Integrated 2017 Annual Report
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Integrated 2017 annual report Orange Mapping Foreword The Internet of Things, Big Data, cybersecurity, ever more digital essential services, ambient connectivity and artificial intelligence are a few examples of the unprecedented digital shifts and surge we are seeing today. These developments are placing Orange ever closer to the core of these big issues and deepening our determination to contribute to a more intelligent, more open and more responsible society. This attitude shapes our commitment. This is also what our Human Inside philosophy is all about: the only metric that matters when we look at digital technology and at all the innovation it can spur is the extent to which they serve people in particular and society as a whole. We hope this third integrated annual report gives you a clearer picture of what our dedicated teams are achieving day after day and how Orange’s commitment is generating value for stakeholders across the board. Contents We have chosen to illustrate what we are doing with seven experiences you will find in these pages 04 – 05 Orange at a glance and on our digital platform, rai2017.orange.com/en/. 06 – 07 2017 key figures 08 – 09 Corporate governance 10 – 11 Our model to create value 12 – 35 Chapter 1 Our vision for digital technology 36 – 73 Chapter 2 Our strategy to create value 74 – 103 Chapter 3 Our contribution 104 Tables and charts 105 Contacts and useful links Listen to the IAR podcast on rai2017.orange.com/en/ 4 Orange integrated 2017 annual report 5 Orange at a glance Europe Belgium France Luxembourg Moldova Operating networks, creating digital experiences Poland 1 business line 28countries around the world, Romania and a global presence with Slovakia Orange Business Services Spain Communication services for consumers Africa and Middle East Botswana Burkina Faso Communication services for businesses Cameroon Central African Republic Content Côte d’Ivoire Democratic Republic of the Congo 5business Egypt activities Mobile financial services Guinea Guinea-Bissau Wholesale Iraq Jordan Liberia Madagascar Mali Consumers: the women, men and families we connect Mauritius to the people and things they care about the most Morocco Niger Senegal Businesses: the professionals, SMEs and multinationals Sierra Leone that use our digital transformation facilitation solutions Tunisia 3customer groups Operators: the communication and Internet companies that leverage the power of our networks and services 6 Orange integrated 2017 annual report 7 2017 key figures 152,000 42.5% France employees 16.7% Businesses 12.9% Spain 11.6% Africa and Middle East 6.4% Poland 4.2% Central Europe 3.0% Belgium and Luxembourg Over 2 Over 3,000 2.7% International operators million BtoB customers customer and shared services (professionals multinationals and SMEs, incl. outside France 43,000 businesses with more than 50 employees) in France €41.1 billion in revenues 273 Over 450 €7.2 million BtoC customer operators billion investment customers in France (wholesale) in 2017 4.7 46 No. 1 10.3 million customers million 4G customers FTTH operator million BtoC with very high-speed in Europe customers on (over 100 Mbit/s) (26.5 million fibre- convergent fixed broadband access ready households) and mobile deals 8 Orange integrated 2017 annual report 9 Corporate governance 1 2 3 4 Orange’s robust governance is geared to advancing the Group’s A sound organisation A Board Active and proactive Strategic strategy and tackling the challenges in its environment. Convinced where responsibilities encompassing a directors seminars twice that strong governance drives strong performance, we keep are balanced across complementary a year to contribute accountability along with risk management and control constantly the corporate array of profiles and to the Group’s management fields of expertise, transformation at the centre of our concerns. That is why we have built Orange’s structures and representing governance around four central bricks (see opposite). commensurately Orange’s full wealth with the Group’s of stakeholders scope Audit Board of Directors Establishes strategic direction, oversees implementation 3 Committees Governance and Corporate Social and Environmental Responsibility Innovation and Technology General Meeting Chairman and Chief Executive Officer of Shareholders 2 Chief Executive Officer Delegates 3 Deputy Chief Executive Officers Executive Committee Steers the Group, coordinates strategy implementation 9 Senior Executive Vice-Presidents 10 Our model to create value Our Planet philosophy Technology only brings about innovation when it serves a purpose. That, in a nutshell, is what our Human Inside philosophy is all about. It is the simple, Society powerful belief that inspires and guides everything we do. People Our ambition Through Delivering pioneering and purposeful Create enduring our business products and services value for our four line stakeholder families, namely businesses, the public sphere, civil society Through and employees. Direct jobs and wages, investments, our business purchases, dividends, taxes and levies activities Through Indirect jobs, deep roots in host communities, our footprint and our social and environmental commitments in society Orange integrated 2017 annual report 11 Our strategy Our Essentials2020 Offering strategic plan is aimed ed connec rich tivi at maximising the value en ty c u we generate through s R to e i g g m n our model and n in s v i t e s e y i e r f l n i s r a t s s e distribute to our t i r i n a l a e p g r t v a An i u i t stakeholders by o c o h D n e y unmatched s n b h connecting everyone o i customer p to what matters to them. experience t t a o h S h g f e u t n b p l i tr p g e r u a o in d a s n r d o c in s tin il d e fo g Bu m n ss rm ny a c ati pa al us on om it to a c dig me th rs is bo A digital, efficient and responsible company Our business model Resources In essence, we generate returns from our Invest in building and operating our network resources using four infrastructure business and industrial levers. Serve our customers and thereby monetise Business our networks model Nurture customer loyalty with outstanding services and experiences Provide an open service ecosystem Share value with beneficiaries 12 Orange integrated 2017 annual report 13 Our vision for digital technology In addition to reshaping our societies, digital technology is opening up new growth opportunities for Orange. Our overarching aim is to build a more intelligent, more open and more responsible society. That involves rising to the challenges that the digital revolution is bringing about, i.e. harnessing innovation to make it useful and make sure its benefits reach as many people as possible. This way, we can concurrently address the high hopes emerging throughout society and deliver the performance investors expect from a publicly traded company. Our role as operator, our teams’ expertise and the investments we make put us in a position to steer today’s shifts in the right direction and support our long-term growth. Chapter 2 Chapter 3 Chapter Our contribution Our Our strategy to create value create to strategy Our Chapter 1 Chapter 14 Orange integrated 2017 annual report 15 How technology is reshaping and augmenting the world The leaps forward in artificial 3.8% developments that will have the most our future-ready fibre networks (with 12 billion the environment, i.e. renewable intelligence, upsurge in processing ICT market extensive impact over coming years: bandwidths exceeding 10 Gbit/s), tons energy and the raw materials that power and ubiquitous networks are growth in 2017 deep-learning technologies are Internet of Things networks (LTE-M Potential the digital economy needs to thrive; giving rise to a fourth industrial enabling machines to solve problems and LoRa®) and the very high-speed reduction in CO2 the regulation to channel activities revolution. Orange is one of the by themselves, and thereby opening mobile bandwidth that 5G will usher emissions from in global markets where borders are Over digital and smart driving forces behind that 5 billion doors to wonderful opportunities in, starting in 2020. Then, this services by 2030 blurring; revolution, as well as one of its mobile users ranging from task automation revolution is opening up new (1/5 of the world’s security, as people and businesses beneficiaries. Our Group has the worldwide to customer-support chatbots possibilities to bring our BtoC and total emissions) have a crucial need to place their expertise, infrastructure and and on to industrial robots and home BtoB customers ever more essential data in digital spaces they can international wingspan to channel assistants. Artificial intelligence will services. We are already supplying fully trust. today’s and tomorrow’s disruptive 21 billion also play a pivotal role harnessing mobile banking solutions and other 15% These are the ripples that the fourth connected Average annual technologies. Those breakthroughs objects in 2020 Big Data, i.e. collecting, analysing content today, and the prospects growth in the industrial revolution is setting will in turn spur growth in our core and processing masses of data we are looking forward to range Big Data market in motion, that will shape the world business and in the new service generated by billions of connected across connected homes, well-being, through to 2020 tomorrow, and that Orange is universes that are becoming objects to distil purpose-designed healthcare, education, energy, addressing through its business increasingly essential in people’s applications that effectively improve industry, transport and even smart model, strategy and commitments connected lives and for companies people’s lives and companies’ cities.