• Since sustainability and climate change are important issues for Deutsche Telekom, efforts to address these issues are managed at the top level of the company. Our CEO, along with the other members of the Deutsche Telekom Board of Management, has responsibility for addressing climate-related issues throughout the entire Group. This extends to our climate strategy, our climate targets, and our climate-related opportunities and risks.
• Deutsche Telekom’s Board of Management is informed annually concerning the current status of the company’s achievement of its climate targets and regarding other climate issues which are relevant for the company. Climate indicators (Energy Intensity ESG  KPI, Carbon Intensity ESG KPI ) also form part of the quarterly report submitted to the Board of Management. As of January 1, 2022, the CEO has this responsibility.
• In addition, Deutsche Telekom’s risk management team reports, on a quarterly basis, to the Supervisory Board’s Audit  Committee regarding ESG risks and opportunities. When unforeseen risks occur outside of the regular-reporting framework, they are flagged on an ad hoc basis, and reported to the company’s Board of Management and Supervisory Board. The key risks for the Deutsche Telekom Group are reported in our annual report.

Further information is available at:

• Current CR-organization structure
• Risk and opportunity management
• Addressing climate risks
• CDP questionnaire, C.2 Governance

• Responsibility for managing the company’s efforts in connection with CR- and climate-related issues lies with the Group Corporate Responsibility department (GCR). That responsibility extends to evaluation of climate-related opportunities and risks. Responsibility for implementing the climate strategy rests with the Group business areas and segments.
  
  An overview of Deutsche Telekom’s complete CR-organization structure is available in the CR report.

Further information is available at:

• Risk and opportunity management
• Addressing climate risks
• CDP questionnaire, C.2 Governance

• The central climate-related risks include the possible failure of the network infrastructure, as a result of damage to the secondary infrastructure (such as through power failures) or failures of cooling systems. Another risk consists of possible network damage or failure as a result of network-infrastructure damage resulting from climate events or changes in climate conditions. The primary transitional risks mentioned include carbon prices and regulation of products and services – for example, via increased energy-efficiency requirements. In addition, there is a risk of negative stakeholder  feedback and reputational damage. For the most part, the time horizon for the identified risks is seen as medium-term to long-term.
• With regard to opportunities, we have identified our increasing use of energy-efficient technologies, and growing demand for climate-friendly products and services, as significant climate-related opportunities.

Further information is available at:

• Progress in implementation of the TCFD recommendations
• CDP questionnaire, C.3 Risks and Opportunities

• Climate-related opportunities and risks have affected our business operations in many different ways. Energy efficiency, for example, is of great importance for Deutsche Telekom, since the network’s energy consumption strongly affects operational costs. It is also important in light of the Group’s strategic approach to climate protection and of the growing concerns and expectations of our stakeholders. Consequently, we are now aiming to at least keep our annual energy consumption stable, despite the expected increase in data consumption. In Germany and Europe, we have set ourselves the target of doubling the energy efficiency of our networks by 2024 and thus reducing energy consumption further. Cutting energy consumption and reducing Scope 1 and 2 emissions  have each been declared as remuneration-related targets, with a 50-percent weighting in each case.
• For this reason, we have launched a number of programs for improving energy efficiency at our locations and in our operations. We have studied our value chain in order to identify potential for enhancing resource efficiency and reducing carbon emissions. We have identified central action areas for future measures that are expected to make our company’s operations more sustainable overall. The measures include, for example, labeling of products that are especially sustainable.

Further information is available at:

• Analysis of our products’ sustainability benefits
• Energy consumption & efficiency
• Climate strategy
• CDP questionnaire, C.3.3 and 3.4 Business Strategy

• In an initial step carried out in 2020, we analyzed a representative sample of Deutsche Telekom AG’s locations in Germany, comprising 500 locations in all, with regard to their physical climate risks. The risks for the various locations were considered in light of various climate scenarios of the Intergovernmental Panel on Climate Change (IPCC): a business-as-usual scenario (RCP 4.5), with a global temperature increase of more two degrees, and a four-degree scenario (RCP 8.5). Also, the RCP 2.6 scenario, which entails a temperature increase of less than two degrees, was available for some climate risks, such as rising sea levels and intense rainfall. Further details are provided here in the CR report.
• Currently, we are extending our scenario analysis to additional international locations, with a view to a full assessment of our organization’s long-term resilience. In a first step in this effort, we are bringing the largest national companies into the process: T-Mobile US in the United States and the OTE Group in Greece. With the help of comprehensive materiality assessments, the companies’ key locations in this context are being identified and analyzed in terms of the physical risks they face. In each case, the same physical risks and climate scenarios are applied.
• In addition, the International Energy Agency’s (IEA’s) Sustainable Development Scenario (SDS), which is also a less-than-two-degrees scenario, is being applied with regard to transitory opportunities and risks. That scenario considers political, social and technological changes that the transition to a decarbonized economy would bring and that would lead to various risks and opportunities for our company. At the time of the analysis, the SDS scenario was the IEA’s most ambitious scenario. Since then, it has been supplanted in this role by the Net Zero Scenario.

Further information is available at:

• CDP questionnaire, C3.2, Business Strategy – Scenario Analysis

• In 2020, in the framework of various workshops with experts from the areas of technology, procurement, and strategy and risk management, we defined the main climate-related opportunities and risks and began weighting them. In the process, we considered the consequences, for our business operations, that could result from the physical impacts of progressing climate change. In addition, we analyzed the impacts resulting from political, technological, and social developments tied to the transition toward a low-carbon economy that has been initiated. Further details are provided here in the CR report.
• The process for identifying the opportunities and risks tied to climate change comprises the following:
  • Screening of media and NGO publications
  • Actively supporting the work of various industry associations that are studying the issue of climate change, such as GeSI, econsense, Foundation 2°, ICC, GSMA, and ETNO
  • Initiating and participating in stakeholder dialogs on the issue of climate change
  • Analyzing responses to the CDP  supply-chain program
  • Analyzing relevant inquiries of rating agencies, such as RobecoSAM , CDP, Sustainalytics, etc.
• The process for evaluating the opportunities and risks tied to climate change comprises the following:
  • Identifying and quantifying the important trends
  • Calculating the impacts on operations
  • Analyzing the impacts on the value chain
• We financially quantified our transitory risks in 2022 in order to verify the qualitative materiality analysis from the workshops. The quantification for a number of risks was already published in the CDP questionnaire 2022. Climate-related opportunities are set to be quantified in 2023. The resulting financial impacts will then be taken into account in the company’s planning. Management instruments for taking account of climate protection in investment decisions are regularly reviewed for feasibility and benefit (instruments such as an internal carbon price, for example).

• On an expert-knowledge basis, opportunities and risks are evaluated in terms of their potential financial impacts (on EBITDA-AL) and of the probability of their occurrence. Where opportunities and risks cannot be quantified, their potential impacts can be reported in qualitative terms. Once risks and opportunities have been identified, they are analyzed and evaluated, in detail, in terms of the probability of their occurrence and their potential financial impacts. This can be done with the help of a scenario analysis, for example. Then we decide what concrete measures need to be taken in order to reduce the risks or exploit the opportunities. As a next step, in each case the relevant risk owner implements the measures, and monitors and evaluates their effectiveness. As necessary, the above steps are repeated and adjusted in light of the latest pertinent developments and decisions.

Further information is available at:

• Board of Management’s assessment of the aggregate risk and opportunity situation
• CDP questionnaire, C2.2 Risks and Opportunities – Description of processes

• Our processes for identification and evaluation of climate-related risks are completely integrated within company-wide, multidisciplinary processes for risk identification, evaluation, and management. On a quarterly basis, risks and opportunities (with impacts of over 100 million euros on EBITDA) are identified via a Group-wide risk-management process (RMP) that has been developed, and is managed, by the Group Risk Governance department. The RMP provides methods and systems for identification and evaluation of risks and opportunities. The responsibility for reporting on Group risks and opportunities is divided among the relevant business units; consequently, GCR is responsible for climate risks. Further information on the risk process is available in our annual report.

The risk area also works closely with GCR to identify material climate-related opportunities and risks, and participates in internal workshops.

Further information is available at:

• Risk and opportunity management system
• CDP questionnaire, C2.2 Risks and Opportunities – Description of processes

• The most important performance indicators for measurement and management of climate-related opportunities and risks are as follows:
  • Scope 1 to Scope 3 emissions   
  • Share of renewables
  • Energy consumption
  • Energy Intensity ESG KPI
  • Carbon Intensity ESG KPI
  • Enablement Factor
  • Waste production, including e-waste
  • Waste management and recycling
  • Water consumption
  • Land use
• In addition, we calculate the share of our revenue that is sustainability-oriented, and we continually analyze the sustainability benefits of our products.
• Historical performance indicators of Deutsche Telekom and its national companies are published in the interactive benchmarking tool of the CR report.

• Deutsche Telekom discloses its Scope 1–3 emissions annually, in its CR Report and Annual Report.
• The Scope 1 and Scope 2 emissions are calculated in accordance with the GHG Protocol . The calculation of Scope 3 emissions is based on the GHG Protocol.
• Deutsche Telekom’s carbon intensity is published annually in the company’s CR Report and its Annual Report (Carbon Intensity ESG KPI). This KPI shows carbon emissions in relation to managed data volumes.

Further information is available at:

• Benchmarking tool
• CDP questionnaire, C4 Metrics and targets

• The two non-financial performance indicators “energy consumption” and “carbon emissions” (Scope 1 and 2) have been included as components of the variable remuneration of the members of the Board of Management since 2021. Since 2022, achievement of these ESG KPIs has also been a key element of the remuneration system for managers (excluding T-Mobile US). For selected important functions, achievement of targets oriented to specific areas of responsibility enters into the calculation of performance-based remuneration. This also applies to goals based on the Socially Responsible Investment (SRI) ESG KPI and on the goal “Listing of T-Shares in sustainability indexes/ratings”, which reflect climate-change issues and the Energy Intensity and Carbon Intensity CR KPIs, which are directly related to those issues.
• Deutsche Telekom AG’s climate targets are published in the CR Report.
• Our targets with regard to energy efficiency are disclosed here.
• Here, we also publish targets for sustainable procurement.