Telekom's business is based on the principles of integrity and respect. Compliance, which is understood as the lawfulness of corporate activities, therefore plays a significant role in the Group's business activities. Telekom is clearly committed to the ethical principles set out in the Guiding Principles and in the Code of Conduct.
All compliance management activities are in line with legal regulations and with Telekom's Privacy Code of Conduct, a policy on handling personal data at the Deutsche Telekom Group.
Download Privacy Code of Conduct
The key elements of the compliance management system are as follows:
- Establishment of a compliance organization in all major Group units
- Risk-based derivation of a compliance program and its consistent implementation through policies, training and consulting offers, and communication measures
- Conducting compliance controls and compliance due diligence
- Appropriate response to breaches of compliance
The Group's compliance organization was certified by independent auditors on December 31, 2010 in terms of adequate implementation of specified minimum requirements and implementation specifications. Recertification is planned by 2013.
Responsibility for the compliance management system lies with the top management level at Telekom. In line with the high relevance of the topic, a separate Board of Management department for Data Privacy, Legal Affairs and Compliance was created in 2008.
Group-wide structures for efficient compliance management have been in place since 2005. The compliance organization is comprised of the Chief Compliance Officer, the Compliance Committee and central as well as local compliance organizations The Group Compliance Management department holds central responsibility. It develops Group-wide standards, tools and processes to guarantee compliant conduct at the company.
Compliance Committee provides internal consulting.
The Compliance Committee consists of executives from the following areas:
- Legal affairs
- Data protection
- Internal Audit
- Human Resources
The Compliance Committee helps the compliance organization design and conduct a compliance program. It also encourages company departments that deal with compliance topics to share experiences and information with each other.
Compliance Officer plays key role in compliance management.
The Chief Compliance Officer reports to the Group Board of Management member for Data Privacy, Legal Affairs and Compliance. He plays a key role in setting up the compliance management system and maintaining it over the long term. The Compliance Officer reports directly to the Board Member for Data Privacy, Legal Affairs and Compliance and has the right, in consultation with said Board member, to send reports to Deutsche Telekom AG's Board of Management as well as the Audit Committee. According to the German Corporate Governance Code, the Audit Committee is responsible for compliance issues.
Different legal practices and cultural values in the various countries where Deutsche Telekom is active represent a significant compliance challenge. In line with the Group's international structure, strategic issues are discussed with an International Compliance Advisory Team and a shared vision is defined. The team is a "trend-setter" of sorts, as it provides incentives for designing and implementing balanced compliance structures at the Deutsche Telekom Group.
We have been promoting Group-wide cooperation for years with the International Compliance Days, an annual meeting of the representatives of all compliance organizations of the international subsidiaries. On April 25 and 26, 2012, around 120 representatives from 26 countries came to Bonn at the invitation of the central Compliance department to attend the eighth annual meeting. There, they discussed new initiatives to advance the compliance management system. Participants also discussed how the systems' rules and policies can be integrated even better in daily work routine. Telekom is preparing another International Compliance Day in Bonn in April 2013 to continue the successful collaboration.Find out more
The Group Board of Management and the respective bodies of the affiliated companies must ensure an appropriate compliance organization. The Group Compliance Management (GCM) unit supports these bodies in this task. The legal basis for this are contracts between the Telekom Group and its direct subsidiaries, the Intra Group Compliance Agreements, which define the rights and obligations of both parties.
The Group Policy on Avoiding Corruption and Other Conflicts of Interest (or Anti-Corruption Policy) and the Group Policy on the Acceptance and Granting of Benefits (or Benefits Policy) were revised in 2011.
The Anti-Corruption Policy serves as an overarching policy and a link between the Code of Conduct and the detailed rules of the more specific policies which regulate the acceptance and granting of undue benefits, sponsoring, donations, benefits extended in the political sphere, dealing with consultants, the ban on insider trading and anti-competitive agreements. In addition, it defines the organizational obligations and measures to prevent corruption and other conflicts of interest. The Benefits Policy governs how to handle gifts, entertainment and invitations to events in business relationships.
This policy are now in effect and mandatory throughout the Group. It was approved by all German Group units and announced in 2012. At the international level, the process will involved greater outlay because we first had to check whether the policies complied with relevant national laws. Still, almost all international units introduced the policy in 2012. The process will be completed in 2013. The introduction is being accompanied by communication and training campaigns.
During the reporting period, Telekom in Germany conducted various training and awareness programs to communicate our key anti-corruption topics:
More than 1,700 managers and experts in Germany, from the Board of Management, top management and employees from other selected areas, completed custom anti-corruption training programs in 2012. These face-to-face events, which will continue in 2013, cover the main anti-corruption regulations, using case studies to deepen understanding. The compliance team worked with the various areas in advance to develop specialist case studies so that training courses could be tailored to the specific needs of each area.
Telekom addresses other employee groups with its anti-corruption e-learning module. The module is designed in particular to familiarize them with the content of the Anti-Corruption and Benefits Policies, help them recognize typical corruption risks in day-to-day work, and provide guidance on how to deal with them correctly. Almost 16,000 employees in Germany received this risk group-specific training between September and December 2012. The e-learning course will subsequently be adapted as necessary and introduced at the international subsidiaries. The face-to-face training courses and e-learning sessions are scheduled to be completed over the course of 2013.
The "Bearing compliance in mind" e-learning module is targeted at all Telekom employees in Germany as an ongoing campaign. All new employees will be required to complete the module as well. The module communicates the most important compliance requirements and conduct guidelines in terms of our Guiding Principles, our Code of Conduct, current legal regulations and internal policies. Employees learn where to report compliance breaches and where to ask for help with questions relating to compliance or the Code of Conduct.
In order to prevent compliance risks, we set up the "Ask me!" portal in 2008. Here employees can ask compliance-relevant questions, for example regarding the Code of Conduct or laws and internal policies. "Ask me!" offers reliable information that employees can apply in their daily work routines.
We are dependent on the input of our employees, business partners, customers and other stakeholders when it comes to investigating violations of internal policies, laws or codes of conduct. "Tell me!" is a portal that is also accessible to external parties, which can be used to report misconduct via e-mail, phone and fax.
Telekom employs a zero tolerance policy when it comes to corruption. Violations are systematically investigated and prosecuted in order to create maximum transparency.
Review of irregularities in T-Systems International's sponsorship activities.
An internal investigation that was triggered by an anonymous tip gave rise to the suspicion that an arrangement violating compliance regulations had been made in the context of the business relationship between T-Systems International GmbH and a major car manufacturer to reward sponsorship involvement by awarding future contracts for IT services. Due to this, T-Systems International GmbH immediately terminated employment of the responsible sales manager and an external consultant and sent the internal report to the prosecutor's office responsible for further review. On the basis of the report, the public prosecutor initiated a preliminary criminal investigation, which resulted in charges being brought to the Regional Court in Stuttgart. The regional court gathered additional evidence during the interim proceedings and initiated the main proceedings in March 2013. Dates have not yet been set for the trial.
Deutsche Telekom is party to several proceedings both in and out of court with government agencies, competitors, and other parties. The proceedings mentioned in the 2012 Annual Report are of particular importance from Deutsche Telekom's point of view.
Respecting human rights is part of the fabric of Deutsche Telekom and a principle that is entrenched at our company worldwide. Our Code of Conduct, which applies Group-wide, stipulates our requirements for ethical conduct. The Social Charter adopted in 2003 defines Group-wide regulations regarding how to deal with employees and suppliers. The Charter is based on the principles of the United Nations Global Compact , the conventions of the International Labour Organization (ILO) and the Organization for Economic Co-operation and Development (OECD). The head of Group Relations Management is responsible for all matters dealing with human rights issues at Deutsche Telekom. This position has existed in this form since late 2012.
Telekom publishes an annual social performance report in which we assess all of our Group companies' compliance with the provisions set forth in the Social Charter . We added two special questions on the observance of internationally recognized human rights to our annual survey for the 2012 report. None of the responses indicated non-compliance with the Social Charter .
In addition to human rights issues, we are committed to guaranteeing official employee rights on all of our markets on the basis of our Social Charter and are involved in developing measures that in part exceed national legislation in the respective countries. Minimum standards for dealing with our employees are also defined by the Telekom Diversity Policy, whose aim is to prevent discrimination based on gender, age, disabilities, ethnic origin, religious beliefs and sexual orientation.
We also require our suppliers to comply with the ethical, social and environmental standards defined in our Social Charter and to observe basic human rights. We conduct regular social audits to determine whether our strategic suppliers, including those that present a particularly high risk, are in compliance with these requirements.
The European Commission is currently preparing regulations for certain industries specifying how to address human rights. These rules will be based on the UN Guiding Principles on Business and Human Rights. Deutsche Telekom was involved in a committee of experts that helped structure these rules for the ICT industry and participated in the final draft review process in December 2012.