2014 audit results

A total of 45 social audits, 23 on direct and 22 on indirect suppliers of Deutsche Telekom, were conducted in 2014 through the auditing program set up and managed at Group level. As in previous years, we focused our audit activities on suppliers in Asia and especially in China. We also conducted social audits in Latin America (e.g., Mexico and Brazil) and Eastern Europe.

Among the suppliers audited were vendors of devices, IT services, IT hardware/software and network technology. The audits did not uncover any cases of corruption.

Legend: Area (Number of violations)

We do not audit all of our suppliers (over 30,000) equally but instead focus on strategically important and/or high-risk supplier groups. We therefore audit around 150 suppliers at regular intervals of about three years. The majority of these audits have been conducted within the scope of the Joint Audit Cooperation (JAC). We identified key weak points and considerable need for improvement particularly in the following areas:

We found violations against Deutsche Telekom supplier requirements in a total of 350 cases, 100 of which must be considered critical. We were able to address 282 violations (69 of which were critical) by the end of 2014. The remaining improvement measures are currently scheduled for implementation. See below for some examples of key findings and completed improvement measures.

Last year's CR report

Area   Results   Measures and improvements
Occupational health and safety   Some emergency exits were blocked in work and sleeping areas.   Objects blocking the exits were removed and those responsible instructed to make sure the emergency exits remained accessible. Functional and compliant escape and access routes as well as fire and smoke zones ensured.
  No safety lighting above emergency exits.   No safety lighting above emergency exits.
  Insufficient fire alarm system, no back-up system, insufficient emergency plan.   Effective fire alarm system set up in sleeping quarters. Fire safety concept updated. All fire safety issues integrated into an upstream emergency management system.
  Chemicals were being stored under the fire escape, no catchment tanks in warehouse.    Separate, safe chemicals warehouse including catchment tanks set up.
  Emergency power generator in one sleeping area, incorrect use of another sleeping area as a workshop.   Separate sleeping and work spaces established. 
  No fire safety certificate for dormitory building.   The management was requested to always provide and keep the fire safety certificate for dormitory buildings. 
Working hours   Daily/weekly/monthly working hours in violation of SA8000 and local regulations.    Adjustments made in production. Payment corrected. Training measures. Limited overtime to three hours per day and 36 hours per month and limited weekly working hours to 52. 
  Time cards missing.    The management was instructed to provide accurate time cards in the future.
Payment and compensation for overtime   Full payment of overtime for piece workers only on weekdays.   Detailed policy for payment of overtime developed. Compliance with local laws regarding payment (including for overtime) ensured.
Area   Results   Measures and improvements
Youth employment   Employing minors at factories with a noise level above 80 dB.   Young employees prohibited from working in locations subject to high health risks. Negative list of those locations created as a preventative measure and integrated into human resources processes.
Forced labor   No ongoing payment for sick employees and no policies regarding inability to work.   The management was instructed to continue to pay sick employees in compliance with local laws and to introduce policies regarding inability to work.
Area   Results   Measures and improvements
Environment   No permit to operate an x-ray machine and dispose of x-ray waste. No valid disposal agreement with licensed company.   The management was instructed to provide a permit issued by the environmental authorities as well as a disposal agreement.

No significant violations were identified regarding corporate ethics including corruption, bribery, compliance or protection of intellectual property within the scope of our social audits.