CR Strategy: setting the framework, measuring progress

Sustainability and social responsibility have been part of Deutsche Telekom’s business activities for three decades. We have anchored our self-image as a responsible company in our Group strategy and in our Corporate Responsibility (CR) strategy. In this way, we are committed to acting sustainably along our value chain throughout the Group – and to contributing to solving ecological, economic and social challenges. We record our ambitions and progress in the ESG (Environment, Social, Governance) dimensions in our sustainability reporting. With it, we want to meet the expectations of stakeholders, such as our B2B customers or the capital market, track progress in implementing our ambitions and at the same time meet regulatory requirements. That is why we are publishing this CR report in addition to our sustainability statement in the Annual Report – for a holistic and easier to understand view of our ESG activities. For more information on the background to this CR report, see About this report.

Our Group and CR strategy

Our Group strategy is based on continuous improvement and value creation, as shown in the flywheel model shown (see graphic). The model starts with investments in infrastructure and technology to best meet the needs of our customers. Efficiency improvements reduce our costs and increase the quality of our services. This leads to a solid financial basis that enables renewed investment and growth. Data and artificial intelligence (AI) act as drivers of innovation and efficiency. Through our global growth, we are exploiting synergies and strengthening our competitiveness on an international level. At the heart of the model, symbolized by our brand, is what sets us apart: a unique portfolio, the best team, strong values and leading ESG ambitions.

Further information on our Group strategy can be found in our audited Annual Report 2025.

Sustainability is an integral part of our Group strategy: Our CR strategy is derived from our business model and at the same time shapes our strategic goals and decisions. It is based on the three pillars of environment, social and governance (ESG) and bundles the key topics in which we want to provide significant impetus.

In the environmental and social pillars, we focus on the following topics:

Climate

• We are pursuing ambitious, science-based climate targets: We want to be pioneers on the way to a climate-neutral future and make measurable progress. By 2040, we aim to achieve net zero emissions along the entire value chain – across all three scopes. To achieve this, it is necessary to reduce emissions by at least 90 % compared to 2020. Only up to 10 % may be neutralized via high-quality projects that bind CO₂e from the atmosphere.

Circular Economy

• Our commitment to recyclability: We have set ourselves the goal of being almost completely recyclable in technology and devices by 2030 (excluding T‑Mobile US). In this context, we aim to be able to return almost all the products we put into circulation by 2030. This includes the entire network technology as well as a large part of our own-brand devices and the mobile devices we sell.

Best Team

• Our promotion of corporate culture and inclusion, as well as our investments in the training of our employees: We want to ensure a safe and supportive environment in which we promote equal opportunities for people – in every dimension of diversity.

Digital Society

• Our commitment to help shape a digital society that promotes better interaction and in which all people can participate safely, competently and confidently: We want to contribute to making the digital world a more tolerant and secure space for everyone and to enable society to overcome the digital divide.

Detailed information on these priorities, our climate and circular economy goals, and our actions and progress can be found in our audited Sustainability statement 2025.

To implement our sustainability goals, we manage key governance issues and processes as part of effective corporate governance:

• Data protection, cybersecurity and information security

• Corporate compliance management system as well as risk and opportunity management system

• Implementing the basic principles of digital responsibility

• Respect for human rights and consideration of social and environmental aspects in the supply chain

• Investments based on environmental and social criteria as well as transparent and consistent communication about our activities in the field of environmental and social sustainability

• Effective management of topics of sustainable business in the Group

We are constantly driving these topics forward and want to secure Deutsche Telekom’s long-term value creation and competitiveness. Our ambition is: We want to be a world-leading sustainable telecommunications company. We assess our progress in this project on the basis of external benchmarks and ratings, such as the Carbon Disclosure Project’s (CDP) Climate A list. Deutsche Telekom also focuses on transparency and further development along the supply chain in its supplier engagement and is listed by CDP as a Supplier Engagement Leader (Rating A).

Sustainability is not a parallel agenda to our core business. In times of polycrisis, we see sustainability as a contribution to strengthening long-term relevance, resilience and entrepreneurial freedom of action.

Measuring and managing sustainability: our CR controlling

We measure and manage our performance in the areas of our CR strategy using non-financial performance indicators. These KPIs (Key Performance Indicators) reflect our performance and progress in the areas of environmental, social and governance (ESG). The designation has been standardized compared to previous reports and the preceding “ESG” has been deleted for easier comprehensibility. The KPIs remain the same.

The basis for calculating our KPIs is provided by ESG data and key figures, which are collected and reported transparently and in a timely manner throughout the Group. Important non-financial performance indicators such as “Energy consumption” and “CO₂ emissions” (Scope 1 and 2) are included in the calculation of the variable Executive Board compensation and are also relevant for our international managers (outside T‑Mobile US) as well as all non-tariff employees of the Group in Germany. The KPIs “Energy Intensity”, “Scope 3 Emissions” and the Telco Circularity Score (TCS) are part of the Group-wide controlling process. In addition to these KPIs, we report other metrics and data to meet internal and external transparency requirements.

In 2021, we integrated our data process into the Internal Control System (ICS) to ensure high data quality, adherence to deadlines and transparency. As part of the ICS, the process must meet specific principles. In addition, we subject the ESG data process to particularly demanding controls (“transaction level controls”) for the KPIs that are most important from a management perspective. The effectiveness of the transaction level controls is checked internally and in some cases externally. You can find more information about our ICS in our Sustainability statement.

We are continuously developing our metric system to review progress and better manage and communicate our ESG performance. The KPIs are broken down in the KPI Tool according to the segments “Germany”, “USA”, “Europe”, “Systems Solutions”, “Group Headquarters & Group Services”, “Group Development” and “Technology and Innovation”.

How we determine our KPIs

KPIs are highly relevant for us to measure and manage our progress in the area of ESG and for transparent reporting on them. Depending on the materiality of the topic, we publish them in the Sustainability statement of our Annual Report or here in the CR report.

Our segments represent 99 % of Group sales. Accordingly, they play an important role in collecting group-wide KPIs by collecting ESG data themselves.

In the sense of integrated financial and sustainability reporting, the KPIs represent all six types of capital:

In addition to our KPI system, we have developed an impact measurement methodology to evaluate the environmental and social aspects of our products and measures along the value chain. This methodology helps us to manage our sustainability activities and communicate them transparently.

Corporate Digital Responsibility as a business principle