2004 Committee Charter : ETN

The Governance Committee shall be comprised of at least three Directors, all of
whom meet the independence requirements of the New York Stock Exchange and the
Board of Directors. The Committee members shall be appointed by the Board upon
the recommendation of the Governance Committee or a majority of the independent
members of the Board. Committee members may be removed by the Board at any time
upon the recommendation of the Governance Committee or a majority of the
independent members of the Board.

The Governance Committee shall have the following responsibilities:

1. Recommend to the Board improvements in the Company's processes of corporate
governance, including proposed changes in the Board Governance Policies.

2. Advise the Board on changes in the size and composition of the Board.

3. Make recommendations to the Board regarding the structure and
responsibilities of Board Committees, recommend one year in advance a member
of each standing Board Committee to be appointed Chairman of the Committee,
and annually submit to the Board candidates to be appointed members and
Chairman of each standing Committee.

4. In consultation with the Chairman and Chief Executive Officer, identify and
recommend to the Board candidates for Board membership, based on the
criteria for Board membership listed in the Board Governance Policies.

5. Recommend to the Board individuals to be nominated for election or
re-election to the Board, taking into account input from all Directors.

6. Oversee the orientation of new Directors and regularly review the continuing
education needs of the Directors relating to their roles and
responsibilities as members of the Board and its Committees. In regard to
continuing education, the Committee will recommend seminars, provide
guidance and monitor the process.

7. Recommend to the Board compensation of non-employee Directors.

8. Administer the Board's policy on Director retirements and resignations.

9. Administer the Directors' stock ownership guidelines.

10. Recommend to the Board guidelines and procedures to be used by the Directors
to evaluate the Board's performance.

11. Provide oversight regarding significant public policy issues with respect to
the Company's relationships with shareholders, employees, customers,
competitors, suppliers and the communities in which it operates, including
the following areas:

(a) Ethics compliance

(b) Environmental, health and safety issues

(c) Diversity and equal employment opportunity

(d) Community relations

(e) Government relations

(f) Charitable contributions

(g) Shareholder and investor relations, including recommended responses to
shareholder proposals

(h) Eaton Philosophy of Excellence through People

12. Review the Company's Code of Ethics, including its programs to promote
ethical and legal conduct, to facilitate anonymous reporting of violations
and to assure protection of employees who report violations in good faith,
and from time to time recommend the adoption or amendment of the Code of

13. Periodically report to the Board concerning the Committee's actions,
conclusions and recommendations.

14. Assure that performance evaluations of the Governance Committee are
conducted annually.

The Governance Committee shall have the authority to retain and terminate
consultants and other advisors to advise the Committee in the performance of its
responsibilities, including search firms to be used to identify Director
candidates and compensation consultants to assist in the evaluation of Director
compensation. The Committee shall exercise sole authority to approve the fees
and other retention terms for such consultants and other advisors, who will
report directly to the Committee.


Upon the recommendation of the Governance Committee, the Board of Directors on
July 24, 2002 adopted a policy regarding any business transactions between the
Company and other businesses in which its non-employee directors are executive
officers or major shareholders. The purpose of the policy is to assure that all
such transactions are undertaken strictly upon an objective assessment of the
economic value of the transactions to each party, and not because of personal
relationships between the director and the Company or its executives. The policy
provides, in effect, that in any business transactions between the Company and
such other businesses, there shall be no direct communication between the
director and any Company personnel and no direct communication between the
Company's Chief Executive Officer and any employees of the director's business.
The policy further provides that, if a proposed transaction is potentially
significant to either the Company or the director's business, or if the
director's independence may be compromised (or appear to be compromised), the
Chairman of the Company's Governance Committee shall be so informed.

Upon the recommendation of the Governance Committee, the Board of Directors on
October 23, 2002 adopted a policy that all non-employee directors shall be
"independent" according to the criteria set forth in the policy. Those criteria
have been updated by the Board of Directors most recently in February, 2004 and
are consistent with the independence criteria contained in the New York Stock
Exchange listing standards. The purpose of this policy is to assure the
independence of the Company's non-employee directors.