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Approach, Strategy and Goals

Magyar Telekom’s sustainability approach

For Magyar Telekom sustainability, as recognising the relationship with the three pillars of environment - society - economy and the positive activity within this, is a long term strategic principle. "Sustainable development is a development that meets the needs of the present without compromising the ability of future generations to meet their own needs" (UN, Brundtland Report, 1987). In practice it is realisable if the economic, social and environmental interests are harmonised.

Recognising the importance of sustainable development - and the fact that it is vital for the success of the future's business activity - Magyar Telekom Group undertakes the obligation and responsibility for that will do its operation, corporate governance, activities in its spirit in Hungary and in all countries, where appears with its business or co-operation. In addition to the opportunity for a long-term success of the company group, it includes a significant positive effect through its role in the region and its services for the society, environment and economy.

structural_approach_to_sustainability

The main aim of the figure is to demonstrate the relations of the company-group with the three of environment - society - economy in its whole complexity. According to this we developed Magyar Telekom Group's approach to sustainability, gathering around the three principles, bellow. These principles are in close relation with each other, not realised separately.

Sustainability Values

Within the three dimensions of sustainability, related tasks can be described with the following values:

Economic dimension

  • Business venture, integrity, transparency
  • Vision, innovation
  • Employees, team, dynamism
  • Client

Social dimension

  • Democracy, information society
  • The future generations, sustainable society
  • Diversity, social solidarity, quality of life
  • Partnership, talent, creativity

Environmental dimension

  • The Earth
  • A viable and wholesome environment
  • Nature, biological diversity
  • Natural resources

Sustainability spans the whole organization, so it cannot be discussed on its own as the task of one organizational unit only. Each individual task affects the most diverse areas of the company and requires the cooperation of organizational units that are often at a distance from each other. Sustainable development is not a one-man challenge, it is a personal issue for everyone. Therefore we encourage everybody to put forward proposals, send their opinion or question through which we can jointly improve our future chances.

BE SMARTER! – 4. Sustainability Strategy (2016-2020)

The main directions of creating the new strategy for 2016-2020 have been influenced by not only the strategic achievements we have already made in the previous period, but also the expectations of responsible investors, EU directives, industrial and corporate trends, as well as local, i.e. Hungarian conditions and consumption patterns.

Magyar Telekom’s 4th Sustainability Strategy has been compiled in harmony with Company’s other strategy. Its main objective is to make sustainability an integral part of Magyar Telekom’s business. This can be ensured, if considering all three pillars of sustainability, we are comprehensive, credible and innovative.

Until 2020, climate protection, education and awareness, and digitally enabled sustainablility are the major foci of the strategy.

Climate protection:

Our goal is to make our customers climate-conscious, too, and to be an authentic and responsible company that helps them along that journey. It is our ambitious objective to generate revenue from our climate protection activities, as the ICT world offers especially great potential for that, at the same time to push Magyar Telekom Group’s actual CO 2 emission below 100,000 tons. In order to achieve the above, in addition to the emission decreasing initiatives, we also need to work on elaborating ”green” services specifically.

KPI: push Magyar Telekom Group’s actual CO 2 emission below 100,000 tons

KPI: generate revenue from climate protection

Education:

We want to assume a role in educating the public and our customers. Our goal is to directly or indirectly reach 100,000 people in Hungary with our trainings by the end of the period covered by the strategy. We shall primarily focus these trainings on two areas: programs aimed at eliminating the digital gap and the succession pool of the industry.

KPI: 100,000 digitally educated people in Hungary

Digitally enabled sustainability:

Being a sustainable digital company, it is our clear expectation that our customers should also use sustainable digital services. To that end, we strive to pursue responsible marketing and activities that enable and inspire others, as well as are based on sharing. In this context, our goal is that awareness about Magyar Telekom, as a sustainable company should reach 50%.

KPI: awareness about Magyar Telekom, as a sustainable company should reach 50%

 

Sustainability Strategy 2011-2015

Main objective
Sustainability to become part of Magyar Telekom’s identity, thus providing a competitive edge to the company in the long run.

Vision
Magyar Telekom, as a leading Central-European ICT provider enables its partners to consciously take part in sustainable development, a goal achieved in the framework of the hello holnap! initiative.

The company takes committed, proactive and transparent actions every day to make sustainability part of its identity and translate that into a competitive advantage.

By means of its forward-looking thinking, innovative and sustainable products and services, as well as its responsible conduct, it enables the renewal of society and environment.

Approach
In order to formulate the new strategy, the topics were prioritized on the basis of the accomplishments, the Dow Jones sustainability evaluations and the trends of the previous 3 years. Our objective set forth by the new strategy is to more intensively communicate our commitment to sustainability to the stakeholders. This objective cannot be achieved without setting new and ambitious goals, following best practices and forceful, targeted communication.

Topics, KPIs, tasks, key areas

SUSTAINABILITY = RESPONSIBILITY + OPPORTUNITY
  Economy Brand management Stock
Brand
Market
Innovation management
Environment Climate Strategy
Society Supplier standards
Telecommunication services’ effects

Key priority KPIs up to the end of 2015:

  • Brand management – focus: introducing, grasping the concept of sustainability, category building
    • Knows the concept of sustainability:
      KPI: public: 20%, employees: 80%
    • Magyar Telekom’s sustainability perception
      KPI: 25%- of the public, 50% of the employees should mention Telekom as the most sustainable company.
  • Innovation Management – focus: innovations aimed at society and environment
    • Innovations aimed at society and environment
      KPI: 10% of R&D
  • Climate Strategy – focus: building the reputation, for which the EU requirement is to be accomplished, credibility and ICT applications
    • CO 2 emission decrease
      KPI: 20% (basis year: 2004)
      Breakdown with 2010 as basis year and together with the eco-efficiency targets:
      • Electric power consumption: -5%
      • Energy efficiency indicator: 48 GBit/KWh
      • Green energy: 46 GWh
      • Gas consumption: -5%
      • Heating energy: -5%
      • Paper consumption: -30%
      • Fleet fuel consumption: -5%
      • In part of the vehicles for personal use the proportion of hybrid and electric cars: 20%
  • Supplier standards – focus: sustainable supplier chain
    • KPI: Establishing a sustainable supplier chain process
  • Effects of telecommunication services – focus: sustainable competitive advantage
    • Increasing the revenues from services of sustainable nature
      KPI: 20% of annual sales
    • Sustainable products
      KPI: their ratio in the portfolio: 25%

Sustainability Strategy 2008-2011

Main aim
To make Magyar Telekom’s sustainability role visible for employees and customers while retaining its leading position.

Factors Affecting the Elaboration of the Strategy
On the one hand local and international regulations such as the National Climate Change Strategy, the EU climate plan, National Sustainable Development Strategy, EU Sustainable Development Strategy and the redesigned Lisbon Strategy.
On the other hand, the needs of our stakeholders were also taken into consideration, among others those of our responsible investors (who, apart from the classic financial indicators also consider the company’s environmental and social effectiveness) and NGOs which for example had a chance to express their opinion regarding the company’s performance at the 9th Round Table Meeting.
And last but not least, in the formation of the new sustainability strategy the company also considered global and local problems and trends that are currently in the focus of attention, such as climate change, closing the digital divide, various social problems, trends in the industrial sector and best practices.

Strategic Sustainability Orientations
The strategy is being implemented through tasks clustered around 34 topics addressing the following key challenges (following categorization of SAM, Sustainable Asset Management).

Corporate Governance and Risk Management
Magyar Telekom aims at transparent and accountable operation, while providing for compliance, the struggle against corruption and effective risk management. Our aim, among others, is to improve our compliance system and the rating of our suppliers from environmental and social aspects.

Customer relations
The company group wants to make its customers aware of its efforts taken for sustainable development. This effort includes, among others, the development and dissemination of electronic service and product ordering solutions, as well as the measuring of the perception of sustainability performance.

Enabling society to communicate
In addition to keeping pace with technological development, Magyar Telekom finds it important to facilitate access for all to the benefits of info-communication tools. Thus the company group has among its goals the continuation and improvement of its digital inclusion programs, the provision of sustainability-specific ICT services and communication of the sustainability impact of products to customers, thereby enhancing their sense of responsibility.

Reducing our environmental footprint
Although the use of telecommunication products and services can result in savings of raw materials and energy, it can also cause environmental damage. Our company’s goal is to reduce its extent. The struggle against climate change is our key task: our company has set the target of reducing its CO 2 emission by 10% by 2011. Magyar Telekom strives to promote the reduction of its clients’ emission too, while extending help to them in adaptation.

Human resources management
“Committed professionals who take initiatives on their own constitute the key success factor of Magyar Telekom Group’s business success” (Magyar Telekom human resources vision). In this spirit the company group’s aim is to continue the development of human capital, to attract and retain talent, to ensure equal opportunities and to contribute to the balance of work and family life.

Maintain trust and credibility
To be able to retain social confidence our company must operate transparently and in consideration of the requirements of the stakeholders. Keeping this in view Magyar Telekom’s aim is, among others, to continue to strengthen communication related to electro-magnetic fields, to improve the protection of children from adult contents and to join, as well as to create, key sustainability initiatives.

High priority topics
Because 6 out of 34 topics are of special importance, the company’s top management addresses them as priorities through enhanced communication. These topics are the following:

  • ICT products that are special from sustainability aspects,
  • programs aimed at closing the digital divide,
  • communication of the sustainability effects of products,
  • ambitious climate strategy,
  • electro-magnetic fields,
  • joining key sustainability initiatives, creation of new initiatives, communication.

Sustainability strategy 2005-2008

Main aim
Magyar Telekom Group, as a leading info-communication provider in Central Europe has achieved a leading role also in environmental protection. The main aim of the Sustainability Strategy of 2005-2008 is to maintain the company’s leading role in environmental protection and, at the same time, to achieve a leading position in sustainability as well. The leading position on sustainability includes the inclusion of sustainability in 'core business'; the revision of the processes and operation of organisations; the application of international guidelines; and setting the course of a new communication and co-operation guidelines.

Focuses
In parallel with the increasingly wide use of information and communication technology (ICT) products and services (through the operation of technology itself) the negative impacts on the environment and society may also increase. The Group steps up efforts to reduce these negative impacts. To this aim-group belong the control of inputs and outputs, and decrease of them as it is needed and possible, e.g. carbon-dioxide equivalent (by reducing the use of non-renewable resources), electro-magnetic radiation, waste reduction, effective management, etc.

The sustainable management of information and communication technology, utilisation of the opportunities. The opportunities to sustainability lying in info-communication products and services (as reducing global negative environmental impacts - by decreasing green house gases, dematerialization - improving social welfare - knowledge society, access to information, workplaces, etc. - increasing economic effectiveness) should be supported for wider use. For this aim such processes should be implemented, which enables to analyse the products, and to control them on the input and output sides properly.

Results
The integration of sustainability into the core business and operating processes can be illustrated, among others, with the following achievements: Diversity Policy, Social Charter, Equal Opportunities Film Club, Romaster Program, sustainable supply chain management, active participation in ETNO’s Sustainability Working Group, annual publication of the sustainability report, climate protection campaign, regular sustainability section in the company’s magazine “Enter”, annual sustainability round table discussions, professional cooperation, etc.

Reduction of operation-related negative environmental and social impacts can be demonstrated by the company’s efforts in reducing group level CO 2 emission, using energy rationalizing solutions (e.g. cooling of base stations with free air), waste recycling, collection of used batteries, introducing the use of hybrid cars, communication of the impact of electro-magnetic fields, reducing the use of paper, digital inclusion initiatives, etc.

The efforts aimed at managing information and communication products from sustainability aspects resulted, among others, in publishing the brochure “Climate Protection at the Speed of Light” in cooperation with ETNO-WWF, in expanding the product development process with sustainability aspects and in the management of sustainable product proposals. It can also be ascribed to the credit of the ETNO-WWF publication that the European Commission issued a communication on May 13, according to which it will promote the use of info-communication technology in making the economy more energy-efficient. According to Viviane Reding, EU Commissioner for Information Society and Media it is a win-win situation, as ICT enhances the competitiveness of the EU’s industry, while spearheading the struggle against climate change.

Prizes, ratings
In addition to the achievements enumerated above, various awards and ratings prove the achievement of a leading role in the region. Some of the most important ones: Accountability Rating Hungary, first place in 2006 and 2007, DT Diversity Award, Business Ethics Award and Company Rating evaluation (Cégmérce).