Telefónica O₂ Germany consults with Telefónica Europe when addressing overarching issues relating to Corporate Responsibility. All CR officers of the national European companies are represented in a Corporate Responsibility Forum. The forum meets every quarter to discuss current issues and challenges, carry out consultations at European level, and make preparations for decisions by the Governance Committee.
This committee was set up by the Board of Telefónica Europe in spring 2007 with the aim of discussing all important strategic decisions exerting effects on the entire Telefónica Europe Group and taking appropriate decisions. This also applies to issues relating to responsibility and sustainability. Telefónica O₂ Germany is represented in this forum by its Chief Financial Officer (CFO) and reports to the committee on a quarterly basis. The issues addressed include progress made within the framework of the CR targets.

Responsibility affects all areas of the company and has to inform all daily actions. Central coordination supports this endeavour. This aspiration is supported at O₂ by establishment of the unit entitled "Corporate Responsibility & Reputation", which is part of the Corporate Communications division. The employees working in this team are responsible for the entire spectrum of CR issues and manage all activities associated with the issue of sustainability. They are available to the divisions as central contacts for information and consultation. The team is responsible for implementing the global CR strategy of our parent company within Germany and reviewing the development status of the various CR activities on a regular basis. It fosters dialogue with partners and stakeholders, manages the Corporate Citizenship commitment, and ensures that the reputation of the company is continually enhanced.

Regular meetings ensure that the process managers responsible for issues relevant to CR communicate across the entire company, define strategies and discuss results. The CR Team meets once a month in the "Corporate Responsibility Committee" with responsible managers from the departments relevant to CR, such as Corporate & Legal Affairs, Human Resources and Network Technology. Furthermore, we have established three task forces that look after issue management, matters relating to digital integration and staff satisfaction. The members of this committee meet regularly.
Once a year, the CR Team and the responsible CR managers from the departments meet in a wider forum that also includes representatives from brand management, product development, shop & public domain division, the corporate customer segment and corporate strategy. Targets and potential adjustments to the overall CR Strategy are agreed at this meeting.

Risk management is an important element of our Corporate Responsibility. Our Risk Management Team in the Corporate & Legal Affairs division regularly analyses our activities using parameters defined by 50 categories. On the basis of this analysis and our Corporate Responsibility Strategy, we define targets and actions dedicated to restricting CR-related business and reputational risks and establish deadlines and responsibilities.

Telefónica S.A. has introduced a standardised process to evaluate the CR activities of the entire Group. This process generates reports on developments and permits successes to be measured. Key indicators are a central tool. They relate to seven areas: employees, customers, environment, company management, health & safety at work, society and suppliers.
These indicators are reviewed annually by an auditing company and are included in the group-wide CR Report produced by Telefónica S.A. and in the CR Report published by O₂. Our regular checks on success in relation to donations and sponsoring have been structured using a monitoring process that is based on the specifications drawn up by the London Benchmark Group (LBG). They are intended to define social commitment in quantifiable terms.
Our corporate vision is defined as the "Spirit of Progress". This vision is based in part on specifications that provide a foundation for evaluating and enhancing all the activities we use to implement corporate responsibility. The process specified for this aspiration is illustrated by the flowchart shown below:

Our annual CR targets are also defined with the assistance of a standardised process. An incremental procedure involves managers with specialist responsibilities, CR managers and senior managers to designate concrete activities and targets that are approved by the Executive Management and the international Governance Committee. This gives us strategic control over our sustainability activities in close harmony with our core business. If objectives prove impossible to achieve, the reasons are carefully analysed and new targets are defined for the subsequent year.
Our targets for 2010 at a glance

Every three months, the Reputation Institute is commissioned to ask 300 men and women to give their perception of our company. Our aim is to find out whether the interviewees perceive us as having a profile that is distinct from our competitors. We are also interested in ascertaining whether the respondents can clearly identify our positions on concrete issues. The results of this survey provide two indices. The so-called RepTrak Pulse© informs us how the respondents perceive us in emotional terms. It measures their feeling, their respect and their admiration for our company. This index also gives an indication of the confidence they place in us. By contrast, the RepTrak Index© highlights the rational factors that are important for the perception of our company. This includes areas such as products and services, our innovations, our company management and our social commitment.