Annual Report

2018

groupp Table of content

Proximus at a glance 2

Foreword from our CEO & Chairman 4 a glance at Who we are & what we do 8 Key financial highlights 10 Key achievements 13 #shifttodigital, our new 3-year strategy 17

Creating an inclusive, safe, sustainable and prosperous digital 20 Non-financial reporting approach 2018 Living and working in an ever fast changing society 22 For the Non-Financial information included in this Contributing to society while creating value for our stakeholders 25 Annual Report, we followed the indications of the Sustainability Enabling a better digital life 28 Global Reporting Initiative (GRI) guide (core option). We have detailed our reporting approach in the Caring for our stakeholders 40 Transparency section. Proximus answers several questionnaires on Sustainable and Responsible Contributing to society 52 investments such as Sustainalytics, Vigeo Eiris, Respecting our planet 60 MSCI, etc. Our ambition is to keep improving our performance by comparing it with that of peers. In 2018, we were listed as follows on the different indices: CDP Supplier Engagement leader board Governance and compliance, safeguarding long-term value 66 and a constituent company in the FTSE4Good Index Series. Corporate Governance statement 68 Regulatory framework 85 For this 2018 report, we have created a structure around how we create value for our stakeholders Risk management report 91 and society: Enabling a better digital life, Caring for our stakeholders, Contributing to society and Proximus share 100 Respecting our planet. We covered our most material topics, defined through an internal and

Remuneration report 106 and Compliance Governance external process, explained in the Transparency section. In the Governance section, we describe our governance framework, risk management, Appendix 116 remuneration structure and the Proximus share. Overview of non-financial information 118 Throughout the report we provide detailed performance data. Transparency 122 Social figures 134 Environmental figures 138 GRI Content index 142

Material topics 157 Appendix KPI description 158

1 Proximus Group Annual Report 2018 Proximus at a glance Proximus a glance at Proximus at a glance Sustainability

Foreword from our CEO & Chairman 4

Who we are & what we do 8

Financial fi nancial highlights 10

Key achievements 13

#shifttodigital, our new 3-year strategy 17 and Compliance Governance Appendix

3 Proximus Group Annual Report 2018 Proximus a glance at Proximus wants to play a positive role in the digitalization of 2018 all aspects of life, work and public services, for a more prosperous digital Belgium Sustainability Dear reader, The market context for telecom operators year, closing 2018 with a 2.4% increase. We Proximus is at the very heart of the digital economy and society, becomes increasingly challenging. We also maintained our high investments pace and through the digital solutions and services we offer, we make operate in a mature market with intense local with € 1,019 million invested with a clear a positive and meaningful difference in all aspects of life. The competition and an increasing disruption of focus on digitalization, networks and overall guiding purpose of our five-year Fit for Growth strategy (2014- voice, SMS and linear TV by new over-the-top customer experience. The deployment of 2018) has been to connect everyone and everything so people players in both the residential (WhatsApp, our future-proof network in the context of live better and work smarter. To fulfil this mission, we’ve saved Netflix,…) and enterprise (Microsoft Teams, the Fiber for Belgium project kicked off early cloud, API, SDWAN,…) market. At the same 2017, with the roll-out ongoing in 9 cities costs and grew our core business so that we could invest, fuelling time regulation focusses on lowering in 2018. We also invested extensively in IT new growth. We continued our transformation from a Telco consumer prices with the end of roaming, the systems and digital platforms and in further company to being a Digital Service Provider delivering superior opening of fiber, Easy Switch and a potential enhancing our mobile network. th customer experience and helping customers reap the benefits 4 mobile operator. and Compliance Governance of digital transformation. Today we’re enabling a better digital More customer oriented, agile life by means of a future-proof infrastructure with high-quality Solid position in a highly and efficient organization competitive market networks and digital platforms, as well as through innovative By moving to a single mass market IT chain We maintained a solid position despite a highly and phasing out our old switching network, solutions and services that address societal challenges. Proximus competitive market and delivered upon our we have simplified and modernized our wants to play a positive role in the digitalization of all aspects 2018 outlook. We kept a stable domestic infrastructure. This large-scale transition of life, work and public services, for a more prosperous digital underlying revenue and grew our Group of customers from legacy networks such Belgium. underlying EBITDA for the fourth consecutive as PSTN and ATM, to IP-based technology Appendix

4 Proximus Group Annual Report 2018 Proximus at a glance at Proximus has allowed us to phase out 1,119 switches strategy, Proximus and , and thanks to grow, and in 2018 we added the national and migrate 3.4 million voice lines and as a to the continuous success of our all-in offers basketball championships, a new eSports consequence, we have vacated a total of 16 Tuttimus and Bizz All-in, reaching 508,000 league for fans of video game competitions. buildings over the past five years. At the same customers end of 2018. We developed a time we are modernising our core network Dominique new range of Mobilus offers, as well as our For our enterprise customers we have been with the roll out of our Simplified Backbone first mobile subscription with unlimited calls, bundling our services into customer-oriented Optical network (SIMBA). Leroy texts and mobile data. And millennials got and competitive integrated solutions. The CEO a new, dedicated offer: Epic. Epic beats and launch of Call Connect, essentially a telephone The redesign of the IT architecture has Epic stories offer unlimited music and data for exchange in the cloud, is an inspiring example been accompanied by a redesign of our “With our new strategy, the most popular apps. For self-employed of how we’ve been able to combine over-the- Sustainability processes so we are First-Time Right. We’ve ‘#shifttodigital’, we want persons and small businesses we also top offers with our unique telco capabilities simplified the selling & ordering process, to remain relevant to our created Bizz Online to encourage more small (fixed-mobile, Quality of Service). A strategy and migrated all the billing of our mass- customers and support businesses and entrepreneurs in Belgium to that clearly works: in 2018, we increased our market customers to a single platform. Our enterprises in their have a stronger online presence. Scarlet, our volume share in mobile for the enterprise customers can now consult all their invoice digital transformation, no-frills brand continues to perform strongly segment and reached more than 1 million details in the MyProximus app as well as while becoming more and is further growing its customer base. And cards, while also protecting value share. activate or deactivate options, switch to a efficient and agile.” in Luxembourg, , with fixed, mobile, TV Pack and keep track of their usage in real and convergent services, also continues to be Building the best network time. At the same time ‘Invoice Insights’ now the dominant force. infrastructure of the future allows business customers to more easily We have slimmed down our legacy catalogue Our networks have been transformed over manage their mobile invoices through an and proactively offered pack migrations to Year after year, we’ve focused on improving the last five years, and will no doubt change easy-to-use app interface. In 2018 we also future-proof, easy-to-use solutions that our Proximus TV content offer. We integrated again in the five years to come. Not only launched our Chatbots “Titus” (on the web) are more advantageous for our customers. Netflix on our set-up boxes and we further have we proactively migrated customers and Compliance Governance and “Sam” (on Facebook) to answer the easy Today nearly all customers enjoying our enlarged our offer for families and children from ADSL to VDSL where possible, a move questions from consumers, which in turn has convergent offers are on one of the most with the exclusive deal signed with Studio that has substantially improved the customer given our customer service employees more recent generations of packs. 100 and access to the premium channels of experience (on both TV and the Internet), but time to handle more complex problems and BeTV. Customers addicted to pop culture and our roll-out of fiber in Belgium also continues questions. Solutions tailored to our lifestyle programs have access to the Viceland rapidly. In 2018, the deployment of fiber in customer needs channel and with “Radioline” they can listen to Belgium reached cruising speed, connecting Each year has seen us move towards a more In the consumer market, we grew our total over 60.000 radio and podcast broadcasts. a vast majority of businesses and centers simplified portfolio of products and solutions. market share thanks to our dual brand Our range of live European football continues of cities and municipalities. To date, 9 Belgian Appendix

5 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Fluvius intends to roll out in Flanders by in all things we do and how we do it. In order cities are in full deployment: Antwerpen, Luik, to be successful, it’s essential we cultivate Brussel, Leuven, Charleroi, Namen, Roeselare, the end of 2022. In our in-house innovation the right culture, as well as the right skills Gent, Hasselt. center, we transform technologies such as and attitudes. IoT, Cloud or Big Data into impactful solutions Stefaan With download speeds 2 to 3 times faster for smart homes and buildings, smart retail, De Clerck Since 2014 we have been investing in a new than 4G, Proximus was the first to launch smart logistics, smart energy, smart mobility, culture, Good to Gold, shaping a growth

Chairman Sustainability 4.5G mobile technology in Belgium and we smart industries, smart cities… mindset among our employees. We also continued to extend the coverage of our 4G “We are proud that we focus on on-the-job training and we have network, reaching 99,9% outdoor and 99,5% In a world that is changing at the speed of have both the ambition strengthened our existing training offer by indoor at the end of 2018. We’re equally light, we are bringing all our talents together and the strategy to make launching several new courses. excited about the opportunities that 5G will and we are expanding our ICT ecosystem our contribution to a deliver and are preparing its roll-out. This year to really make a difference to society. The sustainable future.” In the scope of our Good to Gold culture, we had a successful 5G field trial in Haasrode acquisition of Davinsi Labs strengthened we have been working for several years on (Leuven) and we want to have the first 5G our abilities in cybersecurity, while Unbrace giving teams more empowerment. In 2018, city in 2020. added to our web development expertise. we increased the speed of this initiative, Last year, ION IP in the field of security, Transforming into an agile as autonomy will empower employees to Furthermore, we started a long-term Umbrio, a company specialized in managing and flexible organization with create more value for our customers. We investment program to develop our IT operations and Codit, a market leader in digital savvy, engaged and are working more and more in transversal “backbone” network. This work, part of business application integration joined the empowered employees. and multidisciplinary teams, also upscaling

a multi-year project called TITAN (Terabit company. Through our subsidiary Be-Mobile, We are committed to making Proximus a safe, capabilities of employees in methodologies and Compliance Governance IP Transport & Aggregation Network), will we are also paving the way for better mobility inspiring and inclusive workplace that offers like Agile and Design Thinking. All this leads increase our capacity significantly and will and trialing Road User Charging. While Bics, equal opportunities for everyone and training to increased accountability and faster delivery also raise our network reliability. our leading international communications to build the skills of the future. of the right products & services. enabler and its recently acquired subsidiary We are the market leader in IoT (Internet of Telesign, offering Communication Platforms The Proximus corporate culture is based on We give people ownership of their ongoing Things). Our new Narrow Band-IoT network as a Service, continue to connect the world five overarching values: Collaboration, Agility, development. A “Digital First” mindset has will be used to connect the 1.3 million digital by creating reliable and secure mobile Accountability, Customer orientation, Digital been nurtured amongst employees through meters, for both gas and electricity that experiences anytime, anywhere. mindset. These values are a connecting thread training and coaching, and each has been Appendix

6 Proximus Group Annual Report 2018 given the appropriate tools they need to fully promote green mobility and reduce waste. Respecting our planet continuing our efforts workload reduction. Proximus has a tradition Proximus at a glance at Proximus embrace the digital workplace at Proximus. We are one of the few CO2 neutral telecom to being CO2 neutral, becoming truly circular of realizing transformation in a responsible and players in the world and proud to have a place and through a sustainable supply chain. respectful way and commits to continue doing Sustainability and society in the CDP Supplier Engagement leader this. Recently we started the consultation and matters board. Preparing for a digital future information phase with our social partners to Over the past years, our CSR activities To further drive growth in the challenging investigate how the ambitions can be reached revolved around three main pillars: education, As CEO and Chairman of the Board, we are environment we work in, we are launching in the most socially acceptable way. At the communities and the environment, and we proud that we have both the ambition and a new 3-year strategy in 2019 under the same time we will continue investing in the are deeply committed to each one. We are the strategy to make our contribution to a name #shifttodigital to become a truly digital- future of our company amongst others with a founding partner of 19, the first entirely sustainable future. In 2018, we dedicated centric organization. We believe that by fully an important investment in the training and Belgian Coding School, and Digitalent, time & resources to review our CSR strategy embracing the shift to digital we can stay upskilling of our employees to increase our an initiative set up in collaboration with and develop a more extensive sustainability relevant and create a more personalized competences in the digital domains Sustainability employment agencies and cities that strategy with the ambition to contribute to service offering, while increasing our efficiency encourages young people to become an inclusive, safe, sustainable & prosperous and reducing internal costs. This reflects our We are at the heart of both the digital and more familiar with modern technologies. digital Belgium. new sense of purpose: “we open up a world the country’s economy and we take this Furthermore, a number of our employees are of digital opportunities, so people live better responsibility seriously. We will continue to involved in an outreach program that aims to We believe Proximus can act in 4 strategic and work smarter.” build the company for the future by embracing create a safer Internet for all. And we continue areas. First and foremost, as a digital company the opportunities that digital brings. to support Bednet & Take Off, 2 initiatives and provider of digital services, we want Over the coming years Proximus will that bring school to long-term sick children. to enable a better digital life. This goes accelerate its transformation, and further Dominique Leroy through deploying the digital infrastructure reduce its cost structure in order to continue CEO As a company strongly rooted in Belgium, of the future, being a motor of innovation by to stay relevant in the market and maintain we are a proud sponsor of major culture supporting the right ecosystems and creating the needed investments in networks (fiber, and sports organizations, as well as various a trusted digital environment to encourage 5G), innovation and content. As such we are

events. We are particularly focussed on digital adoption by citizens and companies. targeting an additional gross saving of €240 and Compliance Governance football (Red Devils) and cycling, all the Next to this, we want to be Caring for our million by 2022. Proximus will continue to Flanders classics are sponsored by Proximus, stakeholders, especially our customers and grasp cost-saving opportunities through as well as various festivals (Rock Werchter employees, while also doing business right the rationalisation of its networks, product Stefaan De Clerck etc.) and high-cultural events at the Bozar (ethics, compliance, GDPR, privacy…) By portfolio, platforms, buildings and IT systems Chairman (Queen Elisabeth competition, KlaraFestival). making digital accessible to all and driving and through further simplification, automation education, as well as investing in local culture and digitalization. Proximus will also consider We also take our impact on the environment and societal causes, we want to contribute to the possibility of reducing further the number very seriously as is clearly demonstrated by a better society. Facing the impact of climate of employees by approximately 1,900 people

our efforts to reduce energy consumption, change, we want to focus even more on in the next 3 years in line with the planned Appendix

7 Proximus Group Annual Report 2018 Belgium Netherlands Who we are & We are a telecommunication & ICT company serving the Belgian Telindus is a leading provider of market through our Proximus and Scarlet brands. smart and secure IT-infrastructure

Proximus: Through its best-quality integrated fixed and mobile services. a glance at Proximus networks, Proximus provides access anywhere and anytime to what we do digital services and easy-to-use solutions, as well as to a broad offering of multimedia content. As a pioneer in innovation, Proximus transforms technologies like the Internet of Things (IoT), Big Data, the Cloud and Security into solutions with positive impact on people and society. 1 Proximus is a telecommunications company and a digital Scarlet: The no-frills offering for customers looking for the best service provider operating in Belgium and abroad. We prices. provide services to residential, enterprise and public

customers under various brands. From , Sustainability internet, television or network-based ICT services to digital services like smart mobility and security. Luxembourg Global Proximus Luxembourg is active through its commercial brands BICS is a leading international Our advanced interconnected fixed and mobile networks Tango and Telindus, matching all telecom needs for residential communications enabler, one of offer access anywhere and anytime to digital services and and business customers in Luxembourg. the key global voice carriers and the data, as well as to a broad offering of multimedia content. Tango: Fixed and mobile telephony, TV and Internet services for leading provider of mobile data services We are investing in future-proof networks and innovative residential customers, self-employed and small businesses. worldwide. Telindus: Converged ICT and telecom services for large Their solutions range from global solutions, creating the foundations for sustainable growth companies and public administrations. mobile connectivity, seamless roaming and becoming a truly customer-centric digital company. experiences, fraud prevention and authentication, to global messaging and

1 Proximus Public Limited Company under Belgian Public law the Internet of Things. Governance and Compliance Governance

Proximus is “opening up a world of digital opportunities, so people live better and work smarter,” and ensures that everyone can enjoy the benefits the digital world has to offer. Appendix

8 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

We grew our ecosystem of digital transformation experts in all areas Sustainability

In the growing digital economy, a company’s success is increasingly founded on partnerships and innovation. In 2018, Proximus further grew its ecosystem of experts to reinforce its objective of enabling the digital transformation of its customers.

Proximus acquired ION-IP, a Dutch based security company to strengthen its position in the cybersecurity market.

Proximus also acquired Umbrio, a Dutch company specialized in IT & network Microsoft Azure and Interneternet of ThinThings.gs. This and Compliance Governance operations, monitoring and analytics to acquisition fuels its ambitionbition to become the reinforce its position in the growing IT & partner of choice to guidee enterprises in their network operations and analytics market. digital transformation.

In July 2018 Proximus made the acquisition Proximus subsidiary, Be-Mobile,Mobile, specialized specialized in in of Codit, a Belgium-headquartered IT services smart mobility, expandeded its smart mobility company and a market leader in business services in Europe by acquiringacquiring thethe FrenchFrench application integration, API Management, company Mediamobile. Appendix

9 Proximus Group Annual Report 2018 Dominique Leroy Key Financial CEO “We maintained a solid position on the a glance at Proximus Highlights market and delivered on our 2018 outlook, with stable Domestic revenue and Group We maintained a solid position on the market and delivered on our EBITDA growing by 2018 outlook, with stable Domestic revenue and our Group EBITDA 2.4%” growing by 2.4%.

Operating in a highly competitive environment, mobile customer base and benefitting from a high-quality mobile network, improving the at the tail of European 5G deployment, while Sustainability we achieved in the last quarter of 2018 the enlarged ICT portfolio. Over the past overall customer experience and becoming a we would like to support enterprises testing further growth in our Consumer base for year we have grown our ecosystem of ICT personalised gateway for access to content. 5G use cases in the context of their digital Internet, TV and Mobile Postpaid, driven by experts, allowing us to offer new meaningful transformation. our ongoing customer centricity efforts, dual- solutions for our Enterprise customers, while When it comes to our announced brand strategy and market segmentation supporting the retention of Telecom services. transformation plan, we have started the With regards to our expectations for 2019, we approach. In the family segment, our information and consultation phase with our anticipate our underlying Domestic revenue successful year-end campaign attracted Our Fit for Growth Strategy, launched in social partners, with the intention to review to remain nearly stable compared to the prior many more customers to our convergent 2014, has proven to be successful, with our our HR rules and to negotiate the potential year. The 2019 underlying Group EBITDA all-in offers Tuttimus/Bizz All-in, with the underlying EBITDA growing since 2015. We leave of 1,900 employees over the next 3 is expected to remain stable with a slight base now reaching 508,000. The revamped operate in a highly competitive environment years. EBITDA growth of our Domestic operations mobile portfolio launched 1 November 2018, within a fast-evolving landscape, and our compensating the EBITDA decline of BICS. and the Epic offer designed for millennials industry is now reaching a tipping point when it In our continuous endeavor to bring new The Group Capex for 2019 is expected to be

drove a sound mobile customer growth. In comes to digital. That’s why we have adopted solutions to our customers, we are happy to stable compared to the 2018 level of around and Compliance Governance the price-seekers segment, our no-frills a new strategy, “#shifttodigital”, as we want to announce the further enhancement of our EUR 1 billion. In line with the announced brand Scarlet continued to grow its base, remain relevant to our customers and support millennials offer with Epic combo, available 3-year commitment in 2016, we reconfirm benefitting from a strong increase in brand enterprises in their digital transformation, on April 2. This includes fixed and mobile our intention to return to our shareholders a awareness over the past year and occupying while becoming more efficient and agile. internet access, music and social apps and free stable dividend of EUR 1.50 per share over a competitive position on the low-end of the viewing of many video platforms, including the results of 2018 and 2019. market. We continue to invest extensively in our the Proximus TV app and this on all screens. infrastructure by expanding our Fiber-to- Our Enterprise segment sustained its solid the-Home footprint, now initiated in 9 cities, Regarding the spectrum auction, we fear for

position in the fourth quarter, growing its upgrading our backbone network, ensuring a further delay, potentially putting Belgium Appendix

10 Proximus Group Annual Report 2018 Group underlying revenue +0.5% Proximus at a glance at Proximus

Revenue by segment waterfall a competitive landscape. Moreover, the at the same time keeping its Operational revenue from ICT showed good progress, costs nearly stable in spite of its expanding benefitting from a strengthened ICT portfolio, ICT business. 5,778 -12 16 -6 1275,804 including the acquisition of several small, specialized ICT companies. Furthermore, BICS closed 2018 with its Segment Result 2018 benefitted from a continued positive totaling EUR 154 million, 7.7% above that revenue evolution in Advanced Business of 2017, including TeleSign. BICS’ segment Sustainability Services and a revenue increase posted for margin as percent of revenue for 2018 was Tango. 11.4%, up 0.6pp from the previous year.

These favorable evolutions were able to offset 2017 BICS 2018 Other the continued revenue erosion from Fixed EBITDA Voice and Mobile prepaid; and from a lower (underlying, M€) Wholesale Consumer Enterprise Wholesale revenue.

+2.4% (incl. eliminations) +1.5% 1,866 Underlying EBITDA 1,796 1,823 149 -4.2% 143 +7.7% 154 +1.9% The Proximus Group posted an underlying +2.0%

Revenue Carrier business unit, including the revenue EBITDA of EUR 1,866 million for 2018, an and Compliance Governance from TeleSign. increase of 2.4% compared to 2017. The 1,647 1,680 1,713 The Proximus Group ended the year 2018 Domestic operations of Proximus grew the with total underlying revenue of EUR 5,804 For its Domestic operations, Proximus posted EBITDA by 1.9% to a total of EUR 1,713 million, 0.5% above that of the prior year. The stable revenue of EUR 4,458 million revenue. million. This was driven by Direct margin Group underlying revenue is the aggregate The revenue was primarily supported by the generated by Proximus’ growing customer 2016 2017 2018 of a stable Domestic revenue and a higher ongoing expansion of the TV, Internet and base, more than offsetting the EUR -30 revenue for BICS, Proximus’ International Mobile Postpaid customer base, in spite of million net decline in roaming margin, while Domestic BICS Appendix

11 Proximus Group Annual Report 2018 Proximus at a glance at Proximus CAPEX Free Cash Flow

The level of Capex reflects the Group from 2017, including an increasing share Proximus’ 2018 FCF totaled EUR 451 million, On a like-for-like basis, the EUR 16 million strategy to invest extensively in enhancing its of capex for Proximus’ Fiber for Belgium or EUR 501 million when excluding the decrease compared to 2017 was the net networks and improving the overall customer project. The deployment of this future-proof 2018 cash-out related to the acquisition of result of higher cash paid for Capex, higher experience. In 2018 Proximus invested a total network kicked off early 2017, with the roll- subsidiaries in the ICT domain. This compares payments for income tax and the beneficiaries amount of EUR 1,019 million. This compares out ongoing in 9 cities in 2018. Proximus to a EUR 517 million FCF for 2017, excluding of the early leave plan ahead of retirement, for to EUR 1,092 million for 2017 which included also invested extensively in its IT systems the cash-out related to the acquisition of a large part offset by a growth in underlying the renewal of 3-year contracts for football and digital platforms and in simplification Davinsi Labs (May), Unbrace (October) and EBITDA and less cash needed for business Sustainability broadcasting rights (Jupiler Pro League and and transformation. In addition, it ensured TeleSign (November). working capital. the UEFA Champions League). This aside, attractive content for its TV customers. the 2018 investments were somewhat up

Capex (M€) Free Cash Flow (underlying, M€)

1,092 559 1,019 949149 517 501

451 and Compliance Governance 292 €1,019 M €501 M investments in Normalized Free 2016 2017 2018 2018 Cash Flow 2016 2017 2018 Football broadcasting rights Acquired companies Appendix

12 Proximus Group Annual Report 2018 Key achievements

2018 a glance at Proximus Digital

New improved MyProximus app

Launch of Sustainability 3 chatbots, drastically improving customer experience

Aggregated A unique experience dashboard giving our Launch of a with the frontline employees an integrated view new decoder Proximus and Compliance Governance TV app of all customer enabling 4K TV interactions

Single best TITAN project intervention increasing Data analytics enhancing backbone customer experience network Appendix capacity: data x 10 Sustainable digital society Fiber a glance at Proximus Sustainability

14 agreements with other operators on access to Proximus Fiber network Partnership with brand new 19 Coding Fiber roll-out in Governance and Compliance Governance , Antwerp, School: Gent, Roeselare, a top-level coding 145,000 old Namur, Charleroi, school based on peer- mobile phones Liège, Hasselt, Leuven to-peer learning with collected in schools 157 students in 2018 since 2013

48% Appendix of companies in industrial zonings with Fiber © BEP We continued conquering the heart of our customers Mobile leadership Redtogether Delighting our in Enterprise market supporting the Red Devils during the World > 1,000,000

Cup by giving free data a glance at Proximus customers mobile cards during their matches

Enriched content offer We further strengthened supporting esports with the creation of 3 official our leadership in IoT leagues and incorporation of content on its platforms

IoT ecosystem with

more than 250 Sustainability partners Festivals strong presence during 25 festival days

M2M Market leadership 1,273,000 cards

Launch of Epic, Strategic acquisitions a new offer to win over Millennials

Growing digital ecosystem Launch of our NB-IoT and Compliance Governance network to connect Fluvius’ digital meters

Innovation projects Launch of together with partners Bizz Online

Key deals Appendix allowing entrepreneurs to have a website tailored to their needs Proximus at a glance at Proximus Simplification Our & efficiency employees

New simplified Sustainability bill for mobile customers

An agile way of working resulting in faster Introduction of Digital workforce products delivery, IoT Intensive re-skilling of our leading to faster for better employees for the skills of the complaints stock future, such as cybersecurity, resolution and data engineering prevention management and Compliance Governance

270,000 Launch of a training hours unified receivables 725 platform internal moves Appendix improving invoices collection 548 external recruitments Proximus at a glance at Proximus #shifttodigital our new 3-year We open up a world of digital Sustainability strategy opportunities, so people live better and work smarter

The world is changing particularly as consumers have become more pressure on prices, just as we have growing to a truly digital and customer-centric faster than ever accustomed to digital interfaces, convenient investment needs to cope with the rising organization. end-to-end journeys, self-service and real demand for data (fiber, 5G) and increasing Our Fit for Growth Strategy, launched in customer-centricity, as delivered by the customer expectations. 2014, has proven to be successful: we are the best digital native companies. Markets Our renewed Sense only European incumbent that consistently conditions are profoundly changing too: That’s why we have adopted a new strategy, of Purpose and Compliance Governance grew both revenues and EBITDA from 2015 what was once an evolutive market is now “#shifttodigital”, as we believe it’s only by fully to date. But in an ever-faster changing disruptive. We are faced with a flat market embracing this shift to digital that we can Driven by the belief that “we open up a world environment, what worked in the past is no outlook and increasing competition, as well remain relevant to our customers, become of digital opportunities, so people live better guarantee for the future. as new regulatory headwinds with the end more efficient, and reduce our costs to and work smarter”, we can already see that our of international call prices for residential continue investing in our future. investments in high-quality digital infrastructure Our industry is reaching a tipping point when customers in Europe, the opening of fiber are impacting the country’s economy for the it comes to digital. There is mass adoption of and cable and a potential 4th mobile operator We have to act now and need to transform better. And that Proximus plays a somewhat digital in respect of customer interactions, on the horizon. Moreover, there is a strong much more quickly from a Telco company hidden but positive role for society. Appendix

17 Proximus Group Annual Report 2018 By 2021 Proximus made a real shift to a truly customer- centric digital

company a glance at Proximus

Exciting ambitions for Being relevant and streaming. We want to be on the first screen become even more relevant in the future. the next 3 years attractive to customers of Belgians’ with an application There is no limit to what we can achieve in We want to be the leader in all mass market giving access to entertainment, a gateway cloudification, security, Internet of Things We don’t want to continue to just make segments: families, millennial/GenZ, no- to people’s content and passions. Our goal and Data Analytics. incremental changes; by 2021 Proximus frills, and small enterprises. In the premium is to aggregate this preferred content, from made a real shift to being a truly customer- consumer segments, we want to make the whichever platform to whatever screen, while Shifting customer centric digital company. This will enable us to difference versus competition with the roll- adding the extra “local touch”. In the no-frills experience to digital-first Sustainability remain relevant and attractive to customers out of fiber and mainly on content services by segment we will continue to boost Scarlet’s customer journeys and will make our employees digitally savvy, proposing new forms of increasingly popular brand awareness – both in fixed and mobile. Our goal is to embed digital in everything we engaged and empowered. content such as e-gaming, e-sports and music do. We will mainly rely on digital interactions to For small enterprises, we will deliver premium create effortless, personalized and proactive services to protect the value and boost tailored customer journeys in the residential market. ICT products (such as website design and maintenance) so that they too can keep up For our professional customers, we will build and take advantage of the digital changes. a coherent and easy-to-use digital self- servicing environment, while of course still For the larger companies and enterprises, providing human support for more complex Proximus wants to be the preferred partner situations. when it comes to digital transformation

by providing the precise assistance they We will also use digital to increase internal and Compliance Governance require. As a top digital integrator, we are efficiency in customer operations. We will already pioneering in ICT innovation, with bring more value to our customers and make integrated solutions based on Internet of our operations more efficient by leveraging Things and data analytics. And we will tailor the abundant data that we gather thanks our end-to-end solutions more specifically to our capabilities in data governance, towards different industry segments to automation, advanced analytics and AI. Appendix

18 Proximus Group Annual Report 2018 Our Good to Gold values: collaboration, accountability, agility, customer centricity and digital mindset Proximus at a glance at Proximus

Leading in convergent of €150 million by 2019, we will maintain network experience: our focus on reducing our operational costs building our fiber network in the next years supported by new digital and providing best video technologies. experience in mobile Proximus will also meet its ambitions by At the same time, we’ll prepare the next wave delivering the best network infrastructure of efficiency gains through simplification and in the country. We are reaching cruising the decommissioning of legacy products, attention and active change management Purpose. We want to make a positive and Sustainability speed in the roll-out of Fiber and started networks and IT. Furthermore, we’ll save at Proximus. In the end the shift to digital will meaningful difference and have an impact the preparatory groundwork for 5G in mobile. on network costs by renewing the backbone, come through ourselves. With more digital- on society as a whole; our networks and phasing out copper, reducing the number of savvy employees, future-proof skills and a platforms are the digital highway of our We are rolling out fiber to connect a vast buildings and streamlining product portfolios. life-long learning mindset, our DNA will be country’s economy and our solutions address majority of businesses and centers of cities In January 2019, Proximus announced an digital by design. Our transformation will be societal challenges such as mobility, energy, and municipalities in order to achieve fixed additional gross cost saving ambition of supported by our continued commitment climate, etc. We contribute around four network leadership in the long term. We also €240 million by 2021, that will be realized to our Good to Gold values: collaboration, strategic areas: Digital for all, Caring for our continue to invest in zones where we don’t through different types of measures, including accountability, agility, customer centricity stakeholders, Contributing to society and have fiber to deliver the rising enjoyment a potential reduction of employees by and digital mindset. Also, we plan 1,250 Respecting our planet. speeds of households (100 Mbps by 2025). approximately 1,900 people. recruitments in the next three years (500 In mobile we maintain quality leadership in new digital domains and 750 in IT at our Digital creates a world of opportunities, by focusing on video streaming quality and Transforming into an agile affiliates). but also comes with new challenges and coverage on train lines. And we will prepare and flexible organization responsibilities. We therefore put a special and Compliance Governance our country for 5G with a first city covered with digital-savvy, A shift to digital with focus on cybersecurity, resilience of our by 2020. engaged and empowered sustainability at its heart networks and systems, and compliance. employees On our journey towards becoming a truly Reducing our costs by Interacting with customers earlier in the digital company, besides delivering strong While we appreciate that there will be radical simplification and development process, leveraging data, financial and operational performance, we challenges ahead as we #shifttodigital, we decommissioning of legacy hiring and coaching top digital talent, etc.: all want to contribute to create an inclusive, safe, also know that this is where we need to be products, networks and IT these things come naturally to digital native sustainable and prosperous digital Belgium, and where we want to be: at the very heart While we will reach our cost saving ambition companies but they will require careful thereby bringing to life our new Sense of of a better digital society. Appendix

19 Proximus Group Annual Report 2018 Creating an inclusive, safe, sustainable and prosperous digital Belgium Creating an inclusive, safe, a glance at Proximus sustainable and prosperous digital Belgium Sustainability

Living and working in an ever fast changing society 22

Contributing to society while creating value for our stakeholders 25

Enabling a better digital life 28

Caring for our stakeholders 40

Contributing to society 52 and Compliance Governance

Respecting our planet 60 Appendix

21 Proximus Group Annual Report 2018 Living and working in a glance at Proximus

Fast changing society Digital technologies can help develop an ever fast smart ways to manage waste, energy and Greener future buildings. Pollution in cities can be reduced Climate change is a major concern for us through smarter mobility and smarter energy changing all. While ways to tackle this are debated at choices. Through digital, we can build a more global level through initiatives such as the sustainable society and help preserving our

Paris Climate Agreement (2015), there is planet’s future. Sustainability an urgent need for each of us to reduce our society environmental impact and carbon emissions. Smarter mobility Belgium’s traffic jams are some of the worst in Europe. They impact the mobility of citizens and air quality, especially in large cities, and As a provider of have huge economic impacts. Many European digital services, countries are making great strides in tackling we keep a finger the mobility crisis and Belgium needs to get on the pulse of up to speed, fast. Because of the unique societal trends, challenges we face, Belgium is the perfect opportunities and incubator for innovative solutions. Within challenges. Digital 10 years, our mobility can be drastically innovations not only changed if the right investments are made and Compliance Governance delight customers, in infrastructure and technologies supporting they also bring smarter mobility and smarter logistics. new ways to tackle societal, economic This would not only benefit the environment, and environmental but also make traffic faster and safer thanks challenges. to mobility monitoring, smart parking, route planning and an intelligent and accessible mobility mix. Appendix

Proximus Group Annual Report 2018 Proximus at a glance at Proximus

unemployment and social tensions will continuous investment in mobile and fixed increase. But for every job lost, new jobs will connectivity, as the digital highways of our appear. In fact, the total labor demand is economy. Currently, Belgium holds the 5th expected to rise by 629,000 jobs by 2030, place on the DESI for connectivity, and to stay meaning 310,000 workers and unemployed in the top, rolling out the Gigabit networks of

Belgians will require massive re-skilling and the future like Fiber and 5G will be crucial. Sustainability upskilling 1. While Artificial Intelligence, the Internet of A changing society Things (IoT), augmented/virtual reality and With Belgium becoming one big city Blockchain are factors of disruption, they environment, challenges in terms of mobility are also drivers of innovation and economic and quality of living are becoming citizens’ growth for our Belgian companies while at major preoccupations, with smart cities projects the same time offering an array of possible and homeworking solutions on the rise. solutions to societal and environmental challenges. Also our population is aging, and digitalization, Digital human capital At present, 39% of the Belgian population smart living and health solutions will bring new A digital consumer Our country is lagging behind in terms of have little to no digital skills. Belgian ways of addressing this enormous societal In parallel, consumer needs are shifting

digital skills for the new economy. On the enterprises state the lack of digital human challenge. extremely fast. Today, the digital consumer and Compliance Governance 2018 DESI (Digital Economy and Society capital as their biggest challenge in the years expects a personalized and smooth Index), Belgium currently occupies the 12 th to come. Grasping economic growth experience in every interaction, from place for digital human capital and the Traditional industries are being disrupted by entertainment and shopping to banking and 23rd place for STEM (Science, Technology, The stakes are high. Accelerated digitization new entrants bringing new business models government services. Engineering and Mathematics) graduates. and emerging technologies such as such as the platform and sharing economy. There is an urgent need to reimagine our Artificial Intelligence across all industries Connectivity is seen as a basic right, like education system so our children acquire the are transforming the labor market as we Data is the new currency and managing clean water and electricity. Consumers essential digital skills they need for tomorrow. know it. Without the necessary digital skills, the vast quantities we produce requires expect a seamless experience and are Appendix

1 Agoria, 2018

23 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

continue to change rapidly and the exponentially consuming data driven by also need to understand how to behave of customer interactions, diversifying B2B video consumption and gaming. Investments responsibly and safely in the digital world. business through acquisition of ICT and fragmentation of content offers increases with in digital infrastructure to cope with these integration skills and capabilities. local broadcasters going OTT (VTM.be, Auvio, rising demands while the willingness to pay While consumers become increasingly aware VRT.NU, Stievie, etc.), with big OTT players decreases, is creating a huge challenge for of security and privacy, we should put specific Low growth and low pricing like Netflix and Amazon producing more and operators. attention on the non-digital natives and power in telco markets more original content, in new domains such as

children. Those are the new responsibilities The telco market is featuring increasing live sports or local content, and new forms of Sustainability The digital society should offer opportunities the digital world brings. saturation. Growth in Internet and TV services entertainment such as e-sports are emerging. to all, the young and old, the rich and poor. is slowing down to population growth. Also The digital future needs to be made inclusive, increases in penetration are New and improved communication and through education and community initiatives. A fast-changing limited to the oldest and youngest age collaboration tools for enterprises such as market environment segments. In this flat market incumbents and Microsoft Teams and new technologies such Digital trust new low cost challengers compete for market as cloud, API, SDWAN are just a few examples The other side of the data coin is trust. As data for Proximus share, resulting in increasing pressure on price. of substitution of traditional telco and ICT grow exponentially, so do the risks of breaches services in the enterprise market. and cyber-attacks. While communication Declining legacy revenues, low pricing power, How to remain relevant to networks need to become more flexible and limited differentiation and product innovation, customers Regulatory headwinds customized, they also need to be reliable and lack of silver bullets in adjacencies have The disintermediation of voice and messaging While the impact of roaming-like-at-home has and secure. kept growth below inflation in European telco services by OTT applications like WhatsApp is fully materialized, new regulatory headwinds

markets (0.3% in 2017 according to ETNO). still a major driver of the slow growth in telco, will put pressure on revenue growth in coming and Compliance Governance Trust is one of the most important success through its impact on fixed voice and metered years: regulation of international call tariffs, factors for becoming a truly digital economy. In a low growth environment, increasing mobile voice revenues. In coming years other more favorable regulation of cable wholesale While GDPR formalizes the protection of operational efficiency is key to answer disintermediation risks will increase. access, regulated FttH access and the risk of data privacy as well as the reputational and high investment needs in domains that will a potential 4th entrant on the Belgian market. financial consequences of failure to do so, determine future competitive advantage: Content is an important lever to remain consumers, companies and governments fiber/5G, TV/content offers, digitalization relevant to customers. Viewing behaviors Appendix

24 Proximus Group Annual Report 2018 Contributing a glance at Proximus to society while creating

value for our Sustainability stakeholders

Our strategy material topics and our governance, can be actionable pillars. Driven by our sense of our customers and employees. Contributing found in the appendix. purpose, and as a provider of digital services, to society, by making digital accessible to all

In 2018, we dedicated time and resources we want to enable a better digital life. This and driving education, as well as investing and Compliance Governance to review our CSR strategy and develop a What emerged as our overriding goal is entails deploying the digital infrastructure of in local culture and societal causes. Last more holistic sustainability strategy, around “contributing to create an inclusive, the future, being a motor of innovation by but not least, respecting our planet by

4 strategic areas. We started through an safe, sustainable and prosperous digital supporting the right ecosystems and creating being CO 2 neutral, becoming circular and extensive reputation survey amongst our Belgium”. a trusted digital environment to encourage through a sustainable supply chain. With stakeholder groups and developed a new digital adoption. We want to care for our concrete objectives, we want to increase our framework based on these outcomes. The We believe Proximus can act in 4 strategic stakeholders, by ensuring we have a solid contribution to a better Belgium. details of our approach, also leading to our areas to serve this goal, each translated into governance alongside all initiatives towards Appendix

25 Proximus Group Annual Report 2018 Integrating the UN’s Sustainable Development Goals

We have integrated the realization of the United Nations’ Sustainable Development Goals (SDGs) in our new sustainability strategy, linking a glance at Proximus them to our four strategic area’s: Enabling a better digital life, Caring for our stakeholders, Contributing to society and Respecting our planet.

Link to our sustainability SDG SDG goal Strategic relevance for Proximus framework Ensure healthy lives and promote well- With concerns surrounding radiation and health, we want to play our role in informing customers about Caring for our stakeholders being for all at all ages electromagnetic waves as well as providing precautionary measures.

Ensure inclusive and equitable quality The war for talent is getting harder and harder as the skills for the jobs of tomorrow get more specialized. The re- Caring for our stakeholders education and promote lifelong learning skilling of the Belgian workforce is a challenge we must participate in so as to ensure we have the skills needed for

opportunities for all the digital economy & society of tomorrow. We invest in upskilling our workforce so our people can grasp the digital Contributing to society Sustainability opportunities, with a yearly training budget of around €24 million (2018) and will increase this substantially over the next 2 years. We also pilot re-skilling initiatives for young job-seekers such as Digitalent or School 19. Promote sustained, inclusive and We know that the jobs of the future will be digital. We work with many associations to re- and up-skill the Belgian Caring for our stakeholders sustainable economic growth, full and population so as to sustain Belgian economic growth and increase the number of digital talents. In that way, we productive employment and decent contribute to driving the digital transformation of our economy & industry. We are also a major employer through work for all direct (13,385 FTE) & indirect (16,000) employment and as such contribute to the Belgian economic ecosystem.

Build resilient infrastructure, We build future-proof digital infrastructure, investing around €1 billion per year in networks and innovative Enabling a better digital life promote inclusive and sustainable platforms & solutions that are critical enablers of a digital economy & society. We also started a €3 billion fiber industrialization and foster innovation investment. In addition, we support innovation ecosystems to make Belgium a frontrunner in digital in Europe and unlock the economic growth potential.

Make cities and human settlements We contribute to building smarter cities and smart solutions that answer societal challenges & support local Enabling a better digital life inclusive, safe, resilient and sustainable communities. Contributing to society Governance and Compliance Governance

Ensure sustainable consumption and We set strict ambitions to reduce our waste, recycle our construction materials, etc. We also impose strict standards Respecting our planet production patterns throughout our supply chain and partner with suppliers respecting our standards. Finally, we aim to becoming circular within the next 10 years and signed the Green Deal Circular Purchasing of Circular Flanders in 2017.

Take urgent action to combat climate Climate change is a key issue for us. We aim to limit the negative environmental impact of our operations and set Respecting our planet change and its impacts ambitious goals to do so. For instance, we are one of the few carbon neutral telecom operators in the world. Appendix

26 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Our materiality Enabling a better digital life 7 - innovation and digital infrastructure 21 matrix 14 5 - digital competitiveness of institutions 1 The areas in which we contribute to and companies 22 sustainability are broad. To bring focus we - privacy and data security consulted our stakeholders to define and act 4 2 Caring for our stakeholders 17 3 9 11

upon the most material topics, represented Sustainability - business conduct and ethics 8 13 in our materiality matrix. 16 - pricing and billing transparency 6 15 12 In 2018, we went through an in-depth - quality products and services 20 1019 assessment process, gaining a structured - responsible marketing 18 understanding of where we have a social, - customer relationship environmental and economic impact and - health and safety what matters to our stakeholders most. We - human capital and employee

address and report on the most material & decisions assessments on stakeholder Influence development topics in our annual report and plan an in- Contribution to society depth review of the matrix in three years’ time. More information about our methodology - connectivity and digital inclusion Significance of economic, environmental & social impacts and the design of the materiality matrix can Respecting our environment be found in the Transparency section in the - sustainable supply chain 1 Innovation and sustainable infrastructure 12 Remuneration and Compliance Governance Appendix. 2 Connectivity and digital inclusion 13 Responsible sourcing and resource effi ciency - energy and greenhouse gases 3 Energy and greenhouse gases 14 Quality products and services 4 Circular economy: Electronic waste and 15 Responsible taxes and state contribution - circular economy The audited KPI’s are highlighted in the GRI equipment recycling 16 Law suits/ claims 17 Content Index in the Appendix. 5 Business conduct & Ethics Responsible marketing 6 Sustainable supply chain 18 Sponsoring 7 Privacy & data security 19 Redundancies We focus on the topics in the upper quadrant 8 Health and safety 20 Human rights 9 Human capital & employee development 21 Pricing and billing transparency of the matrix. These link with the strategic 10 Social engagement and development 22 Customer relationship areas of our sustainability framework: 11 Digital competitiveness of institutions and companies Appendix

27 Proximus Group Annual Report 2018 Proximus at a glance at Proximus Sustainability Governance and Compliance Governance Enabling a better digital life Appendix Proximus at a glance at Proximus Enabling a better Connected, no matter where you digital life Sustainability live or where you go

We enable a better digital life by building a Future-proof digital future-proof infrastructure with high-quality networks and digital platforms, as well as infrastructure through innovative solutions and services that Material Topic*: 1 We are investing €3 billion over 10 years to address societal challenges. We believe in open accelerate the roll-out of Fiber, connecting innovation and co-create in digital ecosystems The success of Belgium’s digital future a majority of businesses and bringing Fiber with the academic world, start-ups and scale- depends on future-proof connectivity. Being to all centers of cities and municipalities. ups. connected is part of every person’s and And with the further deployment of 4.5G

every company’s daily life. At home, at work we are preparing the road to 5G in 2020. and Compliance Governance We pay particular attention to developing a and on the go. That’s why we massively safer digital society. We provide cybersecurity deploy future-proof infrastructure. Our networks enable people and companies solutions and services to our residential, to access the opportunities of the digital Since 2014, Proximus has been investing world. As the main national player in enterprise and public customers and build trust around €1 billion annually in its telecom telecom, our engagement is to ensure that in digital through data protection/privacy infrastructure and fixed and mobile every citizen has access to high-quality and awareness initiatives. We are also a proud networks. This makes us the biggest fixed and mobile connectivity, no matter founding partner of the Cybersecurity Coalition. investor in digital infrastructure in Belgium. where they live or where they go. Appendix

*Materiality Matrix p. 27

29 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

KPI Result 2018 Result 2017 In 2019, we have planned to double our fiber to VDSL. In addition, we will optimize Wi- 4G indoor coverage1 99.5%2 98.1% footprint and start deployment in seven new Fi performance thanks to new tooling and 4G outdoor coverage3 99.9%2 99.8% cities. And we will finalize the deployment in continue testing and developing the next industrial zonings as we reach our targeted generation of copper technologies – Ultra Fixed Internet: 30Mbps coverage4 92% 86% coverage. In parallel to the deployment, we Vectoring – enabling us to significantly Combined Average VDSL & ADSL speed 72.6 Mbps 68 Mbps will especially focus on digitizing our activities increase the network speed for customers. Vectoring coverage in Belgium 88% 83%

and optimizing the experience we deliver our Sustainability customers, from the first contact they have Mobile network 1 The indoor coverage refers to the coverage of 4G inside of buildings. 2 The 2018 fi gure is based on a Q4 measurement campaign performed by an external agency Commsquare (from with fiber up to the after-sales service. Our To meet growing demand for connectivity 07/11 to 28/11/2018 in the main cities and on the main roads). ambition is to increase the level of proactivity on the go, Proximus continued to extend 3 The outdoor coverage refers to the coverage of 4G outside of buildings 4 This includes copper & fi ber homes passed in our servicing approach in order to further the coverage of its 4G network, reaching delight our customers. 99.9% outdoor and 99.5% indoor at the end of 2018. We are also investing in 4.5G While we believe fiber to be the network of the and performed a successful 5G field trial in Fixed network end of 2017) – bringing our fiber roll out to future, Proximus continues to maintain and Haasrode (Leuven). Deploying 5G along with Fiber enables low-latency and stable high- cruising speed thanks to our industrialization upgrade the copper infrastructure to ensure fiber will allow us to provide consumers with speed connectivity, today reaching up efforts. a high-quality customer experience for all. a stable high-speed network both inside and to 1 Gbps up- and download speeds, and outside their home. tomorrow even up to 10 Gbps, making its roll- For business customers, we proactively roll- In 2018, we further increased the speed

out one of our key investments for a digital out fiber in zones with high business densities, with the continued roll-out of vectoring In 2019, we plan to further explore 5G and Compliance Governance economy and society. Today we commercially like industrial zones and business parks and technology reaching 88% coverage and by capabilities and continue extending 4,5G offer a download speed of up to 220 Mbps, offer on-demand fiber connectivity to any migrating customers from ADSL to VDSL to offer an excellent experience to our which can be boosted to 400 Mbps. business customer who requests it. Our (+30,000 customers in 2018) offering customers. coverage within the business and corporate higher speed and improved stability. In In 2018, we were rolling out fiber in nine market segments also saw a strong increase. 2019, we will continue to expand VDSL White zones Belgian cities – Antwerpen, Luik, Brussel, By the end of 2018, 48% of companies coverage by installing new VDSL While white and rural zones are less Leuven, Charleroi, Namen, Roeselare, Gent, (compared to 17% in 2017) located in remote optical cabinets and continuing economically attractive, we aim to connect Hasselt (an increase of two compared with the industrial zones could benefit from fiber. migration everyone everywhere by using new Appendix

30 Proximus Group Annual Report 2018 Proximus at a glance at Proximus technologies and co-investing with public authorities. The main Belgian operators each promised to invest €20 million over three years (from 2017 to 2019) in Wallonia to improve the coverage of these zones. Open innovation and supporting new In 2016 the BIPT identified 39 municipalities ecosystems with as white zones. At the end of 2018, 38 out universities, start-ups and of the 39 municipalities had a 4G (outdoor) scale-ups are key mobile coverage of more than 99% of the to unleashing

population, and 32 out of 39 municipalities Sustainability had a fixed broadband coverage of at the digital least 30 Mbps for more than 60% of the future households.

We have worked for several years with Tessares, a UCL spin-off, on innovative solutions to connect remote areas. Also, more Digital innovation Academic partnerships recently, we have been testing microwave ROP amongst others on security and IoT If we want to succeed in tomorrow’s digital technology, connecting VDSL street cabinets Material Topics*: 1 11 solutions such as smart energy, smart economy, we need open innovation. That’s through wireless microwave technology. For mobility, smart logistics and smart health. why we collaborate with major universities example, in 2018, we launched a promising Open innovation and supporting new Together, we not only create more impact and their talent hubs. pilot in Felenne. ecosystems are key to unleashing the and address societal and environmental

digital future. We partner with universities, challenges, we also open up a world of It’s a win-win partnership: we gain access and Compliance Governance We continue to deploy new ROP’s to offer start-ups, scale-ups and other key players digital opportunities that improve the lives to innovative designs and perspectives from high-speed fixed broadband services and that drive innovation in Belgium, working and work of people. academics, and they gain access to our digital TV with High Definition quality. Our aim infrastructure and resources to scale up their is to offer outdoor 4G mobile coverage to the KPI Result 2018 Result 2017 ideas. entire population of the defined white zones Active M2M cards 1.3 Mio 1.2 Mio and we will continue launching innovative Together, we’ll shape our future. ICT revenues (national + international) 561 Mio 509.2 Mio projects to further improve fixed and mobile Number of projects with universities/education institutes 39 N.A. network quality. Appendix *Materiality Matrix p. 27

31 Proximus Group Annual Report 2018 From fundamental technologies to education and upskilling, Proximus has a comprehensive portfolio of initiatives with universities a glance at Proximus

Proximus has worked with universities Support start-up and Going forward, we intend to involve and join for many years and this collaboration has workingdoctoral with research UGent and on thseveraleses. Weprojects, are currently such scale-up communities forces with Belgian corporates from other gradually intensified. as studying exposure to air pollution using Belgium has a huge network of young companies, industries in our calls-for-innovation. data from our mobile network, or making a start-ups and scale-ups. We want to be a motor In 2018, we contributed to many hackathons predictive analysis of criminal offences, again of innovation and a catalyst of new Belgian Co.Station and tech events: the “Citizen of Wallonia” using our mobile network. companies. Proximus has been a shareholder of

hackathon hosted by UMons, the “Dramco By sharing our know-how, resources and Co.Station since 2017. Co.Station is a Sustainability Ghent” event with KUL, the “Antwerp Furthermore, we envisage cooperating even infrastructure in collaborative partnerships, we Belgian community that unites some Chainport” hackathon with UA, the “Mons more closely on aligning training courses with can increase innovation and grow our digital 1,500 entrepreneurs, start-ups, scale-ups, Hack Arena” event with UMons, the “Wallonia the fast-evolving labor market and bringing the economy. corporates, investors and influencers. Besides Futurocité” seminar, and many more. corporate and university worlds closer together. Brussels and Ghent, an additional location InPost opened in Charleroi. Co.Station was granted Proximus supports academic research by In 2018, we launched the TalentHub in Ghent InPost, launched in 2017 to facilitate the management of Antwerp’s IoT House, providing relevant business input to ensure with seven pilot projects, recently expanded collaboration with start-ups, is a portal where The Beacon, in 2018. that research programs stay closely aligned to to all &D flagged projects within Proximus. start-ups can quickly measure their value business demand. In addition, we can provide Here, we encourage collaboration between propositions against Proximus’ business We supported various events around IoT, access to resources and infrastructure.We our employees and innovation communities challenges to find a strategic fit. In these GDPR, Blockchain and social innovation, all have research projects at ULB/UCL, KUL, such as universities and start-ups. “calls-for-innovation”, start-ups compete for aimed at a wide entrepreneurial community and VUB where Proximus also participates in selection to further co-create with Proximus. in Brussels, Ghent, and Charleroi.

the Advisory Boards that steer these research We also signed a strategic partnership with In 2018, we focused on the speech-to-text and Compliance Governance projects. Proximus also actively participates in IMEC in 2018 on societal challenges such as challenges of dialectal languages. We have also supported +90 start-ups and funded RD&I projects with universities, such Smart Cities and Artificial Intelligence. scale-ups representing +500 workers as as with KUL and ULB. Through our IMEC partnership, the iStart Co.Station residents. In 2019, we want to rethink our strategic start-up portfolio has been scanned to map In 2017, Proximus and UGent announced their approach and structure and refine our Proximus’ business challenges. Selected In 2019 we will include our customers in the intention to jointly create research projects in collaboration with the education and candidates will pitch their solutions in front Co.Station community. the telecom and ICT fields and to cooperate on academic ecosystem. of the Proximus team. Appendix

32 Proximus Group Annual Report 2018 MIC, B-Hive and Co.Station are key innovation partnerships for Proximus a glance at Proximus

FinTech private partnership with the Walloon Region Belgium has an important ecosystem of and Microsoft, as a structural partner. FinTech start-ups and companies that we are proud to support. MIC focuses on entrepreneurship through coaching sessions and works closely with the

Proximus is a founding partner of B-Hive, developer community to enhance technical Sustainability a European FinTech platform promoting skills, organize events, provide training and collaborative innovation between major certifications, and provides access to the latest banks, insurers and market infrastructure IT hardware. The objective is to encourage to develop innovative solutions for financial the adoption of new technologies such as markets. IoT, Data and AR/VR that will facilitate the next wave of innovation and to accompany In 2018, we worked with them on the enterprises in their digital transformation. organization of a series of events around The IoT Lab – a first joint step taken in 2018 blockchain that reached the entire Belgian – provides an environment to prepare for the FinTech scene. We will continue our efforts digital future in the spirit of open innovation. notably by facilitating start-ups’ access to blockchain technology. In 2018, jointly with MIC, we also promoted

digital innovation. A great example is the and Compliance Governance We invested in early-stage FinTech start-up launch of the new “Hack in the Woods” festival in Luxembourg and also envision expanding of code, bringing together developers and our FinTech activities via our affiliate Telindus. professionals around societal goals.

Microsoft Innovation Center 2019 will be a pivotal year for the Microsoft In 2017, Proximus joined the Microsoft Innovation Center with the launch of new Innovation Center (MIC) Belgium, a public- initiatives, bringing more cutting-edge Appendix

33 Proximus Group Annual Report 2018 We want to be the partner of choice for enterprises, guiding them in their digital

transformation and co-creating a glance at Proximus smart solutions together

technologies such as AI and Machine Learning cities, etc. Think of a digital future in which Smart Utilities such as hospitality, workspace optimization, to enterprises. Belgium leads the way! To enable new digitally-driven services, energy and floor efficiency and safety and Fluvius will connect more than 800,000 security. MIC’s mission to inspire, educate and foster Proximus is Belgium’s leading connectivity gas and electricity meters in Flanders in the digital entrepreneurship will also extend provider with more than 1.3 million coming five years using our IoT networks. We collaborated with IPARC (International to an ecosystem of business partners and connections over our different networks Platform for Art Research & Conservation, Smart Retail humanitarian organizations, fully in line within the Internet of Things (IoT) ecosystem. SME of the year in 2018) on the integration of Sustainability with Proximus’ commitment to open up a We have secured this position by providing Using Proximus Analytics, shopping malls new technologies in art conservation. The IoT world of digital opportunities to all actors the best technology for each use case and collect data on attendance and location solution we developed, Smart Care, monitors of society. by creating an ecosystem of more than 250 attractiveness. the environmental conditions of artworks. solution providers who combine our assets Local innovation support with their specific solutions thus covering Smart Logistics In 2018, we also started developing a MIC, B-Hive and Co.Station are our three main every industry. Some of our logistics sites are managed in solution stack to support smart venues to innovation partnerships, but we also support collaboration with H.Essers. On those sites, we offer a more complete customer experience. ad hoc initiatives to foster agility and speed Our ambition is to be the partner of choice need real-time positioning (within a precision A first example is the renovation of the entire in innovation. for enterprises, guiding them in their digital range of 1m) of our trailers to optimize yard Tour&Taxis site in Brussels, with event halls, transformation and co-creating smart management processes. By connecting each offices, living units, shopping zones, and more, Going forward, we will continue advancing on solutions together. We aim to show that every trailer to the parking spot, H.Essers managed integrated into one customer journey. the road of open innovation. small change to digital can lead to higher to increase visibility, eliminate useless search

value creation. Some examples: time and optimize onsite routing. Smart Energy and Compliance Governance Innovations addressing In partnership with GoodPlanet Belgium societal challenges Smart Industry Smart Buildings we use LoRA sensors in schools to poll the In our in-house innovation center, we transform To become more efficient, Bombardier had to Smart Building solutions offer tremendous behaviour of children and raise awareness in technologies such as IoT, Cloud or Big Data optimize the movement of materials between opportunities in terms of energy efficiency, relation to sustainability. In 2018 we visited into impactful solutions for smart homes and sites across Europe. This is now possible waste management and occupancy. In this the first 15 schools. Secondly, we encourage buildings, smart retail, smart logistics, smart thanks to a smart solution connecting racks area, we collaborate with Besix to embed schools to start to upload consumption data energy, smart mobility, smart industries, smart in each location. intelligence into new buildings in domains regarding electricity, gas, fuel, transport, Appendix

34 Proximus Group Annual Report 2018 Students are standing up for the climate and make their voice heard. With our partner GoodPlanet Belgium we track consumption patterns in schools with our IoT sensors

and raise awareness on a glance at Proximus sustainability

waste, etc. The schools can check the Smart mobility evolution and compare consumption patterns Mobility is an important driver in the economic, with other schools. environmental and overall well-being evolution of a country. There is still plenty

With GoodPlanet, we have set goals to reach of room for improvement in Belgium and Sustainability and install our sensors in more than 400 neighboring countries. Our affiliate Be-Mobile, schools in 2019. one of the leading Smart Mobility companies, is already facilitating this. A key element of Be- Smart Cities Mobile’s solutions is creating ecosystems that In 2018, we refined our strategy for smart connect all stakeholders such as commuters, cities, as vital contributors to a better quality governments, road operators, automotive helping commuters optimize their journeys. acquisition strengthens Be-Mobile’s position of life for Belgian citizens. Via our affiliate and fleet owners. Finally, Be-Mobile grew its heavy vehicle in the automotive industry and increases the Be-Mobile, we tackle traffic congestion and road user charging or tolling business and is coverage of its traffic management services parking challenges. In recent years, we have In 2018, Be-Mobile tested and implemented helping policy makers to analyze a Belgian in France, Germany, the Nordics and Poland, also delivered ANPR surveillance cameras C-ITS solutions to influence traffic lights road user charging solution for passenger where Mediamobile is active today. to many cities. In the future, our ambition based on traffic conditions and to inform cars, which is believed to be a crucial step is to engage directly with citizens to co- drivers and road operators of approaching towards effective mobility management and design their city, in collaboration with city vehicles such as ambulances to improve road achieving a better balance between mobility Digital trust and Compliance Governance administrations. We are already doing this in safety. Additionally, Be-Mobile was able to capacity and demand. Louvain-La-Neuve at the Living Live Lab and enlarge the coverage of its mobile mobility Material Topic*: 7 in Antwerp with IMEC in the City of Things payment solution to 58 cities and communes, Be-Mobile also grew its business project. These initiatives allow local citizens facilitating payments for parking or public internationally by acquiring Mediamobile Today’s digital world offers many to connect with city officials to voice their transport. Furthermore, Be-Mobile developed in 2018. Mediamobile specializes in opportunities but also new types of needs, address traffic congestion, security an inter-modal route planner for the city providing real-time traffic information for threat. Trust is a prerequisite for people and waste management. of Antwerp to encourage a modal shift by the navigation systems used in cars. This and companies to embrace the many Appendix

35 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

opportunities of digital and enable the Cyber safe Our corporate Cyber Security Incident In 2019 and beyond, we want to raise digital future. As a leading digital company, We place cybersecurity at the core of our Response Team (CSIRT 1) continuously cybersecurity efforts to an even higher we are actively involved in driving digital business: we make important investments to monitors security alerts and coordinates level. We will continue investing in our awareness initiatives. secure our infrastructure and protect it against the response to cyber threats. In 2018, our Cyber Security Corporate Program over the attacks. We also offer our clients solutions to CSIRT handled 2,087 incidents (versus 2,204 next three years, further strengthening our Cybersecurity is at the core of our business. protect themselves and continuously train our in 2017). No incident had a major business capabilities and sustaining our ISO 27001 and

We continuously develop solutions to employees, so they are up-to-date with the impact. Proximus CSIRT is internationally Trusted Introducer certifications. Sustainability anticipate possible threats and make sure our latest security practices. recognized as the only certified team in infrastructure and processes are more secure. Belgium through the Trusted Introducer For our customers We give our customers the means to protect Within our company and is part of the European platform ETIS We offer our customers best-in-class security themselves and educate our stakeholders We aim to be the frontrunner in how we and global community FIRST. In 2017, solutions and expertise. Our partnership with on the value and how-to of cybersecurity protect and transform our company in Proximus successfully overcame the global Norton offers residential customers a multi- through training and partnerships. the face of today’s and tomorrow’s cyber cyberattacks WannaCry and NotPetya thanks device security solution at a reduced price. challenges. We see cybersecurity as an to the prevention measures and the fast We supply a vast range of security services As a major ICT player, we handle huge enabler of digital transformation. Over the detection and response. to companies: analysis and diagnostics, quantities of personal data and we ensure last four years, Proximus has invested €43 monitoring and surveillance, reporting and its privacy, confidentiality and security. million in our Corporate Cyber Security We are the proud holder of ISO certifications in interventions. We apply strict policies, make significant Program with the aim of making our data security and privacy. To date, we have five investments in the training of all employees company more cyber resilient and to offer ISO 27001 certifications, covering our data In addition, we offer solutions to protect

and lead by example when it comes to data best-in-class secured services and networks centers (housing and hosting), our Security companies’ data, networks and servers. and Compliance Governance safety. to our customers. Operations Center, the enterprise Explore network and “Work Place As-a-Service” Our Security Operations Center monitors solutions. more than 2,000 million events daily, alerting KPI Result 2018 Result 2017 customers in case of incidents. This number is increasing because the number of events International certifications related to privacy 6 6 1 The Proximus CSIRT is the central incident res- and cybersecurity ponse team of the Proximus Group. Its mission is to and customers keep growing. Since 2016, provide information and assistance to reduce the we have been offering “CSIRT as–a-service”, risks of cybersecurity incidents as well as respond *Materiality Matrix p. 27 eff ectively to such incidents when they occur. leveraging our internal expertise to help our Appendix

36 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

For everyone with the European Cybercrime Center of We are one of the partners behind BE-Alert, Europol and finally through new and existing a 24/7 public warning system for the Belgian partnerships, such as with NATO. authorities. BE-Alert can broadcast news and information in the event of a crisis via SMS, Cybersecurity education Our Security fixed voice, email and social media. For Belgium to become a digital leader, citizens

need to have trust in digital. We want people to Sustainability Operations Center With threats coming from many different enjoy the online world and know how to behave monitors more than 2,000 places in this globalized digital world, we safely when using it. We help them by sharing million events daily, alerting continued our engagement with NATO’s our security knowledge and educating them on customers in case of incidents Cyber Defense teams in 2018 and also the value and how-to of cybersecurity. participated in working groups with international law enforcement agencies to Educating our employees get first-hand information on the modus Keeping the cyber environment safe starts operandi of cyber criminals. Additionally, we from the inside, which is why we continuously customers solve incidents. Privileged account and management of cyber incidents. In are actively exchanging information about educate our employees on responsible management, controlling access to IT systems recognition of its multi-domain expertise and observed threats and attacks on a national behavior to protect company information and data are becoming crucial given the rise determination to innovate, Telindus received and European level via the ETIS platform. and customer data. in cloud applications and privacy regulations. the award for Best Security Partner of the

We also successfully launched this solution year 2018 at IT One in Luxembourg. In 2019, we will continue expanding our Each year we organize a Security Week for and Compliance Governance internally and with key enterprise customers collaboration network through active our employees. In addition, we organize in 2018. In 2019, we will further expand our participation in the Cyber Security Coalition dedicated training, awareness sessions cybersecurity solutions for the professional and its operational focus groups, through and phishing exercises. In 2018, we tested Our affiliate, Telindus Luxembourg, is an market. Our ambition for the coming three close collaboration with the Center for Cyber 27,743 employees and contractors of the expert in cybersecurity. Telindus Luxembourg years is to maintain leadership and grow at Security Belgium (CCB), with other European Proximus Group through two “real-life” completed its existing range of cybersecurity market pace. Recently acquired companies telecom operators via the ETIS platform, phishing campaigns, which were inspired services with a Cyber Security & Intelligence Davinsi Labs, Umbrio and ION-IP will help with global companies through the World by real incidents. In addition, we gave them Operation Center (CSIOC) for the detection us achieve this. Economic Forum’s Center for Cybersecurity, advice on how to detect such suspicious Appendix

37 Proximus Group Annual Report 2018 On Safer Internet day, Proximus employees together with Child Focus educate close to 11,000

kids every year on using the a glance at Proximus internet safely

a non-profit organization aiming to raise e-mails. Furthermore, we launched two participants are cyber experts and receive pedagogical approach in order to improve educational videos on the topics of phishing the necessary certificates to start a new job cybersecurity capabilities in Belgium through the impact of the program in coming years. and information classification. in this field. In 2018, 15 employees followed experience sharing, awareness raising, Drawing from the real-life experiences of the this training. The training will be organized policy recommendations and cross-sector children, the latter will discover in workshops The 2018 Security Week, organized for again in 2019. operational collaboration. how to behave when surfing on the internet the fifth consecutive year, reached 1,237 and interacting on social media. Educating the business world & employees and offered a vast awareness In 2018, five one-day information and Sustainability program including new digital ways of society networking events were organized around In 2018, Proximus handled 72 requests from working, physical security, privacy and GDPR, We also educate and raise awareness among secure application development, regulatory law enforcement authorities to block access to our customer security solutions, phishing companies, organizations and the general frameworks such as the European Directive websites. Proximus is also constantly looking detection and prevention, and child safety public. “Network and Information Security” and for new ways to prevent child pornography on online in collaboration with Child Focus. GDPR, cloud security, cyber talent and its hosting infrastructure. In order to protect For the first time in 2018, we organized an For our customers innovation. In addition to awareness our customers from fraud, like phishing via internal “capture the flag” contest - an online We organize the biannual Proximus Cyber raising, privacy, NIS and CSIRT-SOC focus fake Proximus websites, the Proximus CSIRT game where employees could test their cyber Security Convention, where we bring groups, three new operational focus groups is closely monitoring any attempts to attack skills through hands-on exercises. customers up to speed on the latest trends. addressing cloud security, cryptography our customers – and is usually able to take Our Proximus Corporate University (PCU) and enterprise security architecture were down phishing websites in a matter of hours During Cyber Security Month in October, also provided security education programs launched in 2018. after the attacks were launched. we transposed the national awareness for customers in 2018, including Network

campaign about cyber hygiene “boost your Security Explored, Hacking and Intrusion We have a specific project aimed at primary To reach undergraduates, in 2018 we and Compliance Governance digital health” to our employees. Articles on Detection, HEXID Assault, Wireshark, Davinsi school children. Twice a year - in February organized for the second consecutive year our intranet reached no fewer than 4,590 Labs, Blockchain and Security Awareness, on the International Safer Internet Day and a full-day “capture the flag” contest for 33 readers. reaching 75 companies (47 from the public in October during the Safer Internet Day - students following the new cross-university sector). our employees (trained by our partner Child master’s in cybersecurity (regrouping the ULB, We also want to offer employees the Focus) educate children on how to use the UCL, U-Namur and the Royal Military School). opportunity to develop careers in For Belgian citizens Internet safely (10,259 children in 212 schools We also welcomed students from HOWEST cybersecurity through an extensive one-year We are a founder and steering member in 2018, vs 11,330 children in 229 schools during our Security Week. training course on cybersecurity, after which of the national Cyber Security Coalition, in 2017). In 2018, Child Focus reviewed its Appendix

38 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Finally, we believe in lifelong learning, we procedures but also training and awareness collaborate with CyberWayFinder, offering initiatives. women who want to change career paths GDPR trainings reached the opportunity to join the cybersecurity We have also put in place infrastructure that 93% of world. Through this collaboration, we offer spots data breaches to keep our network secure. on-the-job work experience in addition to Because we want to make sure data stays safe, Proximus

the training they receive via the association. always. workforce Sustainability In 2018, we welcomed two women trainees and a privacy control in our cybersecurity teams. Although small, To ensure all our employees are aware of EU framework was installed this type of initiative contributes to reskilling and Belgian privacy legislation, we organized employees and job seekers to be ready for dedicated GDPR training, reaching 93% of the jobs of tomorrow. our workforce in 2018. We also implemented a Privacy Control In 2019, we want to extend the reach of our In 2018, Proximus continued its GDPR Framework to provide assurance on the fact training programs and learning partnerships. implementation project started in 2017. Our that personal data is managed as intended, is For example, by extending our “capture the objective was to ensure compliance with accurate, is protected by default and by design flag” business game to new schools and GDPR without disruptions to Proximus data and that our organization is compliant with universities. Finally, via our Safer Internet flow and business operations. More than 150 applicable laws and regulations and able to Day, we want to reach 10,000 students in persons were directly involved in the project demonstrate this.

the coming year. and approximately 500 others were involved and Compliance Governance in surveys, questionnaires, assessments, etc. GDPR implementation will remain on the Ensuring data privacy agenda for 2019. We aim to optimize our As a major ICT player, we are responsible for Being committed to protect personal data internal processes to allow an efficient privacy keeping our customers’ data safe and private. We and privacy, we took a series of actions such by design/default approach. Proximus will have developed a privacy control framework to as appointing a Data Protection Officer further extend the privacy settings within the ensure personal data is processed in accordance (DPO), developing a structure for consent MyProximus app and website to allow our with legislation and with the highest-grade management, security screening and customers to efficiently choose how Proximus security. The framework contains policies and corrective measures for our IT applications. can use their personal data. Appendix

39 Proximus Group Annual Report 2018 Caring

for our a glance at Proximus stakeholders Sustainability Governance and Compliance Governance Appendix

40 Proximus Group Annual Report 2018 Caring for our a glance at Proximus stakeholders

Our corporate culture and values define how we work. Customer first Sustainability Proximus is imagining a future that will be positive for everyone. Our focus is not only on what we do, but how we Material Topics*: 21 14 22 17 secure and comply with strict health and safety standards. We conduct marketing do it. How we engage with people. How we conduct business. Our goal is to always provide a good responsibly and respectfully and nurture Our customers are at the center of everything we do. customer experience thanks to a seamless a transparent relationship with our In an increasingly digital world, we want to remain relevant to digital customer journey. customers. them by offering new digital solutions and great experiences We invest time and effort in getting to know And to ensure our products and services that are personalized and authentic. We want our customers our customers and making our appreciation meet our customers’ demands and to feel confident and able to rely on an expert digital provider. of them felt at every customer touchpoint. expectations, we have introduced structural We conduct our business ethically and with integrity. initiatives to engage with them and gather Being a Proximus customer means enjoying feedback, including co-creation, design We live by our values and governance principles when

peace of mind because our products are thinking, forums, and more. and Compliance Governance engaging with our customers, suppliers, employees and other stakeholders. KPI Result 2018 Result 2017 We also care about the people who work with us. We empower them to have an impact, to innovate, to grow Decrease in complaints related to invoices (residential customers) -14.1% vs 17 - and to live meaningful lives. We show our commitment Blended usage satisfaction for residential customers 94.6% 93.7% to them by offering them an inclusive, safe and inspiring Happy House in-home experience satisfaction rate 89% 90% workplace that respects them as individuals. # complaints from JEP (# of which justified) 7 (2) 5 (0) Appendix *Materiality Matrix p. 27

41 Proximus at a glance at Proximus

Listening to our customers Customer experience To make our customers’ lives better, we need Giving our customers a good experience tops Epic, our new continuous feedback on what they want or need. our agenda. We want to meet their expectations, offer designed That’s why we put our customers at the center from the very first contact. when we develop new products and services. for and co-created We want to allow our customers to enjoy with Millennials

We capture and centrally store customer a digitalized, personalized and seamless Sustainability feedback and enrich it with technical and experience. Customer experience starts operational data. This allows us to achieve a from the first moment someone contacts 360° customer view and to tailor interactions us. It continues through every subsequent the journey for residential customers moving products for new customers, we call them to and areas for structural improvement. interaction, whether via our digital or live house. find out if everything went well and to check channels. To help us achieve this, in 2018, whether they have any additional questions To expand our product portfolio, we use an we developed a 360° customer view for all We introduced our chatbots, like Titus who about their products. outside-in approach, starting from customer our sales agents. When a customer reaches answers questions when consumers are needs both in the residential and professional out, our agents can directly see all their browsing our website looking for information. With our Happy House visits we try to give markets. Besides our regular sales channels, interactions with Proximus and provide them our customers the best in-home experience we use multiple forums to connect with our with the right answers. Because digital can sometimes be complex, possible. During these visits, all Internet and customers, including design thinking sessions we continued our “Smart Café” initiative Wi-Fi connections are checked and secured, during which we co-create together and Voice A multi-disciplined High Care team with through which we offer free training on digital and modems and decoders are replaced when

of the Customer meetings to collect customer commercial and technical expertise has also tools, open to all Small Enterprises (SE), both necessary. In 2018, we visited another 40,000 and Compliance Governance feedback. been set up in order to better assist customers customers and non-customers. In 2018, we homes (61,000 in 2017) and achieved an facing complex issues. trained 183 participants in the SE market at 89% satisfaction rate (vs 90% in 2017). To In 2018, we launched our new offer our points-of-sale in 17 cities and another further improve our in-home experience, we Epic. Proximus Epic is designed with and In 2018, we successfully completed 1,056 during a digital roadshow. In 2019, we launched a new Home Optimizer app in May for millennials. Using design thinking more than 40 improvements, including will continue this initiative. 2018. This app allows customers to analyze methodologies, we co-created the product automatically informing a customer of an Wi-Fi quality, after which they can configure with 11 millennials for six months and tested outage, its expected resolution time and when We care about how our customers experience the most optimal Wi-Fi channel on their it via our millennial test panel. the service is restored. We also fully digitalized Proximus. After installing new services/ modems at the touch of a button. The app Appendix

42 Proximus Group Annual Report 2018 Particular attention goes to responsible marketing

practices. We offer parental a glance at Proximus control solutions, solutions to protect from bill shocks and focus on safety and safe use of products

of charge for one month in the event of their rules prohibiting advertising the use of being broken, lost or stolen. phones to children under 7. Sustainability Finally, to reward customers who choose We received 7 complaints from the Jury of Proximus as their digital service provider, we Ethical Practices, of which 2 were justified and organize Proximus Customer Days. In 2018, corrective measures taken. in the framework of our Premium Club loyalty program, we also offered our customers the We also offer solutions to parents such as possibility to use their loyalty points to make parental control on TV and smartphones to a donation to the Foundation Against Cancer protect children from non-adapted programs and UNICEF. This resulted in €173,738 and and provide lots of tips on our website to €217,938 donations respectively. . parents on how to protect their children online.

Customer safety and peace We want to protect customers from bill also gives information on Wi-Fi signal strength another solution using mobile coverage with of mind shocks and offer solutions such as the product

and if required, advises on the best position a 4G modem to improve internet at home. Being a Proximus customer means peace of Mobilus Full Control, which ensures post-paid and Compliance Governance for Wi-Fi extenders. Within seven months, mind. Our devices follow the strictest health customers respect their budgets.Furthermore, the new app was downloaded by more than In 2019, we aim to develop further and safety guidelines in terms of emissions and for all our mobile post-paid customers, to 36,500 users and has already been used improvements to our customers’ in-home electromagnetic fields, our services are reliable, avoid any risk of a bill shock in case of out- more than 573,000 times. experience via a layered approach to deliver a and we communicate honestly and transparently. of-bundle use, we give real-time info on more efficient and fluent Wi-Fi performance. their usage in our MyProximus app. We also We also developed a new Mobile Coverage Responsible marketing have in place a system where automatic text Extender solution to improve the mobile With the Free Smartphone Replacement, We pay particular attention to responsible messages are sent to warn customers of their coverage at home using fixed Internet and we offer our customers a smartphone free marketing practices and comply with the consumption when they are approaching their Appendix

43 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

limit. And we inform them of the possibility Caring for our As diverse as society around to buy additional one-shot data bundles. For employees us 2019, we will continue to proactively contact We show our commitment to our people As a truly Belgian company, we want customers who have regular out-of- bundle Material Topics*: 9 8 by making Proximus a great place to work: our workforce to reflect all the different usage to suggest more adapted offers and a safe, inspiring and inclusive workplace communities in society. prevent bill shocks. We need the help and commitment of of the future with equal opportunities, At Proximus, we do not tolerate discrimination. Our people enjoy equal opportunities, regardless all employees to make the digital future offering continuous training to ensure a Sustainability Safety of our products & services happen. We offer them the chance to long and fulfilling career with us, and the of gender, religion, ethnicity, background and Caring for safe use of our products and bring about positive change, to develop opportunity for each individual to balance any other characteristics unrelated to their services means recognizing our responsibility themselves, make a difference, contribute their personal and professional lives in the abilities. regarding exposure to electromagnetic to our results and be our best ambassadors. right way for them. waves, a societal concern. We comply with We subscribe a Charter on diversity and equal the legislation in force, both for networks and rights, which applies to all employees of the for devices, monitor developments in scientific KPI Result 2018 Result 2017 Proximus Group. (More in the Remuneration research and provide information. Percentage of Proximus employees using 79% 37% report) Office365 OneDrive Proximus has also been displaying the SAR Proportion of Proximus employees actively 96% 93% Gender inclusion (Specific Absorption Rate) of each device in looking for knowledge or people by using our Proximus strongly believes in the importance enterprise social network (#WAP) all sales channels since 2008, while this only of diversity at all levels of the organization. Employee engagement1 72.7% 72.3% became legally required in 2014. and Compliance Governance Frequency rate of occupational accidents2 6.8 6.6 This is also reflected in the female Finally, on our website, we offer very useful Severity rate of occupation accidents3 0.28 0.36 representation at the different levels of our information to our customers on how they company: can mitigate the potential risks of radiation 1 Average result of the employee engagement survey (SpeakUp), measuring the engagement, agility and strate- such as in their own homes. For example, gic alignment of the Proximus employees 43% of the Board of Directors 2 Frequency rate (Fg) = # occupational accidents x 1000000/ total number of hours worked by company em- • we offer b-box set-up which turns it off at ployees • 25% of the Executive Committee 3 Severity rate (Eg) = # lost days due to occupational accidents x 1000/ total number of hours worked by com- night. We also give tips on reducing exposure pany employees • 21% of the members of the Leadership from mobile phones on our website and in Team our shops. *Materiality Matrix p. 27 • 31% of entire employees’ population Appendix

44 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

In 2018, out of 22 moves and new hires in As a major ICT employer in Belgium, we the leadership team, we hired/promoted understand the importance of gender 11 women (50%, compared to 29.6% last diversity. Today, about 14% of the staff in year). The Proximus Group also has a very our Technological department are women, diverse workforce in terms of culture with and we hired 26 women in 2018. In ICT 58 nationalities. specifically, about 20% of our employees are female, representing about 130 FTEs. In

Proximus supports internal and external our Security, Governance & Investigations Sustainability diversity network activities and initiatives such division, 33% of employees are female. as the AfroPean network (APN) and WinC (women network). In 2018, Dr. Herminia Ibarra Generational inclusion (Professor at the London Business School) With people having to work longer, we also came to talk to the leaders of Proximus on focus on generational diversity. Priorities A diverse cultural Woman Leadership. Proximus ensures ad may shift towards the end of a career and workforce with hoc presence to external events such as some jobs may become too physical. We put “Yes she can” in order to encourage young in place specific initiatives for workers aged 58 nationalities girls to opt for engineering studies and a 55+ employed in strenuous physical jobs. For technical career. Our CEO is also ambassador example, we allow them to be retrained, so of the initiative “She loves to code” from 19 they can move to another job or offer reduced coding school. Finally, the European Round work schedules.

Table of Industrialists (ERT) launched the We believe in the and Compliance Governance #EmbraceDifference campaign in 2018, Finally, we launched the initiative power of gender through which more than 50 business leaders, Experience@Work in collaboration with diversity of Europe’s largest companies, including our KBC, AXA and HazelHeartwood. The main CEO, signed a pledge to promote diversity aim with this objective is to allow people to In 2018, 50% of new hires or and inclusion in the workplace. Proximus also work longer. Senior employees (from the age promotions in the leadership team subscribed to the DigitalForHer declaration, of 55 until retirement age) can share their were women an initiative of Commissioner Gabriel. experience with other organizations, while Appendix

45 Proximus Group Annual Report 2018 Generational inclusion We further developed our Experience@Work initiative to allow people to work

longer and share their a glance at Proximus experience outside Proximus

keeping in touch with their current employer • Generations: From experienced our welcome days for new hires to contain defining and implementing the best ways of and without any changes to their contract employees to new graduates, we information on our inclusion program. working for all activities throughout Proximus. or salary package. Meanwhile, 17 employers embrace the strengths and perspectives now offer this opportunity to their senior of different generations. We believe An inspiring workplace of Digital tools employees and 10 Proximus employees each generation brings valuable insights the future We promote smarter working, by collaborating participated in 2018. and perspectives to the workplace and As a provider of digital services, a ‘digital first’ digitally and cross-functionally on any device

encourage collaboration of ideas. We mind-set must be the new normal, enabled by with Office 365. Sustainability To further drive diversity and inclusion in will thus take actions regarding end-of- the right digital tools. our workplace in the following years, we career management for those aged 55+, The adoption of O365 OneDrive supporting developed an action plan around 3 axes: millennials and the multigenerational Empowered organization co-creation of documents in 2018 grew workplace, and unconscious biases in In the scope of our Good to Gold culture, from 39% to 79% year over year and 3500 • Gender: Proximus is committed to performance management, recruitment we have been working for several years on employees followed our digital journey gender equity and we are in the top 200 and training. giving teams more empowerment. In 2018, training track on our new way of working. of the most women-friendly companies we accelerated this initiative, as autonomy will worldwide. In the scope of our plan, we • Communication: Proximus welcomes empower employees to create more value for In 2019, we will continue to invest to fully intend to take part in studies and events employees from around the world, our customers. leverage the collaboration potential. We related to this subject. We will also promoting a culture of great ethnic and will build towards the ability for co-creation collaborate with external organizations cultural diversity. In 2019, we want to We are working more and more in transversal with external parties (partners, customers, such as Center for Balanced Leadership, make sure all employees can draw from and multidisciplinary teams, also upscaling suppliers). We will also continue to invest in

Women on Board, etc. In 2019, an event the benefits of a diverse workplace capabilities of employees in methodologies employee experience tools. and Compliance Governance on women in digital will be organized in through various initiatives within our like Agile and Design Thinking. All this leads collaboration with JUMP1. offices (Talent in Action, FeelGreat@ to increased accountability and faster delivery Collaborative workplace Proximus, an internal blog on diversity, of the right products and services. We piloted a new working environment that etc.). To ensure an inclusion mindset, we enables collaboration yet recognizes specific 1 JUMP Resources is the knowledge center for Gen- der Equality at work, with studies, toolboxes and aim for all of our training tracks for team In 2019 we will go for even more needs by integrating quiet or co-creation corporate practices on gender equality. leaders, experts and trainees, and all of empowerment, among other things by zones. Creating a variety of workspaces is Appendix

46 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

In 2018, we invested €24 million to reskill internally to work for a limited time (at a rate of and upskill our employees. Over 95% of defined hours per week) on a specific project. our population followed formal training covering over 270,000 hours (20.6 hours Being our best selves at per employee on average). These trainings work

were given in all sorts of areas, whether it be Proximus strives to create a positive work Sustainability Over the next three languages, soft skills, creative skills or hard environment where people feel good and years, Proximus skills. recognized, where working conditions are will double its adapted to personal needs, where employees training effort to Culture are resilient, engaged and actively contributing support employees We also strengthen our leadership to realize our business strategy. in the digital competences. In 2018, we organized over 90 transformation reverse mentoring sessions where younger Work-life & Social Unit colleagues trained the leadership teams on At Proximus, a team of social consultants the digital tools, which they can then advocate accompanying employees in different to their employees. domains of psychosocial wellbeing at work based on employee feedback. In 2018, we videoconferencing solutions to strengthen constitutes our Work-life & Social Unit (WLU). remodeled 35 floors and equipped 65 meeting collaboration between different premises. Internal mobility This unit also offers our employees services

rooms with easy-to-use videoconference At Proximus, we try to instigate a more agile such as childcare during the school holidays and Compliance Governance technology, multiplying videoconferencing Always-on learning culture. This involves offering internal mobility, (summer and spring holidays). In 2018, 315 by a factor of 20 compared to 2017. Our employees don’t face the digital as we want to ensure all our employees keep employees benefited from these services. It transformation alone. Different learning learning and doing a job they love. In 2018, also organizes a Fun Day and a Kids Party We continue investing in an inspiring workplace channels will boost the use of our digital tools, 725 employees changed jobs internally. for all our employees and their families each and plan to remodel an additional 12 office with basic digital literacy training for most year. In 2018, 7,977 employees participated. floors in 2019, while further deploying employees and in-depth digital skill tracks To promote internal mobility, we further state-of-the art meeting room equipment for focused communities in data, marketing scaled up NewTone, a program through which Our Affinity program offers all employees in regional offices, such as facilitating and security. employees and teams can recruit colleagues exclusive reductions on different products Appendix

47 Proximus Group Annual Report 2018 In 2018, 7,020 employees benefited from homeworking, with an

average of 4.2 days per a glance at Proximus month

and services. In 2018, 57% of our employees Finally, Proximus makes considerable efforts made use of the Affinity program. to enable its employees to reconcile their professional and private lives as harmoniously FeelGreat@Proximus as possible. Reducing the daily travel time Launched in 2017, this corporate program between work and home, saves time and aims to proactively support employees on reduces stress for our employees, and reduces

improving their resilience. Through lectures, the environmental impact. Proximus offers its Sustainability workshops, information stands, brochures, employees the possibility of teleworking in exercises and communication campaigns, satellite offices specially equipped for this we raise awareness among our employees purpose or of working from home. We have implemented additional measures, unions, the CPP department and occupational on mental, physical and relational resilience. beyond the legal requirements, to protect and physicians. It deals with the elaboration and In 2018, 7,020 employees (vs 6,400 in promote the physical and mental well-being of follow-up of the global prevention and In 2018, we focused on mental resilience 2017) benefited from homeworking, with our employees. protection plan and handles aspects such by working on focus and concentration, an average of 4.2 days per month (vs 3.1 as personal protective equipment given to positive thinking, how to identify and use in 2017). At Proximus, we have a department for technicians, fire safety measures to protect your talents to increase your energy. A Prevention and Protection (CPP), the workers, the protection of employees’ health toolbox was developed to work in teams on In 2019, we will focus on resilience and driving force behind Proximus’ well-being- in the workplace (such as a smoking ban, appreciation, trust, autonomy and connection. managing change. related activities. It defines a common well- health supervision, etc.), the adaptation of In the context of the anti-stress moment for being policy (definition of objectives) and workplaces, the evaluation and resolution the employees of the contact centers, 367 A safe & healthy work gives opinions on all problems concerning of psychological risks and issues, etc. We and Compliance Governance employees signed up for a noon walk and environment wellbeing. All products, goods and services also have local prevention & well-being 195 for a creative workshop. We have many different job profiles at at Proximus need to meet the standards with committees with representatives from Proximus: office jobs, customer service jobs, regards to well-being at work. local management, unions, the prevention A second part of the program are our field technicians, developers, etc. Regardless department and local occupational proactive psychosocial risk analyses. In 2018, of their role, we ensure that every employee is Our Prevention & Well-being Committee physicians. In these committees all accidents we conducted 6 analyses, covering 1,191 able to work in a safe and healthy way. is a permanent working group with at work, local prevention matters, respect employees (an 18% increase over 2017). representatives from management, the of safety instructions, etc. are discussed. Appendix

48 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

There are national formal agreements with sets out the different areas of the Well-being health in the workplace (such as a smoking adaptation. This management approach is trade unions that cover all health and safety Act. In terms of safety, it aims to prevent ban, health supervision, etc.), occupational put in place by conducting a risk analysis, topics. In 2018, we had approximately 88 accidents at work. It deals with aspects hygiene (insurance to have good social taking the necessary prevention and committees. from personal protective equipment given facilities), the adaptation of workplaces, the protection measures reducing work-related to technicians to the fire safety training of evaluation and resolution of psychological accidents, communicating safety instructions Our well-being at work policy provides an staff in our office buildings. In this policy, risks and issues, etc. to employees, and following the VCO/VCA

overview of the applicable legislation and we also define the protection of employees’ (safety management systems for parties Sustainability Each year, we set a theme to reduce work- commissioning the works and for contractors) related accidents. In 2018, we communicated rules for operational departments. We also strongly on the topic of “road safety” through conducted a risk analysis of the new Digital different initiatives such as an e-learning workplace (the new way of working at about road safety, a road safety quiz and two Proximus based on the use of various digital sessions on bicycle safety awareness. In terms tools, e.g. tablets, smartphones, laptop of work-related accidents, we observed a computers used as a (digital) telephone), a stable frequency rate compared to last year. risk analysis of our new telecom equipment, a psychosocial analysis of different work We have an occupational medical surveillance posts, and a fire safety analysis of different program for our workers exposed to risks. In workplaces and installations. In addition, we 2018, 4,823 examinations were conducted delivered new supplementary work clothing

by our external medical service. for certain divisions, new safe utility cars, and Compliance Governance vans and trucks, and held a safety quiz via In 2018, we developed a Global Prevention e-learning for our employees working in Plan for the next five years, based on our shops. With those actions, we reached almost well-being policy and on risk management, all our field force employees. with the application of the following principles: Our FeelGreat@ construction of a prevention and protection Over the next four years, we intend to continue risk management approach, execution of to implement the VCA/VCO policies. We will Proximus initiative the management approach, evaluation and also analyze the risks of our new (digital) was recognized in the ‘Good Work, Appendix Good Health II Guidelines’ of UNI Europa (European trade union 49 Proximus Group Annual Report 2018 federation) Proximus at a glance at Proximus

working equipment and telecom installations employees and affiliates to share and live Proximus adopted its new Code of Conduct support fair and open competition in all our and determine appropriate prevention and by our values and standards. in 2016, applicable to all employees. So far, markets, with a competitiveness approach that protection measures. 93% of Proximus employees have followed is based on good products and services at the We will never compromise on how we do mandatory training on the application of the right price. These policies are all described, business because this defines the vital role principles of the Code of Conduct. On top of along with the responsibilities they engage for Doing business right we play in society. We constantly review our this, we have various internal policies. our employees, in our Code of Conduct. Firm principles, policies and procedures and even sanctions and procedures (e.g. whistleblowing Sustainability Material Topic*: 5 go beyond what is required or expected. We have anti-corruption/bribery, conflict of procedures) are in place to deal with cases This guarantees that our governance interest and competition policies. Corruption that occur. In 2018, we handled seven Compliance and business ethics are our and ethics reflect not only legal but also is a threat to business and society in general. whistleblowing cases. license to operate. We expect all our societal expectations. In addition to unfair competition it can lead to undesirable consequences for the individual Finally, respecting human rights is a such as blackmail or imprisonment. Our fundamental value for us. People are KPI Result 2018 Result 2017 anti-corruption procedures are not only a entitled to be treated with respect, care and Number of cases investigated by the 29 52 legal obligation and an ethical duty: as a dignity. Proximus business practices can only Investigations department for violation of responsible company we take a firm stand be sustainable if we respect basic human policies/code of conduct against corruption. Proximus applies a practice rights and value diversity, cultural and other Number of whistleblowing cases 7 7 of zero tolerance. differences. Our Code of Conduct (which every employee is required to know), values

Also, conflicts of interests involve personal and behaviors are inspired by fundamental and Compliance Governance considerations and can affect judgment, and principles such as those of the Universal At Proximus, we don’t want to be put at the reform of certain autonomous economic ultimately decisions. They should be avoided Declaration of Human Rights, the European center of ethical dilemmas and we put the public companies (“the 1991 Law”). whenever possible. Convention on Human Rights and the United right measures in place to ensure our business Nations Convention on the Rights of the Child. is conducted the right way. This first means Because business is personal for us, we Fair and open competition between companies, having a clear governance model, which is not only follow the law but want to ensure and doing business on a level playing field is Proximus is committed to creating working described in our governance section and every one of our employees is aware of the important to society in general and contributes conditions which promote fair employment follows the Law of 21 March 1991 on the behaviors to follow and avoid. Therefore, to increased welfare for all. Therefore, we practices and where ethical conduct is Appendix *Materiality Matrix p. 27

50 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

recognized and valued. We maintain a In terms of our supply chain, we hold ourselves professional workplace with an inclusive to high social and environmental standards, working environment, and we are committed which are described in the section Sustainable to respecting Belgian legislation and the supply chain. International Labor Organization’s (ILO) fundamental conventions. Going forward, we will keep focus on our code

of conduct training, to ensure all employees Sustainability Proximus recognizes and respects the right know the procedures to follow. We will to freedom of association and the right to continue to hold those we do business with collective bargaining within national laws and to the highest ethical standard. regulations. End January 2018 the Collective Agreement 2017-2018 has been approved Starting in 2019, an increased focus will by the ‘comité paritaire’. This Collective be given to compliance and resilience as agreement contains sections with different a strategic objective in our #ShifttoDigital measures; generic, well-being, employment, strategy. The new digital society goes with quantitative and non-actives. Next to this, new types of responsibilities for a company a series of around 10 measures have been like Proximus. Next to increased focus on agreed upon. We will not contract child labor cyber safety, data privacy and protection, a key or any form of forced or compulsory labor initiative is dedicated to protecting our critical

as defined by ILO fundamental conventions. infrastructure, ensuring network resilience and Compliance Governance Moreover, we are opposed to discriminatory and crisis preparedness. practices and do our utmost to promote equality and diversity in all employment practices. Appendix

51 Proximus Group Annual Report 2018 Contributing to society a glance at Proximus Sustainability Governance and Compliance Governance Appendix

52 Proximus Group Annual Report 2018 Proximus at a glance at Proximus Contributing to society Sustainability We help design the future of our country by facilitating its digital evolution. Together with Digital for all people with disabilities, people who are many others, we are building a digital society less well-off and the elderly, wherever not just for the happy few, but for all Belgians, Material Topic*: 2 they live. no matter their level of digital understanding, physical ability, age or background. We strongly believe that everyone And as a leading ICT employer in Belgium, should have access to the digital world, we want to help new generations gain We invest in education and want to help tackle regardless of physical abilities, economic the technology skills and knowledge they the enormous reskilling challenge the Belgian background, cultural origin, education or need to flourish in the digital economy of workforce is facing in the years to come. Ensuring age. Proximus is committed to making the future. employability and filling the digital jobs of the digital technologies also accessible to future is a priority and will determine the success and Compliance Governance of our digital economy. KPI Result 2018 Result 2017 Percentage of accessible tested devices 91% 100% We want to contribute to social initiatives in (at least for 1 disability category) Belgium, and give back to the community we Number of job seekers supported by our 404 327 operate in. We also strongly invest in the Belgian initiatives in Belgium media landscape and local culture. Number of sick children connected to their > 1,000 > 800 school by Bednet and Take Off

*Materiality Matrix p. 27 Appendix

53 Proximus Group Annual Report 2018 Our low-cost brand Scarlet offers the benefits of our high quality network to people who don’t

need the frills of a a glance at Proximus premium offer

of the devices tested were accessible for at if commercially not relevant (see section least one disability category and 36% were Enabling a better digital life). Proximus also accessible for all categories. invests €3 billion in accelerating its roll-out of fiber, bringing fiber to industrial zonings In the next three years, we aim to strengthen and all centers of cities and municipalities, our relationship with Passe-Muraille. In this way offering all citizen and companies

addition, we plan to review the accessibility access to the Gigabit network of the future. Sustainability of our shops and develop versions of our applications and services that are adapted For people in difficult economic situations, we to visually impaired and disabled customers. offer social tariffs. This is a legal obligation for all operators with a turnover of more than Over the next years, we also aim to improve €50 million. In 2018, more than 155,714 Accessibility to all, independent panel of disabled people, they the accessibility of our TV interface for people people benefited from one or more social everywhere guarantee that our devices meet their needs, with a hearing or visual impairment (audio tariffs granted on social or humanitarian We continuously work on making our products, based on an evaluation grid with different description and subtitles). Already, Proximus grounds. services, shops and applications accessible for accessibility criteria. TV offers subtitling on a large range of disabled or visually impaired people. channels and the “audio description” feature We have an offering for each type of customer. We have also developed a low-cost brand, We’ve also set up specific pictograms to make on the channels één, één HD and La Une. Scarlet is a no-frills offer at a low price, while offering the benefits of our high-quality network access to our services and sales channels We plan to extend this functionality in the Proximus offers a full premium service. Scarlet

to people who don’t need the frills of a premium easier and to make it easy to identify future. Also, by 2024, 25% of programs in wants to make telecom services accessible to and Compliance Governance offer. accessible devices. Our online catalog also our video-on-demand catalog will have an all Belgians and has the ambition to always contains information about devices adapted audio description and 25% will have subtitles. give the best offer for the lowest price. Everyone, including the disabled to the needs of users with a disability. Because people’s physical abilities shouldn’t Everyone connected Scarlet was the first to offer unlimited SMS influence their access to digital nor limit In 2018, 11 new devices were tested (vs 12 in In today’s society, connectivity, like water messages in all mobile deals. Also, Scarlet is their opportunities, we continuously test 2017) before proposing them in our offer. We and electricity, is a basic right. Proximus the only brand to provide unlimited voice calls the accessibility of our devices with the see that there has been improvement by the makes important investments in improving below €20, via its Hot subscription. Passe Muraille association. Through their manufacturers in terms of accessibility. 91% connectivity in rural and white zones, even Appendix

54 Proximus Group Annual Report 2018 Proximus is a founding partner of 19, the first entirely free Belgian

Coding School open to 18-30- a glance at Proximus year olds

Going forward, Scarlet will keep launching new with social, economic or personal difficulties types of offers in the fixed and mobile domains, enter the job market by acquiring the skills adapted to market evolutions and customer they need to have a job in the marketplace of needs. It will facilitate mobile Internet access tomorrow. This foundation supports mainly with a new and simplified portfolio, and offer two initiatives: Digitalent, since 2015, and mobile data access at a competitive low price, School 19, since 2018.

while aiming to improve the quality of our Sustainability services and ensure our customers can keep Digitalent their telecom budget under control (usage Digitalent was set up in collaboration with warnings, new self-care interface, etc.). employment agencies and cities. It helps young people between the ages of 18 and 25 19 accepted. 19 also launched the ‘She loves Educating Belgians for the to become familiar with modern technologies Proximus is a founding partner of 19, the to code’ initiative to attract more women to digital future thanks to projects they develop themselves. first entirely free Belgian Coding School open follow its coding courses. Within the next decade, many jobs will disappear. Digitalent offers an eight-week training course to all. Focused on 18-30-year-olds, the 19 Also new types of jobs will appear, bringing to small groups of young people based on Coding School is innovative in that there With 19, our objective is to encourage even new opportunities. However, digital skills will three pillars: technical, entrepreneurial and is no tuition fee, no diploma awarded, and more applications and see people, especially be a prerequisite. We want to address this the construction of a personal professional education takes place without a teacher. It women, benefiting from its innovative way of challenge by already helping people to gain the path for the future. works as a school thanks to the pedagogic learning. In 2019, we will also welcome a first skills they need to thrive in the new economy. support of the leading coding school in the wave of 10 internships coming from 19 and

That’s why we partner with schools and other Started in Antwerp in 2015, we have since world: 42. will work with them on 9 specific projects. and Compliance Governance associations to bring the power of technology added 13 cities across Belgium. In total, 225 to new generations. students have followed the courses and The collaboration between Proximus and BeCentral received certificates. Of those who followed 19 started in 2018. Within its first year, BeCentral is a new digital campus located Ensuring digital employability our Digitalent courses over the last 18 19 received over 2,000 applications from in Brussels Central Station. Its mission One area of focus is the work we do through months, 41 % have found a job and 28% students wanting to access its ground- is to close the digital skills gap and help the Proximus Foundation. The mission of the are continuing education/training (amongst breaking learning system. 1571 of those were accelerate Belgium’s Digital Transformation. Proximus Foundation is to help young people them 29% in the ICT sector). It hosts digital schools and workshops in an 1 Of which 92 have an unemployment statute. Appendix

55 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

entrepreneurial ecosystem. The campus We are very proud to be supporting offers more than 30 initiatives each day associations harnessing the power of digital to over 200 tech enthusiasts, including to ensure sick children can follow classes in educational programs, start-ups and NGOs. any situation.

Proximus supported the start of BeCentral Sustainability with connectivity, and the Proximus We are a partner to Bednet in Flemish schools Foundation organized two Digitalent sessions and Take Off in French-speaking schools. This at BeCentral in 2018. allows long-term sick children stuck at home or in the hospital to follow and be a part of Education through digital their classrooms. Through innovative software Proximus has developed the project Web and solutions, Bednet and Take Off let kids Experts program for seniors. Organized as a feel like they are still an active part of their contest for schools, children are encouraged classrooms and to stay up to date on their to submit their group projects and teach the education. Proximus supports those projects elderly about the advantages of the Internet, by providing internet lines and sponsoring. how to use the Internet safely, etc. Every In 2018, Bednet and Take Off helped over month, there is a prize for the best project. 1,000 children through these initiatives.

In 2018, 322 people were trained thanks to and Compliance Governance WebExperts, with 8 schools (270 children) In 2019, we will continue our support to taking part in this project. Bednet and Take Off and help them grow their initiatives as Bednet plans to help 1,000 In 2018, 322 elderly were We have decided to redesign the Web Experts children and Take Off 100. Furthermore, the trained by 270 kids in the initiative in a bid to reach more schools each new Bednet interface will allow children to WebExperts month and extend the project’s impact. In record the lessons in order to be able to follow 2019, we aim to increase the number of them later. program schools participating to 30. Appendix

56 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Fans of Belgium’s We are the No. 3 advertiser in Belgium, culture we stimulate Belgian co-productions and share sports rights (football, cycling) with 2018 was an exceptional year for Belgian local media, thereby actively contributing sports; think about our performance in to our local media industries, and looking football, gymnastics and hockey. Proximus with them at ways to safeguard the

is a historic sponsor of our national football industry, through the development of new Sustainability team, the Proximus league as well as advertising models and innovation. basketball and cycling events. Besides We also renewed our partnerships with the Sport sports, we also sponsor local music festivals Brussels cultural and classical music houses and cultural events. De Munt (opera) and Bozar (mix of classical Football and modern concerts), reaching about In sports, we continue to sponsor three Pro KPI Result 2018 Result 2017 500,000 visitors per year. Proximus is also league clubs: Brugge, Anderlecht and Charleroi Unique reach of Music and Sports content on ~5 Million N.A. partner of the Queen Elisabeth Music Chapel (reaching about 1 million active foot fans). Proximus platforms supporting young music talents from all over Proximus also confirmed title sponsorship Unique reach of sponsoring events ~2.5 Million N.A. the world and the QE contest that each of the First Division B football competition year welcomes many international artists. and added an eSports competition in 2018. By sponsoring the Klara festival (VRT) and We were also a proud sponsor of the Red Music Musiq’3 Festival (RTBF), Proximus is actively Devils and actively supported the World Cup

We are a proud and active sponsor of local special reports (42% more than in 2017) supporting the accessibility of classical music campaign by offering free data during the and Compliance Governance music and cultural events: Bozar, Queen while 20,000 customers and prospects to larger audiences. Red Devils’ games. By doing so, we reached Elisabeth Music Chapel, Rock Werchter, participated in our contest to win tickets, more than 1 million fans. Finally, we reinforced les Ardentes, Dour, Pukkelpop and the and 62,000 people visited our booth at the This music support includes big names our engagement to women’s football in Francofolies. In the summer of 2018, we festivals. but also smaller, more niche events and Anderlecht and with the Red Flames. reached more 527,000 unique visitors via organizations that depend on the support our Proximus music platforms. Audiences In 2018, we reconfirmed our partnership of companies like us, and who are proponents Cycling were able to watch the live streaming of with the AB concert hall in Brussels, thereby of Belgian culture. This is something we wish In cycling we remain main sponsor of the the festivals, on-demand concerts or the reaching 300,000 visitors each year. to do more of in the future. six Classic races in Flanders with excellent Appendix

57 Proximus Group Annual Report 2018 Through our 15 races of the Proximus Cycling Challenge we reached 40,000 cycling fans in 2018, Proximus at a glance at Proximus up 60% vs 2017

visibility during the Tour of Flanders (2 million The future of Belgian sports viewers). We put extra focus on content on In the coming years, we will continue to our Proximus platforms for the women’s races actively sponsor sports in Belgium. It is for us a and starter events in Antwerp and Ghent. We great cultural heritage and we will expand our reinforced the Proximus Cycling Challenge by reach as we can. This will come by making sure offering 16 high-quality races in all Belgian the content can easily be shared and watched

regions, also in the southern part of Belgium, by Belgian citizens through our platforms Sustainability reaching about 40,000 amateur cycling fans and by sponsoring more local events as well. and participants (60% more than in 2017). Focus will remain on football and cycling, Proximus remains a partner of the DVV cyclo- with extra attention being paid to women and cross races (12 in total) that are watched for youth active in these sports. free on VRT with, on average, 300,000 cycling, basketball and hockey) with local Shelter will be broadcast by VTM, while the viewers per race and 30,000 visitors on Media media. second season of Ennemi Public by ENTRE location. As a telco company, we are deeply connected CHIEN & LOUP will be shown on RTBF, and to our media landscape. As a major media We are also actively contributing to ensure many more. Basket distributor in Belgium, we offer a strong a better future for our local media industry, In 2018, we extended our sponsorship of platform for local content, with over 96 local which is under pressure, by developing new Art Spirou Charleroi basketball club for one season channels in our basic offer (72 local TV and 2 advertising models and are aiming to improve Our Proximus Art Collection counts 123 artists (2018-2019) and also started to develop local radio channels). our platforms and user interfaces in order to and 520 contemporary art pieces. Of those

other initiatives in the Spiroudôme, such as compete with international OTTs and other artists, 50 are Belgian. This collection started and Compliance Governance the organization of the first Proximus-ESL In addition, we actively encourage Belgian social media players. in 1996. Every year, we promote one Belgian eSports championship in December 2018. co-productions and invested €2.6 million in artist and in 2018, this was Lara Gasparotto. This event had more than 1,000 visitors for its local co-productions in 2018 (e.g. the third In 2019, several co-productions that we To share this collection with visitors in 2018, first edition and over 150,000 unique viewers season of Versailles by ENTRE CHIEN & LOUP invested in will be released, both in the Flemish we organized 27 guided tours and conferences watched on the Proximus eSports channel, was broadcast on the Proximus platform and and French-speaking parts of the country. For around our collection (compared to 25 in marking a very promising start. later by RTBF). We share sport rights (football, instance, Studio Tarara by Production House 2017). Appendix

58 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

partnership with Be.Face and in collaboration night, offering them a bed, a hot meal, with other partner companies, Proximus breakfast and health, medical and social participated in the sale of sandwiches for the support. benefit of associations in Saint-Gilles (Restos

du Coeur) and the North district (Point 32, We also continued our support of Télévie, Sustainability Vluchtelingenwerk Vlaanderen, Harmonie). CAP48 and the Belgian Paralympic Proximus also supports the cause of refugees Committee. , and migrants. In collaboration with NGO’s Proud and various humanitarian organizations, we We supported 9 employee initiatives, by giving sponsor installed free Wi-Fi and Internet in buildings them authorization and space in our common offering shelter to families who have left areas to request support for their associations. of the Belgian their own country. These are a building And by collaborating with the Red Cross, we Paralympic close to Maximilien Park (humanitarian hub donated 244 litres of blood (compared to Committee of Médecins du Monde, the Belgian Red Cross, 282 in 2017). and Médecins Sans Frontières of Belgium); two Fedasil buildings in Ixelles and Neder- In 2019, we will continue supporting Be.Face In 2018, we continued our partnership Over-Heembeek and two buildings of initiatives and will propose employees to

Social engagement with Be.Face by participating in solidarity the Plateforme Citoyenne de Soutien aux associate team buildings activities to a good and Compliance Governance campaigns with this network of socially réfugiés, in Jette and Schaerbeek. cause support. Material Topic*: 2 responsible companies. By appealing to We also donated computers to this the individual generosity of employees organization to equip the classrooms of the As a company strongly rooted in Belgium, and companies, collective operations “Ecole Maximilien pour Adultes”. we want to give back to society in a concrete were conducted, including a large-scale and direct way. We do this by supporting collection of warm clothing and blankets As part of the Winter Plan, we made one local initiatives around our offices and other for the homeless. In addition, a “Solidarity of our buildings in Brussels available to national projects. Sandwiches” marathon was set up. In accommodate 50 homeless people every

*Materiality Matrix p. 27 Appendix

59 Proximus Group Annual Report 2018 Respecting our planet a glance at Proximus Sustainability Governance and Compliance Governance Appendix Proximus at a glance at Proximus Respecting our planet

At Proximus, we think long-term and want to reduce our At Proximus, ecological impact. At our company, in our partnerships with we take our Sustainability suppliers, and in our innovations, we want to make a net impact on positive contribution to our planet. environment seriously We take initiatives to remain CO2-neutral and to become more circular in terms of materials and energy. And from and we have set up concrete our suppliers, we demand the same commitment to measures to reduce it sustainability.

We are one of the few CO -neutral Proud to be CO2 2 KPI Result 2018 Result 2017

telecom players in the world and we are and Compliance Governance neutral Electricity used which came from renewable 99% 98% proud to have a place in the CDP Supplier energy sources Material Topic*: 3 Engagement leader board. But that’s just Carbon neutrality level for own operations and 100% 100% the beginning: we’ll continuously push business travel Energy reduction, waste management, ahead by improving our own good practices Carbon emissions scope 1+21 compared to -12% -4% an ecological network, green mobility: and through digital innovation, to ensure previous year at Proximus, we take our impact on the Belgium remains a good place to live in, Energy consumption compared to 2008 -27% -24% environment seriously and we have set up and to play our part in combatting climate concrete measures to reduce that impact. change. 1 The methodology and detailed fi gures can be found in the chapters “Transparency”, “Carbon emissions and energy: boundaries, scope and methodology” and “Environmental fi gures”. Appendix *Materiality Matrix p. 27

61 Proximus Group Annual Report 2018 We are one of the few telco operators in the world and the only Belgian one that is climate a glance at Proximus neutral since 2016

Our first and main initiative is to reduce our projects, and by adopting more energy- • Telecom solutions to facilitate teleworking from renewable energy sources in 2018. We

CO2 emissions. In 2007, we set a target of efficient systems and features, resulting and work from home. joined the RE100 initiative to reinforce our reducing our emissions by 70% for Belgian in an additional 13 GWh saving in 2018. commitment to 100% renewable power. operations by 2020. We achieved that goal • Gradual shift to carbon-friendly or in 2015, which is why we set a new target of • Extending the lifespan of the network with carbon-neutral offices, always near public While we are continuing our efforts to reduce reducing our Group GHG scope 1 and 2 CO2 innovative technologies. transport stations. our emissions, we have also been climate-

emissions by 30% between 2015 and 2025. neutral for our own operations since 2016. Sustainability By actively focusing on the energy efficiency • Recycling or reusing all technical In addition, we are making our vehicles more This is achieved by offsetting what we cannot of our own car fleet, buildings, networks and equipment after dismantling. carbon-friendly. In 2018, we had more than reduce yet by originating and supporting data centers, we contribute significantly to 200 lease bikes in place, launched the international Gold Standard projects that reducing CO emissions. Over the past eleven Drastically reducing journeys made by business bike concept for technicians and fight global warming. 2 • years, carbon emissions of scope 1 and 2 technicians through virtualization and logistics, and replaced more than 1,330 decreased by 75% and fell by 12% in 2018 remote installation, maintenance and “Euro-3, -4 and -5” technical vehicles by Green clients compared with 2017. Energy consumption repair technologies. much more energy-efficient Euro-6 and CNG We help our customers reduce their impact also continues to fall each year, by 27% over vehicles. Total fuel consumption fell by 3% on the environment by maintaining a sound the past 10 years and by 5% compared with Green mobility for our compared with the previous year. balance between ensuring a long life for our 2017. 99% of the electricity supporting our employees TV decoders and modems and rolling out network, data centers and office buildings Transportation represents more than 60% Green energy consumption energy-efficient devices, with a reduction in comes from renewable energy sources. of the remaining scope 1 carbon footprint, Since 2009, all electricity consumed for average consumption of 41% over the past

so our strategy is oriented towards a drastic our operations in Belgium has come from four years. and Compliance Governance Managing the life cycle and environmental reduction. First of all, we keep reducing renewable energy sources. For example, footprint of our network in a responsible way, employee commuting: electricity from local wind energy is used at Proximus provides many products and despite the significant data growth, is ensured Proximus’ head office. The 100% renewable services that can help other organizations through several major programs, such as: • The mobility budget promotes the shift energy consumption also applies to Telindus’ reduce their environmental footprint. to public transport. In 2018, over 2,000 operations in the Netherlands and our • Reducing our network’s electricity employees opted for commuting solutions Telindus and Tango operations in Luxembourg. Green overall consumption in a structured way by instead of parking spot1. In addition, a growing number of BICS sites We are also working on reducing our indirect putting the emphasis on outphasing and worldwide are switching to renewable energy. scope 3 emissions. With a target of -10% by

power savings in network simplification This means we used up to 99 % electricity 2025 and -50% by 2040, since 2014 we Appendix 1 Representing 53% of people with a mobility plan/ company car

62 Proximus Group Annual Report 2018 As a responsible company, Proximus makes efforts to reduce waste and recycle

resources a glance at Proximus Proximus’ activities in Belgium in 2018 and will continue doing Part of the circular generated 14,700 tons of waste, including what it takes to close the economy 13% residual waste which was converted circle Material Topic*: 4 into electricity and heat energy in waste treatment facilities. The remaining 87% was The current economic system of “take, recycled, reused or reprocessed and consisted make, waste” has reached its limits. We of 41% of stones and sand from our network are rapidly shifting towards a more circular activities, for 29% of glass, plastic, metal, economy, requiring fewer resources and paper, wood, batteries, toners and various producing less waste. items, and for 17% electronic waste. Sustainability At Proximus we are actively contributing The MIDAS project, which has been running to this circular economy, both in-house for several years, is aimed at recycling as and together with our customers. As a many valuable resources as possible from responsible telecoms player, we make network installations. Over the past two efforts to reduce waste and recycle years, more than 2,000 tons of copper cable resources, and will continue to do whatever were recovered from old exchanges and/or it takes to close the circle. the earth and thousands of tons of various

KPI Result 2018 Result 2017 have managed to reduce emissions relating Our very ambitious reduction targets are in Percentage of waste recycled, reused or 87% 85% to employee commuting by 17%, business line with climate science and are approved by composted travel by 20%, journeys by subcontractors the Science Based Targets initiative. Reaching Collected mobile phones 18,279 18,493 by 54%, fuel- and energy related activities these targets will be achieved through multiple Refurbished modems and TV decoders 405,544 322,194 and Compliance Governance by 4% and use of sold products by 18%. initiatives and plans: further migration of our However, as we’re fully investing in the network, continuous green fleet and logistics transformation of our network, indirect improvement, office-building optimization, items of electronic equipment were recycled. of Circular Flanders. Our deal involves setting emissions relating to purchased goods and energy efficiency improvement of end-user Through these activities, we bring valuable up two circular procurement projects and services and capital goods increased by 9%, devices and carbon footprint reductions of metals back into business. sharing each other’s best practices with all and waste generated through operations procured products and services. other signatories. In 2018, we introduced two by 12%. Besides our internal efforts, we also signed, projects being the TV decoder and reuse of the in 2017, the Green Deal Circular Purchasing installation and equipment of technical vehicles. Appendix *Materiality Matrix p. 27

63 Proximus Group Annual Report 2018 Sustainable supply Each year, Proximus works with some 4,000 a glance at Proximus chain suppliers of products or services, mainly in the fields of ICT and technology, and Material Topic*: 13 together we endeavor to improve social and environmental (SE) standards throughout the If we want to tackle climate change, supply chain. This can be achieved by raising we need everyone to do their part. As the suppliers’ SE performance and improving a company with hundreds of suppliers, their own supply chain management, while we’re taking our responsibility in building also increasing our own efficiency. Suppliers Bringing valuable a sustainable supply chain. are essential in our operations to provide metals back into products and services. However, having close

By working closely with our suppliers ties with suppliers implies that their reputation Sustainability business and demanding they meet a set of strict could impact on ours. We undertake to treat sustainability standards and clauses, suppliers fairly and equally, and to promote we can further reduce our impact and relationships of trust with both existing and contribute to a better world. potential suppliers. Moreover, we expect our Next, we also run an initiative in our shops and a multi-year plan to become a circular in schools to recycle phones. Anyone can come company. into a shop and ask for their electronic device to KPI Result 2018 Result 2017 be recycled. In return, we donate €1 to Bednet or For the future, we have set clear goals on our Percentage of suppliers screened using social 87% 85% Take Off. In schools, we work with GoodPlanet waste management. We intend to recycle as criteria (incl. working conditions, human rights, Belgium to raise children’s awareness of the much as 90% by 2025. etc.) who received a silver or gold recognition level1 life cycle of mobile phones. They can then 83% bring in their devices to be recycled and we We also want to reach the target of 200,000 Percentage of suppliers screened using 82% environmental criteria who received a silver or reward schools with refurbished computers in collected phones in schools by 2020 in gold recognition level2 and Compliance Governance exchange for their help. In 2018, we recycled collaboration with GoodPlanet Belgium. 1 Based on the EcoVadis assessment. over 9,000 phones in 95 schools and shops 2 Based on the EcoVadis assessment. and rewarded schools with 156 refurbished Finally, a new project, GoodSchool DigiTool, laptops, desktops or tablets. was launched in September 2018 in partnership with GoodPlanet Belgium to suppliers to subscribe to our social, ethical and As far as our suppliers are concerned, we These initiatives show our commitment to increase children’s awareness of sustainability environmental principles. We will not work integrate SE standards on labor, ethics, safety being circular, but because we know we need matters such as waste, mobility, food and with parties who do not adhere to the same and the environment into our purchasing to go one step further, we are developing energy, by using our LoRa IoT technology. standards as we do. processes. By so doing, we not only improve Appendix *Materiality Matrix p. 27

64 Proximus Group Annual Report 2018 In 2018, 100% of our contracts contained a CSR

clause a glance at Proximus requiring vendors and their supply chains to amount. Of those 121 suppliers, 83% respect and comply with In the event of one of our suppliers not passing worldwide social, ethical received a positive score for environmental the audit or obtaining a negative EcoVadis and environmental risks and 87% for working conditions and score, we invite them for re-assessment the standards human rights (thus leaving 16 suppliers next year. In 2018, 100% of our contracts having potential negative social impact and contained a CSR clause. This clause requires 20 having potential negative environmental vendors and their supply chains to respect impact). Proximus, as a supplier, has itself and comply with worldwide social, ethical

received a high rating for several years; since and environmental standards. Sustainability 2018 it has been granted the Gold label with a score of 67%. Our target is to have 75% of In 2019, every new supplier will have to suppliers with a positive rating within 5 years. complete a CSR survey and reach a predefined level of CSR compliance. Proximus, together with 15 other telecom operators, representing over 50% of our brand image but, above all, we bring relevant sustainability criteria, including a worldwide telecom turnover, is a member about positive change in the communities in clause prohibiting the use of conflict minerals. of the Joint Audit Cooperation (JAC, http:// which our suppliers operate. jac-initiative.com/). In 2018, 91 on-site In addition to the original assessment, and company audits were conducted worldwide in Those standards serve as supplier selection on the basis of purchase value and strategic collaboration with JAC, each of them resulting criteria and are included in all contracts relevance, suppliers are selected to take part in in an improvement plan. The purpose of the

through the CSR clause, which covers topics a CSR assessment and/or audit. Such audits audits is to monitor, assess and develop the and Compliance Governance such as child labor, forced labor, health and may entail an on-site audit at the premises of CSR standards of production sites of large safety legislation and protection of the the supplier or their subcontractors, usually ICT multinationals. environment. In 2018, 87% (85% in 2017) in China or India. Suppliers with a specific of our new suppliers were assessed against risk profile, or with a high contract value, are Proximus received 121 CSR supplier various social criteria, and 83% (82% in assessed for their CSR performance using scorecards and conducted nine audits in 2018. 2017) against various environmental criteria. the EcoVadis platform (http://www.ecovadis. Five other suppliers will be audited in 2019. We have standard RFx documents for the com/). In 2018, CSR supplier scorecards were The CSR selection and qualification process purchase of IT and terminal equipment with compiled for 40% of the total purchase is described in detail on the Suppliers Portal. Appendix

65 Proximus Group Annual Report 2018 Governance and compliance, safeguarding long-term value Governance and a glance at Proximus compliance, safeguarding long-term value Sustainability

Corporate governance statement 68

Regulatory framework 85

Risk management report 91

Proximus share 99

Remuneration report 100 Governance and Compliance Governance Appendix

67 Proximus Group Annual Report 2018 Corporate Corporate governance aims to define a set of rules and behaviors according to which companies are properly managed and controlled, Proximus at a glance at Proximus with the objective of increasing transparency. It is a system of checks governance and balances between the shareholders, the Board of Directors, the Chief Executive Officer and the Executive Committee. Proximus is committed to comply with the legal and regulatory obligations and statement best practices.

Proximus governance • an Audit & Compliance Committee, a Nomination & Remuneration Committee,

model Sustainability and a Transformation & Innovation At Proximus, we know that doing business Committee (formerly Strategic & Business the right way is our license to operate. We Development Committee) created by the never want to be put at the center of ethical Board within its structure dilemmas and we put the right measures in place to ensure our business is conducted • a Chief Executive Officer (CEO) who takes ethically. This first means having a clear primary responsibility for operational governance model, which for us, as a limited management including, but not limited liability company under public law, is imposed to, day-to-day management by the Law of 21 March 1991 on the reform of certain autonomous economic public • an Executive Committee which assists the companies (“the 1991 Law”). For matters not CEO in the exercise of her duties explicitly regulated by the 1991 Law, Proximus is governed by Belgian Company Code and the • Proximus designates the 2009 Belgian

2009 Belgian Corporate Governance Code. Code on Corporate Governance and Compliance Governance as the applicable Code (www. The key features of Proximus’ governance corporategovernancecommittee.be). model are: We not only follow the law but want to ensure • a Board of Directors, which defines every one of our collaborators is aware of the Proximus’ general policy & strategy and behaviours to follow and avoid. Therefore, supervises operational management Proximus adopted its new Code of Conduct Appendix

68 Proximus Group Annual Report 2018 in 2016, applicable to all employees. Until • The Board is composed of maximum a glance at Proximus now, 93% of Proximus employees followed fourteen members a mandatory training on the application of the principles of the Code of Conduct. On • Directors are appointed for a maximum top of this, we have various internal policies term of four years. Mandates are to make sure our employees conduct their renewable but there is a maximum term of Members of the Board of Directors appointed by the Belgian State business ethically. in total 12 years for independent Directors. under the previous version of the 1991 Law

Today, the Board is composed of fourteen Name Age Position Term Board of Directors members. Seven Directors are appointed Stefaan DE CLERCK 67 Chairman 2013 - 2019 by the Belgian State in accordance with the Dominique LEROY 54 Chief Executive Officer 2014 - 2020 Since the modified 1991 Law and the changes previous version of the 1991 Law. Their Sustainability Karel DE GUCHT 65 Director 2015 - 2021 to the bylaws in April 2016, the following mandates expire at the end of their term, principles apply: except in case of early termination by the Martine DUREZ 68 Director 1994 - 2019 Shareholders’ Meeting. The other seven Laurent LEVAUX 63 Director 2013 - 2019 • All Directors are appointed by the Directors are independent as per article Isabelle SANTENS 59 Director 2013 - 2019 Shareholders’ Meeting with 50% + 526ter of the Belgian Company Code and Paul VAN DE PERRE 66 Director 1994 - 2019 one vote, upon proposal by the Board of the Belgian Corporate Governance Code. from those candidates withheld by the Nomination & Remuneration Committee Proximus is proud of a substantial female Members of the Board of Directors appointed by the General representation on its Board of Directors. This Shareholders’ Meeting • Any shareholder holding at least 25% has composition and the complementary expertise the right to propose a number of Directors and skills of all directors create a dynamic Name Age Position Term proportionate to its shareholding which benefits the good management of Pierre DEMUELENAERE 60 Independent Director 2011 - 2021 the company. Guido J.M. DEMUYNCK 68 Independent Director 2007 - 2019 • All Directors other than the CEO and those and Compliance Governance appointed through the aforementioned Composition of the Board of Martin DE PRYCKER 64 Independent Director 2015 - 2019 nomination right are independent. In Directors Tanuja RANDERY 52 Independent Director 2016 - 2020 any case there must be 3 independent On 18 April 2018 Mrs. Agnès Touraine and Agnès TOURAINE 64 Independent Director 2014 - 2022 Directors according to the criteria of article Mrs. Catherine Vandenborre were reappointed Catherine VANDENBORRE 48 Independent Director 2014 - 2022 526ter of the Belgian Company Code for a new mandate of four years. Luc VAN DEN HOVE 59 Independent Director 2016 - 2020 and of the Belgian Corporate Governance Code Appendix

69 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Functioning of the Board of Files on important decisions are prepared by • The financial reporting process The members of the Audit &Compliance Directors standing or ad hoc Board Committees, with Committee are: Messrs. Guido J.M. Demuynck The Board of Directors meets whenever the significant representation of non-executive, • Efficiency of the systems for internal (Chairman), Stefaan De Clerck, Pierre interests of the company so require or at the independent Directors within the provisions of control and risk management of the Demuelenaere, Paul Van de Perre and Mrs. request of at least two Directors. In principle, Article 526ter of the Belgian Company Code. company Catherine Vandenborre. the Board of Directors holds five regularly scheduled meetings annually. • The company’s internal audit function A majority of the members of the Audit Sustainability Committees of the and its efficiency & Compliance Committee have extensive The Board of Directors also yearly discusses Board of Directors expertise in accounting and audit. The and evaluates the strategic long-term plan • The quality, integrity and legal control of Chairman of the Audit & Compliance in an extra meeting. Proximus has an Audit & Compliance the statutory and the consolidated annual Committee, Mr. Guido J.M. Demuynck, Committee, a Nomination & Remuneration accounts and the financial statements of holds a degree in Applied Economics. Mrs. In general, the Board’s decisions are made Committee and a Transformation & Innovation the company, including the follow-up of Catherine Vandenborre holds a degree in by simple majority of the Directors present Committee (formerly Strategic & Business questions and recommendations made Business Economics as well as degrees in or represented, although for certain issues a Development Committee). by the auditors Tax and Financial Risk Management. Mr. qualified majority is required. Paul Van de Perre holds a Master’s degree Audit & Compliance • The relationship with the company’s in Economics and several postgraduate The Board of Directors has adopted a Charter Committee auditors and the assessment & monitoring degrees. The Chairman and the majority which, together with the Charters of the Board The Audit & Compliance Committee (ACC) of the independence of the auditors of the members exercised several Board Committees, reflects the principles by which the consists of five non-executive Directors, the or executive mandates in large Belgian or

Board of Directors and its Committees operate. majority of whom are independent. In line • The company’s compliance with legal and international companies. and Compliance Governance with its Charter, the Committee is chaired by regulatory requirements The Board Charter stipulates, among other an independent Director. Nomination & Remuneration things, that important decisions should have • Compliance within the company with Committee broad support, understood as a qualitative The Audit & Compliance Committee’s role is the company’s Code of Conduct and the The Nomination & Remuneration Committee concept indicating effective decision-making to assist and advise the Board of Directors in Dealing Code. (NRC) consists of five Directors, the majority of within the Board of Directors following a its oversight of: whom are independent. In line with its Charter, constructive dialogue between Directors. The Audit & Compliance Committee meets this Committee is chaired by the Chairman of

at least once every quarter. Appendix

70 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

the Board of Directors, who is an ex -officio • The oversight of the decisions of the De Clerck (Chairman), Pierre Demuelenaere, If appropriate, the Board of Directors can member. CEO with respect to the appointment, Guido J.M. Demuynck, Martin De Prycker and decide on establishing a special ad hoc the dismissal and the compensation of Mrs. Martine Durez. Committee, dealing with a specific subject and The Nomination & Remuneration Management composed of members with the appropriate Committee’s role is to assist and advise the Transformation & experience. Board of Directors regarding: • The preparation of the Remuneration Innovation Committee report and the presentation of that report (formerly Strategic & Business The members of the Transformation & Sustainability • The nomination of candidates for at the Annual General Shareholders’ Development Committee) Innovation Committee are: Messrs. Stefaan appointment to the Board of Directors Meeting The Transformation & Innovation Committee De Clerck (Chairman), Karel De Gucht, Martin and the Board Committees (TIC) consists of a maximum of six Directors. De Prycker, Luc Van den hove, Mrs. Tanuja • Corporate governance matters. In line with its Charter, the Chairman of the Randery and Mrs. Agnès Touraine. • The appointment of the CEO and of the Board of Directors is ex officio member, and members of the Executive Committee on The Nomination & Remuneration Committee the Committee is presided by the Chairman proposal of the CEO meets at least four times per year. of the Board of Directors. Three members are Deviation from appointed among the independent Directors. the 2009 Belgian • The appointment of the Secretary General At the beginning of each year, the Committee reviews the performance, budgets for pay-out The Transformation and Innovation Corporate Governance • The remuneration of the members of of bonuses and merits, and long-term and Committee is a permanent committee of Code the Board of Directors and the Board short-term incentive plans. At that meeting, the Board, discussing those selected files Committees the concept and strategy of the remuneration that need preparatory reflection and need Proximus complies with the 2009 Belgian

policy is also discussed. The Committee to mature before being brought to the Board Corporate Governance Code, with the and Compliance Governance • The remuneration of the CEO and determines the performance measurement for decision. The topics discussed at the exception of two deviations, which were members of the Executive Committee targets of the CEO and the members of Transformation and Innovation Committee imposed under the former 1991 Law. These the Executive Committee through Key may be of diverse nature and will evolve deviations will cease to exist as from the expiry • The annual review of the remuneration Performance Indicators. overtime depending on the company’s needs of the mandate of the last Director appointed concept and strategy for all personnel, and and could deal with matters concerning a.o. by the Belgian State. specifically the compensation packages of The members of the Nomination & technology, network, branding/marketing, the Leadership Team Remuneration Committee are: Messrs. Stefaan transformation, HR skills, digitalization… The 2009 Belgian Corporate Governance

Code states that the term of a board mandate Appendix

71 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

should not exceed maximum four years. Decree in the Council of Ministers in accordance affect personal judgment or professional Activities Report However, the mandates of the Directors with the former article 18 paragraph 5 of tasks to the detriment of the Proximus Group. of the Board and who were appointed by the Belgian State in the 1991 Law. The next Chairman will be the past expire after six years as prescribed appointed by the Board of Directors from On 24 February 2011, the Board adopted Committee meetings by the former article 18 paragraph 3 of the amongst its members. a “related party transactions policy” which 1991 Law. As from 2016, all Directors are was updated in September 2016, which In 2018, seven meetings of the Board of appointed for a term of 4 years. governs all transactions or other contractual Directors were held, five meetings of the Sustainability Conflict of interest relationships between the company and its Audit & Compliance Committee, four of the The 2009 Belgian Corporate Governance Board members. Nomination & Remuneration Committee Code states that the Board of Directors A general policy on conflict of interest and two of the Transformation & Innovation appoints its Chairman. The current Chairman applies within the company. It prohibits the In accordance with article 523 of the Belgian Committee. was appointed by the Belgian State by Royal possession of financial interests that may Companies Code, the CEO, Mrs. D. Leroy, declared during the Board of Directors of A list with the attendance of the members is 1 March 2018 to have a conflict of interest in included in the Remuneration report. connection with her performance evaluation for 2017, item on the agenda of that Board meeting. Insider trading and market manipulation Proximus has contractual relationships and provides also telephony, Internet, digital and/ (market abuse)

or ICT services to many of the companies in and Compliance Governance which Board members have an executive or In order to comply with legislation on insider non-executive mandate. These transactions trading and market manipulation, Proximus take place in the ordinary course of business adopted a Dealing Code prior to the Initial and at arm’s length. Public Offering. This Code aims to create awareness about possible improper conduct Appendix

72 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

by employees, officers and Directors and identified as main strengths a well-balanced The Board of Directors will examine in 2019 The current CEO is Mrs. Dominique Leroy. possible sanctions. This Dealing Code has composition of the Board, the high quality how to prepare its renewed composition Her renewable six-year fixed term contract been widely communicated and is available of information flow to the Board, a Board taking into account the new legal framework. started on 13 January 2014. to all employees. A list of key persons is kept, culture stimulating the decision-making in and all Directors and key employees were the interest of the company and an excellent Executive Committee requested to sign an affidavit that they had leadership by the Board’s Chair. Executive Committee members read, understood and agreed to comply with The members of the Executive Committee the Dealing Code. Closed periods (including As a result of the evaluation, the Board Chief Executive Officer are appointed and dismissed by the Board Sustainability prohibited periods) are defined and any deal reflected on the role of the ‘Strategic and The CEO was appointed by the Belgian State of Directors at the proposal of the CEO, must be communicated to and cleared by the Business Development Committee’ and by Royal Decree deliberated in the Council of after consultation of the Nomination & Director Internal Audit & Risk Management decided to change this as of 2018 into a Ministers, in accordance with the provisions of Remuneration Committee. before transaction (see “Compliance” section ‘Transformation & Innovation Committee’, the previous version of the 1991 Law. Future on p.82). which is a permanent committee of the Board, CEO’s will be appointed by the Board of The powers of the Executive Committee discussing those selected files of diverse Directors, deciding by a normal majority vote. are determined by the CEO. The Executive nature that need preparatory reflection and Committee’s role is to assist the CEO in the Evaluation of the need to mature before being brought to the In line with the 1991 Law and the company’s exercise of her duties. Board Board for decision. This Committee will be bylaws, the CEO is a member of the Board of convened at the request of the Chairman or Directors. The CEO and the Chairman of the The Executive Committee aims to decide by At the end of 2016, the Board of Directors the Board whenever required by the interest Board of Directors must come from different consensus, but in the event of disagreement, started an external Board evaluation together of the company. language groups. the view of the CEO will prevail. with Guberna. The Board members were

invited to answer an extensive questionnaire, As a further action point from the Board The CEO is entrusted with day-to-day The Executive Committee generally meets and Compliance Governance followed by an interview between Guberna evaluation, the Board decided to strengthen management and reports to the Board of on a weekly basis. and each individual Board member. The the reporting from the committees and to Directors. Board members were asked their opinion review and update the delegation from the In 2018, the Executive Committee, in addition on corporate governance at Proximus, Board to the CEO which was last published in The Board of Directors has delegated broad to the CEO, was composed of the following the functioning of the Board and of the 2006. The new delegation was published in powers to the CEO. members: committees. Guberna concluded in 2017 the appendices to the Belgian Official Gazette that the assessment was overall positive and on 23 May 2018. Appendix

73 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Name Age Position Additional fees paid to the Auditors: Deloitte Auditors SC sfd SCRL and Guillaume BOUTIN 44 Chief Consumer Market Officer auditors and CDP Petit & Co SPRL. Sandrine DUFOUR 52 Chief Financial Officer In accordance with the provisions of Article Dirk LYBAERT 58 Chief Corporate Affairs Officer 134 § 2 of the Belgian Company Code, The Group spent during the year 2018 an Geert STANDAERT 48 Chief Technology Officer Proximus declares the supplementary fees amount of 453,909 EUR for non-mandate that it granted during the 2018 financial fees for Deloitte Auditors SC sfd SCRL, the Renaud TILMANS 50 Chief Customer Operations Officer year to two auditors, members of the Joint Group’s auditors. This amount is detailed as Sustainability Jan VAN ACOLEYEN 56 Chief Human Resources Officer follows: Bart VAN DEN MEERSCHE 61 Chief Enterprise Market Officer Amount spent by the Group for non-mandate fees for Deloitte Auditors SC sfd SCRL Board of Auditors Deloitte Auditors SC sfd SCRL, represented (in EUR) Auditor Network of auditor by Mr. M. Denayer and Mr. N. Houthaeve, are Other mandatory audit missions 50,320 42,972 Composition responsible for the audit of the consolidated Tax advice The Board of Auditors of the company is financial statements of Proximus and its composed as follows: subsidiaries. Other missions 66,875 293,742 Total 117,195 336,714 • Deloitte Auditors SC sfd SCRL, represented The other members of the Board of Auditors by Mr. Michel Denayer also Chairman of are, together with Deloitte, entrusted with the Board of Auditors the audit of the non-consolidated financial The Group also spent during the year 2018 an paid to CDP Petit & Co SPRL. This amount is statements of Proximus as parent company. amount of 1,557 EUR for non-mandate fees detailed as follows:

• Mr. Jan Debucquoy, Member of the Court and Compliance Governance of Auditors The mandates of Deloitte Auditors SC sfd Amount spent by the Group for non-mandate fees for CDP Petit & Co SPRL SCRL and CDP Petit & Co SPRL will expire (in EUR) Auditor Mr. Pierre Rion, Member of the Court of at the annual General Shareholders Meeting • Other mandatory audit missions 1,557 Auditors in 2022. Tax advice • CDP Petit & Co SPRL, represented by Other missions Mr. Damien Petit Total 1,557 Appendix

74 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Dominique Stefaan Karel LEROY DE CLERCK DE GUCHT Members Mrs. Dominique Leroy has been Chief Executive Mr. Stefaan De Clerck is Chairman of the Proximus Mr. Karel De Gucht, State Minister, was the of the Board Officer since January 2014 and presides over Board of Directors since 20 September 2013. He European Commissioner for Trade from February of Directors the Executive Committee of Proximus. She joined chairs the Proximus Joint Committee, the Proximus 2010 until 31 October 2014, where he was pivotal Proximus (formerly Belgacom) as Vice President of Pension Fund and the Proximus Art ASBL/VZW. in negotiating, concluding and managing several Sales for the Consumer Business Unit in October He is board member of the Proximus Foundation European Free Trade and Investment Agreements 2011 and was appointed Executive Vice President and of Connectimmo. He is also member of the worldwide. Previously he served as Belgium’s Sustainability of the Consumer Business Unit of Proximus in June Orientation Council of , of the Strategic Minister of Foreign Affairs from 2004 to 2009, 2012. Committee of FEB/VBO, of the Board of VOKA, Deputy Prime Minister from 2008 to 2009, and Prior to Proximus, Mrs. Leroy worked for 24 of the BBR (Benelux Business Roundtable) and as European Commissioner for International years at Unilever. She was Managing Director of of the Bureau of Eurometropole Lille-Kortrijk- Cooperation, Humanitarian Aid and Crisis Response Unilever Belux and member of Unilever’s Benelux Tournai. Before Proximus, he served as a Member from 2009 to 2010. Currently he is the President Management Committee. She previously held of the Belgian Parliament from October 1990 until of the Institute for European Studies (IES) at the various positions in marketing, finance and customer October 2013. From June 1995 until April 1998 Vrije Universiteit Brussel (VUB) – his alma mater development. and from December 2008 until December 2011 (Masters of Laws, 1976) and where he teaches Mrs. Leroy is Chairwoman of the Boards of BICS and he was the Belgian Minister of Justice. From 1999 European Law. He serves as a Director on the Boards Be-Mobile and Chairwoman of the International until 2003 he was President of CD&V, the Flemish of ArcelorMittal SA, of EnergyVision and is a Member Advisory Board of the Solvay Business School. She Christian-Democratic Party. He was the Mayor of of the Advisory Board of CVC Capital Partners. He is an independent Board member at Ahold Delhaize the city of Kortrijk (Belgium) from January 2001 is also the manager of a family-run wine producing and Compagnie de Saint-Gobain. She was also until end-December 2012. Mr. De Clerck holds a company in the Chianti region (Italy).

independent Board member at Lotus Bakeries until Master’s degree in Law from the Catholic University and Compliance Governance May 2018. of Leuven. Mrs. Leroy holds a Master’s degree in Business Engineering from the Solvay Business School. Appendix

75 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Pierre Guido J.M. Martin DEMUELENAERE DEMUYNCK DE PRYCKER

Until 31 August 2015, Mr. Pierre Demuelenaere In 2013, Pierre Demuelenaere successfully Until December 2010, Mr. Demuynck was CEO of Mr. De Prycker is a managing partner of the Qbic was President and CEO of I.R.I.S. (Image Recognition negotiated the acquisition of I.R.I.S. Group by Canon. Liquavista. Before that, he held various positions Fund, an inter-university fund of 100 million euro, Integrated Systems), a company he co-founded in The company has now become a member of the within Royal Philips Electronics NV from 1976 until supporting university spin-off companies in Belgium. 1987 to commercialize the results of his PhD. Canon Group. 2002. Amongst others, he was Vice President Mr. De Prycker was CEO of Barco between 2002 and Mr. Demuelenaere has more than 30 years of Mr. Demuelenaere holds a Civil Engineering degree Marketing Audio in the USA, CEO of Philips in South 2009. Under his leadership he focused on, and made experience in Imaging and Artificial Intelligence. in Microelectronics from the Université Catholique Korea, General Manager Line of Business Portable the company grow in, markets using displays such Sustainability He has accumulated solid experience in technology de Louvain (UCL) and received his PhD in Applied Audio in Hong Kong, and CEO Group Audio in Hong as the medical, digital cinema, control and airline company management, R&D management and Sciences in 1987. Kong. industry, and spinning off the non-core product setting up international partnerships with US In 2000, he became CEO Product Division Consumer lines such as graphics, textile and subcontracting. and Asian companies (HP, Kodak, Adobe, Fujitsu, Electronics in Amsterdam and member of the Group Prior to that, he was CTO and member of the Samsung, Canon, etc.). Management Committee of Philips. Executive Committee of Alcatel-Lucent. Before Throughout the years, he remained very involved in In 2003, Mr. Demuynck joined Royal KPN where he becoming CTO of Alcatel-Lucent, Mr. De Prycker defining the R&D vision of I.R.I.S and contributed to became member of the Board of Management and was responsible for establishing the company’s the development of new technologies, new products CEO of the Mobile Division (KPN Mobiel Netherlands; worldwide market leadership in the broadband and the filing of a number of patents. Base Belgium, E-Plus Germany). Until July 2008, access market. Under his leadership, ADSL was Mr. Demuelenaere received the “2001 Manager of he was CEO of Kroymans Corporation BV in the transformed from a research project into a multi- the Year” award and I.R.I.S. the “2002 Company of Netherlands. He was a member of the Supervisory billion dollar business for Alcatel-Lucent. the Year” award. In 2008, Data News elected him as Board of TomTom from June 2005 until April 2016. Between 2009 and 2013 Mr. De Prycker was CEO ICT personality of the year. He is a member of the In addition, he has been a Board member of Teleplan of Caliopa, a startup in silicon photonics, allowing

Board of directors of Guberna and also Chairman of International N.V. since May 2011, of Aito BV since the transport of hundreds of Gbps on optical fiber; and Compliance Governance the Board of Directors of EVS Broadcast Equipment. January 2012 and of Wizz Air Holding Plc since Caliopa was acquired by Huawei in 2013. He served for 7 years as a director on the Board of March 2014. He is also a member of the Board of directors BSB, an insurance and banking software company, He holds a degree in Applied Economics from the of several companies, including EVS, Sentiance, for 23 years on the Board of Pairi Daiza and for 10 University of Antwerp (UFSIA) and a degree in Molecubes and EYEco eyeCO. years on the Board of e-capital, a Venture Capital Marketing from the University of Ghent (R.U.G). Mr. De Prycker holds a Ph.D. in Computer Sciences, a Fund. Master of Science in Electronics from the University of Ghent, as well as an MBA from the University

of Antwerp. Appendix

76 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Martine Laurent Tanuja DUREZ LEVAUX RANDERY

Mrs. Durez served as Chief Financial and Accounting A ‘magna cum laude’ graduate in Economics at UCL From October 2008 until June 2016, Mr. Levaux Mrs. Tanuja Randery is an Operating Advisor to Officer at bpost until January 2006, when she (Louvain-la-Neuve), Mr. Levaux began his career has been Chairman and CEO of Aviapartner. In private equity firms and was most recently with became Chairman of the Board, a position she held at the age of 22 at the head of a small struggling June 2016 he handed over his daily operational Apax Partners in London. Before Apax, she was until June 2014. She is a member of the Board of company in Liège, at the time employing some 100 duties as CEO and remains Chairman of the Board. CEO, UK & Ireland for Schneider Electric the global directors of several companies, including Ethias Co people. Four years later the company was turned Headquartered in Brussels, Aviapartner is a leading energy management and automation firm, since and SNCB (Belgian Railways). around, developed, and was merged with a large player in ground-handling services for passengers February 2015. Prior to Schneider, she spent more Sustainability Mrs. Durez was also Professor of Financial international group. in 38 European airports. than 10 years in telecom and Managed Services at Management and Analysis at the University of He next obtained an MBA from the University of Mr. Levaux is also a director of bpost, FN Herstal, Colt Technology Services, a leading pan-european Mons-Hainaut until 2000. She has also served as Chicago (1985) before going to work for McKinsey Investsud, Interparking, Sogepa and Hamon. telecoms provider, and most recently at BT Global a member of the High Council of Corporate Auditors & Co, where he spent some 10 years, the last four Services, a €7.0Bn business, as President of Strategy and the Committee of Accounting Standards and as as a partner, undertaking strategic and restructuring & Transformation. While at Colt, Mrs. Randery led a special emissary at the Cabinet for Communication assignments throughout Europe. Strategy, Global Accounts, and was also Managing and State Companies. In 1995 he joined the Executive Committee of Director of the Benelux business during 2006- She has been a member of the Royal Academy Belgian steel group Cockerill-Sambre as head of 2008. of Belgium (Technology and Society Action) since its non-steel subsidiaries, in particular CMI, a loss- Prior to joining Colt, Mrs. Randery led the Strategy 2010. She served as a regent of the National Bank making company, where he was CEO. When he left function at EMC Corporation in Massachusetts, USA of Belgium. CMI in February 2003, it was a debt-free, growing and was instrumental in a number of key software Mrs. Durez graduated as a Commercial Engineer and profitable engineering and maintenance Group. acquisitions. and holds a PhD in Applied Economics from the In March 2003, Mr. Levaux became CEO of ABX Mrs. Randery started her career at McKinsey, the

University of Brussels (ULB). Logistics, a multinational logistics group, operating global strategy consulting firm where she spent and Compliance Governance in over 30 countries and headquartered in Belgium. 7 years specializing in technology and telecoms It was a company which had suffered heavy losses growth strategy serving leading global companies. since its creation in 1998. Mrs. Randery graduated from Boston University Since 2003, the results have been constantly with an MBA and has an undergraduate degree in improved to reach a level that is among the industry’s Economics. She was born and raised in India and now best. In October 2008, ABX Logistics merged with lives in the UK with her husband and son. the Danish Group DSV, quoted in Copenhagen. Appendix

77 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Isabelle Agnès Catherine Luc SANTENS TOURAINE VANDENBORRE VAN DEN HOVE

Mrs. Isabelle Santens was the previous owner Mrs. Touraine is CEO of Act III Consultants, a Mrs. Vandenborre is Chief Financial Officer at Elia. Mr. Luc Van den hove is President and Chief and Design Director of Labels of Andres NV, a management consulting firm dedicated to digital Previously, she was a member of the executive Executive Officer (CEO) of imec since July 1, 2009. Belgian fashion company that designs, produces transformation. committee of APX-ENDEX, the Anglo-Dutch gas Before holding this position, he was Executive Vice and distributes the ladies clothing brands Xandres, Previously, Mrs. Touraine served as Chairman and and electricity exchange based in Amsterdam, and President and Chief Operating Officer. He joined Xandres xline and Hampton Bays. CEO of Vivendi-Universal Publishing, a $4.7 billion CEO of Belpex. She began her career at Coopers & imec in 1984, starting his research career in the field After studying geography and economics at the KUL, company, after having spent 10 years with the Lybrand as an auditor. of interconnect technologies. In 1988, he became Sustainability she joined Andres NV in 1985, became Director of Lagardère Group as Head of Strategy and CEO of the Mrs. Vandenborre is member of various Boards, manager of imec’s micro-patterning group; in 1996, Design and then CEO in 2000 until she sold the mass market division and five years with McKinsey. including Contassur, an insurance company. Department Director of Unit Process Step R&D; and company to a French listed Company in 2016. She graduated from Sciences-Po Paris and Columbia She holds a degree in Business Economics from the in 1998, Vice-President of the Silicon Process and She turned Andres NV from a mere production- University (MBA). She sits on the Boards of Rexel UCL as well as degrees in Tax Law and Financial Device Technology Division. In January 2007, he oriented facility into a sales and marketing-driven SA, Tarkett SA, GBL (since 31 October 2018) and Risk Management. was appointed as imec’s Executive Vice President fashion company with a focus on building strong previously Darty Plc as well as Neopost SA. She is & Chief Operating Officer (COO). brands, opening pilot stores and building a strong also sitting on non-profit organizations board such Under his guidance imec has grown to an e-commerce site. She is also a Board member in as The French-American Foundation and IDATE. organization with a staff of around 4000 people, several cultural institutions. Since May 2014 she has been Chairwoman of operating with an annual budget of around €545M the Board of Directors of IFA (French Governance (2017) and with offices in Belgium, the Netherlands, Institute). US, Japan, Taiwan, China and India. Currently, Mr. Luc Van den hove is also professor of Electrical Engineering at the University of

Leuven. He is also a member of the Technology and Compliance Governance Strategy Committee of ASML. He has authored or co-authored more than 150 publications and conference contributions. He is a frequently solicited speaker on technology trends and applications for nano-electronics at major top conferences. He has presented more than 50 key note presentations. Mr. Luc Van den hove received his Ph.D. in Electrical

Engineering from the University of Leuven, Belgium. Appendix

78 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Paul Dominique Guillaume VAN DE PERRE LEROY BOUTIN Members of Mr. Van de Perre is co-founder of GIMV (a Venture Mrs. Dominique Leroy has been Chief Executive Mr. Guillaume Boutin joined the Proximus Executive Capital Firm listed on Euronext) and was formerly the Executive Officer since January 2014 and presides over Committee as Chief Consumer Market Officer in a director of Sidmar (Arcelor-Mittal), Thomassen Committee the Executive Committee of Proximus. She joined August 2017. With a very strong mix of strategic, Drijver Verblifa Belgium, Sunparks (a division of Proximus (formerly Belgacom) as Vice President of financial and marketing experiences in the telecom Sunair) and other companies. Sales for the Consumer Business Unit in October and the media sectors in France, Mr. Boutin has He is currently director of Greenbridge Incubator 2011 and was appointed Executive Vice President gained a very deep knowledge and understanding Sustainability (University of Ghent), Scientific Investment Board of the Consumer Business Unit of Proximus in June of new market dynamics and business models of (University of Brussels), President of the Board 2012. these sectors. of Directors of CityDepot (a subsidiary of bpost) Prior to Proximus, Mrs. Leroy worked for 24 Mr. Boutin started his career as strategy consultant and member of the Investment Committee of years at Unilever. She was Managing Director of and as web entrepreneur. He then joined SFR where Participatie Maatschappij Vlaanderen (PMV). Unilever Belux and member of Unilever’s Benelux he successively held the positions of Director Mr. Van de Perre is CEO of Five Financial Solutions Management Committee. She previously held Chairman Office, Chief Financial Officer and Chief (a corporate finance house). Mr. Van de Perre is various positions in marketing, finance and customer Marketing Officer, until he joined Canal+ Group in co-founder of Parinsu (an added value company development. 2015 as Chief Marketing Officer. to mature scale-ups) and member of the advisory Mrs. Leroy is Chairwoman of the Boards of BICS and Mr. Boutin is a member of the Board of directors Board of several high-tech start-ups. He holds Be-Mobile and Chairwoman of the International of Scarlet Belgium. Since 1 January 2019, he is a Master’s degree in Economics and several Advisory Board of the Solvay Business School. She also member of the Board of Directors of Proximus postgraduate degrees. is an independent Board member at Ahold Delhaize Luxembourg which is the surviving entity after the and Compagnie de Saint-Gobain. She was also merger between Tango and Telindus Luxembourg.

independent Board member at Lotus Bakeries until Mr. Boutin holds a Master’s degree in Business and Compliance Governance May 2018. Management from HEC Business School and an Mrs. Leroy holds a Master’s degree in Business Executive MBA from INSEAD. Engineering from the Solvay Business School. Appendix

79 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Sandrine Dirk Geert Renaud DUFOUR LYBAERT STANDAERT TILMANS

Mrs. Sandrine Dufour assumed the post of Chief Mr. Dirk Lybaert is Chief Corporate Affairs Mr. Geert Standaert is Chief Technology Officer. Mr. Renaud Tilmans joined the Executive Committee Financial Officer of Proximus on 1 April 2015. In Officer of Proximus and has the following He has been a member of the Executive Committee as Chief Customer Operations Officer of Proximus in addition to the Finance domains, Sandrine Dufour responsibilities: Legal, Regulatory, Public Affairs, since March 2012. In this function, he oversees all May 2014. In this function, he works with his teams is also responsible for the Wholesale activities as Group Communications, Internal Audit & Risk IT development, service engineering, the fixed to align procedures and create synergies between well as the Group Internal Services. From 1999 to Management, Security Governance & Investigations, and mobile network, technical infrastructure and the operational after-sales activities of the different May 2013, Mrs. Dufour held various positions at Corporate Prevention & Protection and Secretary operations for the Group. Business Units. Sustainability Vivendi in France and the US; the latest being Deputy General. Mr. Standaert joined the Group in 1994 and held Mr. Tilmans joined Belgacom in 1993. He held Chief Financial Officer and Director of Innovation. Mr. Lybaert was Secretary-General of Belgacom director positions in various disciplines, including various director positions in the field of ICT and Afterwards, she became Executive Vice President from 2005 to 2014. From 1995 until 2007, he was IT, Infrastructure Operations and Data Operations networks before becoming Vice President Customer Finance & Strategy at SFR. Before that, she held an assistant at the Law Faculty of the University of before becoming Vice President Customer Operations of the Business Unit Service Delivery various posts as a financial analyst in France, at BNP Brussels for the “Named Contracts” course. From Operations in 2007. Engine & Wholesale in 2012. and Credit Agricole Cheuvreux (European telecom 2000 to 2005 he held different positions within Mr. Standaert is also a Board member of Synductis. Within the Proximus Group, Mr. Tilmans is since 1 sector). the legal department of Belgacom. Mr. Standaert holds a Master’s degree in Civil January 2019, member of the Board of Directors Mrs. Dufour holds several degrees from ESSEC Prior to joining Belgacom, Mr. Lybaert served as an Engineering from the University of Ghent (RUG). of Proximus Luxembourg which is the surviving Business School, the Société Française des Analystes officer with the Federal Police, where he reached entity after the merger between Tango and Telindus Financiers, and the Chartered Financial Analyst the position of Lieutenant-Colonel and Director of Luxembourg. (CFA) Institute. the Anti-Terrorism Program. Mr. Tilmans is a civil engineer from the UCL (Louvain- Mrs. Dufour was an independent director at the Mr. Lybaert is a member of the Board of directors la-Neuve) and holds degrees in IT and management. French company Solocal until March 2018. She is of BICS, Proximus Foundation, Proximus Art and

a member of the Board of directors of the Proximus Proximus Opal.He also has external mandates at and Compliance Governance subsidiaries BICS, Connectimmo, Be-Mobile, PGS, Bednet and Festival van Vlaanderen. Proximus Pension Fund, and Proximus Art. Since 1 Mr. Lybaert holds a Master’s degree in Criminology January 2019, she is also the chairman of the Board from the University of Ghent, Law from the of Directors of Proximus Luxembourg which is the University of Brussels (VUB) and Business Law from surviving entity after the merger between Tango the University of Antwerp, and degrees in Advanced and Telindus Luxembourg. Management and Social and Military Sciences. Appendix

80 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Jan Bart VAN VAN DEN ACOLEYEN MEERSCHE

Mr. Jan Van Acoleyen is Chief Human Resources Mr. Bart Van Den Meersche is Chief Enterprise Officer of Proximus. He joined Proximus in May Market Officer of Proximus. In 2011, he joined 2016, after a 28-year career with various Proximus (formely Belgacom) following 28 years international HR management roles, mainly in of experience in the ICT sector with a professional high-tech companies such as Alcatel, Agfa-Gevaert career at IBM, where he held various executive and Barco. As a HR leader, he acquired extensive management functions for 16 years and spent Sustainability experience in organizational and corporate culture eight years as Country General Manager of IBM transformations. Belgium/Luxembourg. In his last year at IBM, he was Mr. Van Acoleyen has a Master’s degree in Vice President Industries & Business Development Educational Studies from Leuven University and IBM South-West Europe, and a member of the IBM an Executive MBA from the University of Antwerp. South-West Europe Executive Committee. He is an independent member of the Board For six years, Mr. Van Den Meersche was Chairman of of directors of SD Worx and Board member of Agoria ICT and a member of the Board of Directors Experience@Work. Within the Proximus group he of Agoria, VOKA and VBO. is board member of BICS, Proximus Foundation, Within the Proximus Group, Mr. Van Den Meersche Non-financial Our most material topics are also mapped in Proximus Pension Fund and is Chairman of the is a member of the Board of directors of Proximus governance specific pillars of the sustainability framework. Remuneration Committee of BICS. Since 1 January SpearIT and Be-Mobile. Since 1 January 2019, he is For each material topic, at least one KPI has 2019, he is also member of the Board of Directors also member of the Board of Directors of Proximus Living up to the commitment of a structured been defined. of Proximus Luxembourg which is the surviving Luxembourg which is the surviving entity after the sustainability framework requires a very well-

entity after the merger between Tango and Telindus merger between Tango and Telindus Luxembourg. defined organization within Proximus, as our Each pillar and their associated topics & KPIs and Compliance Governance Luxembourg. He is also a member of the Board of directors of strategic areas stem from different business are reported on quarterly to the executive Belgian Mobile ID, a joint venture between the 4 units. This is also set up to ensure we reach committee & Board. major banks (BNP Paribas Fortis, Belfius, ING and our ambition and have a strong follow up KBC) and the 3 mobile network operators (Proximus, from the higher management. The KPIs for each topic and their targets Orange, /Base). as well as link to the SDGs can be found Mr. Van Den Meersche has a Master’s degree in Thus, for each of the pillars in the strategic in the section “Overview of non-financial Mathematics from Leuven University. areas, an owner is appointed within Proximus. information”. Appendix

81 Proximus Group Annual Report 2018 Strict ethical standards and principles a glance at Proximus

Compliance Conduct, as reflected in multiple Group and Proximus’ compliance with the legal and • Investment in a dedicated data Company policies and procedures as their regulatory requirements, as well as internal governance tool allowing to document Role of compliance at guide. compliance with the Code of Conduct and E2E data flows, perform effective data Proximus the Group policies and procedures. (lifecycle) management and ensure data In an increasingly complex legal and regulatory Moreover, our company values aim to inspire (quality) by design context and a changing business environment, our employees in their daily behavior and The Compliance Program compliance plays an increasingly important attitudes. Ethical behavior and respect for the values • The compliance domains which were the Sustainability role in the business world. are part of the compliance approach within compliance focus areas for 2018 were: Ethical behavior is thus not limited to the texts the Proximus Group. - Data protection/Privacy The Proximus Group Compliance Office is of the Code of Conduct and basic guiding - Information Security. responsible for coordinating compliance policies and procedures, which only reflect The following efforts have been done in 2018 activities within the Proximus Group, and a summary of the main basic principles and in order to improve the visibility of the Group aims to promote, at all levels, ethical conduct, are thus not exhaustive. Compliance strategy: Diversity & Inclusion respect of values and compliance with laws statement and internal and external rules and policies, The Code of Conduct is available on www. • A mandatory e-learning about the General prevent unlawful or unethical behavior and proximus.com and www.proximus.be. Data Protection Regulation (GDPR) and In accordance with article 3 of the Law of 3 ensures an appropriate response in case such its principles has been launched during September 2017 on the disclosure of non- behavior does manifest itself. Organization of compliance the year financial and diversity information by certain activities large companies and groups, Proximus’ Our compliance program is a key building The Compliance Office is managed by the • Continuous communication campaigns diversity policy, its purpose and results are

block for our Corporate Social Responsibility Director Internal Audit and Risk Management towards our staff through the intranet, described below. and Compliance Governance strategy (more information available in the & Compliance, who reports directly to the posters and specific events (e.g. Security Sustainability chapter). Chairman of the Audit and Compliance week) concerning information security, Strategic orientation about Committee (ACC). data classification, working securely,… diversity & inclusion All employees must perform their daily Proximus believes that a diverse workforce, activities and their business objectives The ACC Charter determines the ACC’s • Annual updates of policies, procedures through employees’ unique capabilities, according to the strictest ethical standards responsibility in helping and advising the given the fast changing business experiences and all other characteristics and principles using the Proximus Code of Board of Directors with respect to monitoring environment unrelated to someone’s abilities, will help to Appendix

82 Proximus Group Annual Report 2018 Equal opportunities Proximus at a glance at Proximus

reach a more diverse marketplace and will • Demonstrating behaviour free from any While taking care of putting in place well- Diamond Sponsorship in the organization create sustainable business. It is also important form of racism, intolerance, discrimination, balanced and talented mixed teams, Proximus “Women on Board”. Our CEO participates to reflect the diversity of our customers and harassment or other attitude that could reinforces its capacity for innovation and in events regarding women at the top and markets in our workforce. negatively affect the dignity of men and fosters its learning culture, the satisfaction signed the “Pledge”, a European Business women at the workplace of its employees and their creativity towards Leaders’ commitment to Inclusion & Diversity. Therefore, Proximus has a Charter on the future challenges of a digital world. Proximus also ensures ad hoc presence diversity and equal rights, which applies to • Incorporating diversity in all aspects of the to external events such as “Yes she can”, Sustainability all employees of the Proximus Group. way we do business without any form of With regards to gender diversity, this approach “Digital4Her” and “She loves to code” in intolerance. is also reflected in the female representation order to encourage young girls to choose With this policy Proximus wants to enable at the different levels of our company: for engineering studies and a technical career. conditions, where these differences are Within Proximus specific teams are in charge recognized and respected, and where all of monitoring the compliance with the Charter • 43% of the Board of Directors Creation of a culture that employees are given equal opportunities. and of taking the correct measures in case of allows to reconcile activities For Proximus, diversity and equality mean: non-compliance. • 25% of the Executive Committee during the different life phases • Treating all applicants and employees Diversity & inclusion in our • 21% of the members of the Leadership Proximus wants to create conditions to equally, based only on relevant leadership and employees Team allow its personnel to reconcile the different competencies and objective criteria communities aspects of their professional and private life Proximus is particularly conscious about the • 31% of all employees’ population. during their different life phases by offering • Creating an open and welcoming importance of diversity at all levels of the opportunities for internal job change and

work environment that encourages organization and concentrates on recruiting Proximus Group also has a very diverse development opportunities, homeworking, and Compliance Governance contributions from people of all employees with an inclusion and growth workforce in terms of culture with 58 part-time schedules, home child care, … These backgrounds and experiences mindset. Once they are part of the company, nationalities. measures allow our employees to work in we ensure that they are the best ambassadors a safe, inspiring and inclusive workplace • Promoting a mind-set of respect and of our company values by including a part on Proximus supports internal and external with equal opportunities for everyone, openness throughout all levels of the our inclusion program and philosophy in our diversity network activities and initiatives allowing them to combine their personal organization and treating all employees welcome days as well as in all related trainings such as the AfroPean network (APN) and professional lives in order to be optimally fairly and equally for team leaders, experts, trainees,… and WinC (women network). We have a present and feel supported, motivated and

engaged at work. Appendix

83 Proximus Group Annual Report 2018 Working

environment a glance at Proximus standards

Proximus is founding partner of “Experience@ Although the Code of Conduct cannot directly Work”. Thanks to this company, experienced be imposed to our business partners, we seek talents from organizations can be deployed to always work with partners respecting the in other organizations which are looking for same ethical standards. specific experience and/or talent. Proximus expects its employees to respect the Diversity as part of Code of Conduct and use it as a reference in Sustainability Proximus Code of Conduct their day-to-day way of working. Proximus’ mission consists in opening up a world of digital opportunities, so people live Human rights better and work smarter. This also means People are entitled to be treated with respect, that we have to earn and keep the trust of our care and dignity. Proximus business practices customers, our employees, our suppliers, our can only be sustainable if we respect basic shareholders, our partners and the company human rights and value diversity, cultural as a whole. and other differences. Our Code of Conduct, professional workplace with an inclusive discriminatory practices and do our utmost values and behaviour are inspired by working environment, and we are committed to promote equality, diversity and inclusion Successful business must go hand in hand fundamental principles such as those of the to respecting Belgian legislation and the in all employment practices. with honest and ethical behaviour. Each Universal Declaration of Human Rights, the International Labour Organization’s (ILO) employee has a crucial role to play in this European Convention on Human Rights and fundamental conventions. Our working environment standards are matter. This is the reason why the Code of the United Nations Convention on the Rights applied to every member of our diverse

Conduct is in place, representing our corporate of the Child. Proximus recognizes and respects the right community and are exemplified by all and Compliance Governance culture and values. This Code of Conduct to freedom of association and the right to managers, team leaders and employees reflects the fundamental principles and rules Working conditions collective bargaining within national laws who are expected to act as role models in which are the foundations of our engagement Proximus is committed to creating working and regulations. We will not contract child this matter. to be a socially responsible company. The conditions which promote fair employment labour or any form of forced or compulsory Code of Conduct applies to everyone: Board practices and where ethical conduct is labour as defined by ILO fundamental Directors, managers and all employees. recognized and valued. We maintain a conventions. Moreover, we are opposed to Appendix

84 Proximus Group Annual Report 2018 Regulatory framework a glance at Proximus

Cable & Broadband joint broadband and television resale offer. In 2018 as in the Regulation Cable operators are also required to make it previous years, possible for alternative operators to provide Proximus remained After the green light granted by the European voice telephony services via the regulated subject to a number Commission end-May, the Belgian regulators access of regulatory published on 29 June 2018 their final Sustainability measures and new decisions on the review of the broadband and In terms of fibre pricing, the regulators have important regulations television market analysis. The new decisions imposed a “fair pricing” (i.e. price based on have been approved confirm the deepening of the cable regulation current costs, increased with a reasonable such as the decisions and the extension of Proximus’ regulation profit margin), be it as a yard stick to identify on the review of from its copper to its fibre network. Proximus’ excessive pricing. This principle is also applied the broadband & planned network topology is not impacted by to cable (was based on “retail minus” under TV market analysis these decisions. former market analysis). The obligation to as well as the new apply these fair prices must be monitored EU telecom Code Overall the new fibre regulation is in line with by means of cost models reflecting the that overhauls the wholesale strategy of Proximus to open costs of an efficient operator. In this context the previous EU its networks to other operators, and therefore the BIPT launched on 13 December 2018 framework. no negative implications are expected in the a consultation on the cost models that will near term. During the past years Proximus be used to evaluate the fair pricing. The

developed and evolved its wholesale offer and regulators announced that they will take a and Compliance Governance signed several commercial agreements with decision on the wholesale prices in 2019. In its main broadband wholesale customers. the meantime, the intermediary tariffs set by the decisions of June 2018 remain applicable. Cable operators are obliged to give access to a stand-alone broadband service, without the The decisions have also established a clear television service. Under the previous decision framework for reciprocal access between (2011), they only had to provide access to a cable and fibre. It was also confirmed that Appendix

85 Proximus Group Annual Report 2018 Proximus at a glance at Proximus Proximus is allowed to access cable where Both Telenet and VOO (Brutélé and Nethys) Spectrum 1400 MHz and 3500 MHz) and unsold there is no own coverage (and no viable lodged an appeal against these decisions spectrum in the 2100 and 2600MHz bands. business case to build). and are demanding for the suspension Multi-band auction and annulation. The Court has rejected the In preparation of the upcoming multi-band Based on the July 2018 proposals, all licenses The regulation also allows for differentiation suspension request. A judgment on the spectrum auction, the Belgian Government will be valid for 20 years with the possibility to according to geographic area. It will take a annulation request is expected in 2019. approved, in July 2018, the different Royal extend by 5-year periods. The total reserve lighter touch in areas where at least three Decrees defining the conditions for the price (minimum price) is around EUR 670 operators, based on own infrastructure, The ‘high quality broadband services’ (leased renewal of the existing 2G/3G spectrum million for the whole market, with the final offering at least 30 Mbps are active, as well lines/connectivity) are not addressed in these (900, 1800 and 2100 MHz licenses due to outcome fully depending on the result of as in areas lacking broadband infrastructure, decisions (review planned in the course of expire on 21 March 2021) as well as for the the auctions. in order to encourage investment. 2019). granting of new 5G spectrum (700 MHz, Sustainability These proposals also include conditions favourable for new entrants (spectrum reservation in the 700MHz, 900MHz, Overview of the overall spectrum holdings and the bands to be included in the auctions 1800MHz and 2100MHz bands, national roaming obligation and less stringent Current spectrum holdings coverage obligations).

Expiry dates 800 Proximus Telenet Some spectrum would also be reserved for 29/11/33 MhZ 2x10 2x10 OBEL 2x10 the existing operators in the 900, 1800 and Proximus Telenet 15/3/21 900 2x12.4 2x10.2 MhZ OBEL 2x11.6 2100 MHz bands. The amount of spectrum Included in 15/3/21 1800 Proximus 2x24.8 the auction MhZ OBEL 2x24.8 Telenet 2x24.8 reserved would depend on the presence or 2100 1x 1x 1x Unallocated 1x not of a new entrant. 15/3/21 MhZ 5.4 OBEL 2x14.8 5 Telenet 2x14.8 5 2x14.8 5

2600Proximus 2x15 Only the 30/6/27 MhZ OBEL 2x20 Telenet 2x15 Unallocated 2x15 Voyacom 1x45

unsold part Specific conditions would also be imposed and Compliance Governance Proximus 2x20 to the 700 MHz operators concerning the Future spectrum The spectrum railway coverage and the provision of national roaming and specific services for Astrid (the Proposed expiry dates auction will include operator in charge of the management of all 700 80% of all available MhZ 2x30MHz mobile spectrum emergency and security services in Belgium). All Included in 1400 around MhZ 90MHz the auction 2040 As the final texts have not been approved 3.4-3.8 GhZ 400MHz yet, the timing and the final conditions of Appendix

86 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

reviewing the wholesale rates every two the auctions remain uncertain. Depending on In Luxembourg, a Regulation of 28 November has been applicable since June 2017. Since timing of final approval of the texts (before or 2016 decreased the maximum FTR to 0.131 then all Proximus customers can surf, call and years. Its first report, which, if necessary, will after the elections planned in May 2019), the eurocent/min for 2017 (from 0.14 eurocent/ text within the European Union like at home, be accompanied by a legislative proposal to spectrum auction could be organized either min previously), 0.135 eurocent/min for 2018 without extra charges within the “Fair Use amend the maximum wholesale charges, is end of this year or could be further postponed. and 0.138 eurocent/min for 2019. Policy” (FUP) aimed at preventing abusive scheduled for 15 December 2019. usage of retail roaming services beyond The Mobile Termination Rates (MTR) periodic travelling in the EU. An interim report Termination Rates remained unchanged in 2018. In Belgium, presented by the on Fixed Telephony Sustainability they have been set at 0.99 eurocent/min 14 December 2018 shows that mobile data Regulation The termination rates are the fees that fixed for the period 2017-2019 by the BIPT and roaming usage in the EU has increased five- and mobile operators pay to other fixed and in Luxembourg, they have been set at 0.89 fold since the introduction of RLAH. On 7 December 2018, the BIPT took its final mobile operators to terminate a call on their eurocent/min since 1 July 2017 until 31 decision deregulating the fixed retail access network. December 2019. In 2017 a decision to gradually reduce and the wholesale call origination markets roaming wholesale prices over five years and withdrawing the obligations imposed to On 23 November 2018, the BIPT defined was also taken as follows: Proximus on these markets in 2013 and 2006 new Fixed Termination Rates (FTR) at International roaming respectively. The decision entered into force 0.116 eurocent/min (from 0.709 eurocent The Commission will present a comprehensive on 1 February 2019. Proximus committed for regional and 0.909 eurocent for national The “Roam-Like-At-Home” (RLAH) that report on the review of the RLAH rules to add an addendum to its BRIO reference previously) based on a pure LRIC “Long Run completely abolished the roaming surcharges in December 2019. It is also tasked with offer, where it explains that it will continue Incremental cost” model. The FTR have been applicable since 1 January 2019. Local call termination is no longer considered since Wholesale roaming caps (€ excl. VAT) and Compliance Governance Proximus closed the last local access points in 2017. Other measures imposed by the BIPT 2015 30/04/16 15/06/17 2018 2019 2020 2021 2022 decision include an access obligation on the Voice call/min 0.05 0.05 0.032 0.032 0.032 0.032* 0.032* 0.032* basis of IP interconnect, transparency and SMS 0.02 0.02 0.01 0.01 0.01 0.01* 0.01* 0.01* non-discrimination. In addition, Proximus is Data/GB 50 50 7.7 6 4.5 3.5* 3* 2.5* subject to an obligation of cost accounting and publication of a reference offer. * 2020 tariff s and beyond subject to Commission review Appendix

87 Proximus Group Annual Report 2018 Through its “Atlas” project, the BIPT publishes maps showing the

coverage of the a glance at Proximus mobile and fixed networks

to offer Carrier Selection (CS) and Carrier the BIPT tariff simulator. This new rules The mobile maps enable the customers equally when providing internet access Pre-selection (CPS) services on a voluntary aim at allowing the clients to identify more to verify the coverage of each of the three services. basis until 31 December 2022, except if some easily their “best tariff plan”, based on their mobile operators (Telenet/Base, Orange and conditions have been met in the meantime real usage profile. The operators will have to Proximus), individually or together, on the The EU Telecom Single Market Regulation and that it will continue to offer the VAS put an URL (for each service) at the disposal map of Belgium. On 15 February 2019, the of 25 November 2015 fixes the principle Sustainability services until 31 December 2019. of their clients in their e-services. The new BIPT published the latest edition of its maps of Net neutrality into EU law and prevents Royal Decree also foresees a link from the showing for the first time different coverage any kind of discrimination in the provision of tariff simulator into the client zone of the levels (very good/deep indoor, good/indoor, online content, applications and services. This Consumer protection operator allowing to transfer the usage data satisfactory/outdoor) instead of one layer Regulation has been completed by Guidelines to the tariff simulator. previously. The new maps show that Proximus issued by the Body of European Regulators, As in the previous years, end-users’ matters has the most extensive coverage for both 4G BEREC, and aimed at providing guidance remained under regulatory scrutiny in 2018. A Royal Decree of 12 December 2018 and 3G. These maps are accompanied by the to the national regulators. The Guidelines has established the responsibilities of the results of a study comparing the quality of cover issues related to commercial practices The new obligations concerning the non- telecom operators and the service providers the experience offered by the three mobile (such as “zero-rating”, i.e. apps not counted payment of invoices introduced by the law concerning the premium rates services. The operators. These results show that Proximus in the data allowance), traffic management of 31 July 2017 modifying the e-com law of rights of the consumers are being reinforced performs best for a large number of KPIs. A measures and specialized services. They 2005 entered into force on 1 July 2018. The entitling them to receive refund for undue new smartphone application now also allows also define how regulators should realize law foresees that the first reminder must payments via their telecom operator.. citizens to participate in the coverage and their supervision, enforcement and reporting

be for free and a ceiling of EUR 10 is set for quality measurement. duties. and Compliance Governance the subsequent reminders. The fee for the Through its “Atlas” project, the BIPT reactivation of the services after a full cut is publishes maps showing the coverage of the The European Commission has to prepare capped at EUR 30 for all services. mobile and fixed networks. On 15 February Net Neutrality a first reporting on the implementation of 2019, the Atlas has been complemented the Regulation to the European Parliament A Royal Decree of 2 September 2018 has set by information concerning mobile customer “Net neutrality” represents the idea that and Council by end April 2019. The report the legal basis for the automatic introduction experience. equivalent types of traffic should be treated should also evaluate the Regulation - and of the recent usage data of a consumer in Appendix

88 Proximus Group Annual Report 2018 The BIPT is closely monitoring how the offers of the different

operators comply a glance at Proximus with the EU Net Neutrality rules

“European Electronic Communications if relevant - suggest adaptations to this Regulation. BEREC on its side issued a Code” (Code) was published in the Official report on 13 December 2018 stating that Journal of the EU on 17 December 2018. the Regulation and the Guidelines are working The Code overhauls the previous EU well. Nevertheless, BEREC considers that its telecoms regulation. It entered into force on Sustainability Guidelines could be clarified in certain aspects 20 December. Member states have until 21 such as zero-rating, traffic management or December 2020 to transpose it into national specialized services. A draft update of the law. This text will determine the regulation of Guidelines will be issued in the course of telecommunication networks and services in 2019. Europe for the next decade.

In Belgium, the BIPT is also closely monitoring In the margin of the Code, the European how the offers of the different operators legislators also adopted an amended comply with the Net Neutrality rules. Its Regulation on BEREC and a Regulation second annual monitoring report published in inserting caps on intra-EU calls and SMS June 2018 concluded that there are no major prices (calls and SMS to another EU country). reasons for concern in Belgium as regards The new caps will take effect from 15 May open Internet access. 2019 at 19 eurocents/minute for calls and

6 eurocents/min for SMS. and Compliance Governance

Review of the EU On spectrum, it has been decided to set regulation a minimum duration of 15-year for the licenses with 5-year extensions as well as to EU Telecom Review perform a voluntary peer review process for The EU Telecom review, the so-called the spectrum auctions as part of efforts to Appendix

89 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

to define the adequate broadband speed coordinate spectrum terms more across the to comply with certain rules on commercial EU. 5G spectrum should be made available taking into account several factors (in Belgium communication/advertising and to restrict The new EU Code will before end 2020. currently set at 1 Mbps). Financing will be minors’ access to harmful content. determine the regulation of possible through the general state budget telecommunication networks The Code also foresees new access or shared among operators (industry fund). New quotas are set for on-demand services and services in Europe for the regulation measures designed to support Requirement of determination of an unfair (at least 30% share of European content in next decade the roll-out of fibre, such as an exemption burden remains. the catalogues). The rules to protect minors of ex-ante regulation for operators with are aligned for all services (linear and on- Sustainability Significant Market Power (SMP) committing Review of the Audio-visual demand) and the accessibility obligation to co-investment plans and a so-called Media Services Directive for disabled users are strengthened. To be “symmetric regulation” on oligopoly markets noted in this respect that the Belgian CSA has imposing rules on non SMP operators if SMP On 28 November 2018, the new Audio- adopted on 17 July 2018 new measures to ex-ante regulation is deemed not sufficient. visual Media Service (AVMS) Directive was increase accessibility of programs (quotas of published. The new text modifies a directive programs with specific subtitling and audio- Consumer protection is characterised by from 2010. Since then, the market for these description). harmonisation and broadening but many of services has evolved significantly. Rapid new elements are inspired by rules that have technical developments have sparked The new Directive entered into force on 18 already been imposed in Belgium (e.g. rules new types of services, viewing habits have December 2018. Member states have to related to switching of customers between changed and user-generated content has transpose it into their national legislations providers, called “Easy Switch” in Belgium). gained in importance. The legal framework within 21 months. has been updated to take account of these

The future Universal Service will be limited developments. and Compliance Governance to access to network and social tariffs. An adequate and affordable connection on a The new Directive addresses now Video- fixed location for broadband internet remains sharing platforms (such as YouTube and at the center of the Universal Service. The audiovisual content shared on social media Code leaves it up to the Member states services, such as Facebook) that will have Appendix

90 Proximus Group Annual Report 2018 Risk a glance at Proximus management Most important risks The enterprise and financial reporting risks and uncertainties are detailed below, together with the related mitigating factors and control measures. report Taking risks is inherent to doing business, Please note that this is not intended to be and successfully managing risks delivers a an exhaustive analysis of all potential risks return to Proximus stakeholders. Proximus that Proximus might be facing. believes risk management is fundamental to Sustainability corporate governance and the development of sustainable business. Enterprise-wide risks

The Group has adopted a risk philosophy that Proximus’ Enterprise Risk Management (ERM) is aimed at maximizing business success and is a structured and consistent framework for shareholder value by effectively balancing assessing, responding to and reporting on risks risk and reward. Effective risk management that could affect the achievement of Proximus’ is a key success factor in the realization of strategic development objectives. The Group’s our objectives. The aim of risk management ERM covers the spectrum of business risks is not only to safeguard the Group’s assets (“potential adverse events”) and uncertainties and financial strength but also to protect that Proximus could encounter. It seeks to Proximus’ reputation. A structured risk maximize value for shareholders by aligning management process allows management risk management with the corporate strategy.

to take risks in a controlled manner. Financial It does this by assessing emerging risks (e.g. and Compliance Governance risk management objectives and policies from regulation and new technologies on the are reported in Note 33 of the consolidated market) and developing mitigating strategies financial statements, published on the in line with its risk tolerance. Proximus website. Risks related to important ongoing claims and judicial procedures are Proximus’ ERM framework was reviewed and reported in Note 35 of these statements. updated in 2017 to align with the market Appendix

91 Proximus Group Annual Report 2018 The market is in constant evolution, with competitive dynamics

at play that might impact a glance at Proximus market value going-forward

best practices. This risk assessment and Competitive market Substitution of fixed line services by OTT Proximus is also responding through a evaluation takes place as an integral part of dynamics services (e.g. by apps and social media such convergent and bundled approach and Proximus’ annual strategic planning cycle. Proximus’ business is primarily focused on as Skype, Facebook, WhatsApp, etc.) and by offering new services and opting for an All relevant risks and opportunities are Belgium, a small country with a few large TV content could put further pressure on aggregator model, putting the best content prioritized in terms of impact and likelihood, telecom players, with Proximus being the revenues and margins, as these over-the-top at the disposal of its customers (e.g. Netflix). considering quantitative and/or qualitative incumbent. Proximus operates in growing services continue to gain ground. aspects. The bottom-up identification and markets (e.g. mobile data, security, IOT, The price-sensitive segment, which has prioritization process is supported by a smart mobility, and API platforms), maturing As a result of its long-term strategy and continued to rise in 2018 as more consumers Sustainability self-assessment template and validation markets (e.g. smartphones), saturated continued network investments (Fiber, seek no-frills offers at a lower price, is sessions. The resulting report on major markets (e.g. Fixed Internet, postpaid mobile, VDSL/Vectoring, 4G/4G+), Proximus successfully addressed through its subsidiary risks and uncertainties is then reviewed by and fixed voice) and even declining markets has been consistently improving its multi- Scarlet. The latter offers attractively priced the Executive Committee, the CEO and the (e.g. prepaid mobile and enterprise voice). play value propositions by putting more mobile and triple-play products. Audit and Compliance Committee. The main customers on the latest technologies, findings are communicated to the Board of The market is in constant evolution, with maintaining its lead in mobile innovation, In the corporate large-company market, Directors. Among the risks identified by the competitive dynamics at play (e.g. frequent structurally improving customer service, the scattered competitive landscape drives last ERM exercise, the following risk categories new product launches, competitors partnering with content and OTT players price competition, which might further impact were prioritized (in the following order): entering new segments of the market) that to offer a broad portfolio of content (Sports, revenue and margins. might impact market value going-forward. Netflix, families & Kids with the Studio 100 • Competitive market dynamics Specifically, the market structure could change agreement, etc), developing an omnichannel Here also, Proximus intends to respond to significantly with the possible entry of a new strategy and improving digital customer increasing competition by strengthening • Business model and servicing evolution mobile operator on the market, supported interfaces, etc. Proximus has established an its voice-data-IT convergence strategy,

by favourable conditions set in the upcoming advantageous and solid competitive position, leveraging unmatched sales reach, broad and Compliance Governance • Employee skills and motivation spectrum auction. Sector federation Agoria providing the company with other levers portfolio and expertise. Proximus has estimates that the possible arrival of a 4th besides price, reducing the risk to churn and developed specific solutions to accompany • Customer experience mobile entrant could impact the total Mobile price disruption exposure. Proximus also our customers in the transition to both market in Belgium with a reduction of 6,000- successfully launched a new mobile offer, local and cloud-based communication • Human Resource cost flexibility. 8,000 jobs and a reduced sector contribution Epic, targeted at the millennial segment, services, leveraging our various assets to to the state of €200 M - €350 M. with a specifically designed offer to meet the offer simple, reliable and technologically mobile needs of these customers. Appendix

92 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

advanced solutions to meet our customers’ Proximus also continues to develop customer-centric strategy, and delay some of working, and our five company values: communication needs. Furthermore, Proximus capabilities to support business customers of our ambitions in innovation. In addition, we the digital mindset, customer centricity, also seeks to answer new customer business in their digital transformation with its industry- need to upgrade skills in customer-facing and accountability, collaboration and agility. needs through solutions combining core tailored support and convergent products other functions to become digitally oriented. assets with innovation like IoT, Cloud, Security combining connectivity, hybrid cloud, and Customer experience and big data, which will help preserve value. managed security solutions. This is why the company is paying so much For Proximus, delivering a superior customer attention to training programs, internal experience is a core strategic mission, but also Sustainability Business model Proximus continuously explores ways to mobility, hiring of young graduates from an ongoing risk domain, considering: and servicing evolution diversify revenue streams outside the classical relevant fields, and employer branding. Proximus’ business model and financial connectivity business. Examples include • the fast evolution of market expectations performance have been and will continue our rapidly growing IoT business (including In this context, it is also essential for Proximus to be impacted by (disruptive) technologies, adjacent services), our EnCo platform, smart to adapt its way of working to the needs and • the large and complex offer of products such as SD-WAN, 5G and OTT (over-the- advertising and smart mobility (through our requirements of the new generation – the and services top) services. Proximus’ response to new B-Mobile subsidiary among others). In these “millennials” - and to manage all talents within technologies and market developments adjacent domains Proximus explores new an inclusive, multi-generational environment. • the process/legacy IT application and its ability to introduce new competitive partnership models and considers inorganic complexity. products or services, which are meaningful growth paths. Considering the imperative to align skills with to its customers, will be essential to its customer and business needs, Proximus has Proximus is committed to meeting its “Always performance and profitability in the long run. Employee skills taken the necessary steps to identify the skills close” brand promise by transforming and motivation that will be critical for facing tomorrow’s into a digital-first service provider and

For ultra-broadband, fiber-based connectivity, In the digital era, knowledge workers are a challenges, and to discover, develop and delivering a superior customer experience: and Compliance Governance Proximus adopts a local marketing approach, competitive asset if they have the right skills share talents in order to have the right talent a consistent and intuitive experience across in which the sales forces, technical staff and mindset. Proximus could face a shortage in the right place. Proximus also continues interactions, a high-quality stable network, and local partners join forces for its fiber of skilled resources in specific domains such to invest in leadership, a collaborative work easy-to-use products and services, a good deployment project. as security, digital front-ends, data science, environment, digitalization, and development recommendation index, and low effort on all and agile IT. This shortage could hamper in order to stimulate a company culture interactions in all customer journeys. the realization of our #shifttodigital and that nurtures a growth mindset, new ways Appendix

93 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

The customer experience is the key focus of A few examples of what has already been Proximus’ strategy, which is implemented achieved: through key transformational initiatives such as “End-to-End Journey Evolution”, “Voice • massive upgrading of customers to the of the Customer”, and business as usual latest technology activities. With these initiatives, we aim to: • “Happy House” visits to improve the in- • ensure products and services are designed home experience Sustainability to match customer expectations before a launch • “Safety nets” for customers at risk via 360° multi-skilled transversal teams • maximize usage satisfaction of products and services with focus on in-home and • multi-objective calls and e-mails to in-office experience proactively address customers at risk

• design or redesign end-to-end customer • improvement of our digital channels and journeys, ensuring a personalized and tools, such as “MyProximus” app redesign, effortless interaction with the Proximus new “Home optimizer” app, etc brand • launch of the new Wi-Fi booster to • create and maintain a continuous dialogue improve Wi-Fi coverage in the home

with our customers to engage with them and Compliance Governance and evolve towards a real customer- • redesign of customer journeys. centric company Human resource • react more quickly when we do not deliver cost flexibility a first-time right experience or even Even though Proximus has been on the path proactively address an issue before the of growth since 2015, strong competition, the customer notices it. impact of regulation and fast market evolution Appendix

94 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

mean that it needs to further reduce costs In 2018, another wave of employees left the In this respect, discussions with the unions and management relies on the Advanced in order to remain competitive and preserve company under the voluntary early leave are aim, on one hand, to adapt workforce to Measurement Approach (AMA) methodology. EBITDA. A significant portion of Proximus’ plan that was agreed by the unions in 2016. workload, and on the other, to simplify the A dedicated “as-if” adverse scenario risk expenses is still driven by the cost of the current social model, enhance functional and register has been developed in order to make workforce (whether internal or outsourced, But in the future, major efforts will be needed geographical mobility, increase HR flexibility, the stress tests relevant. expensed or capitalized). Expressed as a to increase organizational flexibility and agility. and further optimize the balance between ratio of turnover, Proximus’ total cost of insourcing and outsourcing. This will improve our Proximus is covered by extended general Sustainability workforce still lies well above the average of That’s why we intend to accelerate our productivity, flexibility and agility on the market. and professional liability, property damage international peers and main competitors, transformation in the next three years, to and business interruption insurance, as well even if steady progress has been made in become an increasingly digital company with as by a dedicated cyber security insurance recent years. an agile and efficient organization. Operational risks program. Nevertheless, these insurance programs may not provide indemnification Moreover, Belgium applies automatic First, Proximus will continue to adapt and Operational risk relates to risks arising from should the traditional insurance exclusions inflation-based salary increases, leading simplify its organizational structure in order systems, processes, people and external (non-accidental event) apply. to higher costs, not only of Proximus’ own to evolve towards a high-performance events that affect the operation of Proximus employees but also of the outsourced organization by transforming the way we businesses. It includes product life cycle and The most prominent examples of operational workforce, with outsourcing companies being work. execution; product safety and performance; risk factors are explained below: subject to the indexation as well. information management, data protection In addition, different initiatives (drastic and cyber security; business continuity; • resilience and business continuity At Proximus Group level, about one in four simplification and/or automation of Proximus’ supply chain; and other risks, including human employees is a statutory employee. The products, services, processes and systems) resources and reputation risks. Depending • legacy network infrastructure and Compliance Governance application of HR rules as defined during will optimize and safeguard the balance on the nature of the risk involved and the successive Collective Agreements is quite between workforce and workload (both in particular business or function affected, • security (confidentiality, integrity, strict and doesn’t allow for as much flexibility numbers and competencies). The objective Proximus uses a wide variety of risk mitigation availability) as competition. This restricts Proximus’ is to adapt workforce cost and HR rules to strategies, including adverse scenario stress ability to improve efficiency and increase Proximus’ future needs, so that we remain tests, back-up/business-continuity plans, • sourcing and supply chain reliability flexibility to levels comparable to those of competitive and can evolve with customers’ business process reviews, and insurance. its competitors. needs. Proximus’ operational risk measurement • data protection and privacy. Appendix

95 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

For each critical product and service, a relevant We are taking the necessary actions and Maximum Tolerable Period of Disruption making investments to mitigate those (MTPOD) has been defined in line with the risks by employing a number of measures, sales business unit requirements. including employee training, monitoring testing, maintenance of protective systems Proximus is closely following the Proximus closely follows the international and contingency plans. Sustainability international standards best practices guidelines. The level standards best of preparedness (relevant KPIs and score Legacy network cards) is submitted annually to the Audit and infrastructure practices guidelines Compliance Committee. The systems need to talk to each other over a connected information highway that In case of a major adverse event, Proximus has can deliver information at high speed and put in place and is continuously testing a crisis without distortion. There is no doubt that in management process called PERT (Proximus the coming years there will be a continued Business continuity power failures, IT system crashes, natural Emergency Response Team). demand for ever-greater quantities of data Interruptions to our ICT and telecom disasters, supply chain problems, and more. at ever-greater speeds. There is a widely held infrastructure which supports our business Cyber security belief that the increased use of wireless and activities (including services provided by third- For each critical business function, business Increased global cyber security vulnerabilities, fiber optic technology will render copper wire party vendors such as power suppliers) could continuity plans have been developed in order threats and more sophisticated and targeted obsolete.

seriously impact our revenues, our liabilities to: cyber-related attacks pose a risk to the and Compliance Governance and our brand reputation. security of Proximus as well as its customers, The problems with services over copper are • identify and prevent risks where possible partners, suppliers and third-party service speed, reliability and value for money. All too Therefore, building and ensuring the resilience providers in terms of products, systems and often, legacy systems are costly to operate of our products and services is and remains a • prepare for risks that we can’t control networks. The confidentiality, availability and maintain. Copper has been around for top priority. We are convinced that our business and integrity of the data of Proximus and its decades and has far outlived any guarantee continuity plans will keep our company up and • respond and recover if an incident or crisis customers are also at risk. period. Outages on the lines will become running through interruptions of any kind: occurs. more frequent. Appendix

96 Proximus Group Annual Report 2018 Proximus is among the world’s top five operators for the proportion of Fiber in its VDSL network with over

21,000 kilometres of optical fiber a glance at Proximus connecting its street cabinets

Considering those elements, in 2004 vulnerability and ensuring continuity”. and the ability of organizations to use data We also implemented a Privacy Control Proximus was the first operator in Europe to for business purposes. Keeping personal data Framework to provide assurance that personal start building a national Fiber-to-the-Home The following actions have been taken to keep confidential, private, safe and secure is a top data is managed as intended, is accurate, network. And today, Proximus is among the the supply chain risk at an acceptable level: priority for Proximus. protected by default and by design, and that world’s top five operators for the proportion our organization is compliant with applicable of fiber in its VDSL network, with over 21,000 • top critical suppliers or their sub-suppliers Under the General Data Protection Regulation laws and regulations and able to demonstrate kilometers of optical fiber connecting its street under constant watch (GDPR), the unification of data protection this. Sustainability cabinets. standards across the European Union has • stock management raised the privacy bar on personal data The GDPR implementation will remain on In the last two years, Proximus has accelerated by requiring organizations to locate data, the agenda for 2019. We aim to optimize the roll-out of fiber on its fixed network, • consideration of alternative sourcing understand its purpose and appropriately our internal processes to allow an efficient thanks to its “Fiber for Belgium” €3 billion arrangements secure it. privacy by design/default approach. Proximus investment plan over 10 years. will further extend the privacy settings within • business interruption / contingency plans In 2018, Proximus continued the GDPR the MyProximus app and website to allow The initiatives from utility players, such as implementation project it started in 2017. customers to efficiently choose how Proximus Fluvius, to invest in a parallel fiber network, • risk assessments and audits Our objective was to ensure compliance with can use their personal data. risk to have an impact on the business case GDPR without disruptions to Proximus data of the Proximus Fiber investments. • awareness campaigns and training flow and business operations. More than 150 programs people were directly involved in the project Risk Management Sourcing and supply chain and approximately 500 others were involved and Compliance Proximus depends on key suppliers and • strict follow-up of critical suppliers’ in surveys, questionnaires, assessments, etc. and Compliance Governance vendors to provide the equipment its needs contractual liability and Service Level Committee to carry out its business activities. Agreement (SLA) clauses As part of our commitment to protect personal data and privacy, we took a series of actions In 2018, the Risk Management and Compliance Supply chain risk management (SCRM) is • data protection & privacy. such as appointing a Data Protection Officer Committee (RMC) held four sessions. The defined as “the implementation of strategies to (DPO), developing a consent management related decisions were reported to EXCO and manage both everyday and exceptional risks Data protection and privacy structure, security screening, and corrective the Audit & Compliance Committee. RMC along the supply chain, based on continuous Data protection laws exist to strike a balance measures for our IT applications. meetings provide an opportunity to review files

risk assessment with the objective of reducing between the rights of individuals to privacy in which decisions have to be taken by finding Appendix

97 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

a balance between risk taking and cost, in line forms an integral part of the Internal Risk processes. Internal Audit’s activities are based a true and fair view any more. Changes in with the Group’s risk appetite. Management and Control System and provides on a continuous evaluation of perceived legislation (e.g. pension age, customer assurance to the Audit and Compliance business risks, and it has full and unrestricted protection) can also significantly impact Proximus has general response strategies Committee concerning the “in-control status” access to all activities, documents/records, the reported financials. New accounting for managing risks, which categorize them of the Proximus Group segments/units/ properties and staff. The Chief Auditor has standards can require the gathering of new according to whether the company will avoid, entities and processes. Internal Audit provides a reporting line to the Chairman of the Audit information and the adaptation of complex transfer, reduce or accept the risk. These analyses, appraisals, recommendations, Committee. Quarterly Audit activity reports (billing) systems. If not adequately foreseen, response strategies are tailored to ensure counsel, and information to both the Audit are submitted and discussed with the Audit the timeliness and reliability of the financial that risks are within acceptable Proximus risk and Compliance Committee and Proximus and Compliance Committee. reporting could be jeopardized. Sustainability and compliance guidelines. Management. Therefore, the objectives of the Internal Audit, using COSO and other It is the responsibility of the Corporate The RMC’s objectives are: 1. To oversee professional standards, are to ensure: Financial Accounting department to follow the company’s most critical enterprise and reporting risks developments in the area of evolving standards operational risks and how management is • the effectiveness and adequacy of internal (both local General Accepted Accounting monitoring and mitigating those risks; 2. To controls In the area of financial reporting, besides the Principles (GAAP) and International Financial enhance pending/open internal audit action general enterprise risks impacting the financial Reporting Standards (IFRS)). points which remain open for more than six • operational effectiveness (doing it right) reporting (e.g. staff), the main risks identified months. and/or efficiency (doing it well) include: new transactions and evolving Changes are identified and the impact on accounting standards, changes in tax law Proximus’ financial reporting is proactively A disciplined approach to risk is key in a • compliance with laws, regulations and and regulations, and the financial statement analyzed. fast-moving technological and competitive policies closing process. environment, in order to ensure that Proximus For each new type of transaction (e.g. new only accepts risk for which it is adequately • the reliability and the accuracy of the New transactions product, new employee benefit, business and Compliance Governance compensated (risk/return optimization). information provided. and evolving accounting combination), an in-depth analysis is standards performed from the point of view of financial- Internal Audit helps Proximus to accomplish New transactions can have a significant impact reporting, risk-management, treasury, and tax. Internal Audit these objectives through its systematic, on the financial statements, either directly In addition, the development requirements disciplined approach to evaluating and in the income statement or in the notes. An for the financial systems are defined in a In line with European best practices improving the effectiveness of risk inappropriate accounting treatment can result timely manner and compliance with internal requirements, Proximus’ internal audit function management and control and governance in financial statements which do not provide and external standards is systematically Appendix

98 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

analyzed. Emphasis is on the development and operational impact analysis is performed. of preventive controls and setting up reporting The outcome of the analysis is reflected in tools that enable a posteriori controls. The the corresponding financial statements, in Audit and Compliance Committee (A&CC) accordance with the applicable framework. and the Executive Committee are informed on a regular basis about new and upcoming Financial statement Sustainability financial reporting standards and their closing process potential impact on Proximus’ financials. The delivery of timely and reliable financial statements remains dependent on an Changes in tax law adequate financial statement closing and regulations process. Changes in tax laws and regulations (corporate income tax, VAT, etc.) or in Clear roles and responsibilities in the closing their application by the tax authorities can process of the financial statements have been significantly impact the financial statements. defined. During the monthly, quarterly, half- To ensure compliance, it is often necessary yearly and annual financial statement closing dates and hours when IT sub-systems are operational drivers, and coherence tests, to set up additional administrative processes processes, there is continuous monitoring locked, validation meetings and reporting where financial information from different within a short timeframe, to collect relevant of the different steps. In addition, different deliverables. areas is brought together to confirm results information or run updates on existing IT controls are performed to ensure quality or trends, etc. Tests on individual accounting

systems (e.g. billing systems). and compliance with internal and external For every process and sub-process, different entries are performed for material or non- and Compliance Governance requirements and guidelines. controls are performed, including preventive recurrent transactions and on a sample basis The tax department continuously monitors controls, where information is tested before for others. The combination of all these tests potential changes in tax law and regulations, For Proximus and its major subsidiaries, a being processed, and detective controls, provides sufficient assurance on the reliability as well as interpretations of existing tax highly detailed closing calendar is drawn where the outcome of the processing is of the financials. laws by the tax authorities. Based on laws, up, which includes a detailed overview analyzed and confirmed. Special attention is doctrine, case law and political statements of cross-divisional preparatory meetings, paid to reasonableness tests, where financial as well as available draft laws, etc., a financial deadlines for ending specific processes, exact information is analyzed against underlying Appendix

99 Proximus Group Annual Report 2018 The Proximus share a glance at Proximus

Share listing

Stock Market First Market of Euronext Brussels

Ticker PROX Sustainability ISIN code BE0003810273 Bloomberg code PROX-BB Nasdaq code PROX-EB Proximus share price evolution 2018 vs. 3 indices

Reuters code PROX.BR % (in %- rebased)

10

Proximus share 5

Performance in 2018 0

The Proximus share closed 2018 at EUR telecom companies hit a long time low over -5 23.62, -13.6% compared to the last closing the 2018 summer months following the news -10 price of 2017. This relates to a 13.2% decline on Belgium opening the path for a potential -15 for the European Telecom sector (STOXX EUR fourth mobile operator. The downward trend -20

600 Telecom). for European telecoms was turned around in and Compliance Governance

the last quarter, supported by sector rotation, -25

After a disappointing 2017, the European with the PROX share also benefitting from this -30 telecoms market performance continued trend. The telecom sector was also helped its negative pattern during the first nine by a more positive sentiment on pricing -35 12/31 07/31 07/31 12/29 10/31 11/30 03/31 05/31 01/29 08/31 02/28 06/30 09/30 months of 2018. Trade war fears, regulatory and competition, a slight improvement on 04/30 interventions and competition concerns were regulation, a renewed focus of the sector on

the main drivers of this rough patch. Belgian cost reduction and easing concerns on capex. PROXIMUS (PROX-BRU) BELGIUM BEL 20 (BEL20-ENX) STOXX Europe 600 / Telecommunications (Capped) - SS (SXKP-STX) STOXX Europe 600 (SXXP-STX) Appendix

100 Proximus Group Annual Report 2018 Key figures on the a glance at Proximus Proximus share

2018 2018 Share information 2009 2010 2011 2012 2013 2014 2015 2016 2017 IAS18 IFRS15

Share price high 28.65 29.11 27.64 24.60 23.25 32.29 35.67 31.74 32.81 28.1 28.1

Share price low 21.67 24.31 21.40 20.80 16.32 20.78 27.93 25.31 26.42 19.31 19.31

Share price at 31 December 25.32 25.13 24.24 22.21 21.55 30.1 30 27.36 27.35 23.62 23.62

Annual trading volume (number of shares) 181,364,309 138,569,376 148,786,324 142,139,111 189,753,834 178,802,905 179,825,076 157,368,090 147,754,799 169,849,252 169,849,252

Average trading volume per day (number of shares) 708,454 532,959 578,935 555,231 744,133 701,188 702,442 612,327 579,431 650,763 650,763 Sustainability

Number of outstanding shares 320,614,683 321,482,641 317,648,821 318,321,665 319,204,181 321,230,597 322,003,751 322,637,103 322,638,989 322,703,817 322,703,817

Weighted average number of outstanding shares 320,475,553 321,138,048 319,963,423 318,011,049 318,759,360 320,119,106 321,767,821 322,317,201 322,777,440 322,649,917 322,649,917

Market capitalization at 31 December (billion EUR)1 8.12 8.08 7.70 7.07 6.88 9.67 9.66 8.83 8.82 7.62 7.62 Key data per share - on reported basis

EBITDA 6.14 7.56 5.93 5.62 5.33 5.48 5.12 5.38 5.49 5.57 5.56

Earnings2 2.82 3.94 2.36 2.24 1.98 2.04 1.50 1.62 1.62 1.57 1.58

Price/earnings at 31 December3 8.98 6.37 10.26 9.92 10.9 14.73 20.03 16.86 16.90 15.07 15.00

Ordinary dividend (gross) 1.68 1.68 1.68 1.68 1.68 1.00 1.00 1.00 1.00 1.00 1.00

Interim-dividend (gross) 0.40 0.50 0.50 0.81 0.50 0.50 0.50 0.50 0.50 0.50 0.50

Gross dividend yield3 8.20% 8.70% 9.00% 11.20% 10.10% 4.98% 5.00% 5.48% 5.48% 6.35% 6.35% Key data per share - on underlying basis

EBITDA NA NA NA NA NA 5.15 5.38 5.57 5.65 5.78 5.78 Governance and Compliance Governance Earnings NA NA NA NA NA 1.85 1.68 1.71 1.72 1.71 1.71

Price/earnings at 31 December NA NA NA NA NA 16.28 17.87 15.96 15.92 13.84 13.78

1 Calculation based on number of outstanding shares & last closing price of the respective year 2 Corresponds to the Net Income (Group Share) / weighted average number of outstanding shares 3 Based on the last closing price of the respective year Appendix

101 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Our Shareholders

Proximus’ main shareholder is the Belgian Government, owning 53.5% of the company’s shares. Proximus itself held 4.5% of its own shares end-2018. The free float represented 42%. Sustainability Proximus share ownership – 31 December 2018 Number of shares with Number of shares with Number of shares % shares % Voting rights % Dividend rights voting rights dividend rights Belgian state 180,887,569 53.51% 56.05% 55.91% 180,887,569 180,887,569 Proximus own shares 15,321,318 4.53% 0.00% 0.25% 0 820,036 Free-float 141,816,248 41.95% 43.95% 43.83% 141,816,248 141,816,248 Total 338,025,135 100.00% 100.00% 100.00% 322,703,817 323,523,853

About 20% of the shares in free float are held by retail investors. The remainder are US 27% • UK 14% essentially held by institutional shareholders. and Compliance Governance Proximus Institutional • France 11% Proximus’ main institutional shareholders are Belgian government 54% • Germany 7% share • shares per • located in the United States and the Benelux, ownership • Free fl oat 42% geography • BENELUX 17% • Own shares 4% • Nordics 10% followed by the UK and France. • Rest of Europe 7% • Rest of the world 7%

Source : Shareholder analysis October 2018 % of identifi ed institutional shareholders - Nasdaq Appendix

102 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Evolution of treasury Transparency shares declarations

End of period 2017 15,386,146 According to Proximus’ bylaws, the thresholds Options exercised during 2018 -38,398 as from which a shareholding needs to be disclosed have been set at 3% and 7.5%, in Discount Purchase Plan -14,431 Sustainability employee addition to the legal thresholds of 5% and End of period 2018 15,321,318 each multiple of 5%.

End-2018, Proximus held 15,321,318 In 2018, Blackrock Inc. notified of the following treasury shares, representing 4.5% of the changes in their shareholding in Proximus. total number of shares. In the course of 2018, 14,431 treasury shares were used To Proximus’ knowledge, no other shareholder in a Discounted Share Purchase Plan, and owned 3% or more of Proximus’ outstanding 38,398 options were exercised1 . shares as at 31 December 2018.

The voting rights of the treasury shares are Notifications of important shareholdings to be suspended by law. The dividend rights of the made according to the Law of 2 May 2007 or treasury shares acquired in 2004 are also Proximus’ bylaws should be sent to: suspended, whereas the dividend rights for shares acquired as from 2005 are cancelled. • FSMA on [email protected] and Compliance Governance

Under Belgian law, companies are prohibited • Proximus on investor.relations@ from owning more than 20% of their proximus.com outstanding share capital.

1 For more information, please refer to the Remune- ration report” Appendix

103 Proximus Group Annual Report 2018 Voting rights Total incl. equivalent financial instruments Date on which thresh- Notified Reason for nr of voting rights after % of voting rights in total of nr of voting rights after % of voting rights in total of old was crossed: on: Notifier notification: the notified transaction: 338,025,135 voting rights the notified transaction: 338,025,135 voting rights 27/11/18 29/11/18 Blackrock Inc. <5% 15,666,723 4.63% 17,691,851 5.23% 29/10/18 30/10/18 Blackrock Inc. >5% 17,058,049 5.05% 17,846,928 5.28% a glance at Proximus 23/10/18 25/10/18 Blackrock Inc. <5% 16,868,244 4.99% 17,621,124 5.21% 22/10/18 24/10/18 Blackrock Inc. >5% 17,156,189 5.08% 17,909,069 5.30% 05/10/18 09/10/18 Blackrock Inc. <5% 16,712,390 4.94% 17,449,541 5.16% 27/09/18 28/09/18 Blackrock Inc. >5% 16,998,949 5.03% 17,838,794 5.28% 14/09/18 17/09/18 Blackrock Inc. <5% 16,726,531 4.95% 17,436,969 5.16% 13/09/18 14/09/18 Blackrock Inc. >5% 17,114,357 5.06% 17,833,465 5.28% 12/09/18 14/09/18 Blackrock Inc. <5% 16,729,804 4.95% 17,457,552 5.16% 07/09/18 10/09/18 Blackrock Inc. >5% 17,020,815 5.04% 17,759,388 5.25% 05/09/18 07/09/18 Blackrock Inc. <5% 16,753,637 4.96% 17,461,869 5.17%

04/09/18 06/09/18 Blackrock Inc. >5% 17,076,955 5.05% 17,765,735 5.26% Sustainability 31/08/18 03/09/18 Blackrock Inc. <5% 16,773,168 4.96% 17,428,217 5.16% 14/08/18 16/08/18 Blackrock Inc. >5% 17,235,394 5.10% 17,693,079 5.23% 13/08/18 14/08/18 Blackrock Inc. <5% 16,761,218 4.96% 17,239,293 5.10% 06/08/18 08/08/18 Blackrock Inc. >5% 17,279,581 5.11% 17,782,936 5.26% 27/07/18 30/07/18 Blackrock Inc. <5% 16,804,133 4.97% 17,441,607 5.16% 09/07/18 11/07/18 Blackrock Inc. >5% 16,921,087 5.01% 17,636,051 5.22% 06/07/18 10/07/18 Blackrock Inc. <5% 16,893,845 5.00% 17,720,839 5.24% 04/07/18 06/07/18 Blackrock Inc. >5% 17,008,707 5.03% 18,011,814 5.33% 02/07/18 04/07/18 Blackrock Inc. <5% 16,671,308 4.93% 17,706,087 5.24% 29/06/18 03/07/18 Blackrock Inc. >5% 16,961,515 5.02% 18,041,868 5.34% 20/06/18 21/06/18 Blackrock Inc. <5% 16,739,961 4.95% 17,882,340 5.29% 19/06/18 21/06/18 Blackrock Inc. >5% 16,930,915 5.01% 18,024,431 5.33% 18/06/18 19/06/18 Blackrock Inc. <5% 16,740,292 4.95% 17,833,808 5.28%

15/06/18 18/06/18 Blackrock Inc. >5% 17,055,730 5.05% 18,105,219 5.36% and Compliance Governance 13/06/18 18/06/18 Blackrock Inc. <5% 16,776,472 4.96% 17,731,990 5.25% 12/06/18 14/06/18 Blackrock Inc. >5% 16,903,699 5.00% 17,821,224 5.27% 24/05/18 25/05/15 Blackrock Inc. <5% 16,794,486 4.97% 17,603,426 5.21% 23/05/18 25/05/15 Blackrock Inc. >5% 16,941,949 5.01% 17,750,889 5.25% 03/05/18 07/05/18 Blackrock Inc. >5% 16,331,329 4.83% 17,021,352 5.04% 01/05/18 03/05/18 Blackrock Inc. <5% 15,377,072 4.55% 16,560,792 4.90% 30/04/18 02/05/18 Blackrock Inc. >5% 16,079,165 4.76% 17,257,434 5.11% Appendix

104 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Shareholder Shareholder meeting of 17 April 2019 analysts, the Group strives for a fair share and the United States. Furthermore, Proximus remuneration to return over the result of 2018 a gross value based on high-quality financial has participated in several major international dividend of EUR 1.50 per share, of which information. investment conferences. In between these Shareholder return policy EUR 0.50 interim dividend per share was events, meetings and conference calls are Proximus commits to an attractive shareholder paid in December 2018. To keep Proximus’ current and potential held with senior management. In all these remuneration policy by returning, in principle, shareholders informed, Proximus’ activities, management is supported by the most of its annual free cash flow to its After approval by the Annual Shareholder management speaks to the financial Investor Relations team (IR). Sustainability shareholders. Meeting, the normal dividend of EUR 1.00 community on a regular basis. Each per share will be paid on 26 April 2019, with quarterly results announcement is followed The Proximus IR team offers daily support The return of free cash flow either through record date on 25 April 2019 and ex-dividend by a conference call or investor/analyst to the retail and institutional shareholders as dividends or through share buybacks will be date on 24 April 2019. presentation during which maximum time is well as to the sell-side analysts. reviewed on an annual basis in order to keep reserved for a “questions & answers” session. strategic financial flexibility for future growth, This brings the total declared dividend over Twice a year, typically following the full-year A strict quiet period is observed before the organically or via selective M&A, with a clear the result of 2018 to EUR 484 million. and half-year results, Proximus organizes a communication of the quarterly results. The focus on value creation. This also includes roadshow with top management covering start of the quiet period is published on the confirming appropriate levels of distributable In line with the announced 3-year commitment the most important money centers of Europe Proximus Investor Relations website. reserves. on 16 December 2016, Proximus expects to return over the result of 2019 a stable gross The shareholder remuneration policy is based dividend per share of €1.50. Financial calendar* on a number of assumptions regarding future 11 April 2019 Start Quiet period ahead of Q1 2019 results business and market evolutions, and may be and Compliance Governance subject to change in case of unforeseen risks Investor Relations 17 April 2019 Annual Shareholders’ meeting or events outside the company’s control. 3 May 2019 Announcement of Q1 2019 results Proximus Investor Relations (IR) aims at 8 July 2019 Start Quiet period ahead of Q2 2019 results Shareholder return from the ensuring open communication with the 30 July 2019 Announcement of Q2 2019 results financial year 2018 Belgian and international investment world 7 October 2019 Start Quiet period ahead of Q3 2019 results On 28 February 2019, the Board of Directors on a regular basis. Through transparent, approved to propose to the Annual General consistent dialog with investors and financial 25 October 2019 Announcement of Q3 2019 results

* Dates may be subject to change Appendix

105 Proximus Group Annual Report 2018 Remuneration Report a glance at Proximus

The remuneration policies of the Directors and of the Executive Committee are inspired by current legislation, by the corporate governance code and by the market practices and trends. Our company is taking particular care to provide relevant and transparent information on the principles and the level of remuneration of the members of the Board of Directors and of the Executive Committee, as well as an overview of the key elements of the remuneration policy Sustainability of the Proximus Group.

Remuneration of the Board of Directors and of the Committees, the members of the nor for any other mandate within the Group subsidiaries Boards of Directors. Board of Directors The remuneration policy of the non- Director’s remuneration executive Directors foresees an annual policy fixed compensation of EUR 50,000 for the The principle of continuity with the past has Chairman of the Board of Directors and of been maintained. The policy adopted by the EUR 25,000 for the other members of the General Assembly of 2004 has remained Board of Directors. All members of the Board Governance and Compliance Governance applicable in 2018 and no substantial change of Directors have the right to an attendance of the policy is expected for the coming two fee of EUR 5,000 per attended meeting of years. the Board of Directors. This fee is doubled for the Chairman. Attendance fees of EUR The CEO, Mrs. Dominique Leroy, who is the 2,500 are foreseen for each member of an only executive Director, is not remunerated advisory committee of the Board of Directors. for the exercise of her mandate as member of For the Chairman of the respective advisory Appendix

106 Proximus Group Annual Report 2018 Activities report and attendance to Board and Committee meetings

Total yearly gross Proximus at a glance at Proximus TIC remune- Board ACC NRC (total ration Name (total 7*) (total 5) (total 4) 2**) ***

Stefaan De Clerck 7/7 5/5 4/4 2/2 166,499 € committee, these attendance fees are Overview of the Directors’ doubled. These amounts, defined in 2004, remuneration Dominique Leroy 7/7 2/2 0 € have remained unchanged since then and are The total amount of the remunerations Karel De Gucht 7/7 2/2 64,500 € not subject to indexation. granted in 2018 to all the members of the Board of Directors, Chairman included, is Pierre Demuelenaere 7/7 5/5 4/4 84,500 €

The members also receive EUR 2,000 amounting to gross EUR 1,000,499. Guido Demuynck 7/7 5/5 4/4 97,000 €

per year for communication costs. For the Sustainability Chairman of the Board of Directors, the The individual Directors’ gross amounts Martin De Prycker 7/7 4/4 2/2 74,500 €

communication costs are also doubled. paid out to the Directors in 2018, based on Martine Durez 7/7 4/4 72,000 € their activities and attendance to Board and These remunerations are granted on an Committee meetings, is presented in the Laurent Levaux 4/7 47,000 €

annual basis pro rata temporis of the duration following table. Tanuja Randery 7/7 2/2 64,500 € of the mandate during the year in question and are paid semi-annually. These amounts have been granted based Isabelle Santens 7/7 62,000 €

on seven Board meetings, one being an Agnès Touraine 7/7 2/2 64,500 € For the execution of their Board mandates, extraordinary and remunerated Board the non-executive Directors do not receive any meeting, and eleven Committee meetings. Catherine Vandenborre 6/7 5/5 69,500 € variable performance-based remuneration Luc Van den hove 6/7 2/2 59,500 € such as bonuses or stock options, nor do they receive benefits linked to complementary Paul Van de Perre 7/7 5/5 74,500 € pension plans or any other group insurance. ACC: Audit & Compliance Committee; NRC: Nomination & Remuneration Committee; TIC: Transformation & Innova- and Compliance Governance tion Committee (previously called Strategic & Business Development Committee) The Chairman of the Board of Directors is also * Extraordinary remunerated Board meeting on 6/6/2018 Chairman of the Joint Committee and of the ** TIC meeting of 6/6/2018 not remunerated Pension Fund. Mrs Catherine Vandenborre is *** Total remuneration • gross amounts on a yearly basis member of the Board of the Pension Fund. • for all members of the Board, this amount includes the telecom advantage They do not receive any fees for these board • for the Chairman of the Board, this amount also includes the benefi t in kind related to the private use of a company car: mandates. Appendix

107 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Global reward policy and cooperation in a high performance culture. To • To enable our company to attract and Executive principles foster this culture, it is critical to have a market retain market’s talents at all levels; remuneration Our Group has an innovative remuneration attractive Global Rewards Program for both policy which is regularly assessed and updated the Executive Committee members and all • To combine the needs and responsibilities Procedure for drafting of through close cooperation with external other members of the Top Management, as of employees and their families with those the remuneration policy and human resources fora and universities. The well as for the entire workforce. of the company and society as a whole. defining of the remuneration

remuneration policies of our employees are level of the members of the Sustainability defined in a process of dialogue with the Board The main objectives of our Global Rewards Our company also maintains -and Executive Committee of Directors and with the social partners. Program are: modernises- powerful public sector Both the executive remuneration policy and instruments, such as work- life benefits the individual remuneration packages for the Because of our history as a public-service • To drive performance that generates (e.g. sick child care, hospitalisation,…) and CEO and the other members of the Executive company, there are some differences in long-term profitable growth; social assistance. It is the responsibility of Committee are set by the Board of Directors our dynamics and structure, compared to our Work-Life department to combine the upon recommendations from the Nomination the private sector. This has a considerable • To stimulate empowerment that reinforces needs and responsibilities of employees and & Remuneration Committee. The individual influence on how our remuneration policy has the business strategy and desired culture; their families with those of the company and remuneration packages are defined according evolved. Our Human Resources department society as a whole. Over the years, we have to the individual responsibilities and skills. has developed creative and adaptable • To offer a fair and equitable remuneration won several awards for the continuous efforts programs to deal with its obligations related to our staff (both to civil servants and of our company to create a balanced working It consists of a balanced executive to the statutory employment status of to the contractual employees), and environment for its staff. remuneration policy rewarding executives some of its workforce and introduced new competitive on the market; competitively and at rates which are elements that harmonized policies between The Global Rewards Program keeps up and attractive in the market, aligning the Governance and Compliance Governance civil servants and contractual employees. • To recognize and reward high performance supports this goal and mission. interests of management and shareholders and the promotion of the company values and complying with the governance rules To accomplish our company goals within a and culture; applicable in Belgium. Our company wants highly and fast changing competitive global to attract and retain high performing top telecom market, we need qualified, talented • To link pay to both individual performance executives for its Executive Committee and and engaged employees working in close and the overall success of our company; wants to recognize clear role models, who Appendix

108 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

deliver a high level of performance and the European Telecommunications and ICT other members of the Executive Committee As per her contract, the CEO is only entitled promote the company values. sector. This analysis aims to ensure that the included, with regard to the choice of pay out to a short-term variable remuneration which global remuneration of each member of the mean of their variable remuneration. payment is spread over 3 years. The variable Like the rest of the top management of our Executive Committee remains adequate, remuneration of the other members of the company, the members of the Executive fair and in line with market practices and All the amounts mentioned in this report Executive Committee consists of a short-term Committee benefit from dedicated reward consistent with the evolution of both his/ are gross amounts before employer’s social part and a long-term part, with equal target

programs which focus on the principles of her responsibilities and the market situation contribution. amounts which are set up as percentages of Sustainability our strategy to consistently reward high of the Proximus Group in terms of size, scope the basic remuneration. This remuneration performance of individuals and of the of activities and financial results. Executive Committee’s policy therefore fully complies with the article company. A significant part of their total remuneration structure 520ter of the Belgian Company Code and remuneration is variable, based on stringent Current remuneration policy does not The remuneration of the members of the with the Belgian law of 6 April 2010. quantitative and qualitative performance provide for a specific contractual claw back Executive Committee is built upon the criteria, and is driven by our company’s stipulation in favour of our company for the following components: As for the Executive Committee members objectives in terms of performance and variable remuneration of the members of the others than the Chief Executive Officer, the growth. This way, our company wants to Executive Committee, CEO included, allocated • Basic remuneration Board of Directors took action end 2015 to encourage its executives to deliver a long- on the basis of incorrect financial information. • Short-term variable remuneration evolve towards an alignment of their variable term, sustainable profitable growth, in line • Long-term variable remuneration remuneration on market median practices, with our Group’s strategy and the expectations To distinguish ourselves from other • Group insurance premiums and other aligning their minimum target short- and of our shareholders. employers, our company seeks to excel in benefits long-term variable remuneration as from the the total package offered, by providing not performance year 2016. The market positioning of these remuneration only a cash remuneration but also numerous The relationship between the distinct Governance and Compliance Governance packages is reviewed on a regular basis by other benefits. remuneration components of the CEO and As mentioned later in this report, the long- benchmarking the remuneration of the of the other members of the Executive term variable remuneration for the Executive members of our Executive Committee against A fundamental principle of our company’s Committee is illustrated in the graphs below. Committee members others than the Chief both the BEL 20 companies (financial sector remuneration policy is the degree of freedom These graphs show the relative importance Executive Officer is allocated through a excluded) and a set of peer companies in for the top management, the CEO and the of the various components of on-target long-term incentives plan consisting of a remuneration. Appendix

109 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Relative importance of various components Basic remuneration Basic remuneration in kEUR before of the on-target remuneration before employer’s social contribution (end 2018) The basic remuneration consists of a employer social contribution

basic salary earned by Chief Executive It should be noted that in 2017 there was no active Officer and by the other members of the Chief Consumer Market Offi cer for 6 months, while in Executive Committee for the reported year 2018 Guillaume Boutin acted for a full year. in such respective roles. This remuneration

Executive is defined by the nature and the specificities 2,467 2,254 Sustainability CEO Committee of the function, is allocated regardless of the results and is contractually subject to the index applicable to Proximus.

The basic remuneration of the Executive ■ Basic remuneration ■ Basic remuneration Committee members is regularly reviewed by ■ Direct short-term variable remuneration ■ Direct short-term variable remuneration ■ Deferred short-term variable remuneration ■ Long-term variable remuneration the Nomination & Remuneration Committee, 523 515 ■ Group insurance premiums ■ Group insurance premiums based on an extensive review of performance ■ Other benefi ts ■ Other benefi ts and assessment of potential provided by the Chief Executive Officer, as well as on Executive CEO long-term Performance Value Plan which performance criterion of the current plan. external benchmarking data on market Committee has been adopted by our company in 2013. These additional performance criteria will practices. Thereby, the evolution of the basic The design of this Performance Value Plan consist of the Group free cash flow and the remuneration depends on the competency ■ 2017 ■ 2016 has been reviewed. As from the 2019 reputation index. level of the Executive Committee member, Year-to-year variations in the amounts are Governance and Compliance Governance grant, in order to better reflect the Group’s of his or her continued performance level, mainly resulting from the 2% index of October achievements, additional company driven No other substantial change of the of the evolution of his or her responsibilities, 2018 (former one was in July 2017), and performance criteria will be added to the Total remuneration policy is expected for the as well as of the evolution of the market. from the fact that there has been no Chief Shareholder Return (see under “long-term coming two years. Possible adjustments are always submitted Consumer Market Officer during six months variable remuneration”), which is the only to the Board of Directors for approval. in 2017. Appendix

110 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Short-term variable remuneration indicators include financial indicators as well agencies specialized in market and customer Short-term variable remuneration Short-term variable remuneration as non-financial indicators at Group level. intelligence, of which the processes are allocation components audited on a regular basis. The Chief Executive Officer receives a target Our short-term variable remuneration system The performance indicators at Group level short-term variable remuneration amounting has been designed to support the strategy are as follows: The result at Group level is based on to gross EUR 150,000. This amount is subject and the values of our Group and to enhance a predefined formula taking these key to the index applicable to Proximus. For the a performance-based management culture. • the business cash flow performance indicators into consideration other members of the Executive Committee, Sustainability according to a predefined weight per indicator. the target short-term variable remuneration Our company indeed considers close • the number of new customers in voice, is expressed in a percentage of the basic collaboration of all employees to be fix, internet and TV businesses, as well Individual performance remuneration. imperative, all efforts need to be focused as churn reduction On top of the Group results, the individual and aligned towards Group success. performance is annually evaluated in the As explained above, the short-term variable • the Simplification and the Customer course of the first quarter following the end remuneration is allocated by the Board of Group results are therefore highly impacting Experience, measuring our progresses of the year by the Board of Directors. This Directors upon proposal of the Nomination (for 60%) the short-term variable versus our ambition in these domains evaluation is based on the recommendations & Remuneration Committee. The amount remuneration of the members of the made by the Nomination & Remuneration effectively allocated to the Chief Executive Executive Committee, on top of individual • the “employee engagement index”, Committee versus pre-defined measurable Officer and to the other members of the performance (for 40%), and this in line with measuring on a yearly basis our individual objectives and versus the promotion Executive Committee varies according to our company values. employees’ engagement, agility and of our company values and culture. the Group results and to the evaluation of strategic alignment. the individual performances by the Board Group performance – Key Performance The individual performance is taken into of Directors. Governance and Compliance Governance Indicators (KPIs) The achievement of these KPI’s are regularly account for 40% in the short-term variable Short-term annual variable remuneration is followed-up and communicated. Business remuneration. Besides the individual In case of objectives realisation at 100%, the thus partly calculated – for 60% – in relation cash flows is based on audited reported differentiation in terms of talent, performance Chief Executive Officer or the other member to performance against Key Performance financial figures that are adjusted to obtain and impact on the Group performance, the of the Executive Committee gets 100% of Indicators (KPI’s) set by the Board of Directors ‘underlying’ financial figures after exclusion Board of Directors ensures the consistency his short-term variable remuneration target upon recommendation of the Nomination & of ‘incidentals’. Non-financial indicators between the total allocated amount for the amount. In case of sustained excellent Remuneration Committee. These performance are measured by internal and external individual performance and the Group results. performance at Group and individual level, Appendix

111 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

the short-term variable remuneration can In the last couple of years, the Board of Short-term variable remuneration Long-term variable remuneration go above the 100% of the target amount, Directors did a positive evaluation of the in kEUR before employer social The Chief Executive Officer is not eligible to with a cap at 200%, according to a linear realizations of the Chief Executive Officer, contribution long-term variable remuneration. allocation curve. Conversely, this percentage given the overachievement of her objectives 1,111 1,106 can drop down to 0% in case of severe and the long term value she has created since The other members of the Executive underachievement. her nomination in this role. Committee receive a long-term variable

remuneration expressed as a percentage Sustainability As per her contract and in accordance with In 2018, a direct and deferred short-term of the annual basic remuneration. This article 520ter of the Belgian Company Code, variable remuneration were allocated to percentage is the same as the percentage the payment of the short-term variable her for respectively gross EUR 111,585 of their short-term variable remuneration. remuneration of the CEO is currently spread (performance indicators related to 2017) and over 3 years. Indeed, 50% of her variable gross EUR 113,710 (EUR 54,010 linked to 225 227 The long-term variable remuneration is remuneration is related to performance performance indicators related to 2016 and allocated to the other members of the indicators of the accounting year (= direct EUR 59,700 linked to performance indicators Executive Committee by the Board of Directors short-term variable remuneration) while the related to 2015). upon recommendations of the Nomination & Executive CEO other 50% will be deferred: 25% is related Committee Remuneration Committee. Various factors to performance indicators pertaining over The total short-term variable remuneration are considered for the decisions taken by ■ 2018 ■ 2017 a period of 2 years and 25% is related to effectively allocated in 2018 to the other the Board of Directors in terms of effective performance indicators pertaining over a members of the Executive Committee (2017 • Chief Executive Officer : impact of the allocation, such as the retention of talents, period of 3 years (= deferred short-term performance year) amounts to gross EUR index of July 2017 and of the variations the individual performance evaluations or/ variable remuneration). 1,110,745. in the Group KPI results over the last 3 and the Group results. This allocation is made Governance and Compliance Governance performance years. through a long-term incentives plan, currently In 2018, a deferred short-term variable consisting of a long-term Performance Value remuneration, for the performance indicators • Members of the Executive Committee Plan which has been adopted by our company related to 2015 and 2016 has been allocated others than the CEO: Impact of the index since 2013. to the CEO on top of a direct short-term of July 2017 an of the KPI results which variable remuneration, for the performance slightly increased for performance year indicators related to 2017. 2017 compared to performance year 2016. Appendix

112 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Long-term Performance Value Plan Peer companies currently included in the market practices and more particularly Long-term variable remuneration The long-term incentive plan offered by our basket on the practices of the other European in kEUR before employer social company to its executives currently consists • BT telecommunications companies. As from contribution of a “Performance Value Plan”. This plan • the 2019 grant, in order to better reflect the has been designed as to keep our executive • OTE Group’s achievements, additional company 1,025 1,005 remuneration policy balanced and attractive, • KPN KON driven performance criteria will be added to as well as compliant with the shareholders’ • Orange the Total Shareholder Return (see below), Sustainability expectations. It aims to ensure that the actions • which is the only performance criterion of the and initiatives taken by the executives are • Telecom Italia current plan. These additional performance guided by long-term interests. Therefore, this • Telefonica criteria will consist of the Group free cash flow remuneration clearly constitutes a long-term • and the reputation index. incentive. • The CEO is not eligible to long-term variable Our Performance Value Plan is based on a Under this Performance Value Plan, the remuneration. As a consequence, no long- 0 0 balance between the individual and the Group granted awards are blocked for a period of 3 term variable remuneration has been granted Executive performances. years, after which the Performance Values to her since her nomination. CEO Committee vest. After this period, the beneficiaries may The performance criterion of this plan is exercise their Performance Values and the The total long-term variable remuneration ■ 2018 ■ 2017 the Total Shareholder Return. Our Total amounts effectively allocated will depend effectively granted to the members of the Shareholder Return is measured against on the performance of our Total Shareholder Executive Committee others than the CEO the respective Total Shareholder Return Return compared to the group of peer was amounting to gross EUR 1,005,000 Former long-term variable remuneration Governance and Compliance Governance of a basket of 10 other European telecom companies at the exercise time. EUR in 2017 and to gross EUR 1,025,000 plan: Stock Options Plan operators. EUR in 2018. Stock options have been granted to the senior The design of this Performance Value Plan executives from 2004 until 2012, members has been reviewed further to a benchmark of the Executive Committee included. analysis, aimed at a better alignment on Appendix

113 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Only one member of the Executive Committee In 2017 and 2018, the CEO and the other Group insurance premiums and other benefits which are adapted according to the still holds stock options, as shown in the table members of the Executive Committee did benefits common market practices. below. Neither the other members of the not receive any Proximus shares nor Proximus Group insurance premiums Executive Committee nor the CEO hold any stock options. The CEO and the other members of the General overview more stock options. Executive Committee are participating in Below chart reflects the remuneration and a complementary pension scheme. This other benefits allocated directly or indirectly

Overview of the stock options still held by the members of the Executive Committee complementary pension scheme consists to the members of the Executive Committee Sustainability of a “Defined Benefit Plan” offering rights in 2018 and 2017 by the company or any which are in line with market practices. other undertaking belonging to the Group Bart VAN DEN MEERSCHE (benefit based on gross or net remuneration, STOCK OPTIONS They also benefit from other group insurances depending on the type of benefit). in line with market practices, such as life and on January 1st, 2018 15,000 invalidity insurances. It should be noted that the global Number 0 remuneration has been affected by the index Exercised in 2018 Other benefits of October 2018, by the variations in terms of Year of grant - Our Group wants to stimulate its executives by Group KPI results over the last performance Number offering a portfolio of benefits and advantages years and by the nomination of a new Chief Lapsed in 2018 that are competitive in the market place and Consumer Market Officer mid-2017. Year of grant consistent with the Group’s culture. The CEO

Number and the other members of the Executive Forfeited Committee receive benefits on top of their

in 2018 and Compliance Governance Year of grant remuneration, including medical insurance,

on December 31, 2018 15,000 the use of a company car, welfare benefits and other benefits in kind. Comparative The CEO and the other members of the Executive Committee do not hold stock options anymore. assessments are regularly made on these Appendix

114 Proximus Group Annual Report 2018 Proximus at a glance at Proximus

Remuneration overview of the members of the Executive Committee

CEO Other members of the Executive Committee If the CEO mandate is revoked before the

REMUNERATION 2017 2018 2017 2018 end of the six-year term, our company will pay her a contractual termination indemnity Basic remuneration 515,108 € 522,810 € 2,253,540 € 2,466,946 €* equal to one year’s base salary.

Direct short-term variable remuneration 108,020 € 111,585 € 1,105,537 € 1,110,745 € Main contractual terms of the other Deferred short-term variable remuneration 119,175 € 113,710 € 0 € 0 € Executive Committee members

All other members of the Executive Sustainability Long-Term variable remuneration 0 € 0 € 1,005,000 € 1,025,000 € Committee, who are all bound by a non- Retirement and post-employment benefits 181,243 € 180,003 € 516,193 € 494,319 € competition clause prohibiting them for 12 months after leaving the Group from working Other benefits 13,357 € 12,438 € 108,433 € 124,172 € for any other mobile or fixed licensed operator SUBTOTAL 936,903 € 940,546 € 4,988,703 € 5,221,182 € active on the Belgian market. If activated (excl. employer’s social contribution) by our company, they would receive an

Termination benefits 0 € 0 € 0 € 0 € amount equal to six months’ base salary as compensation. TOTAL 936,903 € 940,546 € 4,988,703 € 5,221,182 € (excl. employer’s social contribution) Just like the CEO, the other members of * It should be noted that in 2017 there was no active Chief Consumer Market Offi cer for 6 months, while in 2018 Guillaume Boutin acted for a full year. the Executive Committee are also bound by All these amounts are gross amounts before employer’s social contribution. exclusivity and confidentiality obligations and is liable for respecting the company codes Main provisions of the contractual and is thus not subject to employers’ social at least 5% of its consolidated revenues. If and policies, like the Code of Conduct and Governance and Compliance Governance relationships security charges. activated by our company, she would receive the Dealing Code. Contractual agreement related to the an amount equal to one year’s base salary mandate of the CEO The CEO is bound by a non-competition as compensation. The CEO is also bound by They have a contractual termination clause In January 2014, Mrs. Dominique Leroy has clause, prohibiting her for 12 months after exclusivity and confidentiality obligations and which foresees an indemnity of one year’s started her six-year mandate as CEO. She leaving the Group from working for a is liable for respecting the company codes remuneration. has a contract as a self-employed executive competitor of our company in Belgium and and policies, like the Code of Conduct and in those countries where the Group generates the Dealing Code. Appendix

115 Proximus Group Annual Report 2018 Appendix 117 Social fi Transparency 122 Overview of non-fi P ecito 158 157 142 KPI description Material topics GRI Content index Environmental fi Appendix grs 134 gures grs 138 gures nnilifrain 118 nancial information Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 118 information Overview of non-financial *The definition of each KPIcan be found inthesection “KPIdefi Page p.30 p.36 p.31 Strategic pillar infrastructure Digital Digital trust Digital innovation Digital topics High material Enabling a better digital life digital abetter Enabling infrastructure sustainable and Innovation security data and Privacy and institutions companies of Competitiveness Digital nition”. Theme/KPI* institutes universities/education with projects of Number international) + (national revenues ICT 4G indoor coverage cybersecurity and toprivacy related certifications International Belgium Vectoring coverage in ADSL speed & VDSL Average Combined coverage 30Mbps Internet: Fixed coverage outdoor 4G Active M2M cards agt21 eut21 Result 2017 Result 2018 Target 2018 o vial 39 available Not investments. infrastructure our on targets to disclose wish not do we reasons competitive For 66N 6 1.4 Million €561 Million 99 99.8% 98.1% 99.9% 99.5% 26Mp 68 Mbps 72.6 Mbps 92% 88% 1.3 Million 1.2 Million 1.2 Million 1.3 Available Not Million €509 86% 83% Continued gr beyond & 2019 Target investments. infrastructure our on targets to disclose wish not do we reasons. competitive For o t a v a i l a b l e owth GRI KPI/ref GRI impacts economic Indirect Privacy Customer communities Local impacts economic Indirect Proximus Group Annual Report 2018 Impact/ SDG Impact/ Infrastructure & Innovation 9. Industry, Communities & Cities Sustainable 11. Communities & Cities Sustainable 11. Infrastructure & Innovation 9. Industry,

Appendix Governance and Compliance Sustainabilty Proximus at a glance 119 p.44 Employee care Employee p.44 p.41 Customer first Customer p.41 p.50 aeStrategic pillar Page right Doing business safety and Health development employee and capital Human marketing Responsible relationship Customer transparency billing and Pricing services and products Quality ethics and conduct Business stakeholders our for Caring oisTeeKI agt21 eut21 Result 2017 Result 2018 Target 2018 Theme/KPI* topics High material accidents occupation of rate Severity mlyeeggmn 27 27 23 72.7% 72.3% 72.7% occupational accidents 72.7% of rate Frequency Employee engagement network (#WAP) social enterprise our using by people or knowledge for looking actively employees Proportion of Proximus OneDrive Office365 using employees Percentage of Proximus which justified) (# of JEP from # complaints rate satisfaction experience in-home House Happy (residential customers) toinvoices related Decrease in complaints (residential customers) satisfaction usage Blended cases Number of whistleblowing conduct of policies/code of violation for department Investigations the by investigated cases of Number previous year to relation in Stable 5 6 3 x 93% x previous year to relation in Stable 96% 37% 79% 95% 74% Not available 7(2) 5(0) Not available Not 5(0) 7(2) available Not disclose NPS We don’t Not disclosed Not o icoe 46 37 Not disclosed 93.7% 94.6% Not disclosed Not available 7 7 Not available Not 30 7 52 7 29 available Not 30 .80.36 0.28 . 6.6 6.8 89% 90% Not disclosed Not 90% 89% ‘17 vs -14.1% -Not disclosed previous year to relation in Stable previous year to relation in Stable beyond GRI KPI/ref GRI beyond & 2019 Target safety and Health Occupational Education and Training Relations Management Labour/ Employment behaviour competitive Anti- and safety health Customer performance Economic Anti-corruption Proximus Group Annual Report 2018 3. Good Health Growth and Economic Work Decent 8. 3. Good Health growth and Economic Work Decent 8. Impact/ SDG Impact/

Appendix Governance and Compliance Sustainabilty Proximus at a glance 120 figures, p.141 Environmental p.63 140 figures, p.138- Environmental p.61 all for Digital p.53 aeStrategic pillar Page Being circular neutral Being CO 2

recycling and equipment electronic waste economy: Circular gases greenhouse and Energy Respecting our planet our Respecting digital inclusion and Connectivity tosociety Contributing oisTeeKI agt21 eut21 Result 2017 Result 2018 Target 2018 Theme/KPI* topics High material olce oiepoe o vial 82918,493 18,279 decoders TV and modems Refurbished available Not phones mobile Collected composted or reused recycled, Percentage of waste compared to2008 compared consumption Energy compared to previous year 1+2 scope emissions Carbon travel business and operations own for level neutrality Carbon sources from renewable energy came which used Electricity Bednet and Take Off and Bednet by school totheir connected Number of sick children in Belgium initiatives our by supported Number of job seekers disability category) 1 for (at least devices tested Percentage of accessible Not available 405,544 322,194 Not available Not 322,194 405,544 2025 by 90% available Not 85% 87% available Not 4 1%-%-4% yearly -24% -4% 100% -27% 100% in 2020 -12% 100% available Not 98% 100% -4% 99% 100% 98% 5 0 2 350 Over 1,100 327 90% Over 800 Over 1,000 404 100% Over 1,000 91% 350 90% 2020 by Belgium Goodplanet with schools 200.000 in improvement Continuous beyond GRI KPI/ref GRI beyond & 2019 Target Materials Energy communities Local Proximus Group Annual Report 2018 and Production Consumption Responsible 12. Action Climate 13. Communities & Cities Sustainable 11. Infrastructure & Innovation 9. Industry, Impact/ SDG Impact/

Appendix Governance and Compliance Sustainabilty Proximus at a glance 121 figures, p.141 Environmental p.64 Strategic pillar Page supply chain Sustainable oisTeeKI agt21 eut21 Result 2017 Result 2018 Target 2018 Supply Chain Sustainable Theme/KPI* topics High material recognition level level recognition gold or asilver received environmental criteria who using screened Percentage of suppliers level recognition gold or asilver received who etc.) rights, human conditions, working (incl. criteria social using screened Percentage of suppliers 0 3 2 80% 82% 80% 83% 85% 80% 87% 80% beyond GRI KPI/ref GRI beyond & 2019 Target assessment socialSupplier assessment rights Human Assessment Environmental Supplier Proximus Group Annual Report 2018 Action Climate 13. and Production Consumption Responsible 12. Impact/ SDG Impact/

Appendix Governance and Compliance Sustainabilty Proximus at a glance 122 affiliate, BICS. We also have other affiliates Internationally, we are active through our names Tango andTelindus Luxembourg. as Proximus Luxemburg underthebrand Netherlands. In Luxembourg, we operate the Netherlands,ourdivisionis called Telindus activities of theProximus Group inBelgium. In all itsappendix),Proximus S.A.refers to the stated otherwise. Inthisreport (including are focused onProximus inBelgium unless information” and“GRIcontent index” which to Belgium”, “Overview of non-financial except for thesection “Ourcontribution be read asreferring to theProximus Group, otherwise, references to Proximus should has amajorityshareholding. Unless stated including thesubsidiaries inwhichProximus This report hasfor scope theProximus Group, section onStakeholder Dialogue. relationship withourstakeholders, see the more information onhow we maintain our partners andsocial organizations. For government representatives &institutions, employees, shareholders, suppliers, thepress, to: customers (both corporate andresidential), relationship. These include butare not limited by ouroperations orwithwhomwe have a all theindividualsandorganizations affected of purpose andgoals.Ourstakeholders are society, inrelation withourambition,sense stakeholders aboutourcontribution to The purpose of thisreport isto inform our Scope of thesustainability information About thisreport Transparency in ourAnnualReport. September 2017)andintegrated all elements Reporting (translated intheBelgian law of 3rd comply withtheEUDirective Non-Financial Global Reporting Initiative (GRI)guide.We this report we followed theindications of the For thesustainability information included in The AnnualReport ispublishedinMarch 2019. information Reporting criteria non-financial year of ownership. acquisitions inourreport asof thefirst full For ourfinancialinformation, we include new Codit, ION-IP, etc. such asBe-Mobile, Davinsi Labs, Umbrio, integrated inourEntreprise Business Unit reference table, translated intheBelgian law of 3rd September 2017 EU Directive 2014/95/EU: Non-FinancialInformation andDiversity information ietv utpcChapter / Page reference business model the of description A brief Subtopic Directive Requirements EU HR, safety etc.) safety HR, (e.g. matters personnel Relevant social and development undertaking’s future the affect may that factors and trends Main strategies and Objectives undertaking operates the where Markets structure and Organization environment The business indicators key performance Non-financial managed are risks How chain value within and operations own in risks Principle policies those of outcome The diligence including due policies pursued, the of A description website) our on (available report, Management p.8-9 aglance, at Proximus p.4-7 &Chairman, CEO our from Foreword p.91-99 report, management Risk p.17-19 strategy, 3-year new our #shifttodigital p.13-16 achievements, Key p.8-9 aglance, at Proximus p.4-7 &Chairman, CEO our from Foreword p.142-156 Index, Content GRI p.8-9 aglance, at Proximus p.68-69 model, governance Proximus p.8-9 aglance, at Proximus p.13-16 achievements, Key p.4-7 &Chairman, CEO our from Foreword p.8-9 aglance, at Proximus p.118-121 information, non-financial of Overview p.91-99 report, management Risk Social figures, p.134-137 p.44-50 employees, our for Caring p.91-99 report, management Risk p.44-50 employees, our for Caring p.91-99 report, management Risk Social figures, p.134-137 p.44-50 employees, our for Caring p.44-50 employees, our for Caring p.106-115 report, Remuneration p.91-99 report, management Risk p.44-50 employees, our for Caring Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 123 (e.g. labor protection) labor (e.g. rights human for respect with matters Relevant Chapter / Page reference related impacts) climate- (e.g. matters Relevant environmental Subtopic Directive Requirements EU indicators key performance Non-financial managed are risks How chain value within and operations own in risks Principle policies those of outcome The diligence including due policies pursued, the of A description indicators key performance Non-financial managed are risks How chain value within and operations own in risks Principle policies those of outcome The diligence including due policies pursued, the of A description Overview of non-financial information, p.119 information, non-financial of Overview Sustainable supply chain, p.64-65 p.91-99 report, management Risk p.50-51 right, business Doing p.106-115 report, Remuneration p.91-99 report, management Risk p.68-69 model, governance Proximus p.50-51 right, business Doing Sustainable supply chain, p.64-65 p.106-115 report, Remuneration p.91-99 report, management Risk p.68-69 model, governance Proximus p.50-51 right, business Doing Sustainable supply chain, p.64-65 p.106-115 report, Remuneration p.91-99 report, management Risk p.68-69 model, governance Proximus p.50-51 right, business Doing Sustainable supply chain, p.64-65 p.106-115 report, Remuneration p.91-99 report, management Risk p.68-69 model, governance Proximus p.50-51 right, business Doing Sustainable supply chain, p.64-65 p.120-121 information, non-financial of Overview Environmental figures, p.138-141 p.61-65 planet, our Respecting p.91-99 report, management Risk Environmental figures, p.138-141 p.61-65 planet, our Respecting p.91-99 report, management Risk Environmental figures, p.138-141 p.61-65 planet, our Respecting Environmental figures, p.138-141 p.61-65 planet, our Respecting p.91-99 report, management Risk p.61-65 planet, our Respecting ietv utpcChapter / Page reference bribery and corruption toanti- respect with matters Relevant Subtopic Directive Requirements EU Insight into the diversity diversity the into Insight indicators key performance Non-financial managed are risks How chain value within and operations own in risks Principle policies those of outcome The diligence including due policies pursued, the of A description diversity policy the of Results policy is implemented the how of Description Diversity targets policies pursued the of A description Overview of non-financial information, p.119 information, non-financial of Overview p.91-99 report, management Risk p.50-51 right, business Doing p.91-99 report, management Risk p.50-51 right, business Doing p.91-99 report, management Risk p.50-51 right, business Doing p.50-51 right, business Doing p.68-69 model, governance Proximus p.50-51 right, business Doing Remuneration report, p.106-115 report, Remuneration p.68-69 model, governance Proximus p.44 employees, our for Caring p.106-115 report, Remuneration p.68-69 model, governance Proximus p.44 employees, our for Caring p.119 information, non-financial of Overview p.106-115 report, Remuneration p.68-69 model, governance Proximus p.44 employees, our for Caring p.106-115 report, Remuneration p.68-69 model, governance Proximus p.44 employees, our for Caring Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 124 clarifications). were omitted from thisreport (including topics, aswell theGRIindicators which specifies theboundaries of each material be found inGRIContent Index. Thisindex overview of theGRI linked to thisreport can the Materiality Determination section. The this integrated report isdescribed below in material topics andthusthecontents of The way through whichwe definedour identified material topics. general standard disclosures related to guide meansthatProximus reports onall The following of theindications of theGRI refrigerants installations- building of Cooling purchased by the company the by purchased is that electricity of generation the during released Emissions 100% Group/ Proximus emissions 2–Indirect Scope High installations building of Heating Car fleet fuel High Proximus Group/ 100% Group/ Proximus High fuel fleet Car emissions 1–Direct Scope +activity Protocol) (GHG Scope ihProximus Group/ 100% High ihProximus Group/ 100% High from Proximus Scope/% vs Group total Group vs Scope/% Proximus from Possible impact Gas Protocol. is based ontheguidelines of theGreenhouse Measurement of theGroup’s CO Carbon emissionsscopes 1and2 for environmental figures Scoping and calculation methodologies tickmark intheGRIindex (limited assurance). by ourexternal auditor are indicated by a The partsof thesustainability chapter assured External assurance for 2018. including where relevant oravailable data following theindications of theGRIguide, Proximus prepared thisintegrated report by 2 emissions Standard -Gold credits carbon 100% Standard -Gold credits carbon 100% Standard: 1% Standard: - Gold credits Offset by carbon sources: 99% Renewable energy Standard -Gold credits carbon 100% nryGPSource emission factors GWP energy Climate neutrality/renewable evolving over theyears, inthesense that data availability andquality. Thisispositively group subsidiaries isdonedependingon Reporting onenvironmental figures for the total energy consumption. consumption represents 7%of the Group’s Group subsidiaries outsideBelgium. Their since 2010,theCO concerns emissionsinBelgium, butalso, to operational control. Thisnot only We measure all activities thatare subject their environmental impact. more andmore subsidiaries are monitoring 2 emissionsof Proximus R PCBlnCroeLimited Carbone Bilan IPCC AR5 AR5 IPCC AR5 IPCC AR5 IPCC Base Carbone + Bilan Carbone +Bilan Carbone Base fuel: heating protocol GHG Gas: IEA (CO IEA addition of biofuel BE) biofuel of addition gradual the with adjusted Carbone +Bilan Carbone Base combustion – highlights) -2018 –highlights) combustion are also included inthecalculation. Proximus are CO PFCs, SF gases combined, i.e.CO equivalent emissionfigure of all greenhouse The CO figures. all acquired in2017, are not included inthe 2016 andTeleSign, Davinsi Labs andUnbrace, The new subsidiary Be-Mobile acquired in 2 emissions from fuel fuel from emissions 2 6 e consumption represents aCO . Thegases of primaryinterest for Proximus Group Annual Report 2018 2 andHFCs,butCH 2 , CH Limited Limited Limited assurance level assurance audit External 4 , N 2 4 O, HFCs, andN 2 O 2

Appendix Governance and Compliance Sustainabilty Proximus at a glance 125 other relevant emissionfactors. (www.ghgprotocol.org), BilanCarboneand value chainstandard of theGHGprotocol figures according to thescope 3corporate Proximus reports onall relevant scope 3 Carbon emissionsscope 3 ramn fwsefosMdu rxmsi egu/9%Nn R PCBlncroeLimited carbone Bilan IPCC AR5 Limited None IEA approach, model EEIO 95% Belgium/ in Proximus IPCC AR5 travel Medium business for trains and Aircraft 3-Cat.6 Scope flows waste of Treatment 5 3–Cat. Scope activities network for None Transportation of subcontractors 4 3–Cat. Scope 95% Belgium/ in Proximus transportation included are others, among losses, Network 2. 1and scopes Proximus Group, non-reported in the by purchased electricity and Low fuels direct of transportation and production Extraction, 3 3–Cat. Scope investments Acquired 2 3–Cat. Scope purchased goods and services and goods purchased of production and transportation extraction, Resource 1 3-Cat. Scope +activity Protocol) (GHG Scope ihPoiu ru/10 oeA5IC ia abn,IALimited IPCC AR5 IEA Carbone, Bilan 95% Belgium/ in Proximus IPCC AR5 Low None 95% Belgium/ in Proximus None Low IPCC AR5 100% Group/ Proximus High None 95% Belgium/ in Proximus Low total Group vs Scope/% Proximus from Possible impact the emissionsvaries from low to high,and possible impact from Proximus inreducing we are dealingwithindirect emissions,the indirectly generated by Proximus. Given that downstream GHGemissionswhichare Scope 3refers to theupstream and Gold Standard - credits carbon by offset Fully Source emission factors GWP energy Climate neutrality/renewable account. only theoperations inBelgium are taken into key role. For most of thescope 3categories the choice of suppliers andsolutions plays a AR5 IPCC and transport companies agency travel of figures Official within Cat.1) subcontractors fall EEIO model (other carbone Bilan expenditure) EEIO model (other purchase IEA, carbone, Bilan products), (customer based LCA Proximus Group Annual Report 2018 Limited Limited Limited level assurance audit External

Appendix Governance and Compliance Sustainabilty Proximus at a glance 126 ..NA ..NA R PCNA N.A. N.A. AR5 IPCC Limited N.A. N.A. IPCC AR5 N.A. N.A. None 95% Belgium/ in Proximus N.A. N.A. 3–Cat.8,9,10,13,14 Scope cat.2 in included Investments: 3–Cat.15 Scope life): included in cat.5 of (end products of Processing 3–Cat.12 Scope mobile phones and boxes set-top (modems, customers’ Proximus devices of consumption Energy 3–Cat.11 Scope cars are accounted for in scope 1 scope in for accounted are cars Employee commuting. Company 3–Cat.7 Scope +activity Protocol) (GHG Scope ihPoiu nBlim 5 oeA5IC ia abn,IALimited Limited AR5 IPCC Bilan carbone, IEA carbone Bilan AR5 IPCC IPCC AR5 None Proximus in Belgium/ 95% None N.A. Proximus in Belgium/ 95% None High 98% Group Proximus High total Group vs Scope/% Proximus from Possible impact nryGPSource emission factors GWP energy Climate neutrality/renewable N.A. Proximus Group Annual Report 2018 Limited level assurance audit External

Appendix Governance and Compliance Sustainabilty Proximus at a glance 127 to lighthomes or for reading. They replace The LEDlamps can beused intheevening smartphones orLED lamps. electricity, whichcan beused for charging module, partof theheatisconverted into installed asanextra. Thanksto thisTEG which athermoelectric generator (TEG)is The TEGSTOVE isanefficientcookstove on and there isvery limited access to electricity. households use wood asanenergy source of thepopulationlives inpoverty, 91%of In thisspecificregion inBenin, where 69% org TEG Stove project. More info: www.tegstove. Standard’ certified climate project called the the development of themultiannual ‘Gold Proximus isthemaindriving force behind 3) since 2016. (scopes 1and2)for business travel (scope for itscar fleet, electricity, heating,refrigerants Group to become aclimate-neutral company In practice, thishasallowed theProximus global warming. supporting international projects that fight emissions butwill offset whatisleft over by first of all continue reducing ourcarbon By beingcarbon neutral meanswe will G old Standard carbon credits best available data quality. Since many years we adopt theprinciple of Accuracy quality of life. improved airquality, health, employment and benefits are mainly forest conservation and drastically reduce theuse of firewood. The in Uganda, which efficientcookstoves Another project we supportisthestove project tegstove.org/ Development Goals. More info: http://www. they contribute to several Sustainable The projects were also selected because employment andqualityof life. conservation, improved airquality, health, and rural Asia.Thebenefitsare mainly forest support cookstove projects inUganda,Malawi can also bedramatically improved. We also and current energy efficiencyintheregion up CO to Belgium. Thisisbecause thecost of setting reduced indeveloping countries ascompared by Proximus allows 100times more CO The budget made available for carbon credits credits. serves asproof for theissuance of carbon The use of these cookstoves isregistered and in 2017. with improved cookstove compared to 1700 In 2018,1200households were provided a growing numberof cookstoves. TEG module withaview to integrating itinto the most efficient way to design anduse this Intensive research isbeingconducted to find dangerous andpolluting paraffin lamps. 2 -friendly projects inAfrica islower, 2 to be be to reporting year, buttheorder of magnitude become material inthecurrent andfollowing the reporting year, hence theresults only projects were implemented inthecourse of over awindow of 12months.Thesavings during thereporting periodcalculated Calculation based onactions undertaken Electricity savings withintheorganization system GENY(Belgian activities). suppliers andinternal energy management Calculation based ontheinvoices of energy Electricity Energy conversion factors MWh CDPTechnical Note: Conversion of fuel data to 1 at customer premises. vendor andtheinstalled base devices by type technical consumption data provided by the Code of Conduct for digital TVservices, the based upontheformula described intheEU decoders installed atcustomer premises is related to theelectricity consumption of TV The baseline for thecalculation of savings Electricity savings sold products of installations. installation ismultiplied by thetotal number installations, theconsumption of onetype after the savings operation. For multiple consumption such asfor cooling before and consumption andanestimated indirect based onthedirectly measured electricity The infrastructure savings are calculated remains comparable onayear-by-year basis. 1 through aposteriori sorting of theresidual • waste withenergy recovery. recycling, reprocessing, reuse orresidual • hazardous waste. • waste collections. and theindividually measured weights of the • waste processors: additional information received from the annual report, whichisthenupdated with processors are combined into asingle Monthly bills andcertificates of waste Waste calculation • • Calculation based onsupplierbilling data: Heating or expense statements. the supplier,based onfuel card consumption Calculation based oninvoices andreports of Transport Proximus’ environmental management Environmental management system categories such aswood, metal, paper, etc. waste by the waste processor into recyclable Additional reduction inresidual waste Processing methodsuch ascomposting, Distinction between hazardous andnon- The average weights of thesubscriptions Heating oil:heatingoiltank refills Gas: meter readings Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 128 public transport and bicycles). for employees to further promote theuse of (mobility campaigns, surveys andinfo sessions campaigns related to environmental issues • Resources andactivities batteries). policy andprocedures (packaging, WEEE, external organizations, which audit ourwaste • or theExecutive committee or CSRdepartments,theBoard of Directors, aspects attherequest of the environment out audits onall kindsof environmental reports to theboard of directors andcarries • department department, including theenvironmental • environmental issues andCO (CSR) department,withastrong focus on • Stakeholders system hasavariety of tools andresources. There are different parties involved andthe system ismade upof different components. The internal audit department,which The corporate prevention &protection The Corporate SocialResponsibility Procedures, guidelines, plansand Government-accredited independent 2 reduction of employees. mobile and wireless telephony onthehealth • • and limitdisturbance for neighbours, to ensure compliance withnoise standards • as recycling, eco-design andlife cycle, procedures concerning waste reduction, such • ISO9001 certificate, • committee, toolboxes, internal reporting to theexecutive • and control of permits, issues such ashazardous products, waste • • air pollution intheBrussels Region, • campaigns onwaste recycling, 2016-2019 for IVCIE andawareness • E-learning module ontheimpact of Soil survey for high-riskinstallations, Noise studies andcontrol measurements Environmental clauses inpurchasing Integrated management system, Communication channels:intranet news, Field visitsconcerning environmental Environmental policy, Anti-pollution planintheevent of severe New packaging waste prevention plan we gainedastructured understanding of materiality assessment process. Assuch expert assistance, we proceeded to a This year, for thefirst timeandwithexternal Materiality determination materiality engagement and Stakeholder stakeholders. for theidentification of material topics and and reputation survey served astheinput The mediaanalysis, aswell asthepeerreview account. review andreputation survey were taken into a whole. Amediaanalysis aswell asapeer issues butalso theones of theindustryas not only capturing Proximus’ sustainability First anexternal materiality view was taken Step 1:External analysis of three steps: Board of Directors. Theprocess consisted matrix, whichwas also validated by our The assessment concluded inamateriality further report onthese most relevant topics. stakeholders themost. Also, thisenables usto economic impact andwhatmatters to our where we have asocial, environmental and materiality matrix.Itprovides acomprehensive the internal materiality workshop into one the external analysis andtheresults of The integrated materiality matrix combines Step 3:Integrated Materiality Matrix to definethose that are truly key. in theexternal analysis, which we thenplotted of material topics andstakeholders obtained We started from theaforementioned long list functions of Proximus. the business units,management andsupport The workshop included representatives of all mapping ourstakeholders andmaterial topics. structured andfacilitated workshop thereby We organized awell prepared, semi- Step 2:Internal materiality workshop be validated withinternal stakeholders. upon thissubsequently ashortlistcould then an impact insociety were identified.Based Relevant topics, onwhichProximus can have dialogue were taken into account. described inoursection onstakeholder Indeed, inthisway also thestakeholders from both views. overview of themost material topics taken Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 129 Influence on stakeholder assessments & decisions Significance of economic, environmental &social impacts Materiality Matrix 2018 20 18 16 10 15 19 12 17 8 6 3 4 13 9 21 22 11 14 2 5 7 1 20 10 Customer relationship Pricingandbilling transparency Humanrights Redundancies Sponsoring Responsible marketing Law suits/claims Responsible taxes andstate contribution Qualityproducts andservices Responsible sourcing andresource effi Remuneration Digital competitiveness of institutionsandcompanies Socialengagement anddevelopment Humancapital &employee development Health andsafety Privacy &data security Sustainable supply chain Business conduct &Ethics Circular economy: Electronic waste andequipmentrecycling Energy andgreenhouse gases Connectivity anddigital inclusion Innovation andsustainable infrastructure 19 16 18 14 22 15 13 21 12 17 11 4 9 6 8 5 3 2 7 1 Proximus Group Annual Report 2018 ciency

Appendix Governance and Compliance Sustainabilty Proximus at a glance 130 Index. on andthisisfurtherdetailed inGRIContent can have. These topics are formally reported for stakeholders andtheimpact Proximus are thenthetopics whichare most material The upperquadrant (topic 1 to 11,14 and21) topics. environmental andsocial impacts onthese negative) Proximus hasinterms of economic, indicates thepotential impact (positive or is to these stakeholders. Thehorizontal axis stakeholders andhow important thistopic or influence thetopic hasontheselected society. Thevertical axisindicates whatimpact impact thatProximus haswiththetopic on the vertical axisdetermines thedegree of The combination of thehorizontal axisand Stakeholder group What they expect How we engaged them Main topics & concerns in 2018 Our response Our 2018 in &concerns topics Main them engaged we How expect they What group Stakeholder Employees market. job changing this in need they skills new the learning of possibility the tooffer us expect they Finally, works. company our how on impact an tohave and ambitions totheir fitted &challenges opportunities toreceive expect also They with. comes it flexibility the as well as environment work advanced and asafe with them toprovide us expect Employees is makingsure we maintain astructured framework andincluding thematerial topics, A bigpartof implementing ourcontribution Stakeholder dialogue and definitions. systems anddevelop thenecessary targets will furtherprepare in2019 thereporting Internally, 2018isatransition year. We forward. determine whichtopics to address going Based onthemateriality matrix,we can Step 4:Implementation Material Topics section. well astheirboundarycan befound inthe The definitionof each most material topic as Employee care, p.44). care, Employee in more (described concerns their about specialist HR toan to talk employee each for possibilities many offer We also more. and opportunities, atmosphere, environment, work our of points many toevaluate possibility the have they survey, this In Speakup. called survey a in yearly employees our We engage structured andregular basisinorder for the needto connect withthemonamore and regular way. However, we understand have always beenengaged inastructured (e.g. investors, thefinancialcommunity, etc.) on project orbusiness needswhile others stakeholder groups very organically, based In thepast,we reached outto some of our digital services and partof theBelgian society. they expect andwant from usasaprovider of decisions. Whatwe domuststem from what stray from what really impacts themandtheir stakeholder dialogue, to ensure we donot on aregular basis. stakeholder dialogue andensure engagement developed anapproach to structure our what we doto stay relevant. We thushave execution of our strategy. our of execution the in as well as moves to competitive answer we way the in agility our increase to need the voiced employees Our interactions withourstakeholders: This year, we have had the following Investors. leaders (such asuniversity heads, etc.) and Sales &CSRpartners, Employees, Opinion & regulatory bodies, Start-up communities, clients (SE,ME,COR), Press, Government on theyoungsters (18-25y.o.)), Corporate (including customers, andwithaspecificfocus groups asour stakeholders: General public At Proximus, we consider thefollowing employees whose jobs allow it. allow jobs whose employees our of majority the for flexibility to ensure largely extended been has Homeworking working. of ways transversal fostering organization, empowered agile, as such working of ways new as well as rotation job through fostered is mobility Internal company. the in deployed be can talents best how toassess boards review talent organize We regularly basis. yearly on set Indicators Performance Key Group the of part is SpeakUp survey. the in identified improvement of areas towards work we toensure plans action company and deploy business unit, department, team we employees, our by raised concerns of areas upon and processed yearly is SpeakUp called survey engagement Our Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 131 regulators & Government Stakeholder group What they expect How we engaged them Main topics & concerns in 2018 Our response Our ME, COR) (SE, customers Business 2018 in &concerns topics Main them engaged we How customers Residential expect they What group Stakeholder business ethics. torespect expected We are change. climate down toslow part our playing and tosociety contributing includes This involvement. and investments through tomorrow of &economy society digital the developing in arole toplay company, state-owned &partly aBelgian as us, expect also They & internationally. Europe Belgium, in place in regulations and rules all with tocomply us expect regulators and Government clients better. clients own their serve them help thus and digital more tobecome them with collaborate also but needs, connectivity their serve only tonot us want They times. all at service high-quality and personalized a expect customers business Our Belgium. in player akey as role our tofill us expect They in. live they society tothe tocontribute us for also but world, digital tothe access unfiltered tohave only not want Customers experience. user and connectivity of terms in trends latest the on up-to-date be toalways us expect They services. and product high-quality to receive tous turn customers residential Our basis. aregular on occur interactions These zones). white in coverage internet toincrease one the as (such partnerships todevelop representatives and politicians also maintain regular interactions with etc.We GSMA, (ETNO), Association Operators’ Network Telecommunications European the Agoria, as such associations business through regulators and representatives government our with engage ®ularly We proactively meetings tomorrow for ready 60 organised have will we 2018 In technologies. newest our with them support can we how and customer’s digital transformation needs the in dive todeep also but roadmap development and strategy own our on feedback experience, customer to their relation in feedback tocapture aim we fora different these Through boards. advisory and forums Customer the of Voice as well as meetings tomorrow for ready surveys, personal regular through customers business our engage We clients. toour out toreach ways other created have we channel partner indirect and centres contact managers, account our through customers our with channels interaction regular toour Next counting more than 500 participants. 500 than more counting organized, were sessions thinking design & co-creation consumer 20 2018, In customer. the of voice called initiative internal an have We also groups. focus and sessions thinking design through customers with co-create continuously to ways up set We thus needs. to their can we best the torespond us for key is operations our in customers our Including failure being considered network of case in users of compensation automatic payments; mobile and SMS stricter rules for premium numbers/ and invoices of non-payment of case in on consumer protection: new obligations focus maintained Government Belgian networks parallel in toinvest planning Regions 2019 in organized tobe auctions spectrum the in player mobile a4th of entry the favouring conditions introduce to considering Government Belgian network fiber toits copper its from extended regulation Proximus • Business • Business continuity • Customer solutions customer experience Relevant • • Smart phone, wi-fi and TV usage TV and wi-fi phone, Smart • • Customer experiences digital seamless experience for Need • offers no-frills competitive for Need • differentiating and relevant for Need • customer solutions obligations. new of toimposition actions commercial adequate with responds business the and rules new with compliance timely ensure we authorities, relevant the towards position our We advocate • Move towards vertical solutions & solutions vertical towards Move • network our in investments Further • particular got journeys customer Four • our toexpand M&A Selective • • Further investments in our network our in investments Further • entertainment anew Launch • of awareness brand the of Aboost • Proximus unlimited an of Launch • mobile anew Epic, of Launch • sectors e.g. Healthcare e.g. sectors specific in solutions relevant more customer segmentations to develop experience customer toimprove focus &cloud integration application capabilities in cybersecurity, application market the on offer frills no best the Scarlet, price acompetitive at offer mobile experience with full digital onboarding Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 132 Society at large at Society Suppliers Stakeholder group What they expect How we engaged them Main topics & concerns in 2018 Our response Our 2018 in &concerns topics Main them engaged we How Investors expect they What group Stakeholder current challenges. current solve can that services and products todevelop us want They environment. the respecting while tosociety contribute and ethical be data, their about tocare us want They Belgium. for legacy positive a behind toleave and price right the at opportunities digital and connectivity tooffer Proximus expects Society prices. fair with contract transparent tooffer us want They deal. the of end our uphold and commitment long-term our tofulfil us expect suppliers Our receive clarification and ask questions. ask and clarification receive to opportunity the with management totop access necessary the them provide to expected are We also updates. accurate timely need and value to create expect we how toknow want also They perspectives. tomid-term short and forward going ambitions and strategy our achievements, our on them with clear are We in. operate we market the on insights and communication company consistent and accurate clear, atransparent, expect markets financial the and investors Our scope of Belgium and more. more. and Belgium of scope cultural the in also but employability, education, ICT of terms in alot contribute We society. Belgian the of parts different toimprove associations and NGOs various with work we and surroundings our on mark apositive toleave want we company, aBelgian As Kynetec. agency, research the by organized was It public. general the included and month one of course the over conducted was survey This stakeholders. our for have they importance the as well as these on performance perceived our tounderstand topics material on based survey reputation in-depth an organized we 2018, In chain. supply Sustainable on section the in further described are interactions Such principles. ethical and CSR our follow they toensure audits regular of form the in them with engage we and impactful very as suppliers our We consider invited. are investors all where assembly general a yearly organize We also investors. institutional 200 toabout spoke Proximus 2018, year the Over analysis. materiality and survey reputation our of result the in included then is which provided, was feedback investors’ occasions some For calls. conference and roadshows reverse roadshows, IR-only conferences, sector several in participations the by completed was This results. and strategy our them toexpose countries various in investors our visited Director Relations Investor and CFO CEO, our where results, half-year and full after roadshows, 2management organized we 2018, In section. the in earlier mentioned items material tothe relate concerns their of Most it. of part be to needed skills the and future the about concerned is society topics, these Besides manner. right the in treated is data their toensure and communications clearer toprovide us want also They networks. extensive more and more develop we as waves electromagnetic of impact the is citizens for A concern investments. Fiber and level capex Overall market. Belgian the in entrant new potential the and auctions spectrum Upcoming roaming pricing regulation). a (such pricing on impact Regulatory on Proximus. impact the and environment Competitive to: related mainly were 2018 during concerns and questions Investor audits) within 5years. within audits) and (assessments rating a positive with suppliers 75% of tohave aims Proximus clear KPIs for each topic. each for KPIs clear contains and conducted we survey the on based is framework This framework. contribution our through inclusion digital the and tosociety contribute we Finally, subject. the on certifications ISO acquire We also laws. newest the with comply and privacy data around guidelines and rules strict We have website. our on waves electromagnetic on advice and communication clear offering by concerns totheir We contribute forward. going scenarios potential the investors with discussed has and project Fiber the announcing when target capex a3-year set has Proximus meetings. during discussed extensively and pack, information quarterly the in disclosed been have conditions auction and spectrum on Information quarter. by impact actual the disclosed and 2018 for regulation from impact financial estimated its disclosed Proximus communicated. clearly is pricing of evolution the Also, etc.). Mobile, Voice, Fixed TV, (Internet, products main the on etc.) ARPUs, shares, market growth, customer (net KPIs several of publication the through market Belgian the in get insight in Proximus’ achievements to investors allows disclosure A detailed within the Joint Audit Cooperation. Audit Joint the within Proximus by followed-up systematically are audits sustainability of points Action assessment. initial following year the reassessed systematically are score anegative with risks environmental and rights human on screened Suppliers Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 133 regular interactions withpolicymakers. state asmajorityshareholder, resulting in is apublicautonomous company withthe Ho w we engage withpolicymakersProximus strategy. starting pointfor ournew 3-year sustainability such survey onall ourstakeholder groups, as to adjust ourstrategy. In2018,we conducted update ourmateriality matrix, withtheaim measure progress onreputation items and depth survey of all ourstakeholder groups to • and definepointsof action for Proximus. will beoverseen by anobjective third party are mutually important to address. Thispanel stakeholders to discuss specifictopics that • day basisaccording to more specificdemands. • way, asfollows: stakeholder outreach inamore structured Going forward, we want to organize our We will set abi-yearly panelof We will involve stakeholders onaday-to- Every 3years, we aimto conduct anin- approach policy makers directly. Proximus hasalways had thepolicyto transparent behaviour. Inthepastyears, upholds strictstandards onethical and government institutions.Management of political parties, political individualsor Proximus refrains from any sponsorship European level. engage withpoliticians attheBelgian & associations and through them,we also We are memberof various (business) world. consequences of arapidly changing(digital) which helpto debate inthepublicarena the on every political level andsponsors activities Proximus actively engages withpolicymakers Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 134 Social figures Total numberof employees (FTE)by employment contract (Proximus SA/NV) Total numberof employees (FTE)by gender(Proximus SA/NV) okr ,4. 1,001.6 10,168.1 1,149.8 10,330.8 Workers Employees ae80887,794.2 3,375.5 8,068.8 3,411.8 Male Female 072018 2017 2018 2017 Total numberof employees (FTE)by employment contract, by gender(Proximus SA/NV) aeDfnddrto 70100.0 97.0 84.0 3,238.6 7,746.0 64.0 3,746.9 duration Defined 7,537.7 1.0 184.0 35.0 161.0 Male Defined duration Female Gender Undefined duration Statutory Replacement contract Defined duration contract Employment tttr ,5. 2,638.4 5,054.8 3,056.9 4,888.9 1.0 600.2 2,691.2 26.0 690.0 2,648.8 0.0 Undefined duration Statutory 9.0 Replacement contract Undefined duration Statutory Replacement contract 21 2018 2017 Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 135 Total numberof employees (FTE)by employment type,by gender(Proximus SA/NV) Total numberof employees (FTE)by employment contract, by region (Proximus SA/NV) aeFl ie70386,821.0 7,053.8 2,541.8 2,524.6 973.2 833.7 1,015.0 887.2 Full time Part 50.0 time Full Male Part 37.0 Female time 1,383.4 83.0 time 1,315.3 Undefined 70.0 duration Defined 0.0 Wallonie duration 19.0 Defined duration Replacement 0.0 Vlaanderen 8.0 contract Replacement Bruxelles / Brussel contract tttr ,6. 912.0 1,060.2 1.0 954.1 1,341.5 8.0 1,096.9 1,217.4 1,372.5 Statutory 5,021.2 Replacement contract 1,589.8 5,005.1 51.0 Undefined duration Statutory 54.0 Undefined duration Statutory duration Defined 21 2018 2017 2018 2017 and age group Total numberandrate period/Number of women working atProximus by endof thereporting period)*100. entries inthatcategory attheend of thereporting period.E.g.:(Number of new We female defi hires within thereporting 2 and age group Total numberandrate of employee turnover (FTE)duringthereporting period,by gender 2018 33.2% (341.0) 3.2% (201) 15% (6) 4.9% (548) 4.9% 3.4% (390.3) (6) 15% 5% (601.0) (14.0) 0.3% (201) 3.2% 0.4% (16.0) (129.3) 2% (341.0) 33.2% (258.0) 3.9% (247.0) 25.2% (327.0) 30.7% (548.0) 4.9% 2018 3.4% (390.3) (371.0) 4.8% 2017 3.1% (251.3) 2016 (177.0) 5.2% 4.1% (139.0) 2018 2017 2018 9.5% (96.1) 2.1% (119.9) 12.1% (522.7) 6.6% (738.7) 6.6% (789.4) 6.9% (522.7) 12.1% (537) 13% 2.1% (119.9) 2.1% (135.7) (96.1) 9.5% (116.7) 11.9% 6.6% (738.7) (789.4) 6.9% 7.4%2018 (572.5) 7.5% (608.2) 2017 (166.2) 4.9% (181.2) 5.3% 2018 2017 ne arate asbeingthe numberof new entries over thereporting period,dividedby thetotal numberof ne 03-0oe 0Total 50 over 30-50 Total 30 under Male Female ne3 05 vr5 Total over 50 30-50 Total under30 Male Female 2 of new employee hires (FTE)duringthereporting period,by gender Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 136 Expressed inheadcount, not FTE. 4 Expressed inheadcount, not FTE. 3 employed 12monthsafter theirreturn to work, by gender Total numberof employees thatreturned to work after parental leave endedthatwere still ended, by gender Total numberof employees thatreturned to work inthereporting periodafter parental leave Total numberof employees (FTE)thattook parental leave, by gender Total numberof employees (FTE)thatwere entitled to parental leave, by gender 071213385 193 396 192 385 2018 189 2017 193 208 364.0 214 349.5 2018 178.2 2017 163.9 185.8 3,278.3 185.6 3,467.8 2018 2,245.8 2017 2,382.9 1,032.5 1,084.9 2018 2017 3 3 0 6 369 166 Total 203 Male Female Total Male Female Total Male Female Total Male Female .4 Return to work parental leave/ Total Calculation: (Total numberof employees number of returning employees from retained parental 12months after leave returning inthepriorreporting to work period(s))*100 following aperiodof 6 ployees due to return Calculation: to (Total work after taking parental leave)*100 number of employees thatdidreturn to work after parental leave/ Total numberof em- 5 the reporting period,by genderandemployee category (inhours) Average hours of training thattheorganization’s employees (FTE)have undertaken during 083 82 522 19 25 32 24 24 24 28 22 27 35 24 23 21 2018 2017 23 24 2018 2017 079.%9.%94.4% 93.2% 98.0% Total 99.0% 95.5% 98.4% Male 98.9% 2018 Total 2017 Female 97.7% rates Retention 99.1% Male 2018 2017 Female work to Return 4 5 andretention rates xctv eirMtMdl g oe g Employees Lower Mgt Middle Mgt SeniorMgt Total Executive Male Female 40 49 94.4% 94.9% 94.0% 6 of employees thattook parental leave, by gender Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 137 of all thetheoretical working days amongstfemale employees)*100. Calculation example for female employees: (sum of all theillness days registered amongst female employees/sum absent from work because of taking anillness day (with orwithoutattest), excluding work accidents &pregnancy. theoretical working days, taking into account by defi Measure of actual absentee days lost,10 expressed asthe numberof illness days dividedby thenumberof employees days (due to occupational disease oraccident)/total numberof hours scheduled to beworked by Proximus Group unable to perform theirusual work because of anoccupational disease oraccident. Calculation: total number of lost is defi Impact of occupational diseases andaccidents asrefl 9 nal diseases/ total numberof hours scheduled to beworked by Proximus Group employees injury) relative to thetotal timeworked Frequency by all of workers occupational diseases (disease arisingfrom duringthereporting awork period.Calculation: situationoractivity, orfrom awork-related number of occupatio- 8 Frequency of injuries, relativenumber of injuries inProximus to thetotal Group/total timeworked by all number of hours workers scheduled to duringthereporting beworked period.Calculation: by Proximus Group employees 7 Proximus had nowork-related fatalities in2017and2018. rate (AR Types of injury, injuryrate (IR 08000 .040.0003 0.0004 Total 0.0004 0.0004 0.0000003 Male 0.0002 0.0000004 Total 0.0002 Female 0.0000003 2018 0.0000003 Male 2017 0 Total 0.000007 LDR 0.0000004 0.000006 Female 0.000008 2018 Male 0.000009 2017 0.000005 ODR 0.000006 Female 2018 2017 IR 081.%63 7.7% 7.5% Total 6.3% 6.2% Male 10.8% 10.5% Female 2018 2017 AR ned astime(‘days’) thatcannot beworked (andare thus ‘lost’) asaconsequence of a worker orworkers being 10 ), andwork-related fatalities, for all employees, withabreakdown by gender 7 ), occupational disease rate (ODR nition thework regime of the person. Anabsentee isaworker ected intimeoff work by theaff 8 ), lost day rate (LDR ected workers. ALost day 9 ), absentee whose work, orworkplace, iscontrolled by theorganization, withabreakdown by gender Types of injury, injuryrate (IR),and work-related fatalities, for all workers (excluding employees) 0802 3 Male 0 0 Female 2018 2017 IR Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 138 Environmental figures revenue in Mio €) Mio in revenue TJ in total vs organization the within consumption (energy ratio efficiency Energy oa nrycnupinwti h raiain T) 197197186 302-1e 302-1a 1,876 1,967 552 1,997 575 595 (TJ) sources non-renewable from organization the within consumption Total fuel (TJ) organization the within consumption Total energy lcrct,haig oln rsemsl T) 000 321 302-1d 302-1c 0 0 0 0 0 302-3 0 302-1b 0.140 0.147 0 0.146 0 0 (TJ) sold steam or cooling heating, Electricity, (TJ) consumption steam or cooling Heating, TJ in FTE) vs organization the within consumption (energy ratio efficiency Energy Group -Belgium/ IREC or REC GO, with sources renewable from consumed % electricity (TJ) consumption Electricity (TJ) sources renewable from organization the within consumption Total fuel Being CO : Assured by our external auditor etn:Ntrlgs(J 0 0 0 302-1a 101 101 105 (TJ) Petrol fleet: Vehicle (TJ) Diesel fleet: Vehicle (TJ) oil Heating Heating: (TJ) gas Natural Heating: 2 -neutral: Energy baseline 2014 .4 .3 .2 302-3 0.322 0.339 0.340 1,402 1,392 1,323 302-1c 100/99 1,323 100/98 1,392 100/98 1,402 2 0 9 302-1a 302-1a 398 50 302-1a 409 214 63 429 59 aeie21 0721 Target 2018 2017 2016 baseline 2015 commitment RE100 Proximus Group Annual Report 2018 indicator Ext. audit Ext. indicator GRI

Appendix Governance and Compliance Sustainabilty Proximus at a glance 139 Carbon intensity (Tons CO (Tons intensity Carbon COEvolution COEvolution CO CO (Tons intensity Carbon Evolution COEvolution CO lcrct osmto ihnteognzto Gh 8 8 6 368 387 389 (GWh) organization the within consumption Electricity CO CO CO (KTons) travel) CO Being CO Being CO : Assured by ourexternal auditor 2 2 2 2 2 2 msin cp lcrct oainbsdmto Kos² 6. 846. 305-2 305-1 65.0 3.0 68.4 2.6 69.3 3.0 38.0 40.9 43.9 46.5 45.4 48.4 categories -8relevant 3(KTons) scope e emissions 3business scope 2en 1en (scope credits carbon by compensated e-emissions (KTons)² method based -location 2-electricity scope e emissions (KTons) method based -market 2 -electricity scope e emissions (KTons) fuel fleet and refrigerants 1 -heating, scope e emissions 2(KTons) 1and scope e emissions CO nrysvnsntok(J 3 7 324 302-4 47 137 269 285 282 centers data PUE (TJ) network savings Energy (GWh) +Shops Offices (GWh) Centers Data (GWh) network mobile and Fixed CO CO 2 2 2 msin cp ergrns(Tn) 484603 0- 305-1 305-1 0.3 10.0 4.6 11.0 4.8 10.9 (KTons) 1-refrigerants scope e emissions (KTons) 1-heating scope e emissions msin cp le ul(Tn) 2. 832. 351 305-1 27.7 28.3 29.7 (KTons) fuel 1 -fleet scope e emissions 2 2 2 msin cp n v 07bsln) -1 7%-5 0- 305-5 305-5 -75% -12% -72% 305-5 -71% -4% (2025) -30% -19% -4% -8% -4% baseline) 2007 2(vs 1and scope e emissions Target Based -Science baseline) 2015 2 (vs 1and scope e emissions year) previous 2(vs 1and scope e emissions 2 2 -neutral: GHG -neutral: Energy 2 2 cp n / T’) 363531 0- 305-4 305-4 3.1 3.5 7.0 3.6 8.0 8.2 2/# FTE’s) 1and e scope revenue) 2/Mio€ 1and e scope 2 77 6 6 0 809 305-3 767 765 765 baseline baseline 2014 2014 ,616 ,5 1,65 43 1,63 55 45 1,66 56 48 59 004. 22 42.2 47.9 50.0 aeie21 072018 2017 2016 baseline aeie21 0721 Target 2018 2017 2016 baseline 2015 2015 Target Proximus Group Annual Report 2018 indicator Ext. audit Ext. indicator indicator Ext. audit Ext. indicator GRI GRI

Appendix Governance and Compliance Sustainabilty Proximus at a glance 140 . New calculation methodology -direct refi 3. Restatement of fi 2. 99%of thehazardous waste isbattery related andtemporary highbecause of thenetwork migration program 1. Scope 3 - category 2 - capital goods (KTons) -Belgium (KTons) goods 2-capital 3-category Scope COEvolution cp aeoy4-tasotto n itiuin(Tn)-Blim7743 305-3 3 4 7 7 -Belgium (KTons) distribution and 4-transportation 3-category Scope Group - (KTons) 2) 1en scope in (not activities related energy and 3-fuel 3-category Scope cp aeoy6-bsns rvl(Tn)-Blim2211 305-3 305-3 305-3 1 4 1 1 4 1 2 4 1 2 5 1 -Belgium (KTons) products sold of -use 11 3-category Scope -Belgium (KTons) commuting 7-employee 3-category Scope -Belgium (KTons) travel 6-business 3-category Scope -Belgium (KTons) disposal 5-waste 3-category Scope Scope 3 - category 1 - purchased goods and services (KTons) -Belgium (KTons) services and goods 1-purchased 3-category Scope Being CO :

Deloitte provided alimited external assurance onthese indicators for theyear 2018 Assured by ourexternal auditor 2 emissions scope 3 (vs 2014 baseline) - Science Based Target Based -Science baseline) 2014 3(vs scope emissions 2 -neutral: GHG gures due to better data qualityand/orupdate of emission factors ll reports from subcontractors (better data quality) 2 2 2 2 baseline 2014 4 6 7 8 305-3 184 177 169 146 1 9 8 4 305-3 540 481 492 518 88 76 305-3 64 87 80 78 11 11 305-3 11 11 11 11 %0 +5% 0% 0% aeie21 072018 2017 2016 baseline 2015 -10% (2025) (2025) -10% and -50% -50% and (2040) Target Proximus Group Annual Report 2018 indicator Ext. audit Ext. indicator 0- 305-3 GRI

Appendix Governance and Compliance Sustainabilty Proximus at a glance 141 ubro eubse Vdcdr 3,5 9,9 2,9 0- 301-2 301-2 301-3 222,991 301-3 199,797 182,553 134,356 122,397 -41% 170,765 -33% 44% 32% -28% 56% 24% 19% 24% 0% -Belgium (‘000L) Water (KTons) consumption Paper Evolution average energy consumption customer decoders vs 2014 Number of refurbished decoders/number TV of new installed decoders TV (%) Number of refurbished decoders TV (%) modems installed new of modems/number refurbished of Number Number of refurbished modems recycling phone mobile for reward as toschools offered computers refurbished of Number ubro nieadt nclaoainwt A 98 1 91 89 69 40% 40% 43% 306-2 306-2 306-2 JAC with collaboration in audits onsite of Number PLC -Proximus scorecards CSR supplier by covered spend total the % of 2.0 12.2 9,237 1.7 9,042 9.6 4,493 14,000 1.8 2,141 25,000 12.3 recycling and reuse for Belgium GoodPlanet with schools in collected phones Mobiles recycling and reuse for shops Tango and Proximus in collected phones Mobile -Belgium (KTons) recovered or -recycled waste Hazardous -Belgium (KTons) recovery energy -with waste Non-hazardous -Belgium (KTons) reused or -recycled waste Non-hazardous fhzroswse-Blim 28 .%40 306-2 306-2 2025 in 90% 87% 4.0% 85% 4.3% 88% 2.8% -Belgium reused/recycled % waste -Belgium waste hazardous % of -Belgium (KTons) Waste Sustainable supply chain Being circular : Assured by ourexternal auditor 1 baseline baseline 2014 2014 9 6 9 303-1 194 146,599 260 124,611 123,530 299 156 250 320 451. 47 306-2 14.7 11.8 14.5 . . . 306-2 0.6 0.5 0.4 aeie21 072018 2017 2016 baseline aeie21 072018 2017 2016 baseline 2015 2015 -50% (2019 vs vs (2019 -50% 2013-2020 200,000 in 2014) Target Target Proximus Group Annual Report 2018 0-, 302-2,5 indicator Ext. audit Ext. indicator indicator Ext. audit Ext. indicator GRI GRI

Appendix Governance and Compliance Sustainabilty Proximus at a glance 142 GRI Content index 102-11 Precautionary principle or approach Proud to be CO tobe Proud approach or principle Precautionary 102-11 0- upycanSsanbespl hi,p6 Sustainable supply chain, p.64 organization tothe changes Significant Supply chain 102-10 102-9 102-8 Information on employees and other other and employees on Information 102-8 0- akt evdWow r htw o . audit Ext. p.8 do, we & what are we Who p.134 figures, Social p.68 model, governance Proximus p.8 do, we &what are we Who Omission organization Bruxelles the of -1030 Scale 27B II, Albert Roi du Boulevard served Markets 102-7 form legal and Ownership 102-6 operations of Location p.8 do, we &what are we Who 102-5 information and/or URLS(s) number(s), Page headquarters of Location services and 102-4 products, brands, Activities, Law Public Belgian under company limited public Proximus 102-3 102-2 organization the of Name disclosure GRI 102-1 # Profile Organization Disclosures General standard GRI 102-12 External initiatives #embracedifference pledge; DigitalforHer declaration; Decent work work Decent declaration; DigitalforHer pledge; #embracedifference initiatives External 102-12 and its supply chain supply its and workers N.A. Social figures, p.134-135 Reporting on employees of of employees on Reporting p.134-135 figures, Social Key Financial Highlights, p.10-12 Highlights, Financial Key for all - Commitment charter -Commitment all for 2 nurl .1 p.61 neutral, None to report on in 2018 in on toreport None applicable to Proximus Group. not considered is contractors

non-exhaustive list

Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 143 0-4Kytpc n ocrsrie tkhle naeetadmtraiydtriain .3-3 Stakeholder engagement and materiality determination, p.130-133 Stakeholder engagement and materiality determination, p.130-133 Key topics and concerns raised Approach to stakeholder engagement 102-44 102-43 102-42 Identifying and selecting stakeholders Proximus selects its stakeholders based on its business, their their business, its on based stakeholders its selects Proximus stakeholders selecting and Identifying 102-42 102-41 Collective bargaining agreements 98.5% of employees covered by collective bargaining agreements agreements bargaining collective by covered employees of 98.5% agreements bargaining Collective 102-41 engagement Stakeholder oenne121 oennesrcue oprt oennesaeet .87 p.68 model, governance Proximus Corporate governance statement, p.68-74 authority Delegating 102-19 Governance structure 102-18 Governance taey121 ttmn rmsno eiinmkr oeodfo u E himn .- p.4-7 &Chairman, CEO our from Foreword decision-maker senior from Statement norms and standards, principles, Values, 102-14 102-16 integrity and Ethics Strategy GRI standard # GRI disclosure Page number(s), URLS(s) and/or information Omission Ext. audit Ext. Omission information and/or URLS(s) number(s), Page ETNO Membership of associations 102-13 disclosure GRI # standard GRI 0-0Ls fsaeodrgop tkhle naeetadmtraiydtriain .3 Stakeholder engagement and materiality determination, p.130 List of stakeholder groups 102-40 of behaviour partner and maintain a relationship with. arelationship maintain and partner we those as well as operations, our by impacted those all include We themes. contribution main our and industry toour relevance (all employees except Extended Leadership Team) Leadership Extended except employees (all Non-financial governance, p.81 governance, Non-financial and digital mindset digital and orientation customer accountability, agility, collaboration, Values: website) our on (available conduct of Code p.4-7 &Chairman, CEO our from Foreword p.50-51 right, business Doing Belgian Association of Marketing Marketing of Association Belgian Talent2Connect Cooperation Audit Joint Be.Face Shift The Coalition Security Cyber Guberna ETIS ISPA Belgium Center on Regulation in Europe GSMA Benelux Business Roundtable VKW Wallonie de Cercle Entreprises) des Wallonne (Union UWE BECI (Union des entreprises de Bruxelles) Agoria VOKA VBO/FEB

non-exhaustive list Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 144 103-2 The management approach and its its and approach management The 103-2 0-5GICnetidxGICnetIdx .4-5 Transparency- p.124 assurance, external GRI Content Index, p.142-156 infrastructure sustainable and Innovation topic: material high with Linked assurance External GRI Content index 102-56 2018 31, 1toDec Jan the with accordance in reporting of 2017 March, Claims 102-55 Stakeholder engagement and materiality determination, p.128 the regarding questions for point Contact approach 2016 102-54 GRI 103: Management 102-53 Date of recent report most period Reporting 102-51 Changes in reporting 102-50 Annually 102-49 Reporting 102-52 cycle 102-48 Restatements of information There is no restatement of information unless specifically otherwise otherwise specifically unless information of restatement no is There information of Restatements 102-48 0-7Ls fmtra oisOur materiality matrix, p.27 List of material topics 102-47 102-46 Defining report content and topic topic and content report Defining 102-46 GRI standard # GRI disclosure Page number(s), URLS(s) and/or information Omission Ext. audit Ext. Omission information and/or URLS(s) number(s), Page disclosure GRI consolidated the in included Entities 102-45 # practice Reporting standard GRI 103-1 Explanation of the material topic and its its and topic material the of Explanation 103-1 components Boundaries standards GRI report Boundaries financial statements Transformation & Innovation Committee, p.71 p.81 governance, Non-Financial p.68 model, governance Proximus p.31-35 innovation, Digital p.29-31 infrastructure, digital Future-proof s@rxmscm operations. of countries in institutions governments and communities customers, all - Outside: Group Proximus of management - Inside: Boundaries: p.31-35 innovation, Digital p.29-31 infrastructure, digital Future-proof Material topics, p.157 p.1 2018, approach reporting Non-financial [email protected] stated in the text the in stated Material topics, p.157-158 Transparency, p.122 p.1 2018, approach reporting Non-financial the consolidated financial statements are also included in the report. the in included also are statements financial consolidated the by covered entities All structure. legal Group’ Proximus is statements financial consolidated the in covered entities the for basis The

Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 145 103-3 Evaluation of the management approach Proximus governance model, p.68 model, governance Proximus approach management the of Evaluation 103-3 Own 103-2 The management approach and its its and approach management The 103-2 Own Own economic impacts 2016 203: Indirect GRI Linked with high material topic: Digital competitiveness of companies and institutions and companies of competitiveness Digital topic: material high with Linked audit Ext. approach 2016 Omission GRI 103: Management information and/or URLS(s) number(s), Page Own p.68 model, governance Proximus Own approach management the of Evaluation Own 103-3 disclosure GRI # standard GRI : Assured by ourexternal auditor indicator indicator services indicator and investments Infrastructure 203-1 103-1 Explanation of the material topic and its its and topic material the of Explanation 103-1 indicator indicator indicator education institutes universities/ with projects of Number components p.30 infrastructure, digital Future-proof Belgium in coverage Vectoring p.30 infrastructure, digital Future-proof coverage indoor 4G supported Boundaries p.30 p.30 infrastructure, infrastructure, digital digital Future-proof Future-proof p.30 infrastructure, digital Future-proof speed &ADSL VDLS average Combined coverage Mbps 30 internet: Fixed coverage outdoor 4G Overview of non-financial information, p.118 information, non-financial of Overview p.31 innovation, Digital Overview of non-finanical information, p.118 information, non-finanical of Overview p.81 governance, Non-Financial Non-Financial governance, p.81 governance, Non-Financial p.68 model, governance Proximus p.31-35 innovation, Digital p.118 information, non-financial of Overview p.118 information, non-financial of Overview p.29-31 infrastructure, digital Future-proof in countries of operations. of countries in institutions governments and communities customers, all - Outside: Group Proximus of management - Inside: Boundaries: p.31-35 innovation, Digital Material topics, p.157 p.118 information, non-financial of Overview p.118 information, non-financial of Overview p.118 information, non-financial of Overview Overview of non-financial information, p.118 information, non-financial of Overview Transformation & Innovation Committee, p.71 p.81 governance, Non-Financial

Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 146 Own assessment 2016 rights Human 412: GRI 205-3 Confirmed incidents of corruption and and corruption of incidents Confirmed 205-3 2016 Anticorruption 205: GRI 103-3 Evaluation of the management approach Doing business right, p.50-51 right, business Doing approach management the of Evaluation 103-3 103-2 The management approach and its its and approach management The 103-2 Linked with high material topic: Business conduct and ethics and conduct Business topic: material high with Linked approach 2016 GRI 103: Management Own Own audit Ext. Omission information and/or URLS(s) number(s), Page disclosure GRI # Own economic impacts 2016 203: Indirect GRI standard GRI 412-2 Employee training on human rights indicator rights human on training Employee 412-2 205-2 Communication and training about anti- about training and Communication 205-2 103-1 Explanation of the material topic and its its and topic material the of Explanation 103-1 indicator indicator services indicator and investments Infrastructure 203-1 policies/code of conduct of policies/code of violation for department Investigations the by investigated cases of Number policies or procedures actions taken actions procedures and policies corruption components Boundaries ICT Revenues (national + international) Digital innovation, p.31 innovation, Digital +international) (national Revenues ICT Number of whistleblowing cases Doing Business right, p.50 right, Business Doing cases whistleblowing of Number p.31 innovation, Digital cards M2M Active supported rxmsgvrac oe,p6-9 p.119 information, non-financial of Overview p.50 right, Business Doing p.68-69 model, governance Proximus rxmsgvrac oe,p6-9 to corruption. related toviolations due renewed not or terminated were partners business with contracts no and corruption for disciplined or dismissed were employees No period. reporting the during case acorruption in interrogated been has employee one as mentioned be could Proximus, at aimed directly not although corruption, on incident one 2018, In p.68-69 model, governance Proximus Overview of non-financial information, p.119 information, non-financial of Overview p.81 governance, Non-financial p.68-69 model, governance Proximus Non-financial governance, p.81 governance, Non-financial p.68-69 model, governance Proximus p.50-51 right, business Doing institutions in countries of operations of countries in institutions government and communitites, suppliers, customers, all - Outside: employees) and (management Group Proximus - Inside: Boundaries: p.50-51 right, business Doing Material topics, p.157 Overview of non-financial information, p.118 information, non-financial of Overview Overview of non-financial information, p.119 information, non-financial of Overview p.118 information, non-financial of Overview p.29-31 infrastructure, digital Future-proof

Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 147 Own 2016 behavior competitive Anti- 206: GRI 103-3 Evaluation of the management approach Customer first, p.43-44 first, Customer approach management the of Evaluation 103-3 103-2 The management approach and its its and approach management The 103-2 Linked with high material topic: Pricing and billing transparency billing and Pricing topic: material high with Linked approach 2016 GRI 103: Management Health and Safety 2016 Safety and Health Customer 416: GRI 103-3 Evaluation of the management approach Customer first, p.41-44 first, Customer approach management the of Evaluation 103-3 103-2 The management approach and its its and approach management The 103-2 GRI standard # GRI disclosure Page number(s), URLS(s) and/or information Omission Ext. audit Ext. Omission information and/or URLS(s) number(s), Page services and products Quality topic: material high with Linked disclosure GRI # approach 2016 GRI 103: Management standard GRI : Assured by our external auditor indicator 206-1 Legal actions for anti-competitive anti-competitive for actions Legal 206-1 103-1 Explanation of the material topic and its its and topic material the of Explanation 103-1 indicator Own 103-1 Explanation of the material topic and its its and topic material the of Explanation 103-1 (residential customers) toinvoices related complaints in Decrease practices monopoly and anti-trust, behaviour, components Boundaries customers) Blended usage satisfaction (residential components Boundaries Overview of non-financial information, p.119 information, non-financial of Overview p.41 first, Customer Outcomes of legal actions: nothing toreport nothing actions: legal of Outcomes legislation monopoly and anti-trust of violations and behaviour anti-competitive regarding actions 3 legal website) our on (available report management Consolidated Overview of non-financial information, p.119 information, non-financial of Overview p.81 governance, Non-financial p.68 model, governance Proximus Non-financial governance, p.81 governance, Non-financial p.68 model, governance Proximus p.43-44 first, Customer - Outside: all customers all - Outside: Boundaries: p.43-44 first, Customer Material topics, p.158 Overview of non-financial information, p.119 information, non-financial of Overview p.41 first, Customer Overview of non-financial information, p.119 information, non-financial of Overview p.81 governance, Non-financial p.68 model, governance Proximus Non-financial governance, p.81 governance, Non-financial p.68 model, governance Proximus p.41-44 first, Customer - Outside: all customers all - Outside: Boundaries: p.41-44 first, Customer Material topics, p.157

Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 148 GRI 305: Emissions 2016 305-1 Direct (Scope 1) GHG emissions Environmental figures, p.139 figures, Environmental emissions GHG 1) (Scope Direct 305-1 2016 Emissions 305: GRI CO tobe Proud approach management the of Evaluation the within consumption Energy 103-3 its and approach management The 302-1 103-2 2016 Energy 302: GRI Own Reductions in energy requirements of 302-5 0- H msin nest niomna iue,p19 p.139-140 figures, Environmental Environmental figures, p.139 emissions GHG of Reduction p.139-140 figures, Environmental GHG emissions intensity 305-5 emissions GHG 3) (Scope indirect p.139 Other figures, Environmental 305-4 emissions GHG 2) (Scope indirect Energy 305-3 Environmental figures, p.138-139 305-2 p.138-139 figures, Environmental audit Ext. consumption energy of Reduction Energy intensity 302-4 302-3 Omission information and/or URLS(s) number(s), Page gases greenhouse and Energy topic: material high with Linked disclosure GRI # approach 2016 GRI 103: Management standard GRI : Assured by ourexternal auditor indicator 103-1 Explanation of the material topic and its its and topic material the of Explanation 103-1 organization components and business travel operations own for level neutrality Carbon services and products Boundaries niomna iue,p1819Environmental figures, p.138-139 CO tobe Proud Transparency, p.124 Proud to be CO tobe Proud Environmental figures, p.141 Proud to be CO tobe Proud Material topics, p.157 Proud to be CO tobe Proud Transparency, p.125-126 Transparency, p.124 CO tobe Proud Non-financial governance, p.81 governance, Non-financial p.68 model, governance Proximus p.120 information, non-financial of Overview p.81 governance, Non-financial p.68 model, governance Proximus operations. of countries in customers and communities suppliers, - Outside: Group Proximus of management - Inside: Boundaries: Overview of non-financial information, p.120 information, non-financial of Overview p.120 information, non-financial of Overview p.120 information, non-financial of Overview 2 2 2 2 2 2 neutral, p.61-63 neutral, p.61-63 neutral, p.61-63 neutral, neutral, p.61 neutral, p.61 neutral, p.61

Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 149 assessment 2016 social Supplier 414: GRI 412-3 Significant investment agreements and and agreements investment Significant 412-3 assessment 2016 rights Human 412: GRI 308-2 Negative environmental impacts in the the in impacts environmental Negative 308-2 assessment 2016 environmental Suppliers 308: GRI 103-3 Evaluation of the management approach Overview of non-financial information, p.121 information, non-financial of Overview approach management the of Evaluation 103-3 103-2 The management approach and its its and approach management The 103-2 GRI standard # GRI disclosure Page number(s), URLS(s) and/or information Omission Ext. audit Ext. Omission information and/or URLS(s) number(s), Page Chain Supply Sustainable topic: material high with Linked disclosure GRI # approach 2016 GRI 103: Management standard GRI : Assured by ourexternal auditor 414-1 New suppliers that were screened using using screened were that suppliers New 414-1 412-1 Operations that have been subject subject been have that Operations 412-1 308-1 New suppliers that were screened using using screened were that suppliers New 308-1 103-1 Explanation of the material topic and its its and topic material the of Explanation 103-1 social criteria screening rights human underwent that or clauses rights human include that contracts assessments impact or reviews rights to human supply chain and actions taken actions and chain supply environmental criteria components Boundaries Overview of non-financial information, p.121 information, non-financial of Overview Sustainable supply chain, p.64-65 utial upycan .5 K. to€125 equal or above avalue with contracts as agreements investment significant We define screening. such underwent or clauses rights human include agreements investment %of 100 Sustainable supply chain, p.64-65 Sustainable supply chain, p.65 by Proximus Group within the Joint Audit Cooperation. Audit Joint the within Group Proximus by followed-up systematically are audits sustainability of points Action assessment. initial the following year the reassessed systematically are score anegative with risks environmental on screened Suppliers sustainability standards. their toraise and suppliers among sustainability topromote used are These assessments. the of aresult as terminated Group Proximus with relationship their saw them of None score. anegative had risks environmental on screened suppliers of (22) 18% 2018, In Sustainable supply chain, p.64-65 Overview of non-financial information, p.121 information, non-financial of Overview Sustainable supply chain, p.64-65 Non-financial governance, p.81 governance, Non-financial p.68 model, governance Proximus Sustainable supply chain, p.64-65 Non-financial governance, p.81 governance, Non-financial p.68 model, governance Proximus Sustainable supply chain, p.64-65 - Outside: suppliers and communities in countries of operations of countries in communities and suppliers - Outside: group Proximus of management - Inside: Boundaries: Sustainable supply chain, p.64-65 Material topics, p.157

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Appendix Governance and Compliance Sustainabilty Proximus at a glance 150 103-3 Evaluation of the management approach Environmental figures, p.141 figures, Environmental approach management the of Evaluation 103-3 103-2 The management approach and its its and approach management The 103-2 Linked with high material topic: Circular economy: electronic waste and equipment recycling equipment and waste electronic economy: Circular topic: material high with Linked approach 2016 GRI 103: Management Own Own GRI standard # GRI disclosure Page number(s), URLS(s) and/or information Omission Ext. audit Ext. Omission information and/or URLS(s) number(s), Page chain supply the in impacts social Negative 414-2 disclosure GRI # standard GRI 103-1 Explanation of the material topic and its its and topic material the of Explanation 103-1 indicator indicator components Boundaries with JAC collaboration in audits onsite of Number PLC -Proximus scorecards CSR supplier by covered spend total the % of and actions taken actions and Non-financial governance, p.81 governance, Non-financial p.68 model, governance Proximus p.120 information, non-financial of Overview Non-financial governance, p.81 governance, Non-financial p.68 model, governance Proximus p.63-64 economy, circular the of Part niomna iue,p11 operations of countries in customers and communities - Outside: group Proximus of management - Inside: Boundaries: p.63-64 economy circular the of Part Material topics, p.157 Environmental figures, p.141 Environmental figures, p.141 Cooperation. Audit Joint the within Group Proximus by followed-up systematically are audits sustainability of points Action assessment. initial following year the reassessed systematically are score a negative with risks rights &human practices labour on screened Suppliers standards. sustainability their toraise and suppliers among sustainability topromote used are These assessments. the of aresult as terminated Group Proximus with relationship their saw them of None score. anegative had risks rights human & practices labour on screened suppliers of (18) 25% Year 2018, In Sustainable supply chain, p.64-65

Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 151 2016 Employment 401: GRI 103-3 Evaluation of the management approach Caring for our employees, p.44-48 employees, our for Caring approach management the of Evaluation 103-3 103-2 The management approach and its its and approach management The 103-2 waste 2016 and Effluents 306: GRI Linked with high material topic: Human capital and employee development employee and capital Human topic: material high with Linked audit Ext. Omission approach 2016 GRI 103: Management information and/or URLS(s) number(s), Page disclosure GRI packaging their and products Reclaimed 301-3 # Materials 301: GRI standard GRI : Assured by ourexternal auditor 401-1 New employee hires and employee employee and hires employee New 401-1 306-2 Waste by type and disposal method Part of the circular economy, p.63 economy, circular the of Part method disposal and type by Waste 306-2 103-1 Explanation of the material topic and its its and topic material the of Explanation 103-1 turnover components Boundaries materials oilfgrs .3 Social figures, p.135 Non-financial governance, p.81 governance, Non-financial p.68 model, governance Proximus p.119 information, non-financial of Overview Non-financial governance, p.81 governance, Non-financial p.68 model, governance Proximus p.44-48 employees, our for Caring Environmental figures, p.141 p.120 information, non-financial of Overview - Inside: Proximus employees Proximus - Inside: Boundaries: p.44-48 employees, our for Caring Material topics, p.157 p.120 information, non-financial of Overview Environmental figures, p.141 p.63-64 economy, circular the of Part

data. this on view no has Group organization but Proximus Recupel tothe figures WEEE the report parks container The channel. recycling this tomanage them on rely we Recupel, of a member is Group Proximus Since parks. container municipal local the in points recycling toWEEE scrap as devices life end-of- oldest the to bring allowed also are customers since Group Proximus for relevant not considered is material packaging reclaimed on Reporting Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 152 103-3 Evaluation of the management approach Overview of non-financial information, p.119 information, non-financial of Overview approach management the of Evaluation 103-3 103-2 The management approach and its its and approach management The 103-2 Linked with high material topic: Health and safety and Health topic: material high with Linked approach 2016 GRI 103: Management Own 404-3 Percentage of employees receiving regular regular receiving employees of Percentage 404-3 0- aetllaeSca iue,p16 p.136 figures, Social skills employee upgrading for Programs 404-2 leave Parental 401-3 education 2016 and training 404: GRI GRI standard # GRI disclosure Page number(s), URLS(s) and/or information Omission Ext. audit Ext. Omission information and/or URLS(s) number(s), Page employees tofull-time provided Benefits 401-2 disclosure GRI # standard GRI 103-1 Explanation of the material topic and its its and topic material the of Explanation 103-1 indicator 404-1 Average hours of training per year per per year per training of hours Average 404-1 components Boundaries mlyeeggmn Caring for our employees, p.44 Employee engagement reviews development career and performance and transition assistance programs employee part-time employees part-time or totemporary provided not are that Non-financial governance, p.81 governance, Non-financial p.68 model, governance Proximus Non-financial governance, p.81 governance, Non-financial p.68 model, governance Proximus p.48-50 employees, our for Caring - Inside: Proximus employees Proximus - Inside: Boundaries: p.48-50 employees, our for Caring Material topics, p.157 Overview of non-financial information, p.119 information, non-financial of Overview career review. career aperformance/ receives employee active each ayear 2times least At togrowth. toreturn end, the in it, helps it because Proximus for beneficial also is It better. the all perform will develops, and evolves who employee an Indeed, himself. employee the for beneficial is approach this that convinced We are feedback. and coaching continuous through further, them tosharpen employees of strengths the on focuses process review performance Our culture. toour linked closely are coaching career and development review, Performance oilfgrs .3 (#WAP)) network social enterprise our using by people or knowledge for looking actively employees Proximus of (Proportion p.119 information, non-financial of Overview p.44 employees, our for Caring Social figures, p.136 temporary contract. contract. temporary prolonged) not (and short very the impacts rule This 1/1/2019). from as anymore apply doesn’t rule (this rights pension toget service of 1year of aminimum foresees plan retirement Supplementary 2) coverage) disability coverage, death plan, retirement (supplementary proportion due at regime part-time the by impacted is benefit the of level the remuneration/service, with link adirect with benefits for 1) However, employees. full-time the at aimed package benefit the from employees temporary or part-time exclude doesn’t Proximus

relevant torelevant add. not is operation” of locations definition for “significant a employees, toits given benefits the for exception no makes Proximus As Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 153 403-3 Occupational health services Caring for our employees, p.48-50 We took the step to disclose todisclose step the We took Worker training on occupational health 403-5 and consultation, participation, Worker 403-4 p.48-50 employees, our for Caring services health Occupational 403-3 GRI standard # GRI disclosure Page number(s), URLS(s) and/or information Omission Ext. audit Ext. Omission information and/or URLS(s) number(s), Page and assessment, risk identification, Hazard 403-2 disclosure GRI # safety 2018 occupational health & Material topic 403: standard GRI 403-1 Occcupational health and safety safety and health Occcupational 403-1 and safety and safety health occupational on communication incident investigation management system Caring for our employees, p.48-50 We took the step to disclose todisclose step the We took p.48-50 employees, our for Caring p.48-50 employees, our for Caring under the same circumstances. same the under again happened will accident the that toprevent as measurements protection and/or prevention for department concerned the of management the with together look will CPP accident work each For public authorities. other any or body supervisory Work at Well-being tothe required as reported is it ensure will CPP work, at accident aserious of case In (CPP). Department &Protection Prevention Corporate the by performed be will analysis accident work each & adatabase in department RISK the by treated is data Accident subsidiary. the of department Resources/HR Human via consulted be can This subsidiaries. the for exists procedure Aseparate number. phone &free anational on possible as quickly as reported be must Proximus at occurring work at accident Every p.48-50 employees, our for Caring p.48-50 employees, our for Caring employees own our about information required the reporting on focus year, we This 2021. from compulsory be only will this though even (2018), safety occupational health and GRI disclosure concerning the of version updated to the according safety and health on employees own our about information required the reporting on focus year, we This 2021. from compulsory be only will this though even (2018), safety occupational health and GRI disclosure concerning the of version updated to the according safety and health on Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 154 103-3 Evaluation of the management approach Proximus governance model, p.68 model, governance Proximus approach management the of Evaluation 103-3 103-2 The management approach and its its and approach management The 103-2 Linked with high material topic: Connectivity and digital inclusion digital and Connectivity topic: material high with Linked approach 2016 GRI 103: Management 403-9 Work-related injuries Caring for our employees, p.48-50 employees, our for Caring audit Ext. todisclose step the We took injuries Work-related Omission 403-9 occupational of mitigation and Prevention 403-7 p.48-50 employees, our for Caring information and/or URLS(s) number(s), Page health worker of Promotion 403-6 disclosure GRI # standard GRI 103-1 Explanation of the material topic and its its and topic material the of Explanation 103-1 components Boundaries by business relationships linked directly impacts safety and health Overview of non-financial information, p.120 information, non-financial of Overview p.81 governance, Non-financial Non-financial governance, p.81 governance, Non-financial p.68 model, governance Proximus p.53-56 all, for Digital countries of operations of countries in customers and communities institutions, government - Outside: Group Proximus of management - Inside: Boundaries: p.53-56 all, for Digital Material topics, p.157 aigfrorepoes .85 p.48-50 employees, our for Caring Overview of non-finanical information, p.119 information, non-finanical of Overview p.137 figures, Social

employees. own our about information required the reporting on focus year, we This 2021. from compulsory be only will this though even (2018), safety occupational health and GRI disclosure concerning the of version updated to the according safety and health on todisclose step the We took employees own our about information required the reporting on focus year, we This 2021. from compulsory be only will this though even (2018), safety occupational health and GRI disclosure concerning the of version updated to the according safety and health on Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 155 103-2 The management approach and its its and approach management The 103-2 Linked with high material topic: Responsible marketing Responsible topic: material high with Linked approach 2016 GRI 103: Management Own privacy 2016 customer 418: GRI 103-3 Evaluation of the management approach Proximus governance model, p.68 model, governance Proximus approach management the of Evaluation 103-3 103-2 The management approach and its its and approach management The 103-2 GRI standard # GRI disclosure Page number(s), URLS(s) and/or information Omission Ext. audit Ext. Omission security data and Privacy topic: material high with Linked information and/or URLS(s) number(s), Page approach 2016 GRI 103: Management disclosure GRI # 2016 communities local 413: GRI standard GRI : Assured by ourexternal auditor 103-1 Explanation of the material topic and its its and topic material the of Explanation 103-1 indicator 1- Substantiated complaints concerning 418-1 103-1 Explanation of the material topic and its its and topic material the of Explanation 103-1 indicator Own indicator Own indicator Own components Boundaries privacy and cybersecurity and privacy to related certifications International customer data customer of losses and privacy customer of breaches components Boundaries Take Off and Bednet by school totheir connected children sick of Number initiatives in Belgium our by supported seekers job of Number category) 1disability for least (at devices tested accessible of Percentage Non-financial governance, p.81 governance, Non-financial p.68 model, governance Proximus p.43-44 first, Customer - Outside: customers in countries of operations of countries in customers - Outside: Group Proximus of management - Inside: Boundaries: p.43-44 first, Customer Material topics, p.157 Overview of non-financial information, p.118 information, non-financial of Overview p.36 trust, Digital Data Protection Authorities. Data Protection Belgian tothe incidents data 4personal reported Proximus 2018, In Overview of non-financial information, p.118 information, non-financial of Overview p.81 governance, Non-financial Non-financial governance, p.81 governance, Non-financial p.68 model, governance Proximus p.35-39 trust, Digital countries of operations of countries in customers and communities institutions, government - Outside: employees) and (management Group Proximus - Inside: Boundaries: p.35-39 trust, Digital Material topics, p.157 p.120 information, non-financial of Overview p.53 all, for Digital p.120 information, non-financial of Overview p.53 all, for Digital p.120 information, non-financial of Overview p.53 all, for Digital

Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 156 Health & safety 2016 &safety Health Customer 416: GRI 103-3 Evaluation of the management approach Proximus governance model, p.68 model, governance Proximus approach management the of Evaluation 103-3 103-2 The management approach and its its and approach management The 103-2 Linked with high material topic: customer relationship customer topic: material high with Linked approach 2016 GRI 103: Management labeling 2016 and Marketing 417: GRI GRI standard # GRI disclosure Page number(s), URLS(s) and/or information Omission Ext. audit Ext. Omission information and/or URLS(s) number(s), Page p.68 model, governance Proximus approach management the of Evaluation 103-3 disclosure GRI # standard GRI : Assured by our external auditor indicator Own 103-1 Explanation of the material topic and its its and topic material the of Explanation 103-1 1- Incidents of non-compliance concerning 417-3 experience satisfaction rate satisfaction experience in-home House Happy components Boundaries marketing communications Overview of non-financial information, p.119 information, non-financial of Overview p.41 first, Customer Overview of non-financial information, p.119 information, non-financial of Overview p.81 governance, Non-financial Non-financial governance, p.81 governance, Non-financial p.68 model, governance Proximus p.41-44 first, Customer Outside: all customers, in countries of operations operations of countries in customers, all Outside: Boundaries: p.41-44 first, Customer Material topics, p.158 Overview of non-financial information, p.119 information, non-financial of Overview p.41 first, Customer Overview of non-financial information, p.119 information, non-financial of Overview p.81 governance, Non-financial

information commercially sensitive is it as information this disclose We don’t

Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 157 management system andsolutions to create How thecompany deals withwaste recycling Electronic waste andequipment Material topic: Circular economy: reduce emissions. place orinplanto minimize thisimpact and change due to itsemissionsandtheplansin overall contribution of thecompany to climate how thisaffects emissions. Italso includes Energy consumption, plansto reduce itand gases Material topic: Energy andgreenhouse the all layers of thegeneral public. Further itrelates to thedigital inclusion of customers isatall times at agoodlevel. as ensuringthattheconnectivity of the for all members of thecommunity, aswell infrastructure isup-to-date andinclusive How thecompany makes sure thatits inclusion Material topic: Connectivity anddigital smart security, etc education, smartbuildings, smarthealth, energy, smartmobility, smartcities, smart Fiber, network) andinnovation in smart in digital infrastructure (connectivity -5G, products andservices portfolio. Investments technologies andincluding themwithinthe Keeping upto date withthenewest infrastructure Material topic: Innovation andsustainable Material topics How thecompany deals withitshuman employee development Material topic: Humancapital & management. production andoverall health andsafety in terms of health andsafety inlinkage to The way thecompany treats itsemployees Material topic: Health andsafety to thistopic. development of new technologies relating way. Thetopic also relates to GDPR andthe of the customers are handled in asecure laws are complied with,andthatthedata The way thecompany makes sure thatprivacy Material topic: Privacy &data security address itseconomic impact. to manage theimpact of itssupply chainand should also present anoverarching approach already involve this issue, however Proximus practices of itssupply chain.Someother topics responsibility towards thesustainability The way thecompany manages its Material topic: Sustainable supply chain corporate governance of thecompany. lawsuits andclaims.Itshould include the in regard to transparency, integrity, corruption, Comprises theconduct of business practices Material topic: Businessconduct &Ethics actions related to promoting recycling. It comprises theuse of recycled material and company contributes to thecircular economy. less waste andrecycle equipment.How the on local community, donationsandCSR/ of local community, environmental impact Talent2Connect. Topics mightinclude: hiring of local initiatives such asChild focus and operations. Furtheritrelates to thesupport communities from theplaces where ithas How thecompany dealswiththelocal development Material topic: Socialengagementand development. aging population;turn-over; training and topics such as:Diversity andinclusion; gender; capital including laborconditions. Itincludes through process thatreduce theirimpact). innovations (through greener products or to take partinthesolution and invest ingreen current system, companies are encouraged world isfacing andthepressure itputsonthe Due to thegrowing resource scarcity thatthe resource efficiency Material topic: Responsible sourcing and remuneration (including bonuses). and specially to senior management Disclose thepolicies related to remuneration Material topic: Remuneration companies interms of digitalization. competitiveness of institutions,cities and How thecompany isenhancingthe institutions andcompanies Material topic: Digital competitiveness of Sustainability work inlocal communities. the community interms of financialsupport Includes thecontribution of thecompany to Material topic: Sponsoring and advertising. The policies andpractices around marketing Material topic: Responsible marketing complaints. year. Itrefers to both social orenvironmental placed over thecompany in theconcerning Concerns all law suitsorclaims thatwere Material topic: Lawsuits/claims employment of Belgian workforce to the state (mainshareholder) and the levies. Furtheritrelates to dividendsissued payment of taxes and other government fulfilment of responsibilities related to the application of sustainable tax strategies. The total avoidance andevasion as well asthe professional requirements, including reference with relevant legal, regulatory and Concerns thepayment of taxes compliant state contribution Material topic: Responsible taxes and including safe andhealthy products. quality products andservices to itscustomers, How thecompany ensures thatitdelivers top services Material topic: Qualityproducts and such astheRed Devils andmusicfestivals etc. support of local intitiatives andsportactivities or voluntary work. Additionally, itrelates to Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 158 them withall necessary information. their health of these customers and providing are satisfied.Italso includes theimpact on How thecompany ensures thatcustomers Material topic: Customer relationship transparent way. of itsdifferent products andservices ina How thecompany discloses itspricing transparency Material topic: Pricingand billing in all countries (UNUniversal Declaration). peace, whichapply equally anduniversally form thefoundation for freedom, justice and Human rightsrelate to thebasicrightsthat conditions alignwithinternational standards. How thecompany isensuringthatlabour Material topic: Humanrights that thecompany hasbeenhitby acrisis. redundancies. Issue relevant specially inyears Explanation onhow thecompany dealswith Material topic: Redundancies is covered by thevectoring technology. This This records thepercentage of Belgium which Vectoring coverage inBelgium network. homes connected to theProximus DSL This records theaverage DSLspeed of the Average DSLspeed copper &fiberhomes passed. a speedof atleast 30Mbps. Thisincludes that can beconnected to ournetwork with This isthepercentage of homes inBelgium Fixed Internet: 30Mbps coverage external agency, Commsquare. figure isbased onaQ4measurement by an coverage of 4Goutsideof buildings. The2018 The outdoor coverage refers to theaverage 4G outdoor coverage external agency, Commsquare. figure isbased onaQ4measurement by an coverage of 4Ginside of buildings. The2018 The indoorcoverage refers to theaverage 4G i ndoor coverage KPI definition Records thenumber of M2M(machine to Acti ve M2M cards copper network connections. technology allows for higherspeedof the Number of occupational accidents (multiplied Frequency rate of occupational accidents employees. agility andstrategic alignmentof the Proximus survey (SpeakUp),measuringengagement, Average result of theemployee engagement Employee Engagement domain of cybersecurity and privacy. certifications Proximus hasacquired inthe Records thenumberof international privacy andcybersecurity International certifications related to both internationally andinBelgium. by theProximus Group (including affiliates), This corresponds to all ICT revenues realised ICT revenues (national +international) network. including theconnections to ourLORA machine) active cards inournetwork, not on Proximus platforms Uniq ue reach of Music&Sportscontent Technobel) over thecourse of theyear. through ourinitiatives (Digitalent, 19, Number of jobseekers which were helped initiatives inBelgium Number of jobseekers supported by our category by ourpartner Passe-Muraille. and proven accessible for atleast onedisability Percentage of devices whichhave beentested (at least for 1disabilitycategory) Percentage of accessible tested devices S.A. employees. total numberof hours worked by Proximus accidents (multiplied by 1.000)dividedby the Number of lost days due to occupational Severity rate of occupation accidents of hours worked by Proximus S.A.employees. by 1.000.000)dividedby thetotal number see your content = isthetotal numberof unique users who Unique reach onPxsSocialMedia Platfoms Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance 159 To whichextent Proximus Group iscarbon operations and businesstravel Carbon neutrality level for own sources. Group which came from renewable energy Percentage of electricity used by Proximus renewable energy sources Elec tricity usedwhichcame from and time)represents. environmental initiatives (inkind,financial income thatourinvestment insocial and The percentage of Proximus S.A.’s net net income CSR investment amountinpercentage of Proximus S.A.employee timecontribution. initiatives), including inkind,financial and (including oursocial and environmental The amountinvested in ourCSRinitiatives kind, time CSR investment amount:financial,in based on organization’s figures) Uniq ue visitors onsponsored events (estimate Unique reach of sponsoringevents course of theyear intheaim of recycling them. Number of mobile phones collected over the Collected mobile phones percentage isincinerated withenergy recovery. recycled, reused orcomposted. Theremaining Proximus S.A.’s operations whichwas then The percentage of waste produced by composted Percentage of waste recycled, reused or 70% intheperiod2007-2020). objective to reduce ourcarbon footprint by comparison with2008(whenwe set our consumption of Proximus Group in Decrease orincrease seen intheenergy Energy consumption compared to 2008 electricity consumption andfleet fuel. emissions related to heating gasandfuel, line withtheGHGprotocol, including the Carbon footprint of Proximus group, in previous year Carbon emissionsscope 1+2compared to travel. neutral for all itsoperations andbusiness months have not passed parental leave in2018cannot yet becounted Following as12 thedefi 4 months have not passed. parental leave in2018cannot Following yet becounted thedefi as12 3 total numberof suppliers assessed. Based ontheEcoVadis assessment andon the 2 total numberof suppliers Based ontheEcoVadis assessed. assessment andonthe 1 nition, people whoendedtheir nition, people whoendedtheir Proximus Group Annual Report 2018

Appendix Governance and Compliance Sustainabilty Proximus at a glance Proximus PLC under Belgian Public Law, Bd. du Roi Albert II 27 – 1030 Brussels – Belgium

Proximus Group Proximus SA de droit public / NV van publiek recht Document subtitle= Verdana Heading 12 0/0 single

Proximus SA de droit public / NV van publiek recht Independent auditor’s report on the limited review performed on a selection of non-financial performance indicators published in the document “Annual Report 2018” of Proximus SA de droit public / NV van publiek recht for the year ended 31 December 2018

Deloitte Bedrijfsrevisoren / Reviseurs d’Entreprises Proximus SA de droit public / NV van publiek recht Independent auditor’s report on the limited review performed on a selection of non-financial performance indicators published in the document “Annual Report 2018” of Proximus SA de droit public / NV van publiek recht for the year ended 31 December 2018

Independent auditor’s report on the limited review performed on a selection of non-financial performance indicators published in the document “Annual Report 2018” of Proximus SA de droit public / NV van publiek recht for the year ended 31 December 2018

To the board of directors

We have been engaged to perform limited review procedures aimed at expressing a limited assurance conclusion on a selection of non-financial performance indicators (the “Non-Financial Data”) published in the document “Annual Report 2018” of Proximus SA de droit public / NV van publiek recht (“Proximus”) for the year ended 31 December 2018 (the “Document”). The Non-Financial Data have been defined following the Global Reporting Initiative (GRI) standards and Proximus’ internal non-financial reporting guidelines. The Non-Financial Data have been selected by Proximus management and are as follows: Enabling a better digital life  4G indoor coverage  4G outdoor coverage  Fixed internet: 30Mbps coverage  Number of projects with universities/education institutes Respecting our environment  Energy efficiency index (energy consumption vs total revenue) – Group  Electricity (Terajoules) – Group  Heating (Terajoules) – Group  Vehicle fleet fuel (Terajoules) – Group  CO2 emissions scope 1 and 2 (KTons) – Group  CO2 emissions scope 1 – heating, refrigerants and fleet fuel (KTons) – Group  CO2 emissions scope 2 – electricity – market based method (KTons) – Group  CO2 emissions scope 3 – all reported categories – i.e. category 1, 2, 3, 4, 5, 6, 7 and 11 (KTons) – Belgium  Waste (KTons) – Belgium  % of hazardous waste – Belgium  % waste reused/recycled – Belgium  Non-hazardous waste – recycled or reused (KTons) – Belgium  Non-hazardous waste – with energy recovery (KTons) – Belgium  Hazardous waste – recycled or recovered (KTons) – Belgium Caring for our stakeholders  Number of cases investigated by the investigations department for violation of policies/code of conduct  Number of whistleblowing cases Contributing to society  Number of job seekers supported by Proximus initiatives in Belgium  Number of sick children connected to their school by Bednet and Take Off  Percentage of accessible tested devices (at least for 1 disability category)

The scope of our work has been limited to the Non-Financial Data covering the year 2018 and including only the values retained within the scope of reporting defined by Proximus. The reporting scope covers Proximus SA de droit public / NV van publiek recht and its subsidiaries Telindus-ISIT B.V., Telindus Luxembourg SA, Tango Luxembourg SA and BICS SA (the “Group”). The limited review was performed on the data gathered and retained in the reporting scope by Proximus. Our conclusion as formulated below covers therefore only these Non-Financial Data and not all information included in the Document.

1

Proximus SA de droit public / NV van publiek recht Independent auditor’s report on the limited review performed on a selection of non-financial performance indicators published in the document “Annual Report 2018” of Proximus SA de droit public / NV van publiek recht for the year ended 31 December 2018

Responsibility of the board of directors

The board of directors of Proximus is responsible for the Non-Financial Data and the references made to it presented in the Document as well as for the declaration that its reporting meets the requirements of the GRI standards and of Proximus’ internal non-financial reporting guidelines.

This responsibility includes the selection and application of appropriate methods for the preparation of the Non- Financial Data, for ensuring the reliability of the underlying information and for the use of assumptions and reasonable estimations. Furthermore, the board of directors is also responsible for the design, implementation and maintenance of systems and procedures relevant for the preparation of the Non-Financial Data.

Nature and scope of our engagement

Our responsibility is to express an independent conclusion on the Non-Financial Data based on our limited review. Our report has been made in accordance with the terms of our engagement letter dd. 7 February 2019.

We conducted our work in accordance with the International Standard on Assurance Engagements (ISAE) 3000 "Assurance Engagements other than Audits or Reviews of Historical Information".

Our procedures are aimed at obtaining limited assurance on the fact that the Non-Financial Data do not contain material misstatements. These procedures are less profound than the procedures of a reasonable assurance engagement.

The scope of our work included, amongst others, the following procedures:

 Assessing and testing the design and functioning of the systems and procedures used for data-gathering, processing, classification, consolidation as well as validation of the methods used for calculating and estimating the Non-Financial Data published in the Document;

 Conducting interviews with responsible officers;

 Examining, on a sample basis, internal and external supporting evidence to validate the reliability of the Non- Financial Data and performing consistency checks on the consolidation of the Non-Financial Data.

Conclusion

Based on our limited review, as described in this report, nothing has come to our attention that causes us to believe that the Non-Financial Data, as defined above, related to Proximus published in the Document, have not been prepared, in all material respects, in accordance with the GRI standards and Proximus’ internal non-financial reporting guidelines.

Zaventem, 1 March 2019

The independent auditor

______DELOITTE Bedrijfsrevisoren CVBA / Réviseurs d’Entreprises SCRL Represented by Nico Houthaeve

2