Socially responsible investment
SRIT-Shares serves as an indicator we can use to assess our sustainability performance.investment products consist of securities from companies that have passed an audit based on environmental, social, and governance (ESG ) criteria. The development of demand from socially responsible investors for
With our Socially Responsible Investment ESG KPI we measure how the financial markets perceive our CR activities.
The concept of the United Nations’ Sustainable Development Goals (SDGs) is an increasingly popular topic among investors. This is especially true with regard to the future orientation of the SDGs. To assess the impact of our activities on the SDGs and put it into quantifiable terms, we conducted an impact measurement project in 2018.
T-Shares in sustainability ratings and indexes KPI
As part of our CR strategy, we focus on specific rating inquiries, choosing them on the basis of reputation, relevance, and independence. Examples include ratings from RobecoSAM, Sustainalytics, and oekom.
In 2018, as part of its biennial analyses, the rating agency oekom once again singled us out as the world’s best telecommunications company for our ecological and social performance. Moreover, T-Shares were again listed on leading sustainability indices, including RobecoSAM’s prominent DJSI World and DJSI Europe. Our shares were also listed yet again in the FTSE4Good index (for the eighth year running) and the UN Global Compact 100 index. For further T-Share listings, please consult the table below.
In the reporting year, our shares also made their way into four other sustainability indices: the Euronext Vigeo 120, the Euronext Vigeo Eurozone 120, the S&P Europe 350 ESG by RobecoSAM, and the EURO STOXX 50 ESG by Sustainalytics.Europe
Furthermore, at the beginning of 2019 we were once again named one of the most ethical companies worldwide by Ethisphere, an institute that promotes ethical business methods.
Socially Responsible Investment (SRI) ESG KPI KPI
The Socially Responsible Investment (SRI) ESG KPI indicates the proportion of shares in Deutsche Telekom AG held by investors who take, among other criteria, environmental, social, and governance criteria into account for their investment strategy. („SRI Investment“; SRI for „Socially Responsible Investment“)
And our commitment for more sustainability pays off: As of September 30, 2019,
18 percent of all T-Shares were held by investors who partially take environmental, social, and governance criteria into account for their investment strategy; 3 percent were held by investors who manage their funds primarily in accordance with SRI aspects.
Our ambition: increase KPI
As the basis of calculation is updated annually, year-on-year comparisons may be of limited value. (Source: Ipreo until 2016; from 2017 Nasdaq based on data of Thomson Reuters)
The KPI1 (Strategic Analysis, Strategy and Goals) and 7 (Rules and Processes) of the German Sustainability Code.is relevant for criteria
Sustainable investment at Deutsche Telekom
We apply our sustainability principles to the assets held in the Deutsche Telekom Pension Fund too. We have pursued a sustainable investment strategy for the selection of these capital assets since 2013. Besides financial aspects, we also factor in ecological and social principles and guidelines for good corporate governance. This encompasses:
- Targeted efforts to achieve the Sustainable Development Goals (SDGs) by exercising our rights to have a say in decisions as a shareholder
- General ban on all investments in companies that manufacture or do business with “controversial weapons” (e.g., anti-personnel mines, cluster munitions, nuclear weapons, biological or chemical weapons)
- Ban on investments in companies that have repeatedly violated the principles of the UN Global Compact
Our best-in-class approach:
- Selected investment managers with ESG expertise make targeted investments in companies that are the best in their sector in terms of sustainability performance
- We aspire to reconcile attractive profit expectations with sustainable values
We live up to our fiduciary responsibility toward our employees regarding capital investment by investing in stable values. Above and beyond this, we strive to avoid reputational risks and minimize major risks of loss.
The sustainable capital investment strategy for the Deutsche Telekom Pension Fund received praise from experts in 2019, when we came second in the “ESG Implementation” category at the Institutional Assets Awards organized by the specialist publishing house of German newspaper Frankfurter Allgemeine Zeitung. The award recognizes successful investment strategies that have been implemented in a particularly coherent manner.
Since 2019, Deutsche Telekom’s capital investments (DT Trust) have also been geared toward ecological and social standards. The DT Trust is based on the criteria for Norway’s Government Pension Fund (“Norges”). Among other things, companies that violate human rights, manufacture certain weapons, or whose core business is considered harmful to the environment are excluded.
We are currently drawing up further sustainable finance models in a joint project involving the Corporate Responsibility and Treasury units.
More and more investors and rating agencies are interested in receiving information about our CR activities, and there is a noticeable trend toward integrating SRIapproaches into classic investment strategies. We use different formats – both in our reporting and in direct dialog – to inform SRI analysts and investors of our CR activities.
In addition to our corporate responsibility report, we also publish a non-financial statement and key ESGannual report. Financial market players interested in sustainability can also review ESG information in the Socially Responsible Investment (SRI) section on our investor relations portal.KPIs in our
We seek to engage with investors on a personal level, host Socially Responsible Investment (SRI) roadshows, and regularly accept invitations to present our CR strategy as a best practice at roadshows and conferences. We also provide interested investors with information in conference calls, answer numerous direct requests for information, and take part in SRI conferences.
Tax policy guidelines
The Group Tax department is responsible for ensuring that the Deutsche Telekom Group pays taxes and duties at the national and international level in accordance with the applicable laws.
It is the task of Group Tax to take measures that the Deutsche Telekom Group complies with all its tax obligations in Germany and abroad, in particular that it pays taxes in accordance with the local laws and regulations applicable to the individual Group entities. This includes the Group's income taxes, which must also be regularly reported in our IFRS financial statements, as well as, for example, VAT and wage taxes payable within the context of customer transactions and for Group employees.
Group Tax also ensures that the Deutsche Telekom Group has an efficient tax structure within the framework of German and foreign tax laws as applicable in each country, i.e., that the Group does not carry any unnecessary tax burden. The goal is to achieve sustainable tax efficiency for the Group, which requires a transparent, trust-based cooperation with local tax authorities.
In addition, Group Tax undertakes to contribute to the greatest extent possible to the success of Deutsche Telekom's operations, e.g., by providing detailed tax advice regarding new business models or innovative technological developments. In such matters, Group Tax is particularly focused on clarifying upfront any unresolved tax law-related issues as well as providing practical solutions to meeting all applicable tax requirements.
The tax strategy – Tax Compliance, Sustainable Tax Efficiency, Tax as Valued Business Partner – was also adopted by the Deutsche Telekom Board of Management.
For detailed information on the work of Group Tax, its principles, and its responsible approach to tax, please see the related document.
Deutsche Telekom participates in initiatives for the development and establishment of a comprehensive approach regarding the determination and publication by enterprises and groups of meaningful information relating to tax matters. The aim is to give a full and differentiated view of the various contributions to the financing of the public domain that are made in connection with or otherwise result from enterprises and entrepreneurial activities. In this respect, Deutsche Telekom determines the so-called „Total Tax Contribution“ for the main European group companies in the telecommunications sector. This approach is explained in more detail in the attached document on Total Tax Contribution, which also contains the respective information relating to Deutsche Telekom. Deutsche Telekom intends to determine and publish such information also with respect to subsequent years.
Research and development
As a telecommunications business, we naturally support ongoing research. The escalating number of inquiries about our research efforts proves we are right to do so.
Deutsche Telekom promotes research in a number of ways. Since 2015, for instance, we have supported dementia research through the Sea Hero Quest project, in which a smartphone game records spatial navigation data to support scientists in the battle against dementia. We also collaborate with a large number of universities. In 2019, for example, we established a professorship for software engineering (with a focus on blockchain) at the CODE University of Applied Sciences in Berlin.
Furthermore, we invest in various fields of research such as the Internet of Things 45.5 million euros in research and development throughout the Group in 2019.. We invested a total of