Risk and opportunity management

For us, comprehensive risk and opportunity management also includes considering the risks and opportunities of corporate responsibility (CR). As part of our CR management, we pursue a strategy in which different stakeholder groups are systematically involved in identifying current and potential risks and opportunities. To this end, we participate in a number of committees and initiatives. Continuous monitoring of CR topics enables us to systematically identify stakeholder positions on relevant sustainability issues. To this end, we use, for example, our NGO Radar, which summarizes the activities, research projects, publications and opinions of relevant non-governmental organizations (NGOs) and assesses them for Deutsche Telekom. In addition, we ask our stakeholders on an annual basis as part of our CR reporting which sustainability issues are important to them.

At present, we do not see any severe risks to the achievement of our climate protection targets within our reference period. Deutsche Telekom sees climate protection above all as an opportunity. ICT  products and services have the potential to save seven times as many CO2 emissions in other industries as the ICT  industry emits itself (SMARTer2020 study). Examples of resulting external opportunities include changed customer expectations, political measures to implement the energy revolution, the growing consideration of sustainable criteria in tenders and in procurement, as well as the interest of sustainable investors (socially-responsible investing – SRI ). The Carbon Disclosure Project, for example, advises 767 institutional investors (approx. USD 92 trillion) on selecting investments in climate-friendly assets. Opportunities that Deutsche Telekom can develop itself are the continuous reduction in its own electricity, as well as a reduction in carbon emissions by means of climate-friendly products and services, thus also tapping into new target groups.

We see more sustainability in our supply chain as an opportunity. It helps to enhance our reputation and our economic success. Thus through a development program, we help strategic suppliers to introduce business practices that are socially and ecologically acceptable and economically efficient. The program launched in 2014 has already produced measurable initial successes and is to be rolled out further in 2015. At the same time, our global procurement activities can expose us to country- and supplier-specific risks. These include, for example, the use of child labor, the conscious acceptance of environmental damage or inadequate working and safety conditions in the local supplier factories. Reports by NGOs or the media can give rise to risks to the company's reputation, but also to supply risks. We reduce these risks by systematically auditing our suppliers.

Mobile communications, or the electromagnetic fields used in mobile communications, regularly give rise to concerns among the general population about potential health risks. There is intense public, political, and scientific debate of this issue. Acceptance problems among the general public concern both mobile communications networks and the use of mobile devices. In mobile communications, this affects mobile infrastructure build-out and the use of mobile devices. In the fixed network, it affects sales of conventional DECT  (digital cordless) phones and devices that use WiFi technology. There is a risk of regulatory interventions, such as limiting electromagnetic radiation or the implementation of precautionary measures in mobile communications (e.g., amendments to building law or labeling requirements for end devices).

Over the past few years, recognized expert organizations such as the World Health Organization (WHO) and the International Commission on Non-Ionizing Radiation Protection (ICNIRP ) have repeatedly reviewed the current limit values for mobile communications and confirmed that if these values are complied with the use of mobile technology is safe based on current scientific knowledge. In 2011, despite a lack of scientific evidence, the International Agency for Research on Cancer (IARC), a WHO agency, classified high-frequency electromagnetic fields as "possibly carcinogenic" as a precautionary measure on the basis of isolated indications. This is the weakest category indicating a potential carcinogenic effect. Drinking coffee is also included in the same category. However, the classification provoked an increase in media coverage, as well as controversy among experts. The German Commission on Radiology Protection criticized the IARC's classification on the basis that there is insufficient scientific evidence for it in the Commission's view. There is still agreement among all institutions and expert committees that there is so far no scientific evidence of a health risk from high-frequency electromagnetic fields but there is a need for more research into this issue.

We are convinced that mobile communications technology is safe if current safety standards are complied with. We are supported in this conviction by the assessment of the recognized bodies. The basis of our responsible management of mobile communications is Deutsche Telekom's EMF  Policy. With this policy we are committing ourselves to more transparency, information, participation, and financial support of independent research on mobile communications, far beyond that which is stipulated by legal requirements. We aim to overcome uncertainty among the general public by pursuing an objective, scientifically well-founded, and transparent information policy.

We also remain committed to maintaining our trust-based, successful collaboration with local authorities over and above the statutory requirements. This will not change even after the longstanding cooperation with local authorities in connection with the build-out of the mobile network, which in the past was implemented on the basis of voluntary commitments by the network operators, was regulated by law in 2013.