD ANNUAL SUSTAINABILITY REPORT

Baxter Supports the Global Reporting Initiative's Sustainability Guidelines in Addressing Diverse Stakeholder Interests and Corporate Accountability

DEERFIELD, Ill, July 23, 2002 -- Baxter International Inc. launched today its third annual sustainability report, "Seeing Tomorrow Today, " which reflects that Baxter met its aggressive toxic and chlorofluorocarbon air emissions target reduction four years early and introduces its position on global climate change. The report is aligned with the GRI Sustainability Reporting Guidelines, which provide a rigorous and structured framework for reporting economic, social and environmental performance, often referenced as the "triple bottom line."

Baxter's Sustainability Report reflects a growing trend among corporations to expand their reporting beyond traditional financial indicators to include such corporate accountability issues as governance, community involvement, workplace practices and environmental responsibility. A number of studies underscore the direct impact that social responsibility and environmental performance have on corporate reputation, including the recruitment and retention of top talent, customer loyalty, and productivity and cost avoidance as it relates to the efficient use of resources.

A global study by Environics International Ltd.¹ , in cooperation with The Prince of Wales Business Leaders Forum and The Conference Board, showed that 90 percent of people want companies to focus on more than just profitability and that 60 percent form an opinion of a company based on its social responsibility. A Towers Perrin² study showed that companies with strong stakeholder relations yield nearly twice the rate of shareholder return than other companies in the S&P 500 over the past 15 years. And, according to the Social Investment Forum³, nearly one out of every eight dollars under professional management in the United States is involved in socially responsible investing.

"I believe all of us, regardless of our roles in society, are concerned with ensuring the viability and sustainability of the world around us. The Global Reporting Initiative is important because it provides a framework for consistent communication and information, a forum for exchanging new ideas and perspectives and a basis for tracking performance and progress," said Harry M. Jansen Kraemer, Jr., Baxter's chairman and chief executive officer. "Issues in the news today underscore the importance of communication between corporations and their stakeholders, and reinforce the need for balance, transparency and accountability across all aspects of corporate performance."

As one of the first 21 pilot companies to report under the GRI Guidelines in 1999, Baxter has pledged ongoing support for the organization as one of its 30 Charter Members. Today, more than 110 companies from 17 countries are issuing reports following these guidelines. Baxter is also a member of the GRI Stakeholder Council, which plays a central policy and governance role in shaping the future development of the GRI guidelines.

Some highlights from Baxter's 2001 Sustainability Report include:

• Increasing focus on community involvement through the launch of a fourth corporate goal called "Best Citizen" that focuses all Baxter team members on making a positive impact in their communities.
• Improvement in the company's health and safety performance resulted in fewer team member absences related to occupational injury or illness.
• The company met its toxic and chlorofluorocarbon air emissions reduction target four years early, achieving nearly a 99 percent reduction since 1988.
• The company's environmental financial statement shows that it saved $3 million working towards aggressive environmental objectives.
• The launch of "Doing Business with Baxter," a program in which key suppliers complete a detailed questionnaire on environmental, social and economic performance and participate in on-site workshops to fully understand Baxter's expectations of suppliers.
• The company's performance in taking a proactive approach to corporate governance, including the launch of an initiative to increase the financial literacy of its board of directors.

Baxter's approach toward sustainability has annually earned the company the position of medical products industry group leader for the Dow Jones Sustainability Index since its inception in 1999. The index consists of more than 300 companies, which represent the top 10 percent of the leading sustainability companies across 64 industry groups and 33 countries. The company also has made the list of Business Ethics magazine's "Top 100 Corporate Citizens" for the last three years. Companies make the list for effectively balancing the needs of key stakeholder groups, including employees, the community, environment, customers and stockholders.

"Baxter's success is directly impacted by our 48,000 team members across the world working together toward a common purpose, behaving in accordance with a common set of values, openly communicating about our performance and objectives, challenging each other, and making a difference no matter where we are," said Kraemer. "We are constantly raising the bar, and have launched our Best Citizen goal to increase our focus on making the world a better place at home, work and in the global community."

The report is available in print and online at www.baxter.com/sustainability/.

Baxter Healthcare Corporation is the principal domestic operating subsidiary of Baxter International Inc. (NYSE: BAX), a global health care company that, through its subsidiaries, provides critical therapies for people with life-threatening conditions. Baxter's bioscience, medication delivery and renal products and services are used to treat patients with some of the most challenging medical conditions, including cancer, hemophilia, immune deficiencies, infectious diseases, kidney disease and trauma.

FOR ADDITIONAL INFORMATION:

	Media Contact: Tanya Tyska, 847-948-3256 Investor Contacts: Mary Kay Ladone, 847-948-3371