Management & facts

We see ourselves as a responsible company and have made that a core element of our Group strategy. Our Corporate Responsibility strategy, which is derived from this, has been further refined in the period under review, with four particular focal points identified where we aim to lead the way:

1. Our strict commitment to climate-neutral business practices
2. Our determined efforts to ensure our products and services are compatible with the principle of circularity
3. Our pursuit of diversity, equity and inclusion in our teams and our investment into future skills
4. Our determination to help shape a digital society that is based on our fundamental democratic values and in which all people can participate safely, competently, and with autonomy

More information about our focal points is available in the relevant section of the strategy chapter.

To support the climate strategy and achieve the ambitious Group targets, the national companies have developed and implemented their own climate protection strategies, concepts and measures. These can be viewed in the relevant profiles.

Our integrated climate strategy is based on four pillars: Emissions from the value chain; renewable energy; energy efficiency; and enablement (positive climate protection effects for our customers). We have defined objectives and/or key performance indicators for each of the four pillars.

We are helping to mitigate climate change and contributing to compliance with the Paris Climate Agreement. Our current climate targets were adopted by the Board of Management in 2019 and have applied since 2020. The ambition level was increased again in March 2021. In March 2023, we replaced our interim goal with a more ambitious target based on the Science Based Targets initiative’s (SBTi) Net-Zero Standard. In addition, since 2021, the Board of Management’s remuneration has been linked to various factors, including the meeting of climate targets and the performance indicators “energy consumption” and “CO₂ emissions” (Scope 1 and 2) (excluding T-Mobile US).

Our targets are:

1. We have already achieved our goal of using 100 percent electricity from renewable sources (Scope 2) throughout the Group by the end of 2021.
2. Now, we aim to reach climate neutrality for our own direct and indirect emissions throughout the company by the end of 2025 (Scope 1 and 2). To that end, we plan to reduce carbon emissions by up to 95 percent, with respect to their 2017 levels, and offset any remaining emissions via suitable measures. In the process, we are concentrating on offsetting measures aimed at long-term removal of carbon from the atmosphere, such as afforestation. We also conclude power purchase agreements (PPAs) for green electricity with operators of wind power or photovoltaic parks. In this way, we offer operators investment security and promote the expansion and use of renewable energies. In addition, we are reducing our energy consumption, e.g. through energy efficiency measures and space reduction in buildings, as well as through electrification, especially in our vehicle fleet.
3. As an interim target on the way to becoming climate neutral, we have set ourselves the task of reducing carbon emissions in Scopes 1–3 by 55 percent with respect to 2020 levels. As a result of our systematic efforts to reduce our Scope 1 and Scope 2 emissions , the majority (over 98 percent) of our carbon footprint now occurs through the production and use of our products. We consult closely with our suppliers in order to reduce the emissions generated during production, and to have products manufactured that are energy efficient in their utilization phases. The new interim target is more ambitious than our previous target, which was to reduce Scope 3 emissions  by 25 percent per customer (compared to 2017) by 2030.
4. We want to be completely climate neutral (“net zero”), with no carbon footprint left in any of the three scopes, by the end of 2040 at the latest. We will offset any emissions we are still creating at that point using suitable instruments, as set out in our planning for Scope 1 and Scope 2 emissions. We intend to cut emissions by at least 90 percent, so that we only need to offset up to 10 percent.

Our climate targets from 2019 were developed using the method proposed by the SBTi. The SBTi officially confirmed in May 2019 that we are the third DAX-listed company to contribute toward implementing the Paris Climate Agreement through our climate protection targets. We have thus followed our national companies in the United States and Hungary, whose targets were already endorsed by the SBTi in 2018 and at the start of 2019, respectively. The targets that were adjusted in 2021 and the interim target on the way to climate neutrality approved in March 2023 are currently being validated by the SBTi. At the end of January, the reduction target for T-Mobile US of reducing Scope 1–3 emissions by 55 percent with respect to 2020 by the year 2030 was validated by the SBTi.

Impact assessment for our materiality analysis
Greenhouse gas emissions are associated with a detrimental impact on humans and the environment. For this reason, we have identified climate protection as a key topic throughout the value chain in the impact assessment conducted as part of our materiality analysis. Analysis of the criteria “probability of occurrence” and “severity” has revealed that significant greenhouse gas emissions could be generated in the upstream value chain in particular (during raw material extraction and supplier activities), as well as in the downstream value chain, which comprises the utilization, disposal and recycling of products.

At the end of the year, our progress toward our targets was as had been forecast.

Electricity from 100 percent renewable energies
Since 2021, 100 percent of the electricity we use, Group-wide, has been sourced from renewable energies (Scope 2).

Climate neutrality by 2025 (Scope 1 and 2)
Our targets call for us to reduce our Scope 1 and Scope 2 emissions  by up to 95 percent, with respect to their 2017 levels, by 2025, and to offset all remaining emissions, via suitable measures, in order to achieve climate neutrality in our operations.

In the year under review, we reduced our Scope 1 and Scope 2 emissions by 94 percent with respect to their 2017 levels.

25 percent reduction of per-customer Scope 3 emissions by 2030
For reasons of transparency, we are once again reporting the previous Scope 3 climate target for 2030 in this reporting year, which relates to the number of customers. This describes the reduction of Scope 3 emissions per customer by 25 percent (2017–2030). Relevant for the calculation are the Scope 3 categories: Purchased goods and services, Capital goods, Use of sold products, Rented or leased equipment.

The figure for the base year 2017 was corrected in comparison with the prior-year reporting due to a different basis of calculation. The reason for this is the exclusion of the units T-Mobile Netherlands and Telekom Romania, which have since been sold, from the base year and from the target figure. The customer figures excluding wholesale customers are used for the calculation.

In the year under review, we reduced our per-customer Scope 3 emissions by 1 percent with respect to their 2017 level.

Climate neutrality by 2040
We want to be climate neutral in all three Scopes by 2040 at the latest, so that we no longer have a carbon footprint at all. To date, we have achieved 10 percent of this ambitious target. To allow us to better monitor our progress, in 2023 we replaced our interim target of reducing Scope 3 emissions by 25 percent per customer (compared to 2017) by 2030 with a more ambitious interim target: by 2030, we want to have achieved an absolute reduction of 55 percent in Scope 1–3 emissions (compared to 2020).

The “Task Force on Climate-related Financial Disclosures (TCFD )” was established at the 2015 United Nations Climate Change Conference in Paris. Its aim is to develop voluntary, consistent climate-related financial risk disclosures. In 2017, the TCFD published specific recommendations for putting these disclosures into practice, recommendations that companies can use as a guideline to inform investors, lenders, insurers, and other stakeholders  about the risks climate change presents for their business model.

We welcome the aims tied to the TCFD, and we are moving forward with TCFD-based reporting relative to those aims. As is already becoming increasingly clear, the physical risks posed by climate change include extreme weather events. In addition, transitional risks, such as the trend in carbon prices, are increasingly affecting political debate in this context. This directly influences our operations and our stakeholders. The risks applying to the continuation of our operations are analyzed, and those risks are operationally managed by our business units. In addition, we evaluate internally how reporting on climate-related financial risks and opportunities can be aligned with the TCFD’s recommendations. Ideally, such alignment would build on existing approaches for strategy, controlling, and risk management.

In 2020, we carried out a gap analysis to determine the extent to which our measures already conform to the TCFD  recommendations (see here). In various workshops with experts from the areas of technology, procurement, strategy and risk management, we defined the main climate-related opportunities and risks and began weighting them. In the process, we considered the consequences, for our business operations, that could result from the physical impacts of progressing climate change. In addition, we analyzed the potential impacts resulting from political, technological, and social developments tied to the transition toward a low-carbon economy that has been initiated. In 2022, the analysis was extended to include a financial quantification of transitory risks.

The important climate-related risks include possible network-infrastructure failures as a result of damage to secondary infrastructure (involving power failures, for example) or failures of cooling systems. Another risk consists of possible network damage or failure as a result of network-infrastructure damage due to climate events or changes in climate conditions.

The important climate-related opportunities we have identified include the increasing use of energy-efficient technologies (in network operations, for example), and growing demand for climate-friendly products and services.

In a next step, we analyzed – by way of example, to begin with – 500 of Deutsche Telekom’s locations in Germany with regard to their physical climate risks. This climate-risk analysis was carried out using the Climate Change Edition of the Location Risk Intelligence software of the reinsurance company Munich Re. The analysis covers eight indexes (see graphic). We considered the risks for the various locations in light of two climate scenarios of the Intergovernmental Panel on Climate Change (IPCC): a business-as-usual scenario (RCP 4.5), with a global temperature increase of more two degrees, and a four-degree scenario (RCP 8.5). In addition to studying the climate scenarios, we looked at risks in various time frames: currently, for the year 2050 and for 2100.

The following graphic shows a simplified excerpt of the results: the risks for the year 2050, in keeping with the four-degree scenario:

Tropical Cyclones
Maximum intensity of cyclones with a probability of exceedance of 10% in ten years (corresponds to a return period of 100 years).

Sea Level Rise**
Hazard zones derived from statistical data on sea level rise and altitude data for the respective projection year and scenario.

Fire Weather Stress Index
The Fire Stress Index describes current meteorological fire conditions based on fire hazard models. These combine inflammation probability, speed and spread probability, and fuel availability into a combined metric. The Fire Stress Index includes information on the length of the fire season and extreme fire danger days, for example.

Precipitation Stress Index
The Precipitation Stress Index describes the current meteorological threat of heavy precipitation. The threat is derived from information about e.g. one-day heavy precipitation events and long-lasting precipitation events.

Drought Stress Index
The Drought Stress Index describes the change in water balance derived from the modelled standardised precipitation evapotranspiration index (SPEI). This multi-scale drought index is based on climatic data and is used to determine the duration, intensity and severity of drought conditions compared to normal conditions (in reference periods).

Heat Stress Index
The Heat Stress Index describes the current meteorological threat from heat. The threat is derived from information on e.g. heat waves, annual maximum temperature and tropical nights.

River Flood (undefended)
Areas at risk of extreme floods with return periods of 100 or 500 years. Does not take into account dikes.

River Flood (defended)
Areas at risk of extreme floods with return periods of 100 or 500 years. Flood protection is taken into account.

The scenario analysis shows that only minor physical risks apply for the majority of the company’s locations in Germany. Nonetheless, we are prepared for the impacts of physical risks, such as changes in precipitation patterns and extreme weather variability. As shown by examples such as the storm “Friederike” in 2018, and the disastrous floods of July 2021, extreme weather events are already capable of causing local damage to our telecommunications infrastructure. Consequently, our risk management is based on multiple pillars – we structure Deutsche Telekom’s telecommunications networks with built-in resiliency. For example, we use ring structures to ensure that failures of individual network components do not affect the services we provide for our customers. For most of our critical locations, we use uninterruptible power supply (UPS) systems incorporating batteries and mobile and stationary diesel generators. Such systems can normally provide emergency power for several hours in the event of power failures. Our crisis management also helps with rapid recovery in the event of disruptions. The risks of damage to buildings and to Deutsche Telekom’s network infrastructure are covered by insurance policies. Further information is available in the chapters “Addressing climate risks” and “Risk and opportunity management”.

In 2022, we continued analyzing the most important opportunities and risks presented by the above-described climate scenarios. We now plan to extend our location analysis to additional countries – and we are already holding talks with further national companies to that end. 

The continuing refinement of our risk management, in keeping with the TCFD requirements, is also important from a regulatory perspective, especially in light of the EU Taxonomy guidelines. The criteria for the environmental goal “Climate change adaptation” require – as does the TCFD – companies to study physical climate risks and to be aware of the potential impacts on their business activities. With our TCFD process, we have laid the foundation for the climate risk analysis that is needed to fulfil the taxonomy criteria. More information on the implementation and the results of the taxonomy-aligned climate risk analysis can be found in the “EU taxonomy: compliance” section and the non-financial statement in the 2022 annual report.

In the context of our integrated climate strategy, we determine climate-related risks and opportunities for us as a company and for our stakeholders . Our Board of Management is informed quarterly about current climate risks in a Group Risk Report. Further information on risk management is provided in the “Risk and opportunity management” section of our annual report.

Physical risks
Extreme weather conditions as a consequence of climate change will have a negative impact on our business processes and will inevitably lead to incidents or even network outages. Among the effects of such breakdowns is their massive impact on the management of rescue operations, for example, sometimes even rendering such emergency efforts entirely impossible. In order to be able to react appropriately in these cases, we have defined the necessary responsibilities, processes, and measures in our internal “Group Policy on Continuity and Situation Management”. Additionally, the policy outlines how to handle emergency and crisis situations like floods.

We also take possible consequences of climate change into account when planning our future business activities. For example, our network infrastructure is set up to be better protected from storm conditions, changes in temperature, and high winds and keep mobile supply infrastructure on hand for emergencies.

Financial risks
Climate change also carries financial risks, whether from levies on carbon emissions or through an increase in energy costs. Our contribution to the mitigation of these risks includes measuring our own energy efficiency and developing measures for improvement. To prevent infrastructure failure due to extreme weather events, additional investment in a more robust infrastructure might be necessary.

Prevention
We also help our customers reduce their own carbon footprint, thus helping to mitigate climate change, by providing them with innovative solutions. Examples include projects in the area of sustainable urban development and mobility, and also a real-time solution for agriculture (precise positioning). It can be used, for instance, to correct GPS  data that is often too inaccurate for agricultural purposes and transmit precise location data in real time – using 5G mobile technology. Our low-threshold, comparatively inexpensive solution helps farmers deploy their machinery with greater precision, to reduce emissions, dose fertilizer and seeds more accurately, and increase their yields. That way we can also make an indirect contribution to achieving the second sustainable development goal (SDG) of “zero hunger.”

We also help our customers deal with the adverse effects of climate change (adaptation). In the event of an imminent catastrophe, our infrastructure can be used, for example, to send alerts via early warning apps. Climate change adaptation is part of the EU Taxonomy  Regulation, which we discuss here.