Deutsche Telekom

RATING

SECTOR

Telecommunication Services

WEBSITE

CONTACT

Deutsche Telekom AG

Friedrich-Ebert-Allee 140

53113 Bonn, Germany

Bonn District Court HRB 6794

T: +49 228 181 49494

Email: silke-stephanie.thomas@telekom.de

STOCK EXCHANGE

LISTING

  • CDP A List – Climate Change 2015-2020 
  • CDP Supplier Engagement Rating (SER) 2020
  • Dow Jones Sustainability Index (DJSI) | Sixth Consecutive Listing
  • Forbes World’s Best Employers 2020 (#89)
  • Forbes Global 2000 2020 (#69)
  • Forbes Top 100 Digital Companies 2019 (#19)
  • Forbes Top Regarded Companies 2019 (#139)

EMPLOYEES

229,170

CHIEF SUSTAINABILITY OFFICER

Heinz-Gerd Peters

AWARDS

CONTENT SOURCE

FURTHER READING

Report created by Hamilton Anderson

Deutsche Telekom

SECTIONS :  Sustainability    Evaluation  •  Progress  •  Watch  •  Overview

Company Activity

Deutsche Telekom (DT) is one of the world’s leading telecommunications companies, with about 235.8 million mobile customers, 27.3 million fixed-network lines, 21.3 million broadband lines, and presence in more than 50 countries.

In recent years DT has moved beyond being just a telephone company, working to find opportunities for growth. They first maintain focus on providing highly efficient networks that will meet the demand of the future, and then open doors to sectors including energy, healthcare, and automotive to ensure DT’s continued success. DT invests more than €5M ($6.02M) into their new technologic innovations which is more than any other provider in Germany.

T-Systems is the branch of DT that focuses primarily on the provision of information and communications technology (ICT), and is responsible for leading business’ in their transition to cloud-based services and more. The success of T-Systems relies on the highly secure data systems and global communications network that DT has built.

DT believes that their network goes beyond connecting people. Their network allows people to live safer, equitable, and sustainable lives.

Company Sustainability Activity

Deutsche Telekom takes sustainability seriously. They are committed to acting responsibly along their entire value chain: economic, social, and ecologic.

Through their sustainability commitments, their network has helped reduce energy consumption and conserve resources. This has primarily been achieved by DT’s “we care for our planet” program. The program supports environmental protection, resource conservation, and helps DT achieve their climate targets. Some of DT’s products feature a “we care” label, which is awarded to products and services that contribute toward an improved climate and protection of resources as well as social challenges within the digital landscape.

An example of DT’s sustainability in action can be seen with the company’s commitment to helping their customers reduce their energy consumption by using smart products like their SmartHome devices. These devices not only help their customers be more sustainable, but they help DT become more sustainable too. The only difference is that instead of using a SmartHome device, DT has highly energy efficient data centers! 

DT promotes media literacy through a series of projects and initiatives, but they all aim at educating DT’s customers of all ages on how to use and operate technology safely.

DT places an emphasis on ensuring that their suppliers align with their sustainability goals. They work with their suppliers to help them become more sustainable and audit them  to make sure human rights are protected at the companies DT works with. Their work toward social sustainability has earned DT a spot on the CDP Supplier Engagement Rating list for multiple years.

Deutsche Telekom strives to help create a climate-friendly society, and has many goals in place to do so and are listed in the “Targets” section below. DT’s goals are only one element of their sustainability as they also focus on supporting public policy initiatives (Stiftung 2° foundation and the Global e-Sustainability Initiative (GeSI)), improving public health, ensuring value alignment with suppliers, and maintaining consistent and transparent communication with the public. 

Deutsche Telekom has been using their CR Policy since 2017 and functions as a formal, mandatory framework for the sustainability management activities for all of DT Group. All data collected to track DT’s sustainable progress is used to calculate their ESG key performance indicators (KPIs) for the entire Group. DT uses their 13 KPIs to guide all business activities even if they aren’t directly related to environmental issues, and can be found referenced in their financial report as well.

DT’s holistic approach to sustainability makes them a leader among all working to improve the environment.

Highlights

  • Management and reduction of scope 1 & 2 carbon emissions by 90%, per customer by 2030 compared to 2017
  • 25% reduction of upstream and downstream scope 3 emissions, per customer by 2030 compared to  2017
  • Increase share of renewable energies up to 100% in 2021
  • Increase energy efficiency measured within the Energy Intensity and Carbon Intensity KPIs
  • Increase the number of products and services that produce environmental benefits by improving the enablement factor
    • The enablement factor measures carbon reductions for DT’s customers related to the company’s overall carbon Scope 1-3 emissions. More on this metric here.

Targets

Business

  • Cover 70% of their procurement from carbon-intensive suppliers with the CDP Supply Chain Program by 2020
  • Review 80% of procurement volume by 2020
  • Have 75% of the top 200 suppliers CR-qualified by 2020
  • CR labeling of products and services to increase transparency for customers
  • Increase Group-wide customer retention
  • Obtain relevant service awards
  • Develop and implement a sustainable investment strategy for DT’s capital investments
  • Ensure inclusion in relevant sustainability indices 

Environment

  • Develop and adopt science-based climate targets and ensure official recognition from the Science-Based Targets initiative
  • Develop a program to reinforce environmental management
  • Decrease Group-wide Scope 1 and 2 emissions by 20% by 2020 compared to 2008 (excluding T-Mobile USA)
  • Decrease Group-wide Scope 1 and 2 emissions by 90% by 2030 compared to 2017
  • Reduce emissions from the upstream and downstream value chain (Scope 3) by 25%/customer by 2030 compared to 2017
  • Develop carbon neutrality and join the GSMA initiative
  • Boost the efficiency of DT’s data centers
  • Switch Group-wide power consumption to 100% renewable energy by 2021
  • Raise the profile and boost the impact of the Green Pioneers community
  • Reduce customers’ CO2 attributable to use of DT products and solutions 

Social

  • Increase the Media Literacy ESG KPI to 45% by 2020
  • Increase the proportion of women in top positions in middle and upper management to 30%
  • Increase the Group-wide health rate 95.9% by 2020
  • Reduce the accident rate in Germany
  • Revise the Guiding Principles
  • Boost digital further training
  • Expand #DABEI-Geschichten.com (“#TAKEPART-stories.com”)
  • Improve employee satisfaction
  • Perform Human Rights Impact Assessment (HRIA) and Employee Relations Review (ERR)

Progress

*Each point below directly corresponds to each of the targets listed above

Business

  • Covered 63% of their carbon-intensive suppliers in the CDP Supply Chain Program in 2019. 7% remaining to achieve the goal of 70% procurement.
  • Reviewed 81% of procurement volume in 2019 according to DT’s sustainable procurement ESG KPI criteria.
  • DT had 87% of the top 200 suppliers CR-qualified in 2019, exceeding the target for 2020.
  • At the end of 2019, DT had its 5G network available in 8 German cities. By the start of 2020, DT had already built 450 5G antennas, and aims to operate over 1,500 5G antennas, in all 16 German state capitals, by the end of 2020.
  • DT introduced their “we care” label to increase transparency for their customers.
  • DT’s Group-wide customer retention faced a slight decline: 68.5 in 2018, 67.3 in 2019
  • DT obtained 3 relevant service awards in 2019, which include: the TÜV quality seal, the title “ServiceKönig” (King of Service) from the trade magazine Focus Money, and the top score in the CHIP online test
  • In 2019, DT developed and implemented a sustainable investment strategy for their capital investments
  • In 2019, DT was included in 4 additional indices: S&P Europe 350 ESG, EURO STOXX 50 ESG, EURONEXT Vigeo Index: Europe 120, and EURONEXT Vigeo Index: Eurozone 120. DT was included in 12 total sustainability indices in 2019.

Environment

  • In 2019, DT developed and adopted science-based climate targets and ensured official recognition from the Science-Based Targets initiative.
  • DT adopted the “We care for our planet” Group program adopted to reinforce environmental management.
  • DT reduced their Group-wide Scope 1 and 2 emissions by ~38% from 2017 to 2019. This was primarily achieved through the direct purchase of renewable energy at T-Mobile US and the increased purchase of renewable energy certificates (RECS , GoO) at their national companies in Germany.
  • DT reduced their Scope 3 emissions by ~10% from 2017 to 2019. Still undergoing evaluation for emissions per customer.
  • In 2019 DT joined the GSMA initiative, under which DT will reduce their Scope 1 and 2 CO2 emissions to “net zero” by 2050 to make their business operations climate neutral.
  • In 2019 DT boosted the efficiency of their data centers using a Power Usage Effectiveness (PUE) factor which is calculated using a ratio between the total electrical energy consumed by the data center and the amount of electrical energy consumed by IT.
    • 2011 to 2019: DT’s Global PUE value lowered from 1.85 to 1.64.
    • 2008 to 2019: DT Germany’s PUE value lowered from 1.67 to 1.56.
  • The proportion of renewable energy at Deutsche Telekom:
    • Germany in 2019: 84%
    • Group-wide in 2019: 64%
    • Hungary in 2019: 100%
    • Greece in 2019: 100%
    • Austria: 99%
    • The Netherlands: 100%
    • **T-Mobile US: electricity entirely from renewables by 2021. In addition to 2 existing wind farms, 1 wind farm and 4 solar parks are to follow in 2021.
  • In 2019 DT’s Green Pioneers program increased from 40 to 200. This covers 40 sites in Germany and the rest are more community initiatives in their national companies.
  • DT examined the COsavings potential for products and added 16 in 2019. This is calculated using DT’s ESG KPI “Enablement factor” which analyzes the positive CO2 effects that arise from a DT customer’s use of DT products.
    • Improved the enablement factor in Germany to 2.44 (1.85 in 2018).
    • Improved the enablement factor across Europe to 1.74 (1.21 in 2018).

Social

  • DT increased the Media Literacy ESG KPI to 41% at the end of 2019. 4% remaining to achieve the goal of 45% by 2020.
  • In 2019 DT increase the proportion of women in top positions
    • December 31, 2019: 35% women Group-wide
    • Board of Management: 22.2%
    • In middle and upper management: 26%
    • On Supervisory Board (Germany): 40%
    • On Supervisory Boards (Europe): 25%
  • DT’s Group-wide health rate was 94% at the end of 2019. 1.9% remaining to achieve the goal of 95.9% by 2020.
  • DT reduced their employee accident rate in Germany from 8.7 to 6.8 accidents per thousand employees.
  • DT revised their employee relations Guiding Principles in 2019.
  • In 2019 DT boosted their digital training programs to 60%, compared to 53% in 2018.
  • DT added 2 new modules to their #TAKEPART-stories.com initiative, which highlights the potential for participation and responsible conduct on the internet.
  • DT’s employee satisfaction slightly decreased in 2019, where it dropped from 4.1 to 4.0.
  • DT performed a Human Rights Impact Assessment (HRIA) at T-Systems India and a Employee Relations Review (ERR) at T-Systems Polska. 
 
 

Certificates

United Nations Sustainable Development Goals

United Nations SDGs Compliance

*DT claims to contribute to SDG 14 (Life Below Water) but the Analyst excluded it after review.

SDG 3 

  • DT promotes health with our e-health solutions for the improvement of medical care and has a number of health measures for their employees.

SDG 4

  • DT invests heavily in the training and development of its ~211,000 employees. 
  • DT promotes the development of media skills
  • The Deutsche Telekom Stiftung foundation supports a large number of STEM projects.

SDG 5 

  • DT is committed to the systematic promotion of women in management, supervisory boards, and STEM professions. 
  • Their employees benefit from a number of different offers we provide to improve their work-life balance.
  • DT expects their suppliers to ban gender discrimination.

SDG 7

  • DT’s integrated climate strategy increases the share of green energy for their total energy consumption.

SDG 8

  • DT is committed to sustainable growth, provides excellent working conditions for our current and future employees, and keeps working toward a more sustainable supply chain.

SDG 9

  • DT keeps pushing the network infrastructure build-out forward and adds more innovative, sustainable products to their portfolio.

SDG 11 

  • DT’s innovative solutions help shape the transformation of cities into intelligent urban spaces (smart cities).

SDG 12 

  • DT continuously works on offering more sustainable product solutions and promoting more sustainable production patterns in the supply chain. 
  • DT is committed to avoiding waste and recycling valuable natural resources.

SDG 13 

  • DT helps protect the climate through energy efficiency and renewable energy goals
  • Their sustainable products and services are based on an integrated climate strategy.

SDG 15

  • DT’s efficient smart agriculture ICT solutions allow for higher harvest yields while reducing the use of resources such as seeds, water, fertilizers, and energy.
  • DT conducts projects to protect biodiversity
  • DT requires their suppliers to protect the environment and use resources responsibly.

Secondary SDGs: 1, 2, 6, 10, 16, 17

SDG 1

  • By expanding DT’s networks, they create the conditions for economic and social participation, among other things providing access to education – the lack of which is one of the main causes of poverty. 
  • DT expects their suppliers to pay the minimum wages as set forth in the ILO Convention, and has explicitly formulated this in their Supplier Code of Conduct.

SDG 2

  • DT’s efficient smart agriculture ICT solutions allow for higher harvest yields while reducing the use of resources such as seeds, water, fertilizers, and energy.
  • DT’s narrowband technology contributes to maintaining biodiversity.

SDG 6

  • DT’s efficient smart agriculture ICT solutions help reduce water consumption and the use of fertilizers.
  • DT’s smart metering solution allows for exact measurement and control of water consumption.

SDG 10

  • DT employs adequate measures to connect the unconnected, providing access to the digital world for all.

SDG 16 

  • DT clearly expresses their commitment to complying with ethical principles and current legal standards and has been incorporated into our Guiding Principles and Code of Conduct
  • DT operates a comprehensive compliance management system. All of their activities are compliant with legal regulations and our Binding Corporate Rules on Privacy. 
  • DT’s data protection efforts and products play an important role in ensuring information is kept safe and secure.

SDG 17

  • DT collaborates with associations, institutions, and companies at the national and international levels.

Evaluation

Deutsche Telekom is highly committed to sustainability. 

They are listed on 12 key sustainable indices including DJSI and CDP, they are a member of numerous national and international organizations focused on environmental issues as well as civic issues, are completely transparent on reporting their objectives by providing KPIs to track their progress, and have incorporated nearly all of the 17 SDGs into their business endeavors. 

DT makes it easy for anyone to take a glimpse into their sustainability work and initiatives, and do not shy away from reporting when they do not meet a goal. They seem to constantly be working to be better and think of new innovative ways to be sustainable.

Most companies place most of their focus on reducing their carbon footprints and DT is no exception. The only difference is that they are striving to reduce their emissions in addition to ensuring that their customers and suppliers are being more environmental and understand the importance of working with public policy organizations to pass laws and regulations that will protect the environment as well.

DT is not just a telephone company, they are a sustainable business leader. They, like all leaders, are not exempt from falling behind but their hard work deserves recognition. They focus on nearly every aspect of their supply chain and when they achieve one goal they continue on to the next.

For these reasons, Deutsche Telekom has earned a “B” rating in this index.

Analyst Outlook: Positive

Deutsche Telekom has continuously risen to meet its sustainability goals and initiatives. They have innovative methods of reporting their progress and ensure that they meet the requirements of reporting within sustainability.

The initiatives and goals they have in place set them on a path of continued environmental success, and it will be interesting to see if they can keep up their hard work. However, it does seem like if Deutsche Telekom wants something done, it will happen.

 

Key Points

  • The 2019 CR Report of Deutsche Telekom was created in line with the Global Reporting Initiative (GRI) guidelines, is communication on progress (CoP) as part of the United Nations Global Compact, and conforms with the German Sustainability Code
 
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