Global products …
Apples from the weekly market, potatoes from the farm shop: Consumers who want to shop more sustainably turn to regional products. But what works with food isn’t possible with smartphones and other technical devices. The components come from different parts of the world and have to be transported over long distances and further processed.
SDG 8 – Decent work and economic growth
Promote sustained, inclusive, and sustainable economic growth, full and productive employment, and decent work for all – that is the 8th Sustainable Development Goal of the United Nations.
... global Raw materials and other materials go through many hands before they finally wind up as a finished mobile phone, tablet, or WiFi router on our shelves. Given the news about human rights violations and environmental problems in the production countries, it is very difficult to buy them with a clear conscience. At Deutsche Telekom, we do not turn a blind eye to this – but rather take a very close look. We do not manufacture smartphones and the like ourselves, but buy them from more than 25 000 suppliers in over 150 countries. That’s one more reason for us to work consistently on making our supply chain increasingly sustainable. That’s no easy task, which is why we approach it systematically. Our sustainability requirements play an important role right from the time we select new suppliers. Later on during the collaboration, if necessary, we conduct factory inspections, referred to as “social audits”. In addition, we work closely with strategically important suppliers to achieve concrete improvements in their factories by reducing the number of overtime hours employees work, for instance, or by implementing additional measures to protect people and the environment.
Trust and control
Respect for human rights and protection of the environment are very important at Deutsche Telekom. We expect all of our suppliers and business partners to comply with our high standards. We use a variety of instruments and measures to monitor compliance with our specifications.
Binding sustainability requirements
As a basic rule, all suppliers must accept our Supplier Code of Conduct and the requirements it specifies.
In 2022, we extensively updated our Supplier Code of Conduct. This included expanding it to include the requirements set out in the German Act on Corporate Due Diligence in Supply Chains (Lieferkettensorgfaltspflichtengesetz – LkSG). The LkSG requires companies to ensure compliance with ethical, social and ecological standards, and protection for human rights, throughout their supply chains.
Our suppliers regularly undergo internal and external sustainability reviews. A standardized, on-site auditing process is used to assess the working, social, living and environmental standards upheld by suppliers. In particular, the process is applied especially to suppliers who are of strategic importance or are associated with higher risk.
Supplier training sessions
We train our suppliers using specific online training modules, including modules on compliance topics such as corruption prevention and anti-trust law, and modules on human rights and on other sustainability issues.
The Procurement Policy that includes our Supplier Code of Conduct serves as a standard for our procurement staff. It specifies all of the main sustainability principles for our suppliers – from anti-corruption to social and ecological requirements.
Employee training sessions
Members of our procurement staff receive sustainability training. In addition, we have guidelines with practical recommendations for sustainability in procurement.
We use various indicators to measure our progress – or example, to determine how much of our procurement volume is free of social or ecological risk.
Our approach to achieving a sustainable supply chain
We obtain products from a highly diverse range of suppliers, including more than 25 000 suppliers worldwide. We use our strict sustainability criteria to determine the risk that our sustainability requirements will not be met. This also depends, among other things, on the type of product and the producing country. A detailed overview of our approach to achieving a sustainable supply chain is available here.
As a basic rule, all of our suppliers must accept our Code of Conduct. This is a key aspect of our supplier selection and the most important precondition for a business relationship. In addition, all new suppliers are assessed by an external auditor. A comprehensive investigation is performed to determine if any of our suppliers present increased risks with regard to compliance with our sustainability principles. At the same time, specific sustainability criteria are analyzed and evaluated during supplier selection in categories associated with greater risks, especially for all IT and network products.
The number of supplier checks that JAC has conducted since 2010. Using the findings from those checks, we have initiated a total of 5 243 improvement measures.
Risk management and controlWe carry out further checks for suppliers, and for product groups, that are of strategic importance or are associated with higher risk. This includes looking at how they are rated on the “EcoVadis” online platform. As necessary, we also conduct on-site inspections – “social audits” – and digital checks using mobile surveys. We look not only at our direct suppliers, but also at our suppliers’ upstream suppliers as much as possible. To achieve greater transparency in our supply chain and thus also minimize potential risk, we work closely with other companies that share the same suppliers. To that end, we have joined with numerous other globally operating telecommunications companies to form the Joint Audit Cooperation (JAC). As part of the JAC, we have conducted more than 910 supplier checks – in the form of audits and mobile surveys – since 2010, initiating over 5 100 improvement measures. Over 1.4 million workers have benefited from these improvements.
One supplier who participated in our development program in 2022 saved over 500 metric tons of CO2 e-emissions.
Supplier developmentWhile regular supplier inspections are important, they are often only snapshots. Our goal is not just to combat the symptoms, but to bring about permanent changes, which is why we launched a supplier development program several years ago. In close collaboration with strategically important suppliers, we work to achieve specific improvements, for example in areas such as occupational health and safety, working time, staff accommodation, and environmental protection. Improvement plans are developed and implemented together with the management team and employees of these suppliers. If necessary, we conduct additional workshops on current problems and issues, such as reducing CO2 emissions, extending the life span of products, or avoiding the use of substances that are hazardous to humans or the environment. The program takes a long-term, sustained approach to improvement.
Achieving more together
Can our customers be sure that our products are 100 percent sustainable? Unfortunately not. But they can trust that we are doing everything possible to make our supply chain increasingly sustainable. And they can help us do this, by preferring to purchase products from our portfolio that are labeled as having sustainability benefits.