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2020 Corporate Responsibility Report

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

SDG 8 – Good workplaces

Promote sustained, inclusive, and sustainable economic growth, full and productive employment, and decent work for all – that is Sustainable Development Goal 8 of the United Nations.

... global
challenges

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 20,000 suppliers in over 80 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, or “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.

1
Binding sustainability requirements

Our Supplier Code of Conduct must be accepted by all suppliers. It sets out fundamental human rights, along with our ethical, social, and ecological standards. In addition, specific sustainability criteria are checked and evaluated when selecting suppliers and products..

2
Sustainability reviews

Our suppliers must regularly submit to internal and external sustainability reviews. A standardized auditing process is used to regularly assess the on-site working, social, and living standards, and the environmental situation, particularly for suppliers who are of strategic importance or are associated with higher risk.

3
Supplier training courses

We train our suppliers using specific online training modules, for example on compliance topics such as corruption prevention and anti-trust law, on human rights, and on other sustainability issues.

4
Internal provisions

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.

5
Staff training courses

Members of our procurement staff receive sustainability training. In addition, we have guidelines with practical recommendations for sustainability in procurement.

6
Measuring success

We use various indicators to measure our progress – for example, how much of the procurement volume has no social or ecological risk.

Our approach to achieving a sustainable supply chain

We obtain products from more than 20,000 diverse suppliers throughout the world. 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. You can find a detailed overview of our approach to achieving a sustainable supply chain here.

All our suppliers must accept our Code of Conduct. This is a key element of 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.


728

The JAC has conducted 728 supplier checks since 2010. Based on the findings, we have initiated 4,732 improvement measures.

Risk management and control

We carry out further checks for suppliers that are of strategic importance or are associated with higher risk. This includes looking at how they are rated on the “EcoVadis”  img online platform. 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 16 other telecommunications companies at present to form the Joint Audit Cooperation (JAC). As part of the JAC, we have conducted more than 700 supplier checks – in the form of audits and mobile surveys – since 2010, initiating approximately 4,800 improvement measures. Over 1.3 million workers have benefited from these improvements.

11.5

Satisfaction among employees at a supplier participating in our development program rose by 11.5 percent in 2020.

Supplier development

While 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.