BT Social and Environmental Report

Summary and Highlights 2005 BT Social and Environmental Report

Contents – Summary and Highlights Performance snapshot 02 Employees 09 Economics 18 Chairman’s introduction 03 Investors 11 Sustainability 19 Chief Executive’s message 04 Suppliers 12 Key performance indicators Who we are 05 Community 13 and targets 20 Our approach to CSR 06 Environment 14 Hot Topics 21 Business principles 07 Digital inclusion 16 Customers 08 Human rights 17

As a communications company our aim is to help everyone benefit from improved communications. Doing this in a responsible way is what our corporate social responsibility (CSR) work is all about.

BT’s Social and Environmental Report covers our policies, programmes and performance across a full range of social, environmental and economic issues, including targets for improvement.The full report is available online at www.bt.com/betterworld

About our Social and Environmental Report This is a summary of our online Social and Environmental Report. It covers the financial year ending 31 March 2005.

Our Social and Environmental Report is assured against the AA1000 Assurance Standard, which requires our report to reflect the interests and concerns of stakeholders. It is in accordance with the 2002 Global Reporting Initiative (GRI) guidelines.

BT has been ranked as the world’s number BT is ranked third of the 132 companies one telecommunications company in the that took part. Dow Jones Sustainability Indexes for four years running.

BT Social and Environmental Report Summary and Highlights 2005 01 Performance snapshot

Highlights • Reviewed and improved our key performance indicators (KPIs) - Included a measure of our sickness absence rate for the • Connected 5 million UK customers to broadband – first time meeting our target a year early This helps identify health issues early so that we can We are on target to make broadband available to reduce the number of people taking time off sick. The exchanges serving 99.6% of UK homes and businesses implementation of our company-wide mental health by summer 2005. programme in our customer contact centres has reduced stress by 24% and saved £500,000 in sick pay. • Became the world’s biggest user of green energy - Developed an Ethics Performance Measure We now source nearly all our UK electricity needs from For some time we have measured awareness of our environmentally friendly sources, such as hydro, wind and Statement of Business Practice, The Way We Work. combined heat and power plants. Since 1996, we have The development of an Ethics Performance Measure takes reduced carbon dioxide emissions by 53%. Our green energy us away from a purely perception-based measure towards contract, signed in October 2004, equates to an additional a performance-based one. 325,000 tonnes of carbon dioxide emissions savings a year, equivalent to those produced by approximately 100,000 cars. • Reduced the amount of waste sent to landfill by 8% • Provided online and telephone donation facilities • Improved our safety record – Lost Time Injury rate to the Disasters Emergency Committee (DEC) after was 23% better the Asian tsunami disaster • Invested £9.1 million in community projects and We set up a temporary call centre at the BT Tower provided £11.7 million support in kind in London and provided DEC with facilities to We are committed to give a minimum of 0.5% of our process telephone and online donations quickly, UK pre-tax profits to direct activities in support of society securely and efficiently. and a further 0.5% via in-kind activities. • Achieved certification for BT Ireland’s environmental management system to ISO 14001 Our experience in Ireland is the model we will use as we extend certification to other countries where we operate. • Followed up 100% of actions identified through our supply chain risk assessment process As part of our commitment to high standards in our supply chain we ask all new suppliers to complete a risk assessment questionnaire. Where we identify areas for improvement we take appropriate action within three months.

Lowlights • Missed two key diversity targets While we met our objective on the number of ethnic minority employees, the number of women in BT fell by 0.3% last year, and although the number of disabled employees increased, we fell 0.3% short of our disabled employees target. We connected our five millionth customer to broadband – • Undershot our customer satisfaction target meeting our target a year early We reduced customer dissatisfaction by the equivalent of 23% per annum over three years against our target of 25%.

Please see our online report for further details. All our KPIs are shown on page 20.

“The actions of leading companies such as BT are living proof that significant cuts in greenhouse gas emissions need not come at the cost of economic growth.” Tony Blair, UK Prime Minister

BT Social and Environmental Report Summary and Highlights 2005 02 Chairman’s introduction

Helping our customers to benefit from improved communications and increased connectivity continues to be at the heart of BT.

Achieving this responsibly and in a way which contributes to society is important to us. This year there have been a number of accomplishments that demonstrate this commitment.

For example, broadband. We are confident that we will connect virtually every UK community during 2005, which is a vital part of the role we play in spreading the benefits of broadband. And we have made real progress with our digital inclusion initiative, Everybodyonline, which is working to help deprived communities enjoy the benefits of broadband technology and develop new skills.

I am particularly proud of our efforts in response to the Asian tsunami which struck on 26 December 2004. Our knowledge and expertise, together with the commitment of our people, enabled us to work alongside the Disasters Emergency Committee to ensure the largest ever volume of online and telephone donations were taken quickly and securely. We also had 16 volunteers who went out to the region to assist in the rebuilding of local and international communication links.

Our Corporate Social Responsibility programme has a key role to play in meeting our stakeholders’ expectations and encouraging them to invest in us, buy from us or work for us. Full details of the programme and our performance in the last year are available in our online Social and Environmental report.

We endeavour to manage our social, ethical and environmental issues to grow shareholder value and I am always pleased when we achieve external recognition for our attempts to do this.

This year we maintained our position as the top telecommunications company in the Dow Jones Sustainability Indexes for the fourth year running, which recognises our work in a wide range of areas from business principles, ethical supply chain management and work–life balance to customer service and corporate governance.

For the year ahead, business transformation is critical to delivering growth to our business. This will bring new challenges for our Corporate Social Responsibility programme, which I am confident it will meet.

Sir Christopher Bland Chairman 18 May 2005

BT Social and Environmental Report Summary and Highlights 2005 03 Chief Executive’s message

I am convinced that being a responsible company through living our values (trustworthy, helpful, inspiring, straightforward and heart) brings us business advantage.

Our major business and government customers are increasingly concerned about our corporate social responsibility (CSR) performance. Growing stakeholder, legal and regulatory pressures mean our customers expect us to provide the solid CSR credentials that help them provide a trusted service to their own customers.

Our performance We publish 12 non-financial key performance indicators. These provide a snapshot of our performance on the key measures that underpin our financial performance. Our progress on these measures includes: reducing customer dissatisfaction; connecting the majority of UK communities to broadband; maintaining a motivated, diverse and secure workforce; minimising ethical risks in our supply chain; and massively reducing our carbon dioxide emissions.

The UK is committed to take action on climate change. As one of the country’s largest users of electricity we have a responsibility to help make that happen. This year we became the world’s largest purchaser of green energy and now meet almost all our UK energy needs from environmentally friendly sources. In carbon dioxide emissions savings it equates to an additional 325,000 tonnes each year on top of the considerable savings we have already made in the last ten years. This is a substantial contribution to tackling climate change.

Accountability – challenges and opportunities As we continue transforming our business we must maintain our vigilance on matters of corporate social responsibility. For example, we are increasing our international footprint, through the evolutionary growth of our global services business, by making strategic acquisitions and through the rise in outsourcing and in-sourcing as a key part of BT’s business model. Different approaches to corporate governance and ethical issues in the countries where we operate underline the importance of our CSR activity. In addition, our increasing sales in networked IT services have highlighted the potential privacy implications of the digital networked economy.

The big opportunity is to use ICT products and services to promote sustainability, not only in the way we run our own business, but by helping our customers to benefit too.

You can find details of how we are responding to these challenges and opportunities in our online Social and Environmental report. The report has been prepared in accordance with the 2002 Global Reporting Initiative guidelines and is independently verified. I commend it as a demonstration of how living our values helps us deliver long-term shareholder value.

Ben Verwaayen Chief Executive 18 May 2005

BT Social and Environmental Report Summary and Highlights 2005 04 Who we are

BT Group plc is the listed holding company of an integrated group of businesses. We are one of the world’s leading providers of communications solutions, serving customers in the Americas, Asia Pacific and Europe.

In the UK we have over 20 million business and residential customers. We provide a wide range of communications products and services, including voice, data, internet and multimedia services. We also offer a comprehensive range of managed and packaged communications solutions, and provide network services to licensed operators.

During the 2005 financial year (ending 31 March), BT made two major acquisitions. These were Infonet, one of the world’s leading providers of international managed voice and data network services, and Albacom, the second largest telecommunications operator in the Italian business market. The companies significantly enhance BT’s profile in the global networked IT services market, as well as extending our reach and presence in North America and Asia Pacific.

Our traditional fixed-line telephony business in the UK faces competitive pressures. We continue to maximise the potential of this business, but we are also pursuing profitable growth by introducing our customers to new wave products and services, such as IT and networking, broadband, mobility and managed services.

BT consists principally of three lines of business: Retail, Wholesale and Global Services. BT Retail and BT Wholesale operate almost entirely within the UK, addressing the consumer, business and wholesale markets, offering a broad spectrum of communications products and services. BT Global Services is our managed services and solutions provider, serving global networked IT services needs.

We have over 20 million business and residential customers. We employ approximately 102,100 people around the world, including approximately 90,800 in the UK.

BT Social and Environmental Report Summary and Highlights 2005 05 Our approach to CSR

We are committed to making a positive difference in society. For us, corporate social responsibility (CSR) is how we as a company contribute to the broader societal goal of sustainable development.

The key role of business in society We have identified a clear case We regularly talk to customers, is to generate wealth – providing for the business benefits that flow employees, suppliers, communities, jobs, creating economic activity, from our CSR activities. At the core partners and investors. Their views developing products and services of this is the role that values play in inform and influence our policies that people need and want. If the way we run our business. All and decisions. governments create the right economic decisions are value-laden, whether it framework, businesses can work – is satisfying our customers, providing Our online report shows how individually or in partnership with a service to society, making a profit, our key performance indicators others – to contribute to sustainable or respecting the natural world. We were developed following development by acting in a socially always aim to act in a way that builds stakeholder consultation. and environmentally sustainable stakeholder relationships based way. We believe that businesses on trust, while recognising that we We receive guidance from our will gain from taking this approach, can’t please all our stakeholders Leadership Panel, an independent as will society. all the time. group of external experts that encourages innovation and leadership We take a broad and comprehensive Dialogue with stakeholders on sustainability and CSR in BT. view of our social responsibility and Our relationships with stakeholders The Panel provides an annual the commercial benefits that flow are crucial to the way we do business. independent comment, available from this approach. On a practical The more positive and mutually in our online report. level, our responsibility is to identify, beneficial these relationships are, understand and then manage our the more successful our business social and environmental impacts will be. Engaging with stakeholders as positively as possible. An integral deepens our understanding of what part of this is to develop good they expect from us and how we relationships with our stakeholders, can meet and hopefully exceed lead by example, and be ethical, their expectations. It challenges transparent and accountable in how we work and inspires new ways our daily work. of doing business.

Our approach has evolved over many Our Statement of Business Practice, years. For example, we produced The Way We Work, sets out the telephones for the deaf and partially aspirations and commitments that sighted as early as the 1930s. Our apply in our relationship with each stakeholder dialogue with customers stakeholder group. has been formalised for over 20 years through our consumer liaison panels.

We welcome your feedback on our report. Please email us your comments at [email protected] or contact Susan Morgan, Sustainability Manager, at [email protected]

BT Social and Environmental Report Summary and Highlights 2005 06 Business principles 70% Ethics Performance Measure – a new Statement of Business Practice indicator that measures awareness of We are committed to world-class standards Statement of Business Practice, an external ethics benchmarking survey and questions of business integrity everywhere we operate. from our annual staff attitude survey.

Our Statement of Business Practice, Social, environmental and ethical no social, environmental or ethical The Way We Work, defines BT’s matters are included in the (SEE) risks that would have a material business principles that apply Directors’ induction programme, impact on our business. worldwide, to all employees, agents, to support the integration of CSR contractors and others when into daily management. During the 2004 financial year, we representing BT. It sets out specific developed a CSR risk register, which aspirations and commitments that A CSR governance framework helps sets out our most significant SEE risks. guide our relations with our customers, us manage specific environmental In the 2005 financial year, we further employees, shareholders, partners, and social issues and supervises the developed our understanding of our suppliers and local communities. CSR relationship between BT and key risks: breach of integrity, climate individual lines of business. The change, diversity, health and safety, An Ethics Performance Measure was CSR Steering Group is responsible geography of jobs (offshoring) and developed in the 2005 financial year. for overseeing the implementation supply chain working conditions. This is helping us to move from a of all social and environmental We also added one additional key perception-based measure to one programmes across BT. The risk – privacy. that is based more on performance – Community Support Committee something our Leadership Panel oversees social investments and Public policy has strongly encouraged. establishes the strategy for maximising BT is apolitical and has a strict policy our contribution to society. of not supporting any political party. We take robust action against anyone abusing our business principles. CSR health checks We engage with political parties, During the 2005 financial year, 132 We check to see that CSR is embedded politicians and civil servants on a non- employees were dismissed or resigned in BT’s commercial operations. In the partisan basis to make them aware of because of unethical behaviour. 2005 financial year, five ‘health-checks’ key issues, opportunities and trends in were conducted in Global Services on technology and industry. Corporate Social Responsibility major business change programmes – (CSR) governance framework covering customer service and We put forward our views on matters The BT Board discusses our CSR delivery, our values and organisational that affect our business interests and strategy and performance at least culture, and the creation of a global we make sure that those in government once a year. It is kept informed of standard operating environment. are fully briefed on issues affecting our main CSR risks and opportunities, BT’s activities. along with key performance indicators CSR risks and strategic objectives. The Board takes account of significant We interact regularly with the European social, environmental and ethical Commission and national and matters that relate to BT’s business. international regulators. In the 2005 financial year, we identified

Integrity Works Inc. – a consultancy that implementation policies of a range We raise awareness and educate our helps companies design and implement of UK top 100 listed companies. people globally on business ethics and their business principles – undertook BT came joint first. the BT Statement of Business Practice, an ethical expression benchmark study The Way We Work. reviewing the business principles and

BT Social and Environmental Report Summary and Highlights 2005 07 Customers

In the UK, we serve over 20 million business and 23% residential customers with around 29 million exchange lines. We also provide network Customer dissatisfaction – reduced by 23% on a compound annual basis services to other operators. over the past three years.

Our extensive global network We have introduced CleanFeed, £7.5 billion through productivity gains and strategic partnerships enable a filtering system that uses the attributed to broadband, according to us to serve multi-site corporate latest technology to block access the Centre for Economic and Business and government customers in all key to websites black-listed by the Research. The UK is now leading the commercial centres of Asia, Europe UK Internet Watch Foundation. way in broadband availability among and North America. In Europe, our G7 countries, according to the network links more than 250 towns For many years we have offered a Organisation for Economic Co- and cities across 19 countries. wide range of products and services operation and Development (OECD). to elderly and disabled customers who Customer satisfaction might otherwise find it difficult to Wireless communications and health We set a target to reduce customer make the most of telecommunications. We have re-entered the market of dissatisfaction by 25% a year over the One of our major commitments is mobile communications and provide three years to the 2005 financial year. TextDirect, incorporating Typetalk, mobile services that run on Vodafone’s Although we have not met this target a national telephone relay service network. All the mobile phones we sell – we achieved a 23% reduction – we run by the Royal National Institute conform to the international safety believe the improvements we have for Deaf People, helping deaf, blind standards on exposure to radio made in our customer service have or hard of hearing people to make frequency (RF) emissions set by the been beneficial to all our customers. and receive phone calls. BT has been International Commission on Non- providing bills in alternative formats, Ionising Radiation Protection (ICNIRP) Looking after customers such as Braille and talking bills, since and the UK National Radiological We have taken action in response to 1992. We also offer a variety of Protection Board. customers’ complaints about higher- telephones with more accessible than-expected telephone bills caused features, such as voice amplification. We require that ICNIRP guidelines are by inadvertent use of premium rate applied on all BT sites used by mobile services. Our actions include Broadband operators. BT is a signatory to the providing barring services and more We are committed to provide industry code of practice on the information on how these services broadband as widely as possible deployment of base stations, known operate. We investigate individual and have achieved five million as the ten industry commitments. cases where customers feel they connections, meeting our target have been wronged. a year early. BT owns and operates one of the largest Public Wireless LAN networks BT voluntarily operates a Nuisance We are on target to have extended in the UK (BT Openzone). Public Calls Bureau (NCB) to help and support coverage to exchanges serving 99.6% Wireless LANs use considerably less customers receiving malicious and of UK homes and businesses by the power and consequently emit lower nuisance calls. summer of 2005. By 2007, the UK radiation levels than GSM networks. economy could be boosted by up to

“We believe that everyone is entitled to an abuse-free online environment… By preventing access to that content, BT are protecting their services and their customers.” Peter Robbins, CEO, Internet Watch Foundation

BT Social and Environmental Report Summary and Highlights 2005 08 Employees % % 5 4 6 6

We employ approximately 102,100 people around 0405 the world, including approximately 90,800 in the Employee Engagement Index – measuring the overall success of BT’s UK, where we are one of the largest employers. relationship with its employees

We need to make sure that we During the 2005 financial year, we In the 2005 financial year, 13% of attract, select and retain the best introduced an Employee Engagement our new recruits came from ethnic people. Our approach is to treat our Index (see chart above), which replaces minority backgrounds while 25.9% people fairly and responsibly, helping the People Satisfaction Index. Employee of new recruits were women and them achieve their full potential, engagement is about ‘being proud to 0.5% people had a declared disability. while respecting their personal and work for BT, being committed to your community commitments. customers and gaining an overall sense There were a total of 58 discrimination- of satisfaction from your work’. The related litigation cases involving BT in Recruitment new index helps us understand how the 2005 financial year. Twelve were During the 2005 financial year, we engaged (or disengaged) a team withdrawn, 3 judged against BT, 25 recruited 149 graduates and 258 is and provides an overall score. settled and 18 judged in favour of BT. modern apprentices in the UK, and Examples of issues covered in the 3,496 other new entrants. In the same index include: team working; senior Every such case is one too many. period, 5,523 people left BT by choice. management and communication; For this reason we carefully review our reward and work–life balance. own cases and use real-life examples Training and development in our diversity training workshops. We seek to encourage and provide Diversity opportunities for personal growth We seek to create an open, honest A measure of the diversity of the and professional development. and unprejudiced workplace that BT workforce During the 2005 financial year, BT allows all people to reach their full %

successfully achieved re-accreditation potential. We want to develop and 8 . % % 3 7 4 . 2 . 2 as an Investor in People (IiP). sustain a diverse workforce where 2 2 everyone’s contribution is valued. 2 People satisfaction Our annual Communications and The chart (right) shows the Attitude Research for Employees percentage of our people who are (CARE) survey gives all our people an women, have declared themselves % % 2 . 9 % . 9

opportunity to express their views on from an ethnic minority background 2 8 . a range of issues. In the 2005 financial or have declared a disability. 8 year 80% participated. % % % 2 1 . 0 . . 2 2 2

03 04 05 03 04 05 03 04 05 Women Ethnic Minority Disabled

In the 2005 financial year, BT Spain was ranked in the top 30 best companies to work for by the Actualidad Economica weekly business magazine, one of Spain’s most prestigious listings.

BT Social and Environmental Report Summary and Highlights 2005 09 Employees continued 5 % 8 4 % 8 4 6 . % . 0 0 0 8 3 . 2 6 3 . 0 6 . 2 8 0 4 . 0

03 04 05 03 04 05

H&S: Lost Time Injury Rate – H&S: Sickness Absence Rate – incident rate per 100,000 percentage of calendar days hours worked lost to sickness

Work–life balance The BT European Consultative Council Health and safety Because we want to provide a high- (BTECC) provides an opportunity for Caring for the health and safety quality service to our customers, the transnational Group-wide dialogue of employees is one of our business working day for many BT employees between management and employee principles, and we have made a extends beyond normal hours. The representatives across Europe. specific commitment to promote challenge is to reconcile good service a healthy lifestyle through our health for customers with a healthy work–life In the 2005 financial year, no industrial and wellbeing programme. balance for employees, and we strive action was taken. The one case of legal to get the balance right. action against BT concerning the rights The Significant Incident Rate is a of trade unions was withdrawn. One key performance indicator, with an Innovative communications technology hundred and forty Employment Tribunal original target to reduce incidents means that many more people can Cases involving BT were concluded in by 25% by March 2005. We reached work flexibly. At 31 March 2005, we the 2005 financial year: 41 were the target two years early and doubled had approximately 5,100 part-time withdrawn, 10 judged against BT, 42 the reduction target for 2005. We employees, nearly 500 job sharers and settled and 47 judged in favour of BT. achieved this in September 2004 and approximately 9,030 home-workers. also cut the rates of absence due Outsourcing and offshoring to workplace accidents (down 56% Employee relations Some of our support and transactional since 2001) and occupational ill In the UK, BT recognises two trade operations are provided by external health cases (down 64% since 2001). unions: the Communications contractors. For example, human Workers Union (CWU), which resources contracts are outsourced We met these challenging targets represents over 59,000 BT people to Accenture HR Services, and finance by aiming for zero avoidable accidents. in non-management grades; and and accounting activities to Xansa. Our key measures are Lost Time Connect, which represents around Our agreement with the union Incident Rate and Sickness Absence. 26,000 BT people, predominantly Connect outlines a joint approach managers and professionals. to sourcing work outside the UK. We maintain a positive working relationship with both unions at local and national levels.

In the 2005 financial year, Business in the Community’s Race for Opportunity announced that it had benchmarked BT at Gold Standard and the top overall performing organisation in race equality.

BT Social and Environmental Report Summary and Highlights 2005 10 Investors M U N G A M

G N A

H Investors are increasingly interested in the ethical, C

I H C - N

I environmental and social dimension of business E H C

The BT strategy identifies eight 2. Reputation 4. Employee motivation strategic imperatives: build on our When people trust a company they Working conditions and our networked IT services capability; effectively deliver a societal ‘license relationship with employees are deliver on broadband; create to operate’. This is reflected in the crucial to the success of our business. convergent mobility solutions; defend company’s reputation which, in BT’s For example, a proactive approach to our traditional business vigorously; case, we know directly affects flexible working, personal involvement drive for cost leadership; keep a customer loyalty. in community initiatives, diversity, relentless focus on customer learning and development all improve satisfaction; motivate our people We estimate that BT’s CSR employee satisfaction. In a recent and live the BT values; and transform performance accounts for over survey we found that 63% of our network for the 21st century. 25% of the Image and Reputation employees felt more proud to work element of customer satisfaction. for the company as a result of our Our business case And our analysis shows that a CSR activities. Our CSR work is integral to the 1% improvement in the public’s BT strategy, and affects business perception of our CSR activities 5. Marketplace innovation performance in five key areas: translates to a 0.1% increase in our Increasingly we are being asked retail customer satisfaction figures. to address environmental and 1. Risk management social issues when we bid for We have undertaken CSR risk analysis 3. Cost reduction major contracts – £2.2 billion and management for several years. During the 2005 financial year, in the 2005 financial year. Currently we identify no CSR risk we commissioned the sustainable which is material to the future of development organisation, Forum During the 2005 financial year, we the business. Our seven key risks are: for the Future, to develop our have been incorporating our CSR breach of integrity, climate change, understanding of savings from messages into existing propositions diversity, ethical issues in the supply environmental activities. First, by and bids to differentiate our chain, health and safety, geography creating a more robust methodology networked IT services. We also of jobs (offshoring) and privacy. for measuring our environmental engage with our clients to share cost savings each year, and secondly, knowledge, experience and best by widening the scope of the practice on CSR. environmental initiatives included in the calculation. Long-term sustainability trends create new market opportunities. For Using the Forum model, our example, the use of teleconferencing environmental cost savings for the and flexible working reduce the need 2005 financial year were £410 million. to travel and provide more flexible lifestyles (see Sustainability section).

BT was named one of the BT is included in ‘Global 100 Most Sustainable the UK, European Corporations in the World’. and World FTSE4Good Indices.

BT Social and Environmental Report Summary and Highlights 2005 11 Suppliers 2 0 4 4 2 2 We buy products and services – such as IT 1 equipment, cables, software, design and disposal 3 services – from thousands of suppliers worldwide. 03 04 05 In the 2005 financial year, we spent over £4billion Ethical Trading – number of risk assessment questionnaires on procurement. completed all with 100% follow-up

At every stage of our dealings with Human rights 2005 assessments suppliers – from selection and We want to ensure the working We ask our suppliers to complete a consultation to recognition and conditions under which the products risk assessment questionnaire. For payment – we are committed to and services we purchase meet the those identified as medium or high behave according to the principles standards of the Universal Declaration risk, we follow up to determine what of fair and ethical trading. of Human Rights and the International further action is needed. This may Labour Organisation Conventions. involve an audit of the supplier’s own In April 2004, we gave our suppliers Through our supply chain initiative, facilities or that of a subcontractor. the opportunity through an online Sourcing with Human Dignity survey to give their views on how (SWHD), we seek to ensure that our In the 2005 financial year, we well BT lives up to these commitments suppliers meet these internationally completed 11 on-site assessments and principles. accepted standards. to find out how well our suppliers met our SWHD standard. A total of 213 suppliers responded, Buyers’ awareness training with 94% stating that they had a It is critical that our buyers have Eight of the assessments took place good working relationship with BT. the awareness, knowledge and the in China and Thailand and were of Following the results of the survey we skills required for the successful facilities not previously assessed. sent suppliers our booklet ‘The Way implementation of the SWHD standard. The assessments were done in We Work’ to help them become more those areas where there was a aware of our business principles. We provide a half-day face-to-face high risk of suppliers falling short training session. Any BT buyer of our standard – they should not Payment who cannot attend has to complete be taken as a representative sample BT’s policy is to use its purchasing a computerised course, which includes of our supply chain. power fairly and to pay promptly an online assessment. The package according to supplier agreements. introduces our buyers to the rationale BT has a variety of payment terms. behind the SWHD initiative, its key Our standard terms are 42 calendar features and their role in ensuring days from date of invoice. its successful implementation.

Through the Global e-Sustainability Initiative (GeSI), BT is working with other ICT companies and the UN to develop a supplier questionnaire to be used across the ICT sector.

BT Social and Environmental Report Summary and Highlights 2005 12 Community m 1 . m 6 8 . 2 0 m £ 2 8 £ 1 £

03 04 05

Community contribution – investment in society through funding and support in kind

We want to make a positive difference Fundraising for Asian tsunami relief Arts and heritage to society by helping everyone benefit In the UK, BT played a key role We want to make arts available to from improved communications. in managing the public response to everyone through our Arts for All the Disasters Emergency Committee programme. BT sponsors Tate Online We are committed to give a minimum (DEC) Asian tsunami earthquake – the UK’s most visited Arts site with of 0.5% of our UK pre-tax profits appeal. We set up a temporary call over 650,000 visitors every month. directly to activities that support centre at the BT Tower in London and This website helps to make one better communications. In the 2005 provided the DEC with telephone and of the largest art collections in the financial year, we invested £9.1 online secure payments facilities. BT world easily accessible. We work million (£68.9 million since 2000). made a one-off donation of £500,000 with the National Theatre, the British and provided volunteers and equipment Film Institute and the Philharmonic BT operations provided a further to restore vital communications. Orchestra to make theatre, film £11.7 million in funding and support and music more readily available, in kind in the 2005 financial year. Education particularly to schoolchildren. The BT Education Programme is one We also encourage our people to of the UK’s most significant corporate BT is helping to protect and promote volunteer in the community because investments in the education sector. telecommunications heritage through of the mutual benefits this brings. www.connectedearth.com. This We are committed to help children website, in partnership with key Charities and fundraising develop the communication skills that museums across the UK, makes ChildLine, a UK charity, answers will help them get more out of their the story of the huge advances in 2,300 calls every day but hundreds lives and future careers. We provide technology over the last 100 years more go unanswered. We are working online and classroom learning accessible to everyone. with ChildLine on a campaign to resources on speaking and listening ensure that every child’s call for skills for schools. help is answered. A touring roadshow is one major We manage entire telephone networks initiative. It provides drama-based for major national charitable events workshops to help children improve such as Children in Need and Comic their communication skills. Since Relief. BT provides call centres and 2000, more than two million children online services to take donations. have been involved in the education programme and the roadshow has visited more than 11,000 schools. Over 2,000 BT volunteers regularly visit schools to help implement this extensive programme.

Sixteen BT engineers, specialists in In France, BT sponsors La Fondation In Germany, BT organised auctions satellite, radio communications and pour l’Enfance, an organisation which among employees, Christmas and under-sea cables, went as volunteers fights against child abuse. It focuses other fundraising events in support to the region affected by the Asian on providing helplines and removing of Kinderdorfer, a charity providing tsunami disaster to help re-establish local child abuse from the internet. disadvantaged children with a normal communications and international links. family environment.

BT Social and Environmental Report Summary and Highlights 2005 13 Environment % % % 4 0 8 3 6 % % 5 % 6 7 4 2 4 2

03 04 05 03 04 05

Global Warming CO2 emissions – Waste to recycling – expressed as a percentage of our percentage of total 1996 emissions level waste recycled

Telecommunications is seen as an The electricity will be supplied from During the 2005 financial year, environmentally friendly technology. renewable sources and combined our ozone-depleting emissions But as one of the UK’s largest heat and power (CHP) plants. (measured in CFC-11 equivalents) companies with expanding international increased slightly, from 221 kg operations, we have an inevitable This initiative will reduce our carbon to 254 kg. impact on the environment. dioxide emissions by a further 325,000 tonnes a year, equivalent Waste We have Environmental to that provided by approximately We produced around 110,000 tonnes Management Systems (EMS) in 100,000 cars. of waste in the 2005 financial year. the UK, Spain and Ireland. Each Of this, we recycled 37,000 tonnes is certified to the international We are looking at ways of using (around 8% more than last year) management standard ISO 14001. renewable technology, such as wind and sent 73,000 tonnes to landfill turbines, within our own buildings (8% less than last year). Energy and fuel and network and are testing a small We are one of the largest single vertical axis wind turbine at one of Our facilities management supplier, consumers of commercial and our telephone exchanges in Cornwall. Monteray, works with contractors industrial electricity in the UK. The to collect and recycle large amounts growth of broadband is increasing Emissions to air of office paper. The paper is sent to our electricity use – up by 3.1% We monitor the emissions to air processing plants where it is graded during the 2005 financial year. of a number of substances that according to colour, weight and impact adversely on the environment, quality – this determines what end Since 1991 we have reduced our through their contribution to climate product it can be used for. The best energy-related emissions by 71%. change or ozone depletion. quality paper can be turned into This has been achieved through photocopy paper, while the rest our energy management and Compared with our 1991 emissions is recycled as hand wipes, kitchen efficiency programme, investing level, in the 2005 financial year our towels or toilet paper. in energy-efficient plant and energy and transport programmes saved equipment, reducing waste 1.4 million tonnes of carbon dioxide. In the 2005 financial year, and buying green energy. we introduced a new type of Our emissions savings exceed environmentally friendly copier In the 2005 financial year, we signed the UK Government target to and printer paper, 70% of which a three-year contract with npower reduce greenhouse gases emissions is made from post-consumer waste. and British Gas that will see nearly by 20% by 2010. all of BT’s UK electricity supplied by environmentally friendly energy. This makes us the world’s largest purchaser of green energy.

BT’s 6,500 telephone exchanges, satellite earth stations, offices and depots are using environmentally friendly energy, such as wind, solar, hydroelectric power and energy from combined heat and power plants.

BT Social and Environmental Report Summary and Highlights 2005 14 Environment continued

Transport Product stewardship Procurement We run a commercial fleet of 31,969 BT’s business relies heavily on As one of the UK’s largest purchasers, vehicles, managed under contract by electrical and electronic equipment we have an environmental influence our wholly-owned subsidiary, BT Fleet. (EEE). We buy vast amounts of the that extends well beyond that of our In the 2005 financial year, we equipment to run our own business own staff and workplaces. reduced both our commercial fleet – and to serve our customers. This, still one of the largest in the UK – combined with the legislation on We seek to influence our suppliers and our fuel consumption by 2% EEE, means it is crucial we improve and contractors through our and 3.5% respectively. the way we manage the equipment. environmental purchasing policy. We have specific objectives to ensure BT’s company car policy supports the We supported the introduction of appropriate supplier environmental key objectives of the UK Government’s two EU directives, the Waste Electrical data is collected, and to encourage emissions-based company car taxation and Electronic Equipment (WEEE) improvement of poor performers initiative. This includes: and the Restriction of the use of in significant risk areas. certain Hazardous Substances (RoHS). • Increased allowance to employees The directives aim to encourage the We use two supplier questionnaires who choose to opt out of company reuse of materials and to minimise to enable us to identify risk and take car ownership both the use of hazardous materials appropriate action if needed. • Improved tax efficiencies for employees in electrical and electronic equipment who opt for lower-emission cars and the amount of hazardous waste • Improved advice and communications going to landfill. to company car drivers, encouraging users to choose lower-emission cars. We have a company standard that selects products which comply with The company car fleet size has EU legislation and favours more reduced by 8% (932 vehicles) sustainable items. Suppliers to BT compared with the previous year. must provide information about This reflects the downward trend their products and how they propose in the fleet size and mileage, with to comply with EU legislation. a reduction of over 12 million miles compared with the previous year.

“BT’s initiative is globally significant and sends out a message that the purchase of green electricity is no longer a niche market – it has now gone mainstream.” Steve Howard, CEO, The Climate Group

BT Social and Environmental Report Summary and Highlights 2005 15 Digital inclusion % 5 % 9 5 8 % 7 6

03 04 05

UK Addressable Broadband Market – the geographical reach of broadband

Access to Information and rate at which people make use of the A key element is the Everybodyonline Communications Technology (ICT) can technology. The solution is to work in programme, supported by BT and improve people’s lives and open doors partnership with others and to provide Microsoft. The project is run by to education, entertainment, jobs and the online facilities that people need. Citizens Online, a UK-based charity personal contacts. But many people promoting the use of Information do not yet have the opportunity, or the Content: Encourage and Communications Technology necessary skills, to use the technology. communication and its use for all members of the community. for social and economic benefit We helped establish the Alliance for The amount of information on the Working with local governments, Digital Inclusion (ADI), an industry body internet is vast, but there is still a communities and service providers, working to tackle digital inclusion and great need for content that brings Everybodyonline aims to ensure promote the use of ICT for social benefit. benefits to communities, small that those people disadvantaged by businesses and individuals. This is why location, lack of skills or economic We want everyone to participate in we work with others to promote new factors do not miss out on the the digital revolution. We promote content. Here are some examples: benefits of new technology. digital inclusion in three ways – • Charities: We have teamed up with connectivity, content and capability. ik.com, a business providing specialist Everybodyonline is being piloted internet solutions, to make free, in several small disadvantaged Connectivity: Provide greater access simple-to-build websites available to communities in the UK. The to communications technology UK charities and community groups. communities are the size of an We provide a range of different This is an extension of our existing electoral ward and have been chosen connections, from home dial-up work with UK schools. because they have below-average lines to internet kiosks and high- • UK National Council for Voluntary household Internet connectivity. They speed broadband, which promotes Organisations: The Council’s website rank among the most disadvantaged social inclusion. provides a comprehensive online communities in the UK and progress resource for voluntary organisations. to date on internet use is encouraging. We have now connected our five • BT Resource Bank: We provide For example, a 14% increase in St millionth customer to broadband, resources for teachers, parents and Stephens in Cornwall since 2002, meeting our target a year early, and we children on communication skills, and a 24% increase in Audley in are on track to meet our target to make including animated tutorials, quizzes Staffordshire in the same period. broadband available to exchanges and classroom activities. serving 99.6% of UK homes and businesses by the summer of 2005. Capability: Help groups and individuals use technology Broadband is a critical factor in the Our digital inclusion campaign success of the UK economy, but its demonstrates how communications wider benefits are constrained by the can help improve society.

Lifelines India is a project being developed in rural villages in India where farmers will be able to use a telephone to seek experts’ advice on issues such as agriculture or animal husbandry. It is run by One World South Asia in partnership with BT and Cisco to help communities benefit from ICT.

BT Social and Environmental Report Summary and Highlights 2005 16 Human rights

We base all our relevant BT policies further action is needed. In some Freedom of expression and procedures on the principles cases, an on-site assessment will be vs child protection set out in the United Nations agreed with the supplier which may A key challenge is to balance the Universal Declaration of Human involve an audit of the supplier’s own right to freedom of expression with Rights, which sets a common facilities or that of a subcontractor. the need to protect children online. standard of achievement for all peoples and all nations. Privacy BT is a board member of the Internet Privacy is not a new challenge. Content Rating Association (ICRA), We are committed to protect and We have recognised for many years which aims to “protect children from enhance the human dignity of every that privacy is important to all our potentially harmful material; and to BT employee and everyone who has customers, including those online. protect free speech on the internet”. dealings with us. BT is a signatory to BT complies with, and is registered Our own programme, BT Safe Surf, the UN Global Compact, an initiative under, the Data Protection Act in the gives detailed information for parents that strives to motivate business UK, and we take all reasonable care and provides user-friendly training and industry around ten principles to prevent any unauthorised access for children. on corruption, environment, labour of personal data. and human rights. BT acts on complaints about content But developments in ICT, such as hosted on our servers. We sit on the Supply chain the ability to tailor services to meet funding council of the UK Internet We monitor the working conditions personal needs, have created fresh Watch Foundation, which notifies under which the products and services dilemmas. One of these is to find a us of illegal content stored on our we purchase are produced. We want balance between offering tailored servers and webspace. We have them to meet the standards of the customer service while protecting the contributed to the work of the Universal Declaration of Human privacy of our customers. We address Independent Committee for the Rights and the International Labour trade-offs between advancements in Supervision of Standards of Telephone Organisation Conventions. Through networked technologies and the risks Information Services (ICSTIS). our supply chain initiative Sourcing to personal privacy rights in our most with Human Dignity (SWHD), we seek recent Hot Topic – Privacy in the to ensure that the working conditions Digital Networked Economy. in our supply chain meet internationally accepted standards. We are developing guidelines on how to manage the new risks and We ask our suppliers to complete challenges to privacy posed by the a risk assessment questionnaire. For Digital Networked Economy, such as those identified as medium or high radio frequency identification (RFID) risk, we follow up to find out more tagging and the location registration information and determine what of mobile communication devices.

We have established a Country Risk website to help our people fulfil our commitments to human rights around the world. The website, which includes a summary of key risks and a human rights score for each country, is designed to help our people implement our principles through sales, purchasing, joint venture operations, employment and outsourcing.

BT Social and Environmental Report Summary and Highlights 2005 17 Economics

BT is one of the world’s leading providers of telecommunications solutions and a significant economic force in its own right. Every year, we buy goods and services worth billions of pounds; employ thousands of people; and provide services and products that make our national and global economies work better.

Direct impacts Indirect impacts ICT sector contribution to growth Our direct impacts can be measured Indirect economic impacts arise and productivity using traditional financial indicators from the income and employment We contribute to economic growth such as turnover, spend with suppliers, created in businesses that supply by helping to improve the productivity dividends, employee costs and taxes goods and services to BT. Figures of enterprises, industrial sectors and paid. For the 2005 financial year, for BT’s indirect economic impacts the wider economy. The Organisation these are: have been produced by DTZ Pieda for Economic Co-operation and • BT turnover of £18,623 million Consulting based on BT’s figures Development (OECD) cites evidence (total turnover is boosted to £19,031 for the 2003 financial year. that those sectors that have invested million when our share of associates’ most in ICT, such as financial services, and joint ventures’ turnover (£408 For example our expenditure in health and business services, have million) is added) the UK provides £2.6 billion of experienced more rapid growth in • Total expenditure on employees: income for suppliers and supports productivity than those that have not. £4,451 million the employment of almost • Total spend with suppliers: 135,600 people. The European Union established a over £4,000 million strategic goal in 2000 to become • Total capital expenditure: There is a further indirect impact “the most competitive and dynamic £3,011 million on the economy when incomes knowledge-based economy in the • Total dividend paid to shareholders: created directly and indirectly world… regaining the conditions for £883 million by BT are spent. This has been full employment and to strengthen • Total taxes paid to governments: estimated by DTZ Pieda Consulting social cohesion.” In the mid-term £523 million. to be £3.4 billion of income review of the Lisbon Strategy, and 174,000 employees. the European Union re-emphasised the role of ICT in economic growth and job creation.

Total expenditure on employees: £4,451 million Total spend with suppliers: over £4,000 million Total taxes paid to governments: £523 million

BT Social and Environmental Report Summary and Highlights 2005 18 Sustainability

Sustainable development has increasingly come to represent a new kind of world, where economic growth delivers a more just and inclusive society, at the same time as preserving the natural environment and the world’s non-renewable resources for future generations.

Achieving sustainable development requires a degree of international consensus and a great deal of multi-institutional support.

ICT sustainability impacts This is a challenge facing Europe Raising awareness ICT is changing the way business is in its attempt to refocus the Lisbon We want to understand our done, especially through the internet, agenda on actions that promote impacts and stimulate debate broadband and wireless technologies. growth and jobs in a manner that is on sustainable development This benefits not only business, but fully consistent with the objective and corporate responsibility. the people doing business. of sustainable development. We do this, for example, by ICT can support social and economic The use of BT’s own products and participating in industry bodies development by transforming services is enabling us to reduce our and being involved in public policy communication and access to consumption of finite materials and to development. BT currently chairs information, helping to bring about improve the work–life balance of our the Global e-Sustainability Initiative the powerful social and economic people. We achieve this through the of ICT service providers and networks needed to bring sustainable use of phone and video conferencing, suppliers, with the support of development to emerging economies. flexible working and e-business. the United Nations Environment Programme and International However, for the economic growth We worked with the South West Telecommunication Union. This from the ICT sector to contribute Regional Development Agency initiative promotes technology that directly to sustainable development through the partnership Actnow to fosters sustainable development. it must be managed in the right way. help spread broadband to remote If not, it will lead to further inequalities rural areas in Cornwall. Nearly 45,000 We have produced a number of and greater consumption. broadband connections have been set occasional papers which explore the up since the project began in 2002. complex relationship between companies and society.

BT is a signatory to the UN Global Compact, an initiative that strives to motivate business and industry around ten principles on corruption, environment, labour and human rights.

BT Social and Environmental Report Summary and Highlights 2005 19 Key performance indicators and targets

Category Indicator 2005 2004 2003 Target 2006

Customers Customer Dissatisfaction – 23% 29% 37% To increase the number against an objective of compound compound compound of extremely and very reducing the number of reduction* reduction* reduction* satisfied customers by 5%† dissatisfied customers by 25% per year over three years

Employees Employee Engagement Index – 65% 64% Not available‡ To achieve 66% by a measure of the overall March 2006 success of BT’s relationship with its employees

Diversity – a measure 22.4% Women 22.7% Women 23.8% Women To maintain or improve of the diversity of the (22.1% of senior) (21% of senior) (20% of senior) on the figures for the BT workforce 9.2% Ethnic Minority 8.9% Ethnic Minority 8.2%Ethnic Minority 2005 financial year (8.1% of senior) (7.6% of senior) (7.0% of senior) 2.2% Disabled 2.1% Disabled 2.0% Disabled (0.7% of senior)

H&S: Lost Time Injury Rate – 0.480 cases 0.620 cases 0.885 cases Reduce to 0.41 cases rate of Lost Time Injury per 100,000 per 100,000 per 100,000 per 100,000 hours during Incidents expressed as a rate working hours working hours working hours the 2006 financial year per 100,000 hours worked on a 12-month rolling average

H&S: Sickness Absence Rate – 2.68% calendar 3.06% calendar 3.44% calendar Reduce to 2.57% calendar percentage of calendar days lost days lost to days lost to days lost to days lost due to sickness to sickness absence expressed sickness absence sickness absence sickness absence absence during the 2006 as a 12-month rolling average financial year

Suppliers Supplier Relationships – Not available‡ 94% Not available‡ To repeat a measure in the a measure of the overall 2006 financial year and success of BT’s relationship achieve more than 90% with its suppliers

Ethical Trading – 240 risk 242 risk 31 risk To achieve 100% follow up a measure of the application assessments assessments assessments within three months for all of BT’s supply chain with 100% with 100% with 100% suppliers identified as high human rights standard follow-up ∆ follow-up ∆ follow-up ∆ or medium risk∆

Community Community contribution – £20.8m in £18m in £26.1m in Maintain a minimum a measure of our investment funding and funding and funding and investment of 1% of in society support in kind support in kind support in kind pre-tax profits

Environment Global Warming CO2 53% below 42% below 40% below Cap 2010 CO2 emissions emissions – a measure of 1996 levels 1996 levels 1996 levels at 25% below 1996 levels BT’s climate change impact

Waste to landfill 73,201 tonnes 79,677 tonnes 89,878 tonnes By 31 March 2006, and recycling – to landfill (66%) to landfill (74%) to landfill (76%) we will increase the a measure of BT’s 37,408 tonnes 27,626 tonnes 27,809 tonnes waste recycled by 5% use of resources recycled (34%) recycled (26%) recycled (24%) (recorded in tonnes)

Digital UK Addressable Broadband 95% UK More than 67% UK Broadband available Inclusion Market – a measure of the homes and 85% UK homes and to exchanges serving geographical reach businesses homes and businesses 99.6% of UK homes and of broadband businesses businesses by summer 2005

Integrity Ethical Performance 70% Not available‡ Not available‡ To achieve 71% Measure – a measure of our by March 2006 progress in acting with integrity

BT Social and Environmental Report Summary and Highlights 2005 Hot Topics

Our Hot Topics cover our more controversial social and environmental impacts. They have been written by independent, external authors. Using selection criteria approved by our Leadership Panel, we consider BT’s stakeholder consultations (such as our Consumer Liaison Panels), the results of various opinion polls and press coverage to identify the topical issues of concern to BT and society.

Our Hot Topics seek to interest, engage Abuse of the Internet Virtual Vice and educate the reader and provide Solitaire Townsend of independent James Wilsdon and Paul Miller food for thought on topical issues. consultancy Futerra considers the of Demos examine BT’s approach The views expressed in them are issue of abuse of the internet – such to internet activities of concern those of their authors, and do not as hate crime online, offensive and such as hacking, copyright necessarily represent those of BT. extreme adult pornography and the infringement and spam. Hot Topics include: dangers to children online. Modern Communications Privacy in the Digital Good Migrations? and the Quality of Life Networked Economy Judy Kuszewski and Kavita Prakash- Written and researched by the Our most recent Hot Topic, written by Mani of SustainAbility consider the Future Foundation, this examines the Polly Courtney, Charlotte Lacey and relationship between offshoring, impact of modern communications Rebecca Nash of the Henley Centre, corporate social responsibility and technology on our daily lives. addresses trade-offs between the geography of jobs. advancements in networked technologies and the risk to personal privacy rights.

BT Social and Environmental Report Summary and Highlights 2005 21 Business principles Business principles 70% Ethics Performance Measure – a new indicator that measures awareness of Statement of Business Practice, an external ethics benchmarking survey and questions from our annual staff attitude survey.

We are committed to follow world- Statement of Business Practice Since 2000, a comprehensive Implementation Disclosure of these examples The Way We Work, and a briefing on class standards of business integrity Our Statement of Business Practice, employee communications plan It is crucially important that our demonstrates the action that backs the importance of corporate social everywhere we operate. The Way We Work, defines BT’s has helped improve awareness Statement of Business Practice is up our Statement of Business Practice responsibility, have been distributed business principles that apply of our Statement of Business Practice implemented throughout the business and underlines that such abuse will to all directors of BT’s existing joint Our Statement of Business Practice, worldwide, to all employees, agents, within the UK. and that BT employees feel able not be tolerated. ventures. The Way We Work, defines BT’s contractors and others when to report non-compliance. business principles that apply representing BT. A printed copy of The Way We Work Lines of business Partners worldwide, to all employees, has been sent to every employee and A confidential 24-hour helpline to The Statement of Business Practice During the 2005 financial year, we agents, contractors and others when Here we provide details on the is also available on the BT intranet. the Head of Group Business Practice is a ‘reserved power’ of the BT Group formalised the way we work with our representing BT. It sets out specific awareness of the Statement within The Statement is available in eight is available via phone and email for Board, and all BT’s lines of business strategic partners on our approach to aspirations and commitments BT and the extent of implementation languages - Chinese (Mandarin), people seeking help and confidential are mandated to comply with it. integrity and ethics. This process is that guide our relations with our across the BT Group. English, French, German, Italian, advice. During the 2004 financial year part of our due diligence. We are customers, employees, shareholders, Japanese, Korean and Spanish. It an email promoting the helpline was Implementing the Principles is the committed to work with our partners partners, suppliers and local Use the Business practice site index includes a question & answer guide sent to every BT employee. responsibility of each line of business to create successful ventures with communities. to assess our performance against to help managers brief their teams. - all have a designated senior manager high standards of integrity and the specific principles, aspirations We take our Statement of Business to do this. An operational working business practice. BT’s overall approach to corporate and commitments of the Statement. During the 2005 financial year, we Practice very seriously and act against group meets once a quarter to governance is explained in our Annual continued the roll-out of training anyone abusing our business maximise the effectiveness of We will use our values and principles Report and Accounts. Awareness sessions for senior managers to principles. During the 2005 financial implementation. in dialogue with other organisations In the 2005 financial year we surveyed promote awareness and understanding year, 132 employees were dismissed and in considering new and existing Here we describe our corporate social awareness of the Statement of of our Business Principles. We have or resigned for unethical behaviour. In the 2006 financial year we will work relationships. Some of our partners responsibility governance framework Business Practice in our international focused our effort on those areas of The following examples are to ensure our Statement of Business are also our customers and/or in more detail. operations and discovered that 75 per the business where we believe the illustrative: Practice is more effectively suppliers. In these cases, our cent of employees in those operations risk of non-compliance is greatest. • Dishonest and corrupt behaviour implemented. In particular, that it is commitments to them remain During the 2005 financial year, were aware of the Statement. Those by BT staff: embedded into the practices of newly consistent with their role as a we continued to develop our surveyed were predominantly line Other elements of the - A BT employee has been dismissed acquired businesses and partnerships, stakeholder. understanding of our key corporate managers. communications plan include a for stealing and then selling large such as Albacom (Italy) and Infonet. social responsibility risks. We have training website and training videos quantities of cable to a scrap metal published our second regulatory During the 2005 financial year, we for managers. Senior managers are dealer Wholly-owned subsidiaries compliance report. developed an Ethics Performance requested to write to their teams to - Two employees were interviewed and joint ventures Measure (EPM). The EPM includes our explain the importance of complying and suspended from duty and one All BT’s wholly owned subsidiaries BT has a strict policy of not giving existing awareness of the Statement with our Business Principles. subsequently dismissed following are expected to follow our Statement cash contributions to any political of Business Practice, alongside two the misuse of a corporate credit card of Business Practice. party. But we do participate in additional components. These are: In collaboration with the UK’s Institute - A BT employee has been dismissed debates on public policy and regularly • An external ethics benchmarking of Business Ethics, we run an internal following theft from a customer The Statement outlines how we make contact with political parties, study we commission annually to Business Practice Excellence award. contact centre and misuse of one will work with our international joint politicians and civil servants. measure how we compare with a Individuals are nominated by colleagues of our customer databases ventures to create added value for number of other FTSE 100 for demonstrating excellent business - A BT manager has been dismissed our customers and shareholders, All BT people are asked to respect companies. practice behaviour against one or following considerable business while continuing to adhere to high a set of specific values that underpin more of BT’s 12 business principles. expense claims fraud. standards of business practice. • Two questions from our annual staff everything we do and the vision attitude survey: is BT trustworthy, and • Inappropriate use of the Internet: of the world we share. We are committed to follow our is it safe to speak up? - A former contractor for BT pleaded values and principles in all our guilty to offences under the Protection dealings with subsidiaries. A The EPM moves us away from a of Children Act. comprehensive Joint Venture purely perception-based measure to Statement pack promoting one of performance. Our EPM score in the 2005 financial year was 70 per cent. Our target is 71 per cent in 2006.

Information and data on this page Information and data on this page has been verified by Lloyd’s Register has been verified by Lloyd’s Register Quality Assurance Limited Quality Assurance Limited BT Social and Environmental Report Business principles 01 Business principles continued

Corporate Social Responsibility CSR Governance Organogram Examples of initiatives considered In early 2005 we reviewed the health The team is made up of professional (CSR) governance framework by the Committee during the 2005 check process. Some changes will be CSR experts who investigate long- At least once a year the BT Board financial year are: introduced, including a stronger use term social trends, identify potential discusses our CSR strategy and • International CSR activities of the BT Values, an extension of issues that might affect the business performance. The Board is kept scope and attendance at all health and support BT’s commercial • The development of the Ethics informed of any new developments or checks of an internal BT expert from activities. Performance Measure changing expectations that may affect the appropriate lines of business. its duties. This includes an • Offshoring The team provides support to identification of BT’s main CSR risks Environmental Policy the CSR Steering Group, the • The communication of CSR, internally and opportunities, along with key Implementation Committee Community Support Committee and externally performance indicators and strategic The Environmental Policy and the Leadership Panel. objectives. • A review of BT’s key performance Implementation Committee (EPIC) - indicators. a sub-committee of the CSR Steering During the 2005 financial year, the Social, ethical and environmental Group - meets monthly to ensure Social Policy Unit changed its name to matters are included in the directors’ CSR health checks BT’s environmental policy is better reflect the full scope of its CSR induction programme, to support the CSR health checks are used to ensure implemented effectively. activities and trends in the CSR integration of CSR into daily that CSR is embedded in BT’s marketplace. management. commercial operations. The membership of EPIC consists of This includes our approach to policy Communications, Internal Audit BT’s environmental aspect group Community Support Committee A CSR governance framework helps and reputation, such as ethics and and Procurement). Health checks examine how key owners - senior operational managers This Board Committee oversees us manage specific environmental values, corporate social responsibility, CSR impacts (such as integrity, from around the business whose social investments and establishes and social issues. A number of bodies human resources, pensions, The CSRSG meets quarterly and environment or digital inclusion) may responsibilities have environmental the strategy for maximising supervise the CSR relationships technology, branding and health and regularly reports to the Board. It is be affected by a particular commercial implications. our contribution to society. between the BT Group and individual safety. The Council provides advice chaired by BT’s overall CSR champion programme, and how CSR can help The Committee is made up of lines of business. These are: on critical matters such as regulation, Alison Ritchie, Chief Broadband achieve the commercial objectives. EPIC’s main responsibilities are to: representatives from BT businesses • Management Council media relations, public policy and Officer. Additionally the health checks raise • Meet the environmental improvement and external non-executives who have public affairs. understanding and awareness of the targets and objectives agreed by a reputation for excellence in this field. • Corporate Social Responsibility The main responsibilities of the business case for CSR. CSRSG Steering Group Corporate Social Responsibility CSRSG are to: See more in Community. • Maintain the register of BT’s • CSR health checks Steering Group • Ensure the BT CSR programme meets The checks are undertaken with environmental impacts. An internal committee known as the needs of the business commercial programme directors • Environmental Policy Implementation the Corporate Social Responsibility from BT’s lines of business. They are Committee • Champion major social and Ben Verwaayen, BT’s CEO, takes Steering Group (CSRSG) oversees not audits but structured, informal environmental initiatives and overall responsibility for BT’s • Corporate Responsibility Team the implementation of all social and conversations to identify CSR risks improvements environmental performance. environmental programmes across BT. and opportunities. • Community Support Committee The Steering Group reviews activities • Maintain BT’s ISO14001 certification Corporate Responsibility Team • Leadership Panel. such as ethical trading, environmental (environmental management) During the 2005 financial year, BT’s Corporate Responsibility Team - management, risk management and five health checks were conducted • Agree company policy on specific formerly known as the Social Policy Management Council reporting. in Global Services on major business social and environmental issues Unit - is responsible for the overall BT’s main strategy committee, change programmes covering co-ordination and maintenance of the Management Council, is made The CSRSG is made up of CSR • Assess risk customer service and delivery, BT’s CSR strategy and environmental up of business and functional leaders champions nominated by the BT our values and organisational culture, • Agree key performance indicators management system. One of the from across the BT Group. It meets lines of business and seven support and creation of a global standard and strategic targets. team’s responsibilities is to promote monthly and contributes to the long- functions (Human Resources, operating environment. awareness of BT’s social and term strategic planning and direction Corporate Governance, Health environmental policies among of the BT Group. and Safety, Group Property, employees.

Leadership Panel Risk We have identified these as Regulatory compliance The data published by Oftel/Ofcom we make sure that those in The Leadership Panel is an external BT is affected by a number of non- our key risks: It is our policy to be fully compliant shows that: government are fully briefed advisory group of experts renowned financial factors, not all of which are with the regulatory framework in • Over the last two years, under half on issues affecting BT’s activities. for excelling in their field. The Panel wholly within our control. These are CSR Risk More details which we operate. the investigations completed by currently has five members: described in the BT Annual Report Supply chain Human rights in Oftel/Ofcom were concerned with BT We interact regularly with the • Jonathon Porritt, Chair of the Panel and Accounts. working the supply chain During the 2005 financial year, we European Commission and national • Of the investigations into BT, ten and Director of Forum for the Future, conditions have continued to strengthen our and international regulators. concerned alleged breaches of a UK sustainable development think- The BT Board is responsible for BT compliance activities. This is because Climate change Environment regulation, and eight concerned tank Group’s systems of internal control we want to ensure that we meet the Trade associations disputes and risk management, and for Diversity Diversity and obligations imposed by the UK’s We communicate with government • Mark Goyder, Director, Centre for reviewing the effectiveness of those inclusivity Communications and Competition • Of the investigations into alleged directly and through trade Tomorrow’s Company, a UK think systems. Acts, while competing fairly and breaches of regulation, two resulted associations, which include: tank vigorously within the rules. in findings against BT • European Telecommunications Geography of Hot topics and • Rob Lake, Head of SRI Engagement The processes for identifying, Network Operators’ Association jobs (‘offshoring’) Call centres • Of the investigations into disputes, and Corporate Governance, evaluating and managing the Our main objectives are to: (ETNO) one resulted in a finding against BT. Henderson Global Investors significant risks faced by the BT Group Breach of Business • Maintain good standards of • Confederation of British Industry (CBI) are described in the internal control integrity principles compliance • Elizabeth Laville, Director of Utopies, A major activity in the 2005 financial and risk management section of the • Intellect, the trade body for UK-based a Paris-based sustainability Health and safety Health and safety • Engage positively with the UK year has been the Ofcom Strategic Annual Report and Accounts. information and communication consultancy regulator, the Office of Review of Telecommunications. At Privacy Hot topics technologies and electronics Communications (Ofcom) the time of writing Ofcom was still • Jorgen Randers, Professor, the CSR risks industries. considering its course of action and Norwegian School of Management, The Board takes account of significant • Engage positively with our industry the responses to the review. But the Oslo. social, environmental and ethical The key risks are unchanged from the sector We believe these activities are a consultation document acknowledges matters that relate to BT’s business. initial work done in the 2004 financial legitimate part of normal relationships • Engage positively with compliance BT’s efforts to apply significant During the 2005 financial year, one year, apart from the inclusion of an between business and politics. teams in other regulated industries resources to regulatory compliance panel member, Yve Newbold, an During the 2004 financial year we additional risk - privacy. As we enter to share best practice. and to enrol over 50,000 people in independent adviser, retired. developed a CSR risk register which new markets in the IT services arena Consultation its compliance training courses. sets out our most significant social, there are issues around privacy which Our responses to important regulatory Our Regulatory Compliance The purpose of the Panel is to ethical and environmental risks. we are keen to address in a proactive consultation documents are posted on governance framework includes: Our 2005 Annual Report on encourage innovation and leadership way to minimise the level of risk. our regulatory affairs website. • A Compliance Champion (Hanif Regulatory Compliance provides a on sustainable development and In the 2005 financial year we Privacy in the Digital Networked Lalani, BT’s Finance Director) complete description of our regulatory corporate responsibility in BT. It identified no social, environmental Economy is the subject of our latest Here you can find our responses compliance and performance. meets four times a year and provides or ethical risks that would have a Hot Topic. • A Regulatory Compliance Steering to CSR specific consultations: independent guidance and expert material impact on our business. Group that meets quarterly • BT response to UK government Public policy advice. In the same period, we further There is a person in charge of dealing consultation paper on a Sustainable • A Compliance Control Board that BT has a strict policy of not giving developed our understanding with each risk and all have a Development Strategy for the UK meets monthly to review performance cash contributions to any political Its responsibilities include key areas of of our key CSR risks. mitigation strategy in place. and risks party. • Proposals for an Operating and CSR strategy and performance, Financial Review including policy, performance None of these risks has been • Compliance Control Boards in each We engage with political parties, measures, targets, future objectives, identified as material to BT’s future line of business to ensure that • EU Green Paper on Corporate Social politicians and civil servants on a non- governance, stakeholder relationships prospects. compliance is embedded in working Responsibility partisan basis to make them aware and external communications. practices at all levels of key issues, opportunities and trends • UK Government’s consultation on • Annual reports to the BT Board and in technology and industry. sustainable development, including The panel provides an annual the BT Board Audit Committee by our position on environmental independent comment for inclusion the Director, Internal Audit and We put forward our views on matters taxation. on this web site. Regulatory Compliance. that affect our business interests and

Public policy and sustainable Vision and values • Straightforward: We make things clear development Vision - We make complex things simpler We are members of a number of Connecting your world. Completely. for customers and for each other. organisations that attempt to Our purpose is to connect with our - We get straight to the point. influence public policy on corporate customers wherever they are, - We use our common sense and social responsibility and sustainable irrespective of distance, time or judgement. development matters. They include: complexity. Our role goes beyond • Employers Forum on Disability simply providing a connection • Inspiring: We create new possibilities between people: we enable business - We are determined and passionate • CSR Europe partnerships to develop and flourish, about delivering the very best • Forum for the Future we bring family and friends together. for our customers. Communication technologies have an - We come to work to make • Green Alliance. enormous impact on our customers’ a difference. lives and on society in general. - We set high goals and always There are two ways for government to Because of this, we have an important give 100 per cent of our energy. stimulate changes in behavioural responsibility to think forward, to patterns that will lead society towards develop and promote access to • Heart: We believe in what we do more sustainable lifestyles: regulation telecommunications around - We create and deliver inspirational and economic instruments. We the world. solutions for our customers. believe there is a role for the - We have the ambition and confidence reasonable use of both. Values to do things in new ways. BT’s activities are underpinned - We are innovative, creative, and by a set of values that all BT people outward-looking. are asked to respect:

• Trustworthy: We do what we say we will - We build open, honest and realistic relationships with customers and with each other. - We are reliable and act with integrity. - We do whatever it takes to deliver.

• Helpful: We work as one team - We pull together across BT to put the customer first. - We support each other, without waiting to be asked. - We help others succeed and celebrate their success.

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We communicate with our In addition to communicating with The more positive and mutually Stakeholder engagement Shareholders Leadership Panel stakeholders to understand their the stakeholders listed above, we also beneficial these relationships are, the We engage with our stakeholders The Investors section of our report The Leadership Panel is an external opinions and needs. regularly engage with organisations more successful our business will be. in many ways and learn from them was developed following close advisory group of experts renowned on major issues which have, or will all the time. This engagement has consultation with analysts specifically for excelling in their field. The panel No formal process is used to identify have, an impact on BT’s business. Here we discuss: become increasingly important to interested in the social and environmental has five members: stakeholders, but over time it has In the 2005 financial year, we worked • The various ways we engage with us as a business. We describe in performance of companies. • Jonathon Porritt, Chair of the Panel become clear that six groups are alongside the Confederation of British the different stakeholder groups the individual stakeholder sections and Director of Forum for the Future, particularly crucial to the success Industries, the RAC Foundation and our relationships with particular BT always values feedback from a UK sustainable development • Our Leadership Panel of our business: the University of Bradford on a study stakeholders, their evolution, and shareholders and aims to inform think-tank • Customers into the role of broadband in beating • Stakeholder influence. the related policies and decisions investors of the issues we face. • Mark Goyder, Director, Centre for congestion. We hold quarterly we have taken as a consequence More details can be found in Services • Employees Tomorrow’s Company, a UK think- meetings with the UK Environment You can also provide feedback on our of these relationships. for Shareholders. tank • Suppliers Agency and meet twice a year with social and environmental performance our two unions, the Communications by emailing us at [email protected]. Customers Partners • Rob Lake, Head of SRI Engagement • Shareholders Workers Union and Connect, to • Consumer Liaison Panels Find a description of our relationship and Corporate Governance, Henderson • Partners discuss a range of environmental Corporate social responsibility with joint ventures and wholly owned Global Investors • Surveys of customers on quality issues. We are members of the is how we as a company contribute subsidiaries on social and environmental • Community. of service and future expectations • Elizabeth Laville, Director of Utopies, European Telecommunications to the wider societal goal of issues in our Statement of Business a Paris-based sustainability consultancy Network Operators Association sustainable development. To meet • Telecommunications Advisory Practice. Our approach to integrity Our customers are key stakeholders (ETNO) environment forum and this commitment we must balance Committees. and ethics with our partners was and keeping them satisfied is vital • Jorgen Randers, Professor at the the UK Council for National Parks the needs of our stakeholders with formalised in the 2005 financial year to our continued success. We conduct Norwegian School of Management, corporate forum. We organise the benefits to our business of acting Employees and is now integral to our due diligence. more than 3000 face-to-face interviews Oslo. focus groups with employees responsibly. Our responsibility is to • Our annual employee survey with residential customers every from across the business, looking identify, understand and then manage Community month to assess customer satisfaction • Relationships with trade unions The purpose of the panel is to at BT’s environmental performance our social and environmental impacts. An annual MORI survey of our with BT. Feedback from these surveys encourage innovation and leadership and how to ensure our policies An integral part of this is to develop • European Consultative Works Council. stakeholders (the general public) helps us to improve our service. Our on sustainable development and and communication are consistent good relationships with our tells us that education should be Promises Campaign commits us to corporate social responsibility and effective. stakeholders and to be transparent Suppliers a top priority for our social investment. keep our promises to customers by in BT. It meets four times a year and accountable in our daily work. • Our annual supplier satisfaction Further, our annual employee survey providing the services they require and provides independent guidance For more information on how survey ranks education third behind ‘new on time. and expert advice. we manage the environment, technology’ and ‘helplines’. The • Ethical trading forums with key see Environment. community section describes how we suppliers and industry colleagues. Its responsibility covers key areas manage and distribute this investment. of CSR strategy and performance, Our Statement of Business Practice, including policy, performance The Way We Work, sets out the measures, targets, future objectives, aspirations and commitments which governance, stakeholder relationships apply in our relationship with each and external communications. stakeholder group. The panel provides an annual independent comment for this website.

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Stakeholder influence For example, we show: Influencing BT's Social We review our KPIs on an annual basis Other content It is important to be clear about • How a Consumer Liaison Panel and Environmental Report and, as we reach target deadlines and When defining the content of each what BT is trying to achieve with each in Manchester informed our action Stakeholder consultation has the business changes, we introduce section of this report, we consider stakeholder group and to deepen our to lessen the impact of premium significant bearing on the content new indicators. In the 2005 financial carefully the results of consultation understanding of what they expect rate service (PRS) numbers on our of this report. year, one new indicator was added activities. For example, the Investors from us. customers through initiatives such and two existing KPIs were changed: section was developed following as free call barring and warning Hot Topics • Health target (in addition to our safety close consultation with analysts This is why our Statement of Business advertisements on the BT website. Using robust selection criteria target to reduce accidents) specifically interested in the social Practice The Way We Work, sets approved by our Leadership Panel, and environmental performance • How BT managers work with their • Employee Engagement Index (EEI) in out the specific aspirations and we analyse various opinion polls, of companies. The Customers and teams to carry out action plans based the annual employee survey (replacing commitments that apply in our BT's stakeholder consultations (such Employees sections cover issues on the results of our annual employee the People Satisfaction Index) relations with our customers, as our Consumer Liaison Panels) and that we know to be of concern to survey. The introduction of an employees, shareholders, partners, press coverage to identify topical • Ethics Performance Measure these groups, such as services for Employee Engagement Index will suppliers and communities. issues of concern to BT and society (replacing the Awareness of Business customers with special needs and our help highlight the impact of key that will interest, engage and educate Practice target). call centre reorganisation programme. issues on the performance, motivation BT’s performance against these the reader. As a result, Privacy in the and engagement of BT employees. specific principles, aspirations Digital Networked Economy, Abuse We will review all KPIs in the 2006 Since June 2003 our verifiers have and commitments can be found • How our Statement of Business of the Internet and Good Migrations? financial year. assured our report against the via our site index based on the Practice was sent to all direct suppliers have been included among our AA1000 Assurance Standard. Statement of Business Practice. after our supplier questionnaire Hot Topics. In deciding what other indicators revealed a lack of awareness of the to use in the report, we chose to The underlying basis of this standard It is difficult to make direct links way BT works. We also organised a Previous Hot Topics selected in this follow the 2002 Global Reporting is inclusivity. It requires our report between a specific consultation stakeholder workshop with one of our way included Virtual Vice and Modern Initiative (GRI) Guidelines. As a multi- to reflect the interests and concerns exercise and a particular company partners in the Global e-Sustainability Communications and Quality of Life. stakeholder initiative, these guidelines of stakeholders, both in its content decision. Initiative, Vodafone, to improve the provide the most comprehensive and in terms of demonstrating BT's way we engage with stakeholders, Indicators and independent insight into the response to these issues. But we try to show, in the various especially NGOs, in the supply chain. In June 2003, we established interests and concerns of our sections of this site, how specific a small number of non-financial key stakeholders. We also follow the More details on how we have • How stakeholder dialogue was used stakeholder groups do influence performance indicators (KPIs) to pilot version of the Global Reporting applied AA1000 Assurance Standard in the selection of non-financial key BT’s policy, strategy and practice. provide an overview of BT's social Initiative Telecommunications are found in the About the Report performance indicators and environmental performance. Sector Supplement. section of this report. • How a seminar about radio frequency It followed a consultation exercise identification (RFID) with our involving report users, such as Leadership Panel has led to the investors, customers and employees, commissioning of a new Hot Topic, and outside experts, such as the Privacy in the Digital Networked BT Leadership Panel. Economy.

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Customer dissatisfaction – reduced by 23% on a compound annual basis over the past three years.

We intend to be the best provider Customer satisfaction In addition to our own surveys, an Customer satisfaction The results for the 2004/05 financial of communications services and Improving customer satisfaction is the independent agency seeks the views Customer satisfaction is a measure of year among BT Retail customers are: solutions for everybody in the UK cornerstone of our strategy. of about 10,800 business and those customers who are fairly, very and corporate customers worldwide, residential customers each month. or extremely satisfied with BT. Consumer Business Consumer Business working through partnerships. We have established the strategic These interviews include questions on satisfaction satisfaction satisfaction satisfaction target to outperform our competitors the provision or restoration of a BT Retail's performance - tested over with provision with provision with repair with repair We serve over 20 million business and consistently and reduce customer service, or how a complaint made to the last three months of the past 2001/2002 92% 84% 79% 84% residential customers in the UK and dissatisfaction by 25 per cent a year BT was handled. three financial years -indicates have more than 29 million exchange over the three years to the 2005 progress. 2002/2003 88% 85% 81% 85% lines. We also provide network financial year. We have not met this The perceptions and views of our 2003/2004 93% 86% 78% 84% services to other licensed operators. target and achieved a 23 per cent business customers are surveyed by Satisfaction scores for residential reduction in customer dissatisfaction another independent agency. An customers 2004/2005 92% 83.2% 74.2% 80.9% Our extensive global network and on a compound annual basis over the average of 1,900 BT business BT Competition strategic partnerships enable us to past three years. customers and 450 corporate and 2000/2001 80% serve multi-site corporate and government customers are Initiatives to improve customer government customers in all key The quality of the service we provide interviewed every month by 2001/2002 77% 76%* satisfaction commercial centres of Asia, Europe - and our customers' satisfaction with telephone. Our customers have told us that 2002/2003 76% 75%* and North America. In Europe, our that service - is fundamental to our we must: network links more than 250 towns business. BT Global Services uses three types of 2003/2004 79% 71% • Be easy to contact and cities across 19 countries. survey to measure customer 2004/2005 85.9% NA • Keep them informed (we shouldn't We are committed to listen to our satisfaction: need to be chased) Here we explain our approach to: customers through our millions of • Face-to-face interviews, normally with Source: (Data Source NOP World) • Customer satisfaction day-to-day interactions with them and senior decision-makers in the larger Sample: Approximately 63,000 • Take ownership of their issues through one of the largest customer- organisations and champion their cause • Customer communications research programmes in the UK. Satisfaction scores for business • Tracker surveys, an overall satisfaction • Live up to the commitments • Looking after the customer customers survey conducted over the telephone we make to them. Here we describe: BT Competition • Services for customers • Our customer satisfaction measures • An Event Driven Customer 2000/2001 79% These principles guide us in all our • Voluntary and mandatory services Satisfaction Survey, which is a • Comparable performance indicators initiatives to improve customer telephone survey conducted 2001/2002 64% 62%* • Wireless communications and health satisfaction. They demonstrate that • Initiatives to improve customer immediately after a repair or provision 2002/2003 80% 73%* satisfaction depends on price and the • Broadband satisfaction event. quality of service. 2003/2004 83% 76% • 21st Century Network. • Quality of Service report. We publish customer-satisfaction and 2004/2005 82.4% NA Quality of Service report quality-of-service measures every six Satisfaction measures Source: NOP (from September 2000), Our quality of service is fundamental months. To improve levels of customer prior to that Market Insights to the success of our business. This is satisfaction, we need a thorough Sample: Approximately 42,500 why we operate one of the UK's Customer dissatisfaction understanding of what makes * Accumulated average for the last three largest programmes of customer Customer dissatisfaction measures customers satisfied and dissatisfied. months of the year research. We talk to our residential those customers who are fairly, very and business customers regularly to or extremely dissatisfied with BT. To achieve this, we carry out more We carry out detailed surveys of gather their views about BT, the than 3,000 face-to-face interviews satisfaction with different aspects service we provide and our range of We set a target to reduce customer with residential customers every of service and use the percentage products. This is essential in order to dissatisfaction by 25 per cent a year month. We ask them about their of customers who are satisfied overall improve. over the three years to the 2005 overall perception of BT and the with the provision of service or service financial year. Although we have not quality of service. Customers who use repair as a measure. View the Quality of Service reports met this target - we achieved a 23 per competitors are asked how satisfied available online. cent reduction on a compound they are with our competitors. The annual basis over the past three years interviews also examine image and - we believe the improvements we reputation, price and value, contact made in our customer services have and experience, and products and been beneficial to all our customers. services.

Customer communications • The Brighton and Hove consumer More information on BT's complaints The BT Competitive Marketing the material is blacklisted. The Total number of disconnections* We need to know what our customers' liaison panel looked at how BT procedure is provided in the Service Principles refer to BT selling its technology does not have the (residential customers) concerns are if we want to keep them handled problems and complaints Guide 'Complaints about our Service'. products and services positively, on capability to record access attempts. Financial Year Total number satisfied. We have established a from customers. The discussion Ofcom, the regulator for the UK their merits, persuading customers to By its very nature, the system of disconnections number of consultation initiatives covered areas such as the distinction communications industry, publishes buy BT because of excellence in prevents a crime being committed. to help us identify these concerns. between problems and complaints, advice about how to make a facilities, price, delivery, quality, We are not able to record access 2000 1,067,972 triggers for problem-raising and complaint to a telecoms company. service and value for money. attempts. 2001 964,810 We also provide ways for our principles for effective problem 2002 1,061,036 customers to bring issues and management. The panellists also Services In the 2005 financial year, there were Disconnection 2003 1,051,545 complaints to our attention. discussed customer access to BT and We want to make sure we help 12 complaints made to the We regard a disconnection as a failure 2004 981,336 how calls and problems are handled. customers gain the benefits of Advertising Standards Authority about and make every effort to avoid it. We 2005 981,307 Consultation telecommunications while helping BT and nine of these were upheld. offer flexible payment options to help We undertake in-depth consultation • A Bristol panel discussed how to protect them from those who customers budget for bill payment. If Total number of disconnections* to understand our customers' needs consumers choose a telecoms abuse the network. Internet abuse customers have temporary payment (business customers) and concerns. provider. This included what triggers Internet abuse falls into two categories difficulties, we are eager to work with Financial Year Total number them to leave BT and what encourages Here we explain our approach to: - content and contact. Content refers them to avoid the need to disconnect. of disconnections Consumer liaison panels them to return. BT's win-back • Advertising to websites, files and images that are For example, we are willing to agree We run a number of consumer liaison marketing was examined. posted as a 'one way' communication, payment plans to help customers pay 2000 182,651 • Disconnection panels across the UK. These consist where the person posting the illegal over a longer period than usual. 2001 91,262 of 12-15 consumers with a broad • A Manchester panel discussed • Internet abuse content and those using it have no 2002 292,432 range of experience. They also premium-rate services, in particular immediate relationship. Contact, If we do not receive payment after 2003 301,926 • Nuisance calls represent different needs, interests, awareness, charging, regulation and however, covers person-to-person issuing the first reminder, we will give 2004 132,528 ages and cultural backgrounds. The policing arrangements. Mention was • People on low incomes contact over the Internet - either the customer a second reminder, 2005 161,265 panels are recruited and chaired by made of drop-in diallers and what BT between two people abusing the net usually by telephone. If we still do not • Premium rate numbers independent external specialists. does to inform customers about their by common agreement, or someone receive payment, or have been unable * This includes those who pay after threat. The panel also discussed 118 • Payphones and inclusion approaching a child or harassing to agree a payment plan, we restrict disconnection and reconnect before Feedback from panel members numbers and the call return facility a victim over the net. the customer's service to incoming their service is formally terminated. • Services for customers who are provides valuable insights into on the BT 1471 service. calls only (except for calls to BT and older or disabled consumer thinking and informs the We have introduced 'Cleanfeed', emergency numbers). We only For more information, see policy-making process within BT. The Complaints • Voluntary and mandatory services. which uses the latest technology consider temporarily disconnecting BT Customer Service. panels regularly discuss a range of We are committed to provide the best to block child abuse sites blacklisted the service from outgoing and issues including customer service, how telecommunications service. However, Advertising by the UK Internet industry body, incoming calls if payment is still not we keep customers informed, mobile sometimes things go wrong, and As one of Britain's largest advertisers, Internet Watch Foundation. The forthcoming or we are unable to telephony, payphones, billing, access when they do, we want to put them we not only have a public duty to blacklist consists of a worldwide list negotiate a realistic payment plan to and marketing of broadband right as quickly as possible. uphold the highest standards of of child sexual abuse websites that with the customer. technology, and the provision of advertising, but a great deal to gain have been assessed as "illegal to services for customers with When a customer calls BT, an adviser from adopting such standards. By view" in the UK under the 1978 Child Our Bill Payment Code of Practice disabilities. will try to solve the problem as quickly promoting such a culture, BT can: Protection Act. Illegal child sexual describes our procedures for as possible, preferably during the • Avoid adverse publicity abuse material is the only material requesting payment and the help Specialist interest panels phone call. If this is not possible, we under UK law where possession (by customers can expect if they have • Avoid risk of prosecution. We have set up a number of specialist will agree a course of action. Billing downloading from a website) is a problems paying. interest panels to explore the views queries are more complex and criminal offence in itself. In effect, BT's values in this area are set out in of particular groups of customers - may take a little longer to resolve. this means the blocking technology We have updated the reporting the BT Statement of Business Practice for example, small and medium-sized will prevent an offence being measure used this year from and the BT Competitive Marketing enterprises (SMEs), broadband users If a customer is unhappy with our committed, and is therefore a direct 'telephone lines' disconnected to that Principles. and young people. response they can ask for the matter crime prevention measure. of 'accounts' disconnected. Accounts to be referred to the appropriate are more representative of a single The BT Statement of Business Practice Listening to consumers senior manager. If the complaint still The technology blocks any blacklisted household or single business. states that BT will be truthful and We listen carefully to consumers' cannot be resolved, the case can be material. This could be a whole site, accurate in all our communications views and build feedback directly into taken to the BT Complaint Review a page or even a picture. A customer with customers, and be helpful and policy-making and service provision. Service. The Service will review all who tries to access a blacklisted site honest in all our dealings with them. For example: aspects of the case and strive to will see the 'error 404' message. resolve the matter to the customer's There will not be any indication that satisfaction.

Low incomes Nuisance Calls Bureaux and our main website at www.bt.com, E-payphones Consultation A phone service can act as a lifeline. BT voluntarily operates a Nuisance and including information in the We have 1300 public e-payphones We maintain our long tradition We provide a basic telephone service Calls Bureaux (NCB) to help and Update magazine that comes with BT installed in the UK, enabling of consulting with people with for all, including people on low support customers receiving malicious bills sent to our 20 million customers. customers to use the Internet, send disabilities. The BT Disability User incomes or those who have trouble and nuisance calls. Initial enquiries are emails and text messages and make Panel, whose members are BT people paying their bills. The services are: answered by specially trained advisers We investigate individual cases where phone calls. We have also developed a with an interest in disability, provides who offer simple advice and solutions. customers feel they have been number of joint initiatives with local us with early feedback on new BT's Light User Scheme. This is for The NCB is open 24 hours a day, 365 wronged. We cannot waive charges councils to enable communities to products and services to ensure those who need a phone but make days a year. because only a small percentage is access on-line government services. accessibility. few calls because they can't afford kept by us. We are, however, flexible them. It is available on any BT Complex cases, which may require about payment terms and in some Services for customers who are In the 2004 financial year, BT Text residential phone line, except for police investigation or call tracing, circumstances donate our share older or disabled was launched as a mainstream service those with more than one phone line, are passed on to NCB specialists who of the revenues to charities such Our aim is for everyone to have the to enable SMS messages to be sent or those who use phone services from are trained in police liaison and may as Childline. same freedom and opportunity to between mobile and fixed lines. The another provider. Customers on the appear in court as prosecution communicate. Our Age & Disability technology converts text messages scheme pay standard rental and call witnesses if necessary. Payphones and inclusion Team works in BT and in communities to voice, helping visually-impaired charges, receiving a rebate providing We have a legal duty - known a to enhance the sense of well being of people hear the text message, and their bill is below a certain level. The Nuisance Call team can be s a Universal Service Obligation - elderly people with disabilities. We hearing-impaired people Around two million customers benefit contacted 24 hours a day on 0800 to ensure that basic, affordable provide a range of services and advice communicate with those who hear. from the scheme at a cost to BT of 661 441. telephone services are available to ensure that older people and around £70 million a year. This is a to all consumers, anywhere in the UK. people with disabilities benefit from Billing level of support for the needy that Premium-rate service numbers This is why we ensure that payphone modern communication services. BT has been providing bills in we believe is unmatched by any other We have received a number of services are provided to meet alternative formats since 1992, UK business. complaints about higher than community needs, including rural BT TextDirect and RNID Typetalk including braille, large print, computer expected telephone bills, usually as a communities. Launched in July 2001, BT TextDirect disk and our talking bill service. These BT In-Contact Plus is a basic result of the installation of software is the world's first service to provide are provided at the same time as telephone service available to new and diallers that call premium-rate services We currently have around 66,400 textphone users access to the customers receive their standard bill. existing customers. It offers normal from computers. In some cases the public payphones in operation (this telecommunications network. Many BT publications and user guides incoming call facilities, but with installation is done secretly via the figure excludes Northern Ireland). Automatically bringing in a Typetalk are also available in alternative outgoing calls restricted to 999, 112, Internet, or it is installed by someone Call minutes from public payphones operator to relay the call if required, it formats. 150, 151 and 12822 (Ring Me Free). other than the bill payer. In many have fallen considerably. This is has simplified the making and The service is aimed at customers who cases, the installation is perfectly mainly because of the increased receiving of calls between voice and BT also has a Protected Services previously could not afford a legitimate but customers are unaware use of mobile phones - making many textphone users. Scheme that lets vulnerable telephone service, as well as those of the cost implications. payphones unprofitable. customers nominate a third party customers who need to control their BT TextDirect automatically calculates to manage their bills, for instance telephone costs. The joining fee is BT has taken action. We have: BT's challenge is to meet regulatory a rebate on text calls (which are longer in the event that they have a spell £9.99 (inc VAT), and there is a • Barred calls to over 1,000 of the requirements on access, while in duration) to ensure they cost no in hospital. quarterly rental of £9.25 (inc VAT). numbers allegedly involved ensuring that our payphone more than voice calls. operations are financially viable. Directory enquiries • Offered to all customers a free barring BT Pay & Call is a new, exciting 'pay Typetalk is the UK's national text relay We continue to provide the 195 service to premium-rate numbers and as you go' service only available from During the 2005 financial year, service, funded by BT since 1990 and free directory enquiry service for a removable bar for premium rate and BT. It provides a BT fixed line service we reduced costs by removing 6200 run by the Royal National Institute for customers who cannot use a phone international calls, for £1.75 a month which is pre-paid by credit or debit payphones. This did not leave any Deaf People (RNID). The service book because of a disability. Our card or by using BT's Pay & Call • Provided information about premium communities without a payphone enables textphone users - who may website also offers an accessible, on- Payment Card (cash payments at rate services to customers. This service. be deaf, deaf blind, hard of hearing or line directory enquiries service which PayPoint). Over 100,000 customers included emailing 1.8 million retail speech-impaired - to make and has been designed to give all users use the service. Internet customers, placing receive calls to and from hearing easy access. information on our BT Yahoo! website people.

Voluntary and mandatory services Wireless communications and health It is also possible to measure how installing the new Microconnect BT takes pride in pioneering services for customers and we seek to provide levels of service that go beyond the With the demerger of mmO2 in much radio wave energy your body antennas we undertake consultations mandatory requirements. Some of the services that we have been offering voluntarily have become a licence requirement. November 2001, BT ceased its mobile receives from each model of mobile in line with the industry commitments. network operations but retained a phone. This is called the specific number of mobile services, products, absorption rate or SAR. There The WHO advises that "RF field levels activities and interests. These include: is a European Standard method around base stations are not Voluntary services • BT markets its consumer mobile for measuring the SAR and this considered a health risk". It also states Service Notes phone offering on-line at information is provided to consumers that "in many urban areas television Publication of comparable BT and other telecommunications companies participate in the CPI forum www.bt.com/homeplan and sells for each model of mobile phone sold and radio broadcast antennae performance indicators (CPI) and provide comparable quality of service results, which are published every six mobile voice and data products into in the UK. BT offers a range of mobile commonly transmit higher RF levels months. Most of the information currently available was already published the business market through direct phones from several manufacturers, than do mobile base stations". For by BT before the CPI agreement. sales channels. BT offers a range who all apply these standards. more information on WHO guidance of mobile phones from several phone and fact sheets, see WHO. Consumer liaison panels BT has been running Consumer Liaison Panels since 1984 to help identify and manufacturers. The January 2005 updated Stewart understand consumer concerns. Report on the possible health effects Wireless LAN • BT phones operate on the Vodafone posed by mobile phone technology, BT owns and operates one of the Nuisance Calls Bureau BT set up this facility voluntarily to offer expert advice and practical action to network for both business and including base stations concluded that largest Public Wireless LAN networks help victims of malicious and nuisance calls. consumer mobile services "there is no hard evidence to suggest in the UK (BT Openzone). Public Production of telephones BT supplies a wide range of equipment for disabled people. • BT operates an extensive Public that mobile phone technologies put WLAN require considerably lower for disabled customers Wireless Local Area Network (LAN) the health of the general population power and radiation levels than the network and a number of Private at risk." GSM standards. Wireless Local Area Networks (WLANs) in its own buildings Mobile base stations Additionally, the main application BT follows the highest industry of Public Wireless LAN is for data • BT installs Private Wireless LAN Mandatory services standards and code of practice devices (such as laptop, PDA or networks in business locations Typetalk/TextDirect BT provided significant financial support to Typetalk voluntarily, before this relevant to its operations. For tabletop device) with the transmitting and sells the components for became a licence condition. The text users rebate scheme is a regulatory example, BT requires that the ICNIRP antenna positioned some way away BT customers to install their own requirement for BT. guidelines on radio frequency (RF) from the user's head. This was the Wireless LAN networks at home emissions are applied on all BT sites main area of concern with mobile Free priority fault repair service BT is obliged to provide a priority fault repair service to disabled customers. or in their offices for some customers We extend this service to customers at risk because of age or other factors. used by mobile operators. telephony power absorption. • BT infrastructure (including some Directory enquiry information for BT is obliged to provide a free directory enquiry service to disabled customers BT exchanges, buildings and In addition to ICNIRP standards a Therefore, the radio power levels those unable to use a phone book who cannot use a phone book. telegraph poles) is used to house number of other measures relating near Public Wireless LAN sites are mobile phone base stations and to RF and base station deployment significantly lower than around mobile Billing and general information BT has voluntarily provided bills and some of its publications in alternative aerials. are built into an industry code of phone antennas and devices, all of for disabled customers in braille, format to disabled customers for many years. It is now part of BT's operating practice, known as the ten industry which are well within the guidelines large print or on audiotape licence requirements to provide contracts and bills in an acceptable alternative Handsets commitments. BT was a signatory and recommendations of the UK format upon request. Under the Disability Discrimination Act 1995, BT also has All mobile phones sold by BT fully of this code of practice and adheres Government Health advisory bodies. wider obligations to provide any customer contact in alternative media. conform with the international safety to all its core principles. Further standards on exposure to radio details of these practices can be found Similarly, any Private Wireless LAN Public payphones with BT is required to provide inductive couplers in public payphones. frequency (RF) emissions set by the on the mobile operators' website. site, which uses exactly the same inductive couplers International Commission on Non- technology, standards, equipment Light User Scheme This scheme was designed to reduce the number of disconnections and Ionising Radiation Protection (ICNIRP) BT offers mobile operators a service and power radiation levels as the the number of people without access to a telephone. It enables BT to meet and the National Radiological called Microconnect. This is a network Public sites, are deemed to be its Universal Service Obligation to accommodate consumers with special Protection Board. of small low-powered antennas significantly well within all current social needs. mounted on street furniture - such and known standards and guidelines BT also monitors all relevant scientific as lighting columns and lamp-posts for safe usage. In-Contact Plus This is another service that enables BT to meet its Universal Service Obligation findings relating to mobile phone - designed to provide mobile phone towards consumers with special social needs. health issues and follows the advice coverage in city centres. The exposure of the World Health Organisation levels from these small devices will be Provision of emergency services BT provides a free emergency assistance service that handles over 30 million (WHO) and other leading health hundreds of times below the ICNIRP calls a year. We aim to ensure a high quality of service by answering 95% of organisations. guidelines at street level. Before calls within five seconds.

RA audits and industry consultation We are committed to provide procedures broadband as widely as possible. At BT makes public the locations of the end of March 2005, we achieved existing antennas on the five million connections, meeting our Radiocommunications Agency (RA) target a year early. Sitefinder website. Additionally, the RA has completed a number of audits By the summer of 2005 we expect to of sites near schools and hospitals in have extended coverage to exchanges 2001 and 2002. The results, serving 99.6% of UK homes and published on the website, show that businesses. According to the exposure levels are many hundreds to Organisation for Economic Co- thousands of times below the ICNIRP operation and Development (OECD), public exposure guidelines. the UK is now leading the way in broadband availability among the BT liaises with relevant local G7 countries. development authorities about network growth and the planning 21st Century Network (21CN) of mobile phone antenna deployment, BT's network is being transformed as recommended by the industry code to handle modern communications of practice. A number of different efficiently. We call it the 21st Century consultation models were agreed by Network (21CN) programme. Key the industry partners in the framework features are: of the ten commitments. BT - along • Customers will be able to access any with all mobile operators in the UK - communications service from any applies these models according to device from anywhere - at broadband a range of criteria on a site-by-site speed basis. One of the commitments we • It will provide a world-class customer made is to share masts wherever service, from accessing and managing possible. More information can be a range of services, to receiving and found on the mobile operators' paying the bill website. • It will radically simplify BT's operations, Broadband including lower costs and the capability Broadband means fast, always-on to launch new services faster. access to the Internet - up to ten times faster than a normal narrowband telephone line. The technology has far-reaching social and economic impacts because it stimulates innovation and economic growth by providing easy access to information on the Internet and the ability to work away from the office and in remote areas.

Information and data on this page has been verified by Lloyd's Register Quality Assurance Limited BT Social and Environmental Report Customers 05 Employees % % 5 5 % 4 8 6 4 % 6 8 4 6 . % . 0 0 0 8 3 . 2 6 3 . 0 6 . 2 8 0 4 .

Employees 0

0405 03 04 05 03 04 05

Employee Engagement Index – H&S: Lost Time Injury Rate – H&S: Sickness Absence Rate – measuring the overall success of BT’s incident rate per 100,000 percentage of calendar days relationship with its employees hours worked lost to sickness

We employ approximately 102,100 For example, representatives of BT’s A measure of the diversity of the Retention challenge is to promote best practice demonstrate BT’s business case people around the world, including diversity networks attend careers fairs BT workforce Attracting the best people is one thing across the company. for diversity and flexible working and over 90,800 in the UK, where we are to promote BT as a place to work. - keeping them is another. It is in our show how technology can help people % 8 . % % one of the largest employers. These efforts - which have focused 3 best interest to be as flexible as Work-life balance in practice balance their lives 7 4 2 . . 2 2 2 predominantly on graduate recruits - 2 possible and to provide continuous Our work-life balance policies are in • We chair Employers for Carers, Our approach is to treat our people are reflected in our recruitment learning opportunities in an one portfolio called Achieving the a partner in Action for Carers in fairly and responsibly, helping them diversity figures for the 2005 financial environment of exciting, challenging Balance. It covers flexible working, Employment (ACE National), a project achieve their full potential, while year: teamwork. home-working, part-time working, promoting the benefits of carer- respecting their personal and • 13% of our new recruits were from job sharing, maternity and paternity friendly employment practices. Their

community commitments. an ethnic minority background - % Work-life balance leave, adoptive leave, parental leave, 2 % . 9 % 9 . website contains information for 2 8 .

including 25.7% of new graduates 8 Because we want to provide a high- special leave and leave for carers. carers and employers, a benchmarking Here we describe how we manage: and 5.6% of modern apprentices - quality service to our customers, the tool to help employers assess how % • Employment compared with 9.2% of BT’s total % working day for many BT employees In March 2005, we had approximately % 2 1 . 0 . .

2 carer-friendly they are and some 2 workforce 2 extends beyond normal hours. One 5100 part-time employees, nearly 500 • Employee relations case studies of our great challenges as an employer job sharers and approximately 9030 • 25.9% of our new recruits were 03 04 05 03 04 05 03 04 05 • Diversity and inclusivity is to reconcile good customer service home-workers. Using innovative • We chair Employers for Fathers, a women - including 41.6% of new Women Ethnic Minority Disabled with the provision of a healthy work- communications technology many new forum promoting the benefits of • Learning and development graduates and 10.1% of modern life balance for our employees. We more BT people can work flexibly. For father-friendly employment practices, apprentices- compared with 22.4% • Health and safety. Education strive to get the balance right and example, employees can do a mix of sharing best practice and informing of BT’s total workforce To help maintain a good supply of believe our record is good. home and office-working, work long UK government policy. Employment • 0.5% of our new recruits had a talent, we encourage young people and short days, and save blocks of “Flexible working is very good. I have Here we present our approach to: disability as defined by the UK to further their vocational or academic non-working time (eg, to use during In the 2004 financial year, our been doing it for eight years. I have a • Recruitment Disability Discrimination Act (DDA) - education, especially in Information school holidays). CEO Ben Verwaayen chaired the son who is 14 and I am a lone parent. including 2.7% of new graduates and and Communications Technology (ICT) UK Government’s Lone Parent Task • Diversity When I need to I can work from 2.3% of modern apprentices - subjects. We also offer hundreds of This is made possible by the use of Force, which looked for ways to break 9.45am until 3.15pm, which is • Education compared with 2.2% of BT’s total undergraduate placements each year. ICT technologies such as hot-desk down barriers preventing lone parents brilliant. I then work earlier or later on workforce. office share, laptops with wireless from taking formal work. He • Retention other days to make up my 144 hours To help address Europe’s continuing internet connections, and handheld submitted their conclusions in a a month. Since I started flexible • Work-life balance Opportunity to make career progress shortage of people with good ICT personal organisers. report, Work Works. BT has been working I’ve been promoted and I’m is very important. In the 12 months to skills, BT co-chaired the Career Space lead sponsor for two successful pilot • Pay and benefits. progressing in the company. So it’s March 2005, of those promoted into consortium, a European public/private Flexibility, particularly in attendance events, called Discovery Weeks, to great!” Chris Cope BT Retail or within management positions, 31.7 partnership that encourages people, patterns, is inclusive: it opens show lone parents the choice and Recruitment per cent were women and 9.5 per particularly women, to get engineering “I’ve been homeworking for eight opportunities for people with lifestyle options work offers. BT has We employ thousands of new people cent from ethnic minority groups. and computer skills. Career Space months and it’s wonderful. It fits disabilities, carers and those returning actively supported Jobcentre Plus’ each year and need to make sure that worked with major ICT companies around my children. I’m able to fit in to work after a career break. contracting and delivery of these we attract, select and retain the best. These figures do not include the and over 20 European universities all my commitments around my work. and other innovative lone-parent people who work in our subsidiaries - to develop and launch new ICT job I work better at home. I also don’t Initiatives employment initiatives in During the 2005 financial year, we around 14.5 per cent of our profiles and curriculum guidelines. shout at the children so much.” We participate in a number of Birmingham, Glasgow, Leeds, recruited 149 graduates and 258 workforce. For more information see Career Space. Marcia Tapper BT Exact initiatives to learn and share our Liverpool, London and Manchester. modern apprentices in the UK, and experience with others. 3496 other new entrants. In the same We are very encouraged by these BT contributed to the Tomlinson We recognise that flexible working is • We are members of Employers for period, 5523 people left BT by choice. We are working with the UK figures. They reflect our efforts to Report on education for 14 to 19 not only about location and hours but Work-Life Balance, a group of major Department of Trade and Industry create a talented and diverse year-olds in England and participated about balancing work and home UK employers who share work-life Diversity (DTI) and Jobcentre Plus to promote workforce at every level. in the debate prior to the White Paper commitments. This is why our balance best practice It is crucial that our people reflect flexible working arrangements with in February 2005. policies, including emergency leave, the diversity of our customers and • With the theme Agile Business - other employers. In 2004, this maternity and paternity leave and are able to meet their ever-changing Balanced Life, we organise included making presentations and We support the UK Government’s sickness pay, far exceed the UK needs. We work with a range of conferences to encourage employees briefing Jobcentre Plus Account initiatives to encourage women into minimum legal requirements. employment agencies, universities, work and the annual Take our and other employers to assess our managers and employers. BT has also schools and college careers offices. achievements and identify new ways initiated and sponsored the London Daughters to Work Day. In BT the We realise that there are still too We inform them of the variety of jobs to promote a healthy work-life Employer Coalition’s Lifestyle Friendly event gives young men and women many cases where the balance is not available in BT and that we welcome balance. These conferences Employer Award for the last two years. the opportunity to experience working as we would like it to be. Our a wide diversity of people into our life in a job traditionally done by the business. other gender.

We sponsored the Working Our enhanced maternity leave Employee benefits Equal pay is an increasingly financial year. In June 2004, we Report on Women, Employment and Families/Carers UK/BT Carers in provides 18 weeks’ basic pay and In addition to a competitive basic sophisticated issue in the UK. In the introduced bonus scorecards for about Pay in the UK have made a priority of Employment Award 2004, as part of regular allowances (excluding remuneration package, we offer 2005 financial year, BT contributed to 20,000 UK employees for calculating the issue. our continuing support for the charity, overtime). This is followed by eight a range of benefits that promote the Confederation of British Industry bonus payments. Carers UK. We also supported and weeks at half pay or lower-rate employee ownership: (CBI) submission to the Women and Equal pay to equal value remains high designed the BBC publication, ‘Time Statutory Maternity Pay, or £106 per • Saveshare - an option to buy shares Work Commission. The framework will allow more on the BT agenda and we believe we for you’, launched during the 2004 week (increased from £102.80 per at a discounted rate over three or five consistent reward decisions to be are making good progress on the Carer’s Week. week in April 2005) - whichever is the years. More than half of BT employees Detailed pay-gap audits undertaken made, based on an individual’s value matter. greater. After that employees get participate, including 46% of our in recent years have revealed a in the job market, combined with their Working parents £106 a week for 26 weeks. international employees persisting gap in pay between men contribution to BT’s success. It will Pension scheme We supported the 2004 Fatherhood and women. We believe that one also form a key component of our The BT Pension Scheme, now closed • Allshare - gives employees the right conference organised by Fathers In the 2005 financial year, 98.9 per reason is the legacy from the days analysis of equal pay issues for this to new entrants, is one of the largest to receive free shares based on Direct, at which Patricia Hewitt, cent of women returned to BT when our workforce was split between group of employees. In addition, over funds in the UK, with assets of around company-wide performance Secretary of State for Trade and following maternity leave, and 73.9 engineers (primarily male) and clerks recent years we have: £29 billion. The scheme has about Industry, launched the Charter for per cent of women who had returned • Directshare - employees may buy and operators (mainly female). Pay • Changed our promotion remuneration 80,000 contributing members, about Father-friendly Britain. from maternity leave in the 2004 BT Group shares from their pre-tax levels for the two groups were largely procedures, particularly in management 178,000 pensioners and around financial year were still with the salary each month. More than 14% developed separately. Other reasons grades, from a percentage of base 100,000 deferred beneficiaries. Most Working Families, a UK campaign company. have done so. in the UK outlined in the CBI salary to a comparison with peers and of our employees have chosen to organisation, reviewed our Work-Life submission, include: the market belong to the scheme and contribute Balance policies in 2002, endorsed Paternity leave is now two weeks at Flexibility • Career choices and early stereotyping six per cent of their salary, with BT • Focused our pay review on the lower our activities and suggested a number full pay and two weeks’ unpaid leave, Special paid leave is available to paying the balance of costs (currently • Gender bias in vocational choice end of our pay scales, where there are of improvements. to be taken within 56 calendar days employees caring for relatives or 12.2 per cent of salary). The BT likely to be more women of the birth of the child. working in their communities. We • Educational achievements of older Pension Scheme is a defined benefit One was to gain the Tommy’s shortened the working week to 36, women • Carried out a pay audit following each scheme, with the pension benefits Pregnancy Accreditation by A survey of BT parents - to which down from 37 hours, for non- pay review, based on key measures linked to the members’ final salary • Caring responsibilities demonstrating that we meet its 1900 people responded - in February management grades in 2002. agreed with our unions, maintaining in BT (rather than to the performance criteria for creating a supportive 2005 showed that 94 per cent • Lack of family friendly policies a dialogue on all equality matters. The of the pension fund). The normal environment for pregnant employees. considered our maternity leave In the 2005 financial year, our lowest 2004 BT budget in the UK for equal retirement age is 60. • Early specialisation. This was achieved in the financial year package was adequate or better. It main scale starting salary was £9765 pay was £3.4 million 2004 and we have maintained our also showed that over 80 per cent felt for a 36-hour week (£5.20 per hour). On 1 April 2001, BT closed the BT BT continues to address these issues • Recognised work-life balance as a key accreditation since. their work-life balance was adequate Pension Scheme to new entrants and holistically. We have Board support to enabler to eliminating some of the or better and that over 60 per cent In 2005, we will introduce a flexible introduced the new BT Retirement close the pay gap and our pay review barriers that may be slowing the BT Childcare Salary Direct is an had flexible working arrangements. benefits programme for about 28,000 Plan. The Plan is a defined processes include guidance on progress of women in the workforce. employee benefit programme that The survey results will inform future managers and professionals in the UK. contribution scheme for new creating a fair and equitable reward employees can use for all types of parental support policy and practice. We hope to extend this to a wider employees, with the pension that system based on performance. Equal value approved childcare. The programme, group of employees in the UK and members receive linked to the While jobs may be different they can in conjunction with discounts we have Pay & benefits abroad. This will have to take into contributions paid, the performance All team members (non-managerial be of equal value because of the negotiated with childcare providers, Our benefits package must be account local market conditions and of the fund, and annuity rates at grades) are now on the same pay similar demands made on the helped many employees reduce their competitive if we are to continue be subject to agreement with retirement (rather than their final structure and this has significantly employee. childcare costs by approximately 20 to recruit and retain the best talent. unions/work councils. salary in BT). Members have a choice reduced the scope for inequality. per cent. Over 1000 employees Here we set out our approach to: of seven different funds in which to The concept of equal value for equal benefit from the programme. Tax • Employee benefits Equal pay and equal value invest. There are around 7000 Equal pay activities work has been underlined by a recent changes in April 2005 should benefit Our approach to equal pay contributing members. • Equal pay In the 2005 financial year, we UK court case (Enderby v National many BT Childcare Salary Direct encompasses gender, ethnic origin introduced a new reward framework Health Service). The court concluded participants. • Pensions. and disability. This change is in line with the practice of 300 market-based roles in 18 that collective bargaining and market increasingly adopted by major UK different families covering about value could not justify the difference We continue to offer parental leave We have played an active and groups and is designed to be more 37,500 employees worldwide. Pay, in pay between men and women - benefits far greater than the legal constructive role in the gender pay flexible for employees. It enables BT bonuses and benefits are comparable equal work must be given equal value. minimum. These benefits are also debate over a number of years. Our to determine its pension costs more with the market rate. The introduction available to those in same-sex previous reports show how BT’s precisely than with defined benefit of market packages around the world The UK’s Equal Opportunities relationships. position has evolved. schemes. will be phased in during the 2006 Commissions (EOC) and the Kingsmill

Hermes Pensions Management generation of long-term shareholder with its employees, suppliers and Employee engagement index people, predominantly managers Managers are expected to consult Limited value, and this should be based customers, to behave ethically and to The key indicator in the CARE survey and professionals. their employees and relevant union The BT Pension Fund is managed on appropriate financial disciplines, have regard for the environment and is the new Employee Engagement officials before introducing significant on behalf of the fund trustees by competitive advantage and within society as a whole.’’ Index. This indicates BT peoples’ The CWU is the biggest union for the employment change. The unions have Hermes Pensions Management a framework which is economically, [Extract from the BT Pension Scheme overall engagement and motivation communications industry in the UK, a good ten-year track record of co- Limited, a wholly-owned subsidiary ethically and socially responsible Statement of Investment Principles] with regard to their job, colleagues with members working for the Post operation with BT. Very few days have of the BT Pension Scheme. The fund and sustainable. and customers. The new employee Office, BT and other communication been lost through industrial action. is controlled by trustees who are BT Hermes’ active approach to corporate engagement report provides an companies, cable TV, the Alliance • The Hermes Statement on UK and trade union nominees, with an governance includes the understanding about what engages & Leicester and Girobank. Their In the 2005 financial year, no Corporate Governance and Voting independent chairman. implementation of this statement. (and disengages) a team, and provides members’ expertise includes industrial action was taken. The only Policy sets out how Hermes will an overall score through the Employee engineering, computing, clerical, case of legal action against BT exercise its clients’ ownership rights The trustees look after the assets Employee relations Engagement Index. Examples of the mechanical, driving, retail, financial concerning the rights of trades unions and is intended as a basis for of the pension fund, which are held Good employee relations are vital to a kind of issues covered in the index and manual skills. was withdrawn. dialogue between companies and separately from those of BT. The strong, healthy and successful include team working, senior shareholders. This covers issues pension scheme funds can only be company. Here we explain our management and communication, BT conducts its relationship with Grievances such as the composition of the used in accordance with its rules approach to: reward and work-life balance. This the CWU through officers and the We have a grievance procedure that board, remuneration and guidelines and for no other purpose. • Our annual employee survey new measure was launched in the national executive who represent provides all employees a chance to for reporting on social, ethical and summer of 2004 and replaces the the telecommunications and financial appeal against actions or decisions environmental matters. • Our relationship with trade unions The Annual Report of the BT Pension People Satisfaction Index. The index services sector of the trades union. that they believe adversely affect Scheme includes a description • The Hermes International Corporate • Grievances for the 2005 financial year is 65 per There is constructive dialogue at them. of the appointment, removal and Governance Principles apply to cent, a rise of one per cent on the national level and a practical working • The European Consultative Works responsibilities of the pension fund all publicly quoted companies in index calculated from the 2004 relationship at branch level. In the financial year 2005, the number Council trustees. which Hermes’ clients invest outside CARE data and published in 2004. of concluded employment tribunal the UK. • Employee communications Connect is a specialist union cases involving BT was 140, with 41 Corporate governance Follow-up action representing managerial and withdrawn, 10 judged against BT, 42 • Call centres Hermes’ corporate governance Hermes exercises its voting rights at All managers with teams of eight or professional employees in the settled and 47 judged in favour of BT. programme is founded on a belief annual general meetings (AGMs) • Outsourcing more people receive individual CARE communications industry - largely The outcome of each case is analysed that companies with interested and and extraordinary general meetings feedback reports. This helps them in BT. Again, there is a constructive by the management team concerned, • Offshoring. involved shareholders are more likely (EGMs) and employs a dedicated monitor the impact of their decisions dialogue. and learning points are reviewed to achieve superior long-term financial corporate governance team that and review their management style. within the appropriate policy group. Employee survey performance. maintains a high level of contact with Both unions engage with BT to We conduct a number of formal companies through correspondence Managers are encouraged to work improve the terms of employment for See Data and targets for employment employee surveys. The most Hermes is considered a leader on and meetings. This is particularly the with their teams to analyse the CARE their members and play a constructive tribunal case data since 1999. important is the BT-wide annual issues of corporate governance and case where persistent failure to meet feedback and carry out action plans. role in helping BT implement change Communications and Attitude shareholder involvement. It has a the Hermes corporate governance These plans are monitored through effectively. We maintain a good BT European Consultative Research for Employees (CARE) track record of working with company policy results in under-performance. the normal line management working relationship with both unions (Works) Council survey. This gives all our people boards to ensure that companies are structure. and provide facilities for their Every six months the BT European an opportunity to express their views run by managers and directors in the Socially responsible investment representatives to facilitate effective Consultative Council (BTECC) provides on a range of issues. best long-term interests of Trustees of occupational pension We often carry out smaller-scale dialogue. an opportunity for trans-national shareholders. funds must declare in their statement surveys or run focus groups to find dialogue and exchange of views At the start of 2005, every BT of investment principles “the extent out our employees’ attitudes towards Examples of the issues we have between management and employee employee worldwide was given the Hermes has produced a number (if at all) to which social, environmental specific circumstances. discussed with the unions include: representatives in the UK, Ireland and opportunity to complete a CARE of corporate governance policy or ethical considerations are taken into • Remote sourcing of work continental Europe. survey during the working day. statements that are available on the account in the selection, retention and Trades unions Anonymity was guaranteed and 80 • Changes to work patterns to Hermes website. These policies apply realisation of investments”. In the UK, BT recognises two trades We believe that the interests of our per cent of our people completed the implement customer-friendly working to the BT Pension Scheme and the BT unions: the Communications Workers business - and all those involved in it - survey. The CARE survey does not practices Retirement Plan: The trustees of the BT Pension Union (CWU), which represents over are best served if there is a common include the 2569 BT Consulting and • The Hermes Principles set out the Scheme agreed that every investment 59,000 BT people in non- • Agile (flexible) working and growing understanding of our performance, Systems Integration (formally BT principles and expectations that should should consider this statement: management grades; and Connect, our people’s skills to meet new operating environment and market Syntegra) employees. exist between shareholders and “A company run in the long-term which represents around 26,000 BT business needs. places. companies. In summary, a company’s interests of its shareholders will need primary consideration should be the to manage effectively relationships

The BTECC focuses principally We strive to keep our people informed • Vision programme - an audiovisual important, how they could be adopted Call centres We used to do this work ourselves. In on the performance and overall of company activities. This is essential interview with the Group Finance in their work area and where to turn We have transformed our original 104 the UK, the transfer of BT employees strategy of the BT group, on jobs if we want to keep everyone motivated Director about each of BT’s quarterly for support. Everyone across BT, call centre sites into a slimmed-down to a contractor is regulated by the and employment plans, and on the and supportive of BT. Equally, we strive financial results. regardless of role or location, had a network of larger, multi-functional Transfer of Undertakings - Protection commercial and regulatory factors to listen to and act on our people’s responsibility to keep these Promises. contact centres. of Employment (TUPE) regulations. affecting its operations. Other views and ideas. We provide webcast, video, audio relevant trans-national employee and other on-line facilities, such as Before the television advertising aired, The programme has enabled the twin Responsible outsourcing a must issues such as training, health, safety Communication channels live Internet chatrooms, to support internal research results showed that goals of reducing costs and providing Automatically favouring the lowest and the environment may be We communicate with our employees key announcements. These channels awareness of the Promises was high, improved customer service. For bidder can lead to expensive mistakes included. regularly through a variety of enable people to ask questions and with 88 per cent of employees stating example, customers can get help with when outsourcing services. This was channels: get answers directly. that they felt very aware. Recall of the a range of services on a single call, the warning of Andy Green, CEO of The BTECC is chaired by BT’s • The BT intranet, one of the largest in Promises themselves was also high without being transferred. BT Global Services, during a debate CEO and attended by other senior Europe, is available to over 100,000 To keep our employees informed of with two - thirds able to describe all on the issue at the World Economic executives. Employee representatives people. It contains a wealth of key announcements, we use a number three Promises, unprompted. During the restructuring, 57 call Forum (WEF) held in Davos, are drawn from BT’s operations information on a vast range of topics. of additional channels including: centres have closed. The number of Switzerland in January 2005. across Europe. Participants are With an extensive index and search • Enterprise email, a broadcast email Case study full-time equivalent jobs have reduced chosen according to the practice capability it is easily accessible facility for key announcements 21st century network roadshow by over 2900 to under 13,100. He said managers should always ask: and legislation in each country. The We are running a roadshow for BT “What is the long-term competitive • BT Today, our in-house newspaper, • Face-to-face events representatives chosen must reflect employees across the UK to explain There were no compulsory advantage that will allow a vendor to is sent to more than 187,000 BT’s equal opportunities policies. • Briefing materials for use by line the challenge of rolling out BT’s 21st redundancies and we remain do a particular job cheaper than us?” employees, pensioners and opinion managers. century network (21CN). committed to finding alternative work formers each month. Described as Representatives serve on the Council for every affected person who wishes BT outsources some of its activities ‘the glue that holds BT together’, for four years, long enough to follow Case study 21CN is an Internet-based network to remain in BT. By the end of March and also supplies services for others it helps make sense of what’s going up and understand the issues. My Customer promises - that carries voice, data and Internet 2005, more than 975 people had (known as insourcing). This often on in the company for employees This case study shows how ‘my services on a single network. It will been found other jobs in BT and over involves the transferral of staff from and their families. The paper contains The BTECC meets twice a year - customer’ was communicated to replace the various existing networks 3370 people left voluntarily. Around one company to another. Outsourcing a letters page where our people can normally within three months of the BT employees in advance of the that each provide a specific service. 1900 employees have been re- services is a key part of modern express their views announcement of the group’s annual external launch to the public. This will simplify network deployed to the new UK contact business because it has the potential results. In exceptional circumstances, • Newsdesk, the BT Today intranet management for BT and provide centres. to improve efficiency. The long-term the chairman may convene an news site, is the major source of news BT’s my customer Promise is: increased flexibility, reliability and success of the practice depends on extraordinary meeting. for BT people. It is updated every day • when you make an appointment, security for our customers. More details of support provided by acting responsibly when choosing and features a constant flow of news BT will always do whatever it takes BT to employees during times of vendors and dealing with people. In addition, a sub-committee of the about BT and our industry. It contains to keep it The roadshow toured Edinburgh, change are in the New Start section of BTECC meets four times a year to information to help people do their Ipswich, London and Manchester this site. Read more about this and other • when you ring BT, you will always discuss specific issues in BT Global jobs. The site covers all media in January 2005. More than 2000 debates on the WEF website. have the option to talk to a person Services. The sub-committee is releases, comment and features people attended. Outsourcing chaired by a senior representative of about BT • if the first person you talk to can’t Some of our support and transactional Offshoring Global Services and employee help, they’ll make it their top priority Feedback showed that those who operations are provided by external India • Talking Point - part of the BT Today representatives are drawn from UK to find the right person who can. attended were interested in the contractors where it is operationally BT Retail has two call centres in India, Newsdesk - offers a forum for trades unions, Works Councils and network roll-out and found the and commercially effective. one in Bangalore and the other in employee opinion, feedback and We backed the my customer other bodies. information useful and relevant New Delhi, employing around 2200 debate on a wide range of important Promises with a large external to their work. Outsourced operations include: (UK full-time equivalent) people at the topics, such as work-life balance, advertising campaign. We began our In addition, most of our continental • Human resources contracts, pensions, end of March 2005. They are owned driving safety and broadband internal communications campaign in European operations have works recruitment and training (by a by two suppliers and managed by BT. April 2004, knowing that everyone councils representing employees. • BT Newsline, a telephone news company called Accenture HR should be ready to deliver on the service, attracts thousands of calls Services) We are sensitive to concerns that Promises by the time the advertising Employee communications a month there may be an incompatibility campaign aired in June. We had to • Payroll, finance and accounting Our people are crucially important to between remote sourcing and BT’s • People News - a bi-weekly email create an environment in which every activities (by Xansa). our reputation and success. They are stance on corporate responsibility. newsletter about people’s moves BT employee understood what the our ambassadors and our public face and news Promises were, why they were while on business and out of hours too.

Information and data on this page Information and data on this page has been verified by Lloyd’s Register has been verified by Lloyd’s Register BT Social and Environmental Report Employees 04 Quality Assurance Limited Quality Assurance Limited Senior All BT Employees continued Financial year 2003 2004 2005 2003 2004 2005 Women 20.0% 21.0% 21% 23.6% 22.7% 22.4% Ethnic minority 7.0% 7.6% 8% 8.6% 8.9% 9.2% Disability 0.7% 0.7% 0.8% 2.0% 2.1% 2.2%

Developments in technology have We agree with the thrust of these We will continue to ensure that our Equal Opportunities policy • Harassment is also a type of • To provide highly visible and always changed working patterns - conclusions. For us, CSR is about third-party suppliers abide by our Our Statement of Business Practice discrimination, and we will treat it as inspirational leadership on equality both in type of work and geography companies making effective employment standards. includes a specific principle on such under the terms of this policy. and diversity of the workplace. The question is commercial decisions in ways that diversity: we will “treat all individuals We will not tolerate any type of • To promote processes, practices and whether the movement of employment take account of their responsibility to Diversity and inclusivity fairly and impartially, without harassment or bullying, including behaviours that actively drive equality opportunities is in itself a socially society. We seek to create an open, honest prejudice, and never tolerate offensive remarks, at work and diversity in the BT group, irresponsible activity. and unprejudiced workplace that harassment in any form”. • We will encourage you to tell us relentlessly opposing inequality, In this case, our ethical trading encourages people to reach their full about any disability you may have prejudice and unethical behaviour Many developing countries will often manager visited the call centres with potential. This principle is supported by our and your ethnic background argue the opposite, accusing the an independent assessor from an Equal Opportunities policy: • To agree and implement equality and developed world of using social and Indian non-governmental organisation We want to develop and sustain a • We will take positive measures diversity initiatives across the BT environmental performance for before the announcement was made. diverse workforce where everyone’s Equal Opportunities Policy (which are allowed by legislation for group and within individual lines of protectionist reasons. contribution is valued and where Our aims suitably qualified people) so that we business The assessors looked at all aspects of appointments and progression We are an equal opportunities recruit and employ any under- • To be spontaneous, open, honest, To address these issues we working conditions against BT’s are based purely on merit. Setting employer. The aim of this policy is represented minority group, for challenging, forward-looking and commissioned independent Sourcing with Human Dignity ethical targets help us achieve this goal. that everyone should have the same example, the Government’s Two change-embracing role models for consultancy and think-tank trading standard and concluded that opportunities for employment and Ticks Policy for registered disabled equality and diversity in business. SustainAbility to explore service sector the companies assessed met and The table (top right) shows the promotion based on their ability, people offshoring through the lens of exceeded BT’s standards in the vast percentage of our people who are qualifications and suitability for the • We will follow the Disability We are members of the following corporate social responsibility (CSR). majority of areas. women, have declared themselves work. We will need to keep to, and Discrimination Act and will make organisations in the UK: from an ethnic minority background go beyond, equal opportunities reasonable adjustments for people • Business in the Community Included in Good Migrations? are: Pay for those employed in the call or have declared a disability. legislation. with disabilities. If you become • An examination of the global trend centres is in the top quartile of the • Employers Forum on Disability disabled while working for us, we will of offshoring and evaluation of its local labour market. The working See Data and targets for We have designed this policy to do everything possible to make sure • Opportunity Now implications for CSR environment, training and technology comprehensive data on diversity make sure that no job applicant or you can keep working for us are of the same standard as those in from 2001 onwards. employee receives less favourable • Race for Opportunity • A study of the specific impacts the UK. treatment because of their race, • You must keep to this policy. If you of BT’s offshoring decisions, both • Employers for Work-Life Balance We have achieved our target of sex, religion/belief, disability, marital do not, we may take disciplinary in the UK and in India Advisory Board None of BT’s permanent employees in sustaining eight per cent of our status, age, sexual orientation, action against you • Strategic advice to companies the UK has been made compulsorily employees being from an ethnic gender identity, gender expression • Employers Forum on Age • If you consider that you are suffering interested in exploring offshoring redundant as a result of the new minority background. Meeting our or caring responsibilities, or is from harassment or have been • Stonewall and CSR. centres opening. target on the representation of disadvantaged by conditions or discriminated against, you should women is proving more difficult - the requirements which cannot be shown • Working Families make your complaint in line with our SustainAbility concluded that, Connect agreement figures show that retention rather to be justifiable. grievance procedure. • Employers for Fathers on balance, offshoring’s benefits Our agreement with the union than recruitment is the main barrier. outweigh its negative impacts. Connect outlines a joint approach to It is our policy to develop and • Employers Forum on Belief However, SustainAbility do put sourcing work outside of the UK. It Here we describe our approach to maintain positive measures so we Leadership forward some important reservations has four key elements: the main equality and diversity issues: recruit, develop and hold on to BT’s equality and diversity champion In the 2005 financial year, BT set up concerning the way that offshoring is • No compulsory redundancies for UK • Equal Opportunities policy people with disabilities, keep to the in the UK is Clive Ansell, Group and chaired the Employers Forum on handled and it is here that CSR has an employees affected by the change law and encourage best practice. Strategy Director, who chairs our Belief, which brings together leading • Diversity leadership important part to play. Global Equality and Diversity Forum. employers to exchange and develop • Work of similar career value will be • Ethnic minorities Our guiding principles: knowledge and best practice in this found for those who lose their jobs SustainAbility propose practical things • Equal opportunities and diversity The forum is composed of Diversity field. We reviewed our policy and and we will consult early with Connect • People with disabilities that companies can do to assist those cover all aspects of working life. The Champions, senior managers from its implementation to ensure that before a final decision in the UK who lose jobs to manage • Age understanding and views of people each of our business units. Senior religion and belief issues are their transition - in terms of training, • Trade ethically in countries where we on related issues are shown through managers also lead specific groups, incorporated. An on-line booklet • Gender skills and local job development. They operate, following guidelines from the their behaviour including race, gender, age, disability describes major religions of the also put forward critical improvements International Labour Organisation and • Networks and sexual orientation. world and includes personal accounts • You must not discriminate against that offshoring companies can the United Nations Declaration of of employees who follow a particular • Litigation. any person or group when recruiting, introduce in the new areas of Humans Rights The Forum has five main functions: religion or belief. choosing, training, promoting or operations - such as good working • To create, sustain and deliver our • Monitor actions to ensure that our paying people conditions, training and development, global equality and diversity strategy ethical standards are upheld. and sharing skills and technology.

Information and data on this page Information and data on this page has been verified by Lloyd’s Register has been verified by Lloyd’s Register BT Social and Environmental Report Employees 05 Quality Assurance Limited Quality Assurance Limited Employees continued % e % g e In the 2005 financial year, BT also Our data does not include those The details a Standardising global policies Initiatives Partnerships r g e set up Employers for Fathers. people who work in our subsidiaries, are as follows: a BT Global Services is an Able2 is an employee network for BT AbilityNet v r e % A

14,867 of our total workforce of v amalgamation of different joint people with disabilities. This provides We support and provide office space e k a r r r o BT has already made known its 102,192. o ventures and subsidiaries with their impartial and confidential advice and for AbilityNet, a charity that works o c w t s commitment to equal rights for the t own policies on, for example, diversity, runs a series of roadshows where to bring the benefits of computer c e T e B S Lesbian, Gay, Bi-sexual and Global diversity Category N equal opportunities, bullying and people can discuss their needs with technology to adults and children Transgender (LGBT) community and Declaration of ethnicity is restricted harassment, and flexible working senior BT managers. The shows with disabilities. The organisation’s Leadership set up BT Kaleidoscope network in in some countries where we operate. operating in numerous countries with promote ability, not disability, presence in BT helps ensure that our and the 2002 (see Networks). BT Global Services has committed to differing legal and cultural frameworks. challenge stereotypes and focus on pre-recruitment assessments provide Business Case 87 62 56 ensure that, wherever legal, BT people We have been auditing current data possibilities and ways to break down the most productive and comfortable Ethnic minorities groups are able to declare their ethnicity and Resourcing and with a view to standardising these barriers faced at work by people with equipment available as soon as new Here we look at our ethnic minority national origin. Development 85 56 53 while retaining sensitivity to cultural disabilities. recruits join the company. Existing representation and the measures and legal differences. BT people benefit from easier access Policy and taken to promote diversity. An on-line training programme is eNable is a project designed to to expert assessment and advice. Planning 82 59 61 being designed to help employees People with disabilities improve the working life of all BT Profile understand the interpretation of Recruitment A significant number of people in our people with disabilities. Its objective is Back-Up Among BT people, 9.2 per cent have diversity in different countries. It and Training 82 62 62 society have disabilities. To ensure we to provide guidance and provide the In the 2005 financial year, we worked declared themselves to be of ethnic will be translated into five different meet the needs of all our customers, necessary adjustments to help realise in partnership with the spinal injuries Sharing minority origin. This represents 8.9 languages and deal with relevant we encourage applications from the full potential of all people. eNable charity, The Back-Up Trust. BT Ownership 88 56 52 per cent of non-managers, 9.8 per legislation in 12 countries to ensure people with disabilities and support provides a package of services, sponsored taster sports and activity cent of managers and 8.1 per cent the diversity strategy is fully Communication 88 59 54 their professional development. consultancy and dedicated specialist days which received UK Government of senior managers. understood. In preparing for this we support, including: Sportsmatch funding to help promote Marketing 88 62 46 have been collating information on BT qualifies as a ‘Two Ticks’ disability • A helpline to provide expert advice greater integration and independence In the 2005 financial year, 13 per current local policies. Community employer. This is a UK employer and assistance to people who are, or for people with spinal injuries. A BT cent of our new recruits came from Involvement 93 62 58 commitment to disabled potential become, disabled, or whose employee was also sponsored to an ethnic minority background - Benchmarking employees and customers. This capabilities are restricted attend a week-long Back-Up summer Working with including 25 per cent of new We take part in independent means, for instance, that BT activity course as a buddy. ethnic minority • Guidance on job re-design, suitable graduates and 5.6 per cent of modern benchmarking of ethnic minority guarantees a job interview to any businesses 80 47 34 alternative duties and provision of apprentices. issues. suitably qualified applicant who has In collaboration with the Spinal Injuries equipment and services Results/ a disability. Association, BT Retail Marketing have These figures reflect our continuing In the financial year 2005, Business Impact 84 63 58 • Improved advice to managers on their produced a booklet that promotes the collaboration with employment in the Community’s Race for Profile responsibilities under the UK benefits of broadband and how it can Overall agencies, universities, schools and Opportunity announced that it had Overall, 2.2 per cent of BT people Disability Discrimination Act improve the lives of disabled people, performance 88 60 56 college careers offices. We have benchmarked BT at gold standard have declared themselves to have a particularly those with spinal injuries. • Support to new recruits with achieved our target that 8 per cent of and the top overall performing disability. This represents 2.6 per cent disabilities to ensure they feel valued our employees will be from an ethnic organisation in race equality. BT was Overall score (%) Certificate standard of non-managers, 1.3 per cent of Able to Work and supported. minority background, and are benchmarked against 66 private and managers and 0.7 per cent of senior Our Able to Work project increases the 95 - 100 Platinum committed to maintaining this level. 47 public sector organisations, managers. number of disabled people employed Customer-facing employees in BT representing over 1.6 million 80 - 94 Gold in our call centres. Recruits come from Retail and BT Wholesale receive One of our key initiatives remains employees. In the 2005 financial year, 0.5 per Remploy, an agency helping people 70 - 79 Silver disability awareness training using on- the Ethnic Minority Network for BT cent of our new recruits had a with disabilities find work. Call centres, line and conventional face-to-face employees. The UK programme 60 - 69 Bronze disability as defined by the UK which have a high turnover of staff, courses. An intranet site on disability includes development courses and Disability Discrimination Act (DDA) - provide new employment opportunities Up to 60 Certificate of awareness and the law is available to participation in the national debate including 2.7 per cent of new for disabled people who can participation everyone in the company and provides on diversity. graduates and 2.3 per cent of modern demonstrate the right skills and on-line training. apprentices. commitment. See Data and targets for BT received a gold standard for our The second series of BT’s ‘Think comprehensive data from 2001. overall average score. Our 2005 target was for 2.5 per cent Scope Fast-Track Scheme About It’ diversity webcast raises of our employees to be people with a We have joined the Fast-Track scheme disability awareness through disability. of Scope, the disability charity. The interviews and continues the soap programme places disabled graduates opera dealing with the daily lives of diverse people.

in employment for a year and provides surveyed our people to get their Gender Retention of women BT Ethnic Minority Network (EMN) BT Women’s Executive Network personal development training and views on policies on retirement and We believe that diversity is the lifeblood Retaining the skills and experience EMN provides support and The BT Women’s Executive Network career development through regular new anti-discrimination legislation, of our business. Here we look at our of women is important. Our maternity development for ethnic minority was set up in 2003 to increase the reviews, appraisals and individual changing demographics and the gender representation and how we are package provides 18 weeks’ basic people within BT, through a variety proportion of women in senior level career plans. This increases graduates’ changing needs of people and the working to improve it. pay and regular allowances (excluding of internal and external activities. management. The network’s aims employability. business. overtime) followed by eight weeks are to: One measure we took was the at half pay or lower-rate Statutory The Events Programme is the key • Support members to achieve their Age In the UK, we have been consulted introduction of guidance to our Maternity Pay or £106 per week element of EMN’s activities: it covers maximum potential Preventing age discrimination is part on new regulations on age employees about domestic violence. (whichever is the greater), followed the organisation and management of • Drive change within BT on executive of BT’s diversity and equality policy. discrimination to be implemented in We were pleased to work with by 26 weeks at £106 per week. Personal Development and Weekend gender diversity issues We have an Age Champion - a senior October 2006. Women’s Aid and the UK Department Workshops, Open Days, Roadshows manager who ensures age diversity of Trade and Industry to help design, Progression of women and Annual Conferences. • Challenge BT to provide more issues are taken seriously and put By embracing the values of age produce and host the launch of the Our women employees have a number executive opportunities for women. into practice. diversity and of mixed-aged teams, Employers’ Guide to Domestic of internal networks at different work The workshops are designed to work we benefit from a balanced workforce Violence. levels. These include the BT Women’s on interpersonal and management The Action Plan includes: Profile and are well-placed to respond to the Executive Network and the BT skills. BT greatly benefits from these • Tackling the barriers to women’s Age Profile for BT Plc new marketing opportunities created Profile Executive Assistants/Personal meetings because they encourage career progression by an ageing population. In total, 22.4 per cent of people who Assistants’ Network (see Networks). ethnic minorities to realise their full Age Number of Employees • Increasing the visibility of role models work for BT are women - 21.9 per potential. In addition, it helps BT to and mentors to support and Under 20 318 “We are proud to be associated with cent of non-managers, 23.5 per cent Since September 2004, Global increase the representation of ethnic encourage women to progress Help the Aged and the Living Legends of managers and 22.1 per cent of Services has supported the roll-out minorities in senior management. 20-24 2242 through BT Awards, which showcase inspirational senior managers. of the BT People Networks outside 25-29 5642 people who have achieved amazing of the UK. Successful branches of the BT Women’s Network (BTWN) • Designing a programme of events things. People who are living proof In the 2005 financial year, 25.9 per BT Women’s Network (BTWN) have BTWN encourages self-development with internal and external speakers 30-34 8325 that to ignore the skills, attributes cent of our new recruits were women - been operating in Paris and Reston through sharing experience, to promote the Executive Network 35-39 13,457 and experiences of older people is including 41.6 per cent of new USA. A People Network branch in information and advice, and • Providing networking and support. to ignore a huge wealth of experience graduates and 10.1 per cent of Benelux - open to men and women - communicates ideas to management. 40-44 17,316 and knowledge. This would cut us modern apprentices. was established in 2005. Activities during the 2005 financial 45-49 17,988 off from a huge sector of society who BTWN was started in 1986 by a small year included guidance on financial are shareholders, investors, employees The number of women in BT is Networks group of BT women who attended the 50-54 16,053 awareness, boardroom skills and customers. For us, it is also about declining - down from 22.7 per cent We have six employee networks to Cranfield School of Management (presented by BT Chairman, Sir 55-59 5909 potential. Older people are not just in the 2004 financial year - and below support and advise our employees Programme in the UK. Christopher Bland) and guidance about experience. They also have a our 25 per cent target. The figures worldwide. The use of the networks is 60 & over 75 on how to gain non-executive stake in and create new futures for show that retention rather than promoted by BT’s most senior At the time, the group felt a BT directorships All age bands 87,325 us all.” Ben Verwaayen. recruitment is the main barrier to management and provides: internal network dedicated to women achieving our objective. • Mentoring programmes would bring significant added BT Executive Assistants/ Personal We monitor our age profile and “BT is pleased to be able to offer benefits. The BTWN was created with • Development programmes Assistant Network deal with any imbalances. This led support to the Age Positive campaign. See Data and targets for the aim of increasing women’s sense This network aims to demonstrate the to NewStart - a new approach to Business is no longer just about comprehensive data from 2001. • Annual conferences of involvement within BT and value that personal assistants at all resourcing that challenges people’s achieving bottom-line results; it’s encouraging them to develop career • Information websites levels add to the business while raising expectations about retiring early. about how we achieve those results Our data does not include those potential to the benefit of the their profile as a distinct professional Employees can now stay longer and the behaviours we demonstrate. people who work in our subsidiaries, • Regular roadshows individual and BT. group within BT. It is chaired by the with us and retire gradually, as part To be successful businesses also need 14,867 of our total workforce of • A conduit to senior managers personal assistant to the chairman. of a career/life planning approach. to be in tune with societal changes 102,100. The network has nearly 5000 Options include part-time working, and to react responsibly to them. At • Contributions to the national and members and many non-members The network helps its members sabbaticals, reduction in hours and BT, we believe that only by treating Benchmarking international debate. regularly attend BTWN meetings and develop a broad range of skills, secondments. everyone equally and fairly, embracing n the 2004 financial year, we gained events. It is run by volunteers, funded enabling them to take on more the range of skills and experiences of the highest scores in an independent Able2 for employees with disabilities and fully backed by BT. advanced work while also increasing We are conducting a full age audit people of all ages are we truly able to comparison of how gender issues are Able2 seeks to portray a positive the overall effectiveness of our using the Employers Forum on Age’s release their potential and strive for managed by commercial companies image of disability by working with all Members are kept informed through management teams. (EFA) audit tool to ensure all our business success.” Caroline Waters, and organisations in the public sector stakeholders. The network is a central the newsletter, ‘hersay’, and the policies and practices are free from Director, BT People and Policy. - the Opportunity Now benchmarking point of contact for advice and support BTWN website. age discrimination. We have exercise - retaining platinum standard. to all disabled employees within BT.

BT Kaleidoscope For example, real-life case studies 4. Give our employees opportunities Initiatives such as the UK • The continuing effectiveness of the University of London. In its eighth BT Kaleidoscope is a network for based on BT experience are used to develop their capabilities and Management Insight programme performance review processes, eg, year, the course enables BT people our gay, lesbian, bi-sexual and by our Diversity Coach trainers in prospects for employment so they can enable team members to assess one-to-ones, etc., which have proved to study part-time from home, at transgender employees. training workshops across our deal confidently with organisational their skills and develop plans for both robust and practical despite the work and at residential schools run business where applicable. and commercial change. the future. degree and pace of change at CWU Education centres. About seven per cent of the UK 5. Offer a broad range of solutions • Many of the emerging approaches population is lesbian, gay, bi-sexual Learning & development Regular monthly meetings and The BT Masters programme provides including work-based activity, formal to both leadership development and or transgender. The network offers We seek to encourage and provide annual development reviews help work-based development for BT and informal learning, encouraging talent management are “cutting community support to its membership opportunities for personal growth employees and their managers people, leading to a Master of Science the use of group-wide learning edge” and again have the potential and provides BT with insight and and professional development. communicate directly on career (MSc) degree in telecommunications solutions through the BT Academy to make a major contribution to the knowledge about a potentially development. after 20 months of part-time study. and taking account of individual ongoing achievement of strategic significant market. Here we present our approach to We support, through the use of learning styles. aims and objectives learning and development: In the UK, our NewStart initiative technology, studying for professional During the 2005 financial year, • Principles and commitment 6. Provide an appropriate induction provides a comprehensive toolkit to • An overall majority of interviewees qualifications from bodies such as the we supported Brighton Pride and programme for all new employees and enable our employees to plan and told the Assessment Team they feel Chartered Institute of Management • Career development GlasGay. In the first Stonewall those who are changing jobs to make address career changes constructively. valued and respected by their Accountants (CIMA). Benchmarking Survey we came in • Investors in People sure they can be effective in their new managers. the top 25 gay-friendly organisations, work as soon as possible. Investors in People The Leadership Spine provides a suite • Education demonstrating our commitment During the 2005 financial year, BT Education of BT-wide leadership development 7. Provide a range of support and to support our gay, lesbian, bi-sexual • Career-life plan. successfully achieved re-accreditation BT Academy is a web-based corporate programmes to support the business information to enable the career and transgender employees. as an Investor in People (IiP). IiP is a learning portal that provides BT UK at each level in the organisation. development of our employees. We Principles and commitment standard of good practice for training employees with an extensive range will encourage learning by setting up Litigation We have made the following and development devised by UK of learning programmes and facilities. The BT Academy helps people acquire and developing formal and informal In the 2005 financial year, there were commitment to promote learning leading business and employee skills useful to their job. It also helps communities. a total of 58 discrimination-related and development for our people: organisations. We remain one of The Academy is a key part of our them take advantage of future career cases involving BT. Twelve were 8. Manage actively the way we the largest companies to pass this commitment to lifelong learning. It opportunities in an industry where the withdrawn, three judged against BT, We will set up a partnership with develop identified groups or challenging outcomes-based test. uses the latest technology to deliver skills required change rapidly. 25 settled and 18 judged in favour of each individual who makes the most individuals (with the group or instructor-led and e-learning to all BT BT. There were 14 cases involving BT of their personal performance, individual involved) so we can make The Assessment Network (TAN) people via our intranet. BT Academy We believe that people at the start of in both the 2004 and 2003 financial commitment and prospects for the best use of the talent across BT. evaluated about 690 BT people from is one of the largest corporate learning their careers will increasingly want to years. employment. We will give our people across all lines of business in a variety management systems in Europe. work in companies that commit to 9. Make the best use of learning and the appropriate opportunities to of structured and informal settings. the long-term development of their development suppliers so we can get See Data and targets for data develop business capabilities and will They also observed business meetings In the 2005 financial year, the BT employees. the best commercial value possible relating to discrimination-related evaluate how effective our and training sessions. Academy Learning System has across BT. litigation since 1999. investment is. delivered 253,995 on-line and 34,833 Career-life plan 10. Evaluate our investment in Their report highlighted the following instructor-led course completions. The We are committed to create an Learning from discrimination cases We will do the following: learning and development at all levels best practices across BT: trend to on-line continues with environment where change can be Every discrimination litigation case 1. Give our managers the necessary of the business. • The commitment to ongoing learning average monthly on-line completions anticipated and dealt with constructively. is one too many. resources and personal development and development by the most senior up 26.3 per cent and those for to enable them to support their Career development people within BT is unquestionable instructor-led events down 0.5 per We use two main tools to implement We carefully consider our own cases people’s learning and development. There are many opportunities for cent, compared to 2004. our long-standing policy of expanding • The general effectiveness of the at practitioner and senior management promotion within BT. We have our people’s skills and capabilities: 2. Give our employees ongoing communication processes - particularly levels. We also review developments in established a centralised application Accredited programmes leading NewStart and Achieve the Balance information on the skills and top level communications. This has discrimination law as it emerges. system and an on-line Job News facility. to professional and post-graduate initiatives. behaviour which we believe are been widely welcomed in a period of qualifications are available through essential to future success and how significant change and uncertainty We ensure that our case management To develop their career in BT, the Academy. For example, we have NewStart enables employees to these can be developed. continues to be robust and, at the employees take on challenging tasks • An embedded culture of coaching, an Internet-based Computer Science consider and plan ahead for their same time, that our educational 3. Analyse needs at a business level in daily activities and can participate mentoring and support (both formal degree and access course, developed career. It provides a comprehensive inputs address any issues that arise. and an individual level to see what in ‘buddying’, mentoring, job and informal) which was apparent and run in partnership with the toolkit and the framework necessary development is appropriate and to shadowing and secondments. across the majority of areas in all lines Communications Workers Union to help employees and managers assess the value to our business. of business (CWU), Connect and Queen Mary, discuss these issues.

NewStart offers a number of services: the financial year 2006 and beyond in managing the business. Internationally accepted best practice Implementation • Ensure the safety champion has the • Professional career counselling incorporating Lost Time Incident Rate, Implementing the policy effectively will be adopted as a group-wide These processes and structures responsibility to undertake an Occupational Ill-Health and Total will yield financial and social benefits minimum level of performance. support the implementation of our adequate independent audit of the • One-to-one coaching Sickness Absence as our key measures. which will contribute to our vision of Assessments of risk will form an Health and Safety Guiding Principles. management of health and safety, • On-line advertised vacancies being the most successful worldwide integral part of the operational commit to an action plan to deal We continue to focus on a number communications group. management process. Risks will Each of BT’s lines of business will: with recommendations and have the • On-the-job development through job of major health and safety risks: be reduced to a level which is as low • Appoint a health and safety champion completion of actions verified shadowing and agency secondments. • Driving Achieving the aims of the policy as is reasonably achievable. who is a direct report of the line of • Communicate health and safety will be the responsibility of line business CEO NewStart is supplemented by • Fire and incidents on BT property strategy, planning and performance management. Competent specialist support and Achieving the Balance, an intranet • Produce an annual health and safety to all employees and others involved, • International travel health clear technical information will be site promoting flexible working and plan, with objectives, targets and and involve them in the continuous The Group Chief Executive accepts readily available to all who need it. presenting the range of work-life • Call centre health responsibilities improvement process. overall responsibility for Safety options available to BT people. • Injuries while working on the network Performance within BT. The Chief Appropriate levels of specialist • Prepare an annual health and safety Stress management Executive Officer of each line of support will be available to managers report demonstrating the work done Health & safety • Work-related stress. We are committed to help BT people business will be responsible for safety so that uncertainty about legal or towards meeting its health and safety One of our business principles is recognise and deal effectively with performance within their sphere of technical aspects of health, safety commitment and measuring its to care for the health and safety of These priorities illustrate the scope everyday pressure and work-related control. Implementation of the policy and welfare issues will not hinder performance against the standards set people across all BT’s operations and of our approach to health and safety: stress. will be carried out by line managers. performance. Health and safety in the annual plan products. We have made a specific it is not just about avoiding accidents solutions will be developed by those commitment to promote a healthy - we consider it very important to • Maintain a comprehensive inventory BT’s strategy for mental wellbeing Everyone within BT must contribute who work with the risks. Guidance lifestyle through our health and protect our employees’ physical of physical, chemical and psycho- People feel stressed when they cannot and feel able to contribute if we are on safe working practices will be wellbeing programme. and mental health as well. social hazards cope with pressure in their lives - at to succeed. presented in an easily understood work and at home. We are committed style using a format accessible to • Carry out formal risk assessment and This is why we made our Significant See Data and targets for health to ensure that unreasonable demands Everyone within BT has a everyone who needs the information. profiling of all hazards within the Incident Rate a non-financial key and safety performance data - on are not made on our people and that responsibility to ensure they take inventory and ensure that a system is performance indicator, with a rate of absence, sick absence due they lead balanced lives. reasonable care of their own health We expect our partners and others in place to implement competent strategic target of a 25 per cent to accidents and ill-health referrals. and safety and the safety of others. who work with us to share our task-based risk checks reduction in incidents by March 2005. We do this through job design, It is essential that managers and their aspirations in the area of health The indicator records the incidence Here we discuss: • Put systems in place to ensure that resourcing (making sure jobs are done people seek to work in ways where and safety performance. of injuries, diseases and danger • Our health and safety guiding managers, employees, contractors by people with the right competences), safe behaviour is seen as normal and occurrences. It is a good measure of principles and customers receive appropriate training and development, and people unsafe acts are not acceptable. No The health and safety performance our success in promoting health and advice on relevant hazards that have management. We provide support to • Implementation by our lines of one will be disadvantaged as a result of contractors will represent a key safety. not been eliminated and the potential employees affected by stress caused business of raising health and safety concerns criterion used in the selection process. risks from them by pressure in their private lives. or adopting reasonable safe practices. Wherever contractors seek to work for We reached the target two years early • Stress management Mechanisms will be established to BT, their health and safety policy and • Ensure risk-awareness training and and at that point doubled the Our strategy is in three phases: • Occupational road risk management ensure that all employees and their performance must equal or better the risk management systems are in place reduction to be achieved by the end primary, secondary and tertiary. representative bodies can fully standards achieved within BT. to successfully implement risk control of 2005. We achieved this 50 per • Our partnership with the BT Unions contribute to the safety culture of the measures cent reduction in September 2004 on improving safety. Primary: Reducing stress at source business. The provision of information, and have also cut the rates of sickness • Ensure that arrangements are in place through workplace and job design instruction and training in the most absence due to workplace accidents Guiding principles for the health surveillance of those appropriate form will be assigned the (down 56 per cent since 2001) and BT’s Health and Safety Guiding identified by risk assessment as We use a number of tools to identify, highest priority so that all employees occupational ill-health cases (down Principles requiring it manage and, where possible, understand the risks they face and 64 per cent since 2001). This policy acknowledges the eliminate the causes of work-related how to control those risks to a level • Arrange for sufficient competent commercial advantages and the stress. To do this, we provide our which is consistent with the objectives support in the areas of safety, health These targets were seen as humanitarian necessity of robust employees and their managers with of this policy. and hygiene particularly challenging but we have and effective health and safety comprehensive guidance on the met them by ensuring a commitment performance. • Ensure compliance with the reporting causes of stress and how to avoid We will strive to achieve excellence to zero avoidable accidents requirements laid down by the BT problems, at the personal and in our health and safety performance throughout the company. A broader Health and safety performance health and safety champion organisational level. wherever we work. series of metrics will be adopted for is a key indicator of our success

Our Dealing with Stress internal As part of BT’s Total Health Working with our Partners website includes BT’s stress Management (THM), we introduced in the BT Unions management-related resources a new initiative. Absence Case We made an agreement with the and access to specialist teams. Advisors send letters of support to Communication Workers Union people who are absent with a stress- and Connect on the role of safety Secondary: Identifying early signs related illness on behalf of BT’s representatives. The agreement of stress and supporting individuals. Employee Assistance Programme. formalises the arrangements for the This includes women with post- training of safety representatives and STREAM, BT’s Stress Assessment natal depression. establishes a framework to promote and Management tool, provides co-operation between BT managers us with organisational stress profiles Formal support for people with work- and the employee representative and reports. It helps us identify work related or private problems is also bodies. This partnership enables us to pressures that cause stress and offered through the Employee deal with health and safety issues in a recommends control measures that Assistance programme (EAP) - a non-political and non-confrontational employees and their manager can confidential service that is available manner. This ultimately helps us use. STREAM also provides BT with on-line or via the 24-hour helpline. improve the protection of our people. essential (but anonymous) Line Managers can get support from management information on the the Employee Assistant Management mental wellbeing of our employees. Team (EAM) - a confidential service Regular reports are now sent to all available on-line or via the helpline senior operational and HR managers, profiling the stress-related absence Occupational road risk management information and STREAM results for BT operates a fleet of over 44,000 their Business Units. This helps them vehicles in the UK (this includes all manage the issues specific to their commercial fleet and company car organisations. vehicles). This means there is a significant risk of injury to our people Tertiary: Assisting established cases and the general public from road cope and recover. accidents.

Work can play an important part in We are developing a groundbreaking recovery from mental health approach to the management of problems. occupational road risk. Drivers are individually assessed and the factors We consider it very important that contributing to higher risk of accident managers and colleagues keep in are identified. They are then offered touch with individuals during stress- tailored support to minimise those related absences because it helps risks. By the end of the 2005 financial minimise the problems of isolation year, over 31,000 BT drivers had and de-motivation. taken part in our Starting Point programme. The initiative was commended by the UK-based national road safety charity, BRAKE, in 2003 and won the prestigious Prince Michael International Road Safety Award in 2004.

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Investors are increasingly interested The key issue for investors is The future 2. Reputation For example, a proactive approach BT will also expect to be able to in the social and environmental the business case for sustainable It is crucial to show our investors how When people trust a company they to flexible working, responsible exploit a number of new market dimension of business performance development and corporate social sustainable development and CSR in effect deliver a societal ‘licence management, personal involvement opportunities through its 21st and how it relates to the business responsibility (CSR) and how social, strategies can add shareholder value. to operate’. This is reflected in the in community initiatives, diversity, Century Network (21CN) programme. strategy. environmental and ethical risks and More importantly, the strength of company’s reputation which, in learning and development all improve opportunities are managed to preserve individual business cases for CSR will BT’s case, we know directly affects employee satisfaction. In a recent BT’s 21CN programme will see the During the 2005 financial year, and grow shareholder value. become a key test of how the market customer loyalty. survey, we found that 63 per cent phasing out of the UK’s public BT made two sizeable acquisitions, is being shaped and harnessed to of employees felt more proud to work switched telephone network (PSTN), Infonet, one of the world’s leading Common approaches deliver sustainable development. Through this relationship we have for the company as a result of our which uses a multitude of networks providers of international managed There are few enterprise-specific, understood how CSR is critical to CSR activities. offering specific services, and voice and data network services, quantitative business cases for CSR. Our business case optimising customer satisfaction. replacing it with a global Internet and Albacom, the second largest Our business case for CSR For example, we estimate that 5. Marketplace innovation Protocol (IP) infrastructure that is telecommunications operator in the Social and environmental performance demonstrates how good CSR BT’s CSR performance accounts Increasingly, we have to address capable of carrying voice, data and Italian business market. reports (like all reports of performance) performance helps implement key for over 25 per cent of the image social and environmental matters Internet services on a single network. are often backward-looking (investors aspects of the BT strategy. and reputation element of customer when bidding for major new contracts These acquisitions significantly are more interested in future satisfaction. Further statistical in both the public and private sector For BT’s customers, the 21CN will enhance BT’s profile in the global prospects) and unfocused (investors The BT strategy identifies eight analysis shows that a one per - worth £2.2 billion in the 2005 deliver more choice, control and Information Communications want information presented in terms strategic imperatives: build on our cent improvement in the public’s financial year. We believe that major accessibility as well as increased Technology (ICT) market, as well of business strategy and growth). IT and networking services capability; perception of our CSR activities business clients see that the quality flexibility whilst maintaining reliability as extending our reach and presence deliver on broadband; create translates to a 0.1 per cent increase of our CSR performance differentiates and security. For BT, it will mean in North America and the Asia Pacific BT’s approach convergent mobility solutions; defend in our retail customer satisfaction us from our competitors. fewer network elements overall, such region. From a CSR perspective, this We want to present investors with our traditional business vigorously; figures. as fewer boxes and buildings, and will brings challenges not only as we a forward-looking, quantitative drive for cost leadership; keep During the 2005 financial year, require simpler network management. extend the way we work to our newly business case for CSR and sustainable a relentless focus on customer 3. Cost reduction the Major Business, Commercial and acquired companies, but also into development. Our business case sets satisfaction; motivate our people During the 2005 financial year, Brands team have been incorporating The benefits of 21CN will be: new countries through our greater out how good CSR performance is and live the BT values; and transform we commissioned the sustainable BT’s CSR messages into existing • Empowerment for customers global reach. Details of how we are critical to the delivery of BT’s strategy. our network for the 21st century. development organisation, Forum propositions and bids to differentiate • Faster speed to launch for new working to achieve this are available for the Future, to help us improve our networked IT services. They products for BT throughout the Social and We measure our CSR performance Our business case our understanding of savings from have also supported existing bids Environmental Report. through a series of key performance Our CSR work is integral to the environmental activities. First, by by facilitating CSR peer-to-peer • Reduced costs through more efficient indicators (KPIs) which have been BT strategy, and affects business creating a more robust methodology engagement between BT and clients network management, maintenance The revenue base of BT’s business is developed in consultation with performance in five key areas: for measuring our environmental to share knowledge and best practice and energy consumption. also changing. Our traditional fixed stakeholders. cost savings each year, and second, around CSR. line telephony business in the UK is 1. Risk management by widening the scope of the under competitive pressure and, while See our 2005 financial year As covered in detail in our business environmental initiatives we include Long-term sustainability trends we continue to maximise the potential sustainability performance briefing principles section, we have undertaken when calculating this annual figure. create new market opportunities. For of this business, we are also pursuing to French analysts, hosted by HSBC CSR risk analysis and risk management example, teleconferencing and flexible profitable growth by migrating our in October 2004. for several years. Currently we identify Using the Forum model, our working reduce the need to travel and customers to new wave products and no CSR risks which are material to the environmental cost savings for the provide more flexible lifestyles. The services such as IT and networking In addition, BT’s response to the future of the business. Our seven key 2005 financial year were £410 million. sustainability section of our report services, broadband, mobility and Association of British Insurers’ risks are geography of jobs (offshoring); gives more detail about research we managed services. disclosure guidelines covering social, breach of integrity; diversity; 4. Employee motivation have carried out into these new market environmental and ethical risks and climate change; health and safety; Working conditions and our opportunities and their benefits. As BT’s business extends into these opportunities is provided in the ethical issues in the supply chain; relationship with employees are areas, the nature of the CSR issues Annual Report and Accounts. and privacy. crucial to the success of our business. we face is changing. For example, privacy has been identified as a CSR risk during the 2005 financial year. It is also the subject of our latest Hot Topic, ‘Privacy in the Digital Networked Economy’.

Ratings • The German independent ratings • BT is included in the Ethibel Specialist CSR ratings agencies rank agency, OEKOM research AG, has Investment Register. Ethibel has companies based on the information ranked BT second out of 24 in its been a leading European research available about their social, ethical analysis of corporate responsibility organisation in the field of Corporate and environmental policies and in the telecommunications sector. Social Responsibility (CSR) and practices. sustainable development for ten • BT is included in the UK, European years. Ethibel reviews companies Ratings are based on the premise that and World FTSE4Good Indices. worldwide on their economic, social a company’s management of these and environmental performance. aspects will have a significant bearing • Storebrand (a Norwegian social The Investment Register is used a on its ability to preserve and grow investment fund index) rated s the basis for Socially Responsible long-term shareholder value. us best in class for our social and Investment (SRI) products for a environmental performance. growing number of European banks, BT’s ratings are as follows: fund managers and institutional • BT has been ranked as the world’s • BT has been named as one of investors. number one telecommunications the ‘Global 100 Most Sustainable company in the Dow Jones Corporations in the World’. The Case study Sustainability Indexes for four years new global business ranking In July 2004, BT won four awards running. identifying the top 100 was unveiled at the Investor Relations Magazine at the World Economic Forum, held Awards. The awards were for best • BT is top of the telecommunications in Davos, Switzerland, in February investor relations in the telecoms sector in the Business in the 2005. Companies were selected sector; best investor relations for Community Corporate Responsibility on their ability to manage strategic the retail shareholder; best corporate Index (Business in the Community is opportunities in new environmental social responsibility practice; and an independent business-led charity and social markets. Research and best use of the internet for investor based in the UK) and ranked third in analysis was conducted by relations. the top 100 UK companies who took environmental investment advisory part in the 2004-05 index. firm, Innovest.

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Ethical Trading – number of risk assessment questionnaires completed all with 100% follow-up

We buy products and services - such • Diversity - how we promote diversity Payment Corporate social responsibility of technology to foster sustainable We need the collaboration and support as IT equipment, cables, software, in our supply chain BT’s policy is to use its purchasing We are committed to be socially development. of all our suppliers. Since the launch design and disposal services - from power fairly and to pay promptly responsible and to minimise our of the initiative in 2001, we have • Procurement and the environment - thousands of suppliers worldwide. In and as agreed. BT has a variety of impact on the environment. In the 2004 financial year, GeSI worked with an increasing number how we promote environmental good the 2005 financial year, we spent payment terms with its suppliers. established a CSR Supply Chain of buyers and suppliers to pursue this. practice in all our purchasing over 4 billion on procurement. We promote our principles and values Working Group. activities. The terms for payments for purchases when working with others. Our Our supply chain policy At every stage of our dealings under major contracts are settled when corporate social responsibility (CSR) The group aims to develop or Our SWHD initiative specifies the Selection with suppliers - from selection and agreeing the other terms negotiated programmes seek to apply human improve tools, management practices, minimum standards we ask our BT operates a fair procurement process consultation, to recognition and with the individual suppliers. rights and environmental good processes and systems to help suppliers to achieve in the following - administering our tendering and payment - we are committed to practice within our supply chain. member companies deal with CSR areas: contracting procedures in good faith. behave according to the principles BT’s standard payment terms to issues in the supply chain. It seeks • Child labour of fair and ethical trading. suppliers are 42 calendar days from During the 2005 financial year, we to promote efficient CSR supply-chain Our supplier selection process seeks • Cruel, harsh and inhuman treatment date of invoice and this applies to adopted a single CSR approach that management by helping to eliminate to ensure that high safety, In April 2004, we provided our all orders provided that the relevant consolidates the separate components duplication within the information • Forced labour environmental and social standards suppliers with the opportunity invoice is presented on time and of CSR in procurement. We have and communications technology are met. We value the diversity • Discrimination to give their views on how well BT is complete. developed a single system to request (ICT) industry. of our suppliers. They do not have lives up to these commitments and supplier questionnaires, rather than • Freedom of association & collective to be existing customers of BT. principles through a confidential and BT’s payment terms are printed on the three used previously. The Group commissioned a study bargaining on-line supplier stakeholder survey. the company’s standard purchase to identify what was considered Our Purchasing Principles provide a • Health & safety order forms or, where appropriate, Scope best practice in CSR supply-chain framework to ensure that we act in an A total of 213 suppliers responded, specified in individual contracts Our CSR supply-chain programmes management for an ICT company. • Wages ethically and commercially responsible with 94 per cent stating that they had agreed with the supplier. are used by all purchasing operations This was used as a benchmark. way in our dealings. Adhering to these • Working hours a good working relationship with BT. in the BT Group. The findings have helped decide principles is an integral part of our We reviewed supplier responses to the The ratio, expressed in days, between priorities in the group’s future • Regular employment entitlements. procurement process. other questions in the questionnaire. the amounts invoiced to the company Governance & resource work plans, which now include the We felt suppliers did not have sufficient by its suppliers in the 2005 financial BT’s chief procurement officer, who development of a self-assessment Find out more on Sourcing With Authority to form a contract awareness of some of our business year and the amounts owed to its reports to a BT Board member, has questionnaire to help suppliers assess Human Dignity. is restricted to our authorised principles. A copy of the booklet, The trade creditors at the end of the year ultimate responsibility for these CSR their own environment and labour procurement professionals, trained Way We Work, was sent to them. was 36 days. supply-chain programmes. standard risks, while raising their Methodology to world-class standards and who awareness of the issues. The group For all new BT contracts, suppliers apply BT’s Purchasing Principles. Here we discuss key aspects of our Our buyers - supported by a has consulted key non-governmental are asked to sign a clause relationship with suppliers: procurement CSR manager, product organisations (NGOs), trade unions committing them to complete a Development • Selection - how we choose stewardship experts, waste experts and suppliers on the development risk-assessment questionnaire (GS18) We use a range of tools to assess our suppliers and product managers - implement of the questionnaire. on request. The clause also permits our suppliers and to encourage the programmes. us to carry out on-site audits and • Development - how we work continuous improvement. These Human rights in the supply chain commits the supplier to work with in partnership with our suppliers range from basic desktop evaluations Since April 2004, CSR has been Working conditions us to achieve our SWHD standards. to sophisticated supplier capability • Payment - our commitment to pay incorporated as a key measure in BT’s We want to ensure the working assessments and partnership our suppliers promptly and as agreed procurement’s ‘scorecard’ and buyers’ conditions under which the products The questionnaire establishes the evaluation processes (PEM). objectives. This acts as an incentive and services we purchase are produced level of risk associated with the • Corporate social responsibility - our for the procurement community to meet the standards of the Universal supplier. If the contract is identified commitment to be socially responsible A PEM evaluation is only undertaken fulfil their CSR obligations. Declaration of Human Rights as high or medium risk, we follow and minimise our impact on the where both parties agree that it will (UNDHR) and the International Labour up to find out more information environment throughout our supply be mutually beneficial. The evaluation GeSI Supply Chain CSR Organisation (ILO) Conventions. and determine what further action chain increases the supplier’s understanding Working Group is needed. of how to work in partnership with BT. • Human rights in the supply chain - BT is a member of the Global Through our supply-chain initiative This benefits us and helps the supplier how we apply our Sourcing with eSustainability Initiative (GeSI), Sourcing with Human Dignity when they compete for non-BT work. Human Dignity standards in our supported by the United Nations (SWHD), we seek to ensure that supply chain Environment Programme (UNEP) and the working conditions in our supply We share learning and expertise in the International Telecommunication chain meet internationally accepted quality, the environment, diversity Union (ITU). GeSI promotes the use standards. and ethical trading.

Implementation of GS18 Sourcing with Human Dignity Labour standard 2003 FY 2004 FY 2005 FY Number of new BT Contracts 879 1,199 1,175 GS18 requirement included in new BT contracts 879 1,199 1,175 GS18 risk-assessment questionnaires requested by BT to be completed by supplier* 37 391 243 GS18 ris-assessment questionnaire completed 31 242 240 Number of questionnaire responses where further action was required 15 67 55 Number of questionnaire responses where further action was being conducted / 74 106 Number where required further action was completed / 20 8 Number of initial GS18 on-site assessments conducted on high risk contracts 7 9 8 Number of supplier indentified as falling short of GS18 standard following assessment 7 9 8 Number of GS18 on-site re-assessments conducted 7 4 3 Number of suppliers who, following re-assessment, have reached the GS18 standards 0 0 0 Contracts cancelled due to serious shortfalls persisting against GS18 standard 1 0 0 * One supplier questionnaire response may cover multiple contracts if for the same procurement requirement / =Data not entered onto the central database that year

In some cases, an on-site assessment SWHD training. The training is from the supplier with us. This helps 2005 assessments GS18 Sourcing with Human Dignity Assessment Finding April 2004/2005 will be agreed with the supplier. This mandatory for all those who have suppliers understand the risks and In the 2005 financial year, we (Conducted on supplierd operating in identified risk areas) may involve an audit of the supplier’s not taken the half-day course and how these can be managed in their completed 11 on-site assessments 6 2 Employment is freely chosen own facilities or that of a subcontractor. includes the completion of an on-line supply chain. to find out how well our suppliers 4 4 Freedom of association and collective bargaining assessment. The package introduces met our SWHD standard. 8 Working conditions are safe and healthy 2 6 The assessments include interviews our buyers to the rationale behind Monitoring and improvements Child labour 8 Living wages of the workers. Where possible, the SWHD initiative, its key features The table right provides key Eight of the assessments took place 7 1 Hours of work BT will ask appropriate NGOs, and their role in ensuring its data concerning BT’s monitoring in China and Thailand and were of 5 3 Discrimination independent assessors or academics successful implementation. of Sourcing with Human Dignity facilities not previously assessed. The 8 Regular employment to carry out the interviews. and improvements achieved. assessments were done in those areas 6 2 Harsh and inhumane treatment Interviewers always speak the Suppliers where there was a high risk of suppliers Achieved required standard Some improvement required Improvement required language of the workers and, where The GeSI Supply Chain Working falling short of our standard - they possible, will be of the same gender. Group is developing a self- should not be taken as a representative The safety of the workers is of assessment/awareness-raising tool sample of our supply chain. The graph above shows the findings. In the 2005 financial year, a further utmost importance and we protect to help guide our suppliers in the three re-assessments were made their anonymity when feeding back implementation of labour standards Our assessments use the following We sent the assessment reports to facilities where improvement findings to the management. codes. scoring system: to the suppliers and discussed our plans had already been put in place. • Improvement required - progress is observations with them. We have The visits assessed the level of Where shortfalls against the GS18 We seek to raise suppliers’ needed on at least 51 per cent of the either agreed improvement plans improvement in the way suppliers standard are identified, an action awareness during on-site aspects in that category (and are monitoring progress), or are meet our standards. plan is agreed with the supplier. A assessments. We start these with still to agree plans following the most • Some improvement required - re-assessment will then be scheduled a pre-meeting designed to help recent assessments. To date, only one subcontractor has progress is needed on at least one for completion within the following suppliers understand why SWHD been found, upon re-assessment, aspect in that category. 12 months. standards are important to us. We Not all the shortfalls represent major to persistently allow serious shortfalls explain what we will be looking for labour rights abuses. For example, of the SWHD standard, including Training during the assessment. We often some improvement required in the excessive and forced overtime and Buyers’ awareness training bring the suppliers’ health and safety living wages category does not intimidation of workers. The It is critical that our buyers have the officer with us on the premises tour, necessarily mean that the supplier contractor falsified records to try awareness, knowledge and the skills so that they understand any health is paying below the minimum or living to hide this from the assessors. As required for the successful and safety issues the assessment wage. It may simply be that insufficient a result, we stopped placing orders implementation of SWHD standard. discovers. information about wages is provided with that company. in the employment contract. Our computerised training package When we assess a supplier’s enables all BT buyers to undergo subcontractor, we take someone

This is the first and only case where Diversity In the UK, this makes us one Implementation of GS13 Environmental Impact Process 2003 FY 2004 FY 2005 FY we have stopped trading with a supplier The business case of the largest purchasers, with an Number of new BT Contracts 879 1,199 1,175 because of non-compliance with our Because our customers are so diverse, environmental influence that extends GS13 requirement included in new BT contracts 879 1,199 1,175 SWHD standard. All other suppliers the issue of diversity is commercially well beyond that of our own people GS13 risk assessment questionnaires requested by BT to be completed by supplier* 70 568 289 have been collaborative and open and important to us and built into our and workplaces. In recognition of this, GS13 risk assessment questionnaire completed 43 410 305 continuously try to improve their business objectives. We must and to comply with the ISO14001 Number of questionnaires where continuous improvement was required 18 129 85 performance. understand and align ourselves with standard, we identified procurement Number of questionnaires where continuous improvement was being driven 7 131 175 our customers if we are to provide as one of eight company activities Number of contracts where continuous improvement completed 0 33 18 See Future plans/Targets in corporate a truly world-class service. that affect the environment. * One supplier questionnaire response may cover multiple contracts if for the same environment risk category social responsibility. Supplier diversity Environmental objective 2. Manage the environmental During the 2005 financial year, we Case study Case study During the 2005 financial year, we Our environmental objective in impacts of electrical or electronic produced a guide for buyers on how Paper and stationery Our supplier evaluations in China participated in the European Supplier procurement is to seek to influence equipment (EEE). We have a pre- to encourage continuous improvement We are one of the first companies to have delivered real and tangible Diversity Programme. This looks at the environmental performance of contract product stewardship online with suppliers. introduce a new type of sustainable benefits to the workers there. A GS18 how diversity can be encouraged in our suppliers and contractors through questionnaire (GS19), which is office paper in the UK. This will have a risk evaluation of a subcontractor to supply chains. We held a workshop our purchasing policy. mandatory for all potential EEE Suppliers significant effect on our environmental one of the leading ICT manufacturers to understand the issues that diverse suppliers. This provides information A training programme, started in performance - we consume nearly in China identified several areas where suppliers may encounter when We have set specific objectives on materials used and compliance 2004, helped BT suppliers implement 3,000 sheets per employee a year. the supplier did not meet the standard competing for business with big to ensure appropriate supplier with forthcoming environmental environmental management systems The paper contains a minimum of 70 required by our Sourcing with Human companies. environmental data is collected. legislation. The information is compatible with the ISO14001 per cent reclaimed fibre from south- Dignity standards. Non-compliances After evaluating our suppliers’ assessed and sent to our buyers management systems standard. east England. The balance is from included unsanitary and unsafe We sent The Way We Work booklet environmental impacts, we and product managers so that they Seven BT suppliers took part in sustainably managed forests. This sleeping conditions, enforced overtime to current suppliers to reinforce how encourage poor performers to can make informed decisions. the four-day course, partly funded cuts delivery mileage, further reducing with wages below minimum standards we value diversity in the workforce improve. by the European Union. Participants the paper’s environmental impact. and poor health screening. and how we expect our suppliers to 3. Auditing waste management committed to spend 120 hours reflect this when working with BT. We have adopted a risk-based suppliers. All our waste contractors on project implementation in their See Future Plans/Targets in Corporate As a result of the evaluation, the approach focusing attention on must provide a statement on their companies. All suppliers completed social responsibility. company has invested in improvements Future plans improvements in the areas where waste disposal procedures. We assess the course. that have transformed working and In the future, we plan to review our the greatest impact can be made. this for legal and environmental living conditions. Several key Chinese buyers' training to ensure it reflects compliance. Contractors are audited Monitoring and driving improvements suppliers are now including labour our single approach to CSR, and to Methodology by us (using an external specialist) - Performance at a glance standards such as SA8000 in their ensure it is up to date and relevant. The implementation of our every year. Audit reports are sent The table above provides key data contracts as a result of our leadership. procurement environment to the relevant BT buyer and progress concerning BT’s monitoring and This will potentially improve the We plan to carry out joint assessments objective has three main strands: on any required improvements driving environmental improvements working lives of huge numbers of with a direct supplier to share best 1. Assess suppliers’ general monitored by the auditor. with suppliers Chinese workers. practice. environmental policies and procedures. We do this with our Training In the 2005 financial year, we have We are developing an industry-wide environmental impact online Buyers also assessed 250 product supplier questionnaire as part of the questionnaire (GS13). The supplier In the 2005 financial year, we held stewardship questionnaires (GS19) Global eSustainability Initiative (GeSI) must complete this after agreeing two seminars for our buyers to help and audited 55 waste contractors. Supply Chain Working Group. a mandatory pre-contract award them understand how to help their commitment to work towards suppliers improve. The seminars Procurement and the environment continuous improvement, if were attended by 23 buyers who In the 2005 financial year, BT spent required. In this way we can identify manage suppliers that were over £4 billion on products and and drive continuous improvement recognised to be in need of services. Our purchases range from with those suppliers who do not improvement as a result of their risk telephone exchange equipment and have the procedures needed to assessment questionnaire. This is in vehicles to accommodation, fuel and manage the environmental risks addition to 77 buyers trained in 2004 energy, stationery, office machinery of the product or service we buy. and 182 buyers trained in 2003. and postal services.

Information and data on this page Information and data on this page has been verified by Lloyd’s Register has been verified by Lloyd’s Register Quality Assurance Limited Quality Assurance Limited BT Social and Environmental Report Suppliers 03 Community m 1 . m 6 8 . 2 0 m £ 2 8 £ 1 Community£ Charities and fundraising

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Community contribution - investment in society through funding and support in kind

BT is committed to make a positive Our community activities are Our stakeholders have told us that people experiencing problems are Telephone Helplines difference in society. in five main categories: we should support the most needy able to talk to someone. BT is Association (THA) • Charities and fundraising. We in society. committed to raise millions to help The Telephone Helplines Association We do this by acting responsibly in support a range of initiatives with ChildLine move closer to its goal of (THA) represents organisations our everyday business conduct and a special focus on a campaign with The use of telephone helplines, answering every child’s call for help. providing telephone services including also by making specific investments the UK children’s charity, ChildLine. websites and national telethons ChildLine answers 2300 calls a day, advice, information, listening support in communities to improve the quality demonstrate how communications but hundreds more children can’t get and counselling on a vast range of of life and sense of well-being for • Education. We use a variety of technology can help in charity through. Within the last two years subjects. those who live there. Our focus is techniques and media, including fundraising. we have raised more than £3.1 million on better communications. live drama and web-based activities, across the UK - the largest sum we BT has supported the development to promote communication and Our guide, Bidding for Funds and have ever raised for a single charity. of both paper and Internet versions As a member of the Per Cent Club, citizenship in schools. Resources, gives charities information of the Telephone Helplines Directory, we are committed to give a minimum on how to secure support from We also give in-kind support to which lists more than 900 national, of 0.5 per cent of our UK pre-tax • Employee involvement. Through businesses (not only BT), trusts and ChildLine, such as strategic and regional and local telephone helplines profits (before exceptional items) to the BT Volunteers programme, we public bodies. technical advice. throughout the UK. direct activities in support of society. encourage BT people to volunteer Our provision was £10 million in their time for community activities. ‘Making It Happen: BT’s Guide to BT’s support has included the donation Fundraising 1987; peaked at £16 million in 2001; We also help others (such as Unlocking EU Funding’ is a guide that of premises for several years, large- BT is able to co-ordinate major and was £9.1 million in the 2005 companies and schools) to organise assists UK public sector bodies such scale promotions and staff fundraising national charitable events, including financial year. volunteering programmes. as schools and hospitals, as well as initiatives, and sponsorship of the telethons for UK charities. We manage businesses and charities, gain access annual BT ChildLine Awards for the entire telephone network for these BT operations provided a further • Arts and heritage. We have a to European Union funding of £50 Services to Children. events, as well as providing call centres £11.7 million in funding and support- pioneering partnership with the billion, much of which goes unclaimed. to take donations over the phone. in-kind in the 2005 financial year, UK’s leading modern art gallery, Tate, It is available here as a free ChildLine was the beneficiary of the Many fundraising programmes are bringing the total contribution for sponsoring its website Tate Online. BT Christmas Concert in 2002, and initiated and organised by employees the year to over 1.1% of BT’s 2003 We support the preservation of the PDF download or you can buy a copy a joint beneficiary in 2003 and 2004. themselves with local charities as the pre-tax profits. UK’s telecommunications heritage. from Politico’s online bookshop. main beneficiaries. Community Network We donated £2 million directly • Digital inclusion. We have been Charities The Community Network is a charity We are involved in international appeals to charities in the year. running a digital inclusion campaign We believe that we can make the that provides teleconferencing through our support of the Disasters to support the UK Government’s biggest charitable impact by helping facilities to the voluntary sector. Emergency Committee (DEC), an aim to give all citizens Internet those organisations that will benefit organisation that helps leading UK access by 2005. We believe that most from our communications BT first funded the Network in 1989 humanitarian aid agencies alleviate promoting access to information technology and expertise. as a six-month pilot to research the suffering from disasters abroad. and communications technology can social implications of this technology. improve people’s lives and open doors ChildLine Now, more than 42,000 people take In the aftermath of the tsunami in to education, jobs and entertainment. BT is a founding partner of ChildLine, part every year in Community south-east Asia, BT played a key role For more information, see Digital the free 24-hour helpline for children Network telephone conferences. in managing the massive response inclusion. and young people in the UK. We gave to the DEC earthquake appeal. We it a simple and memorable number: FriendshipLink, a telephone-based set up a temporary call centre at the 0800 1111. Over one and a half social club for housebound people, BT Tower in London and provided million children have been counselled and FaithLink, which links people to the DEC with on-line fundraising by ChildLine since 1986. church services by phone, are two of and secure payments facilities. In the innovative ways the Community 24 hours in December 2004 the DEC We are working with ChildLine on a Network uses the telephone to meet website processed 166,936 donations, major campaign called ‘Am I Listening?’ social needs and promote social facilitated by BT. This aims to ensure that all young inclusion.

Children in Need All proceeds from the appeal are split Around 150 BT volunteers took Awards Spreading and sharing the web BBC Children in Need started in 1980 between these eight UK charities, pledges on the phone at BT Tower on BT Community Connections We share our Internet expertise with to improve the lives of UK children which help children affected by 30 December 2004. They answered BT Community Connections is a our community partners and have who have experienced problems or genetic disorders: over 12,000 calls, collecting £10 UK-wide award programme that helped many to develop their own hardships, such as abuse, serious • The Great Ormond Street Children’s million in one night. BT hosts the gives local community groups the websites. This helps information illness and poverty. Charity website for on-line donations, which opportunity to gain access to the about their work and our investment raised over £30 million up to 5 Internet. to reach a wider audience. • The Primary Immunodeficiency The 2004 BBC Children in Need January 2005. Association Appeal raised a record-breaking £17.1 Judging panels in Scotland, Northern BT won Gold Corporate Website million during the live seven-hour • The Society for Mucopolysaccharide We sent BT engineers and 10 tonnes Ireland, Wales and each of the English Hallmark Awards in 2000, 2001 television programme, with 362,000 Diseases of equipment from the UK to help regions have awarded more than and 2002, and received a highly calls taken over the BT network. restore telecommunications services 4700 Internet-ready PCs to individuals commended award in 2003. This was • The Chronic Granulomatous Disorder in the regions affected by the disaster. and groups who plan to make a from the UK Charities Aid Foundation Research Trust Comic Relief positive impact in their community. for demonstrating its corporate Comic Relief is a charity set up by • The Jennifer Trust for Spinal Muscular The volunteers built a satellite community involvement through comedians and uses comedy and Atrophy station in Indonesia and set up an Two examples of excellent use of the websites. laughter to communicate serious emergency operations room providing award are: • Rett Syndrome Association UK messages about the need to end communications for rescue workers • Croham Hurst Good Neighbours, The Telephone Helplines Association poverty and social injustice worldwide. • Batten Disease Family Association and aid teams in Penang, Malaysia. Croydon, UK are setting up a (THA) website is an outstanding It is known for its biennial Red Nose The operations room will continue shopping programme to allow example of a partner website • The Haemophilia Society. day and the related television appeal. to co-ordinate activities with other volunteers to order food over the developed with BT support. countries affected by the disaster until Internet for frail and housebound BT supports the tsunami Volunteers in more than 190 call an early-warning system is established residents, helping to maintain their The THA represents organisations disaster appeal centres across the UK handled around in the region. independence providing telephone services, including Thousands of people across the UK a million calls during the televised advice, information, listening support responded to the Disasters • Exmouth and District Youth Action telethon on 11 March 2005 in aid of Chief Executive Ben Verwaayen said: and counselling on many subjects. Emergency Committee (DEC) relief Group, UK is a voluntary group of Comic Relief. A colossal £37.8 million “Two things are vitally important BT has supported the development appeal in the aftermath of the young people who have set up a was raised on the night, compared to at a time like this. Getting aid into of the Internet version of the tsunami in south-east Asia in programme of enjoyable educational £35 million last Red Nose Day, affected areas quickly, and getting Telephone Helplines Directory. This December 2004. activities that inform young people in making this a record-breaking event. communications up and running. lists over 900 national, regional and south-west England about the effects BT is taking action on both fronts.” local telephone helplines in the UK. BT helped DEC - a UK consortium of of bullying. The group has created Jeans for Genes 13 non-governmental organisations - a pioneering website where young Jeans for Genes raises funds for BT also made a corporate donation We have teamed up with ik Software, handle their donations efficiently on- people can chat and share their research into serious and often life- of £500,000. an Internet services company, to line and on the telephone. We views and experiences. threatening genetic disorders make free, simple-to-build websites provided technical help and affecting thousands of children. BT available to any UK charity or administrative support to cope with For more information, see BT has supported the appeal since 1999. community group. For further details, the high volume of calls. BT did not Community Connections. see ik.com. profit from these calls.

Surveys of our stakeholders By the end of the 2005 financial year, There are 13 separate animated Awards Case studies Life skills have shown that education should the roadshow had made 10,500 tutorials on the Resource Bank Teaching Awards Katha Information Technology TalkWorks be a top priority for our social school visits and more than 2 million website, all aligned to the UK National BT is an associate sponsor of the and E-commerce School TalkWorks is a package of books, investment. children had been involved in the BT Curriculum and Scottish Guidelines. Teaching Awards, sponsoring the In India, BT is working with Katha, audio material, videos and workshops Education Programme since 2000. The site contains regularly updated Primary Teacher of the Year category. a Delhi-based charity, to establish developed by BT to help everyone These are BT’s educational initiatives: programmes of work and activity Designed to raise awareness about the Katha Information Technology improve their spoken communication • In schools - we help to improve the Specially developed curriculum sheets to support curriculum areas, the profession, the awards celebrate and E-commerce School (KITES) skills. communication skills of young people resources and a dedicated website including citizenship, literacy, the achievements of teachers in in one of the city’s poorest areas. across the UK, and encourage good (BT Education) enable teachers, geography and history. England, Wales and Northern Ireland. The TalkWorks products can be citizenship. We deliver in-school parents and pupils to access proven They culminate in a national event KITES offers educational opportunities borrowed from some public libraries events using teams of actors and learning materials which will help For more details see BT Education. broadcast by the BBC. to young people who have not been or ordered via the helpline on 0800 over 2000 BT volunteers. them develop their communication in formal education, and provides 800 808. skills. Connected Earth Education Centre BT Schools Awards literacy and information and • On-line resources - we provide The Education Centre on BT’s on-line The BT Schools Awards are open communication technology (ICT) Workshops can be arranged by calling materials for teachers, pupils and BT Volunteers museum, Connected Earth, provides to all schools in the UK. skills to young adults, women and 0800 389 8255. parents. BT and ex-BT employees registered free teaching resources on the history local businesses. • Awards - for teachers and schools. in our volunteer programme can now of communications. Grants of up to £2000 each are assist with all BT Education activity, awarded to schools which can The project aims to help teachers • Lifeskills - we help to improve including communication skills in- Arts for All demonstrate how their project helps and parents advance personally interpersonal communication skills school events. They also help extend We are very keen to make arts improve young people’s and professionally by improving their in all areas of life. the reach of our education programme available to everyone through our Arts communication skills. In the 2005 computer literacy. by taking a DVD-based programme to for All programme which has already financial year, 240 projects received We support more than 800 BT people schools that were not included in the made one of the largest art collections an award. Supporting English teaching who are school or college governors, roadshow. In the 2005 financial year, in the world easily accessible through in Spanish schools or work-experience supervisors. they delivered our material to over Tate Online (the UK’s most visited arts Regional media partners help to In Spain, BT worked with the Spanish 100,000 school children. site with over 650,000 visitors per promote the Awards, together with Department of Education and the Information about all our education month). We are also working with a UK national newspaper, The British Council to support English activities can be found at BT Online resources National Theatre, the British Film Guardian. language learning in Spanish schools. Education. BT Education Programme Institute and the Philharmonia We have donated computers and The programme provides resources Orchestra to make theatre, film and The 240 winning schools will all have provided a free Internet connection In schools for parents, pupils and teachers to help music more readily available to an opportunity to win one of three to 44 schools and we host a web The BT Education programme is one them improve their communication schools and pupils. £10,000 awards, by submitting community connecting these Spanish of the UK’s most significant corporate skills. The resources range from project progress reports in May 2005. schools with schools in the UK. investments in the education sector. DVDs, downloadable lessons and BT is ensuring that it protects and It includes free speaking and listening interactive web-based activities. promotes the heritage represented by resources, backed by an in-school All resources are available free from the huge advances in communication communication skills roadshow which the website. and technology over the last 100 years. demonstrates the use of materials Through www.connectedearth.com within the classroom environment. Each ICT tutorial has a user-friendly and a partnership with key museums animated exploration of an important around the UK, the full heritage story Communication skills roadshow area of ICT and includes teaching is available to everyone. One of the main strands of the notes, activity sheets, certificates education programme is a touring and pupil self-assessment forms. roadshow. Teams of actors visit schools in the UK, giving drama presentations and communication skills workshops that bring to life the theme of better communication which can help people get more out of life.

Information and data on this page Information and data on this page has been verified by Lloyd’s Register has been verified by Lloyd’s Register Quality Assurance Limited Quality Assurance Limited BT Social and Environmental Report Community 03 Employee involvement Arts and heritage

BT employs approximately 90,800 BT Volunteers The BT Chairman, Sir Christopher Throughout history, art in its many • An interactive on-line map of Tate Through Connected Earth, the BT people in the UK. We encourage Our employee Volunteer Programme Bland, hosts the annual awards forms has been one of the most Britain, making the largest displays of collection has been distributed to our people to get involved in the enables more than 42,000 BT and ex- ceremony and selects the overall powerful and enduring ways in British art accessible to people all over museums across the UK - making community and there are many BT people to volunteer in schools. All winners in each category. which people have communicated the world and allowing them to create it available to the widest possible ways this can be done. For example, volunteer activities are closely aligned feelings and ideas. their own virtual tour. (relaunched in audience. they can support a local school’s with the company’s focus on improving BT Awards for Quality Winter 2004) activities as a BT Volunteer, answer communication skills, and are related Employees who deliver excellent It is entirely appropriate that BT, a Several Connected Earth exhibitions • An interactive video with the artist telephones in a telethon or donate to the UK’s National Curriculum and results for community causes may company dedicated to encouraging are now on show in the UK: Tracey Emin (Summer 2005). money regularly via BT’s Give As Scottish guidelines. be acknowledged by the company’s and sustaining a communicating • Goonhilly Satellite Earth Station You Earn programme recognition programme, the BT Awards society, should be an enthusiastic in Cornwall Between May 2000 and March 2003, More than 150 Volunteer Clubs have for Quality, which is championed by promoter and supporter of the arts. BT also sponsored the Collection • Avoncroft Museum in the Many employees are involved in their been established across the UK. The our Chief Executive, Ben Verwaayen. We also have a role to play in helping Displays at Tate Modern in London. West Midlands communities through activities programme is available to BT retirees preserve the UK’s telecommunications unrelated to BT’s own initiatives. Our and employees’ family and friends. Community volunteering heritage for educational and cultural • Amberley Working Museum Awards Community Champions Programme Our involvement in volunteering goes purposes. in West Sussex Tate Online has received two encourages and recognises the work The volunteers are working in hundreds beyond the direct engagement of BT Interactive BAFTA Entertainment • The Royal Museum in the National of volunteers by giving financial help of schools across the UK, giving people. We also help bring people Tate Online Awards, the London Tourism Award Museums of Scotland, Edinburgh. to the organisations they support. classroom lessons on speaking and together for voluntary activities. We sponsor Tate Online, Tate’s virtual for best website, a Museum and the listening skills, and helping to develop gallery and the UK’s most visited arts Web ‘Best of the Web’ awards for Three other exhibitions are planned, With over 10,000 BT employees free websites for schools, classes and BT supports TimeBank, a national website. The site - for which BT Best Research site 2004 and is at the Museum of Science and based around the world, our people projects. A number of events have UK volunteering campaign that raises provides technical support, hosting consistently rated the UK’s top visual Industry in Manchester, the Milton are increasingly involved in many local been run for teachers and information awareness of giving time through and on-line broadcasting - provides art site by independent analysts Keynes Museum and the Museum community activities. For example, technology co-ordinators to help them voluntary work. It provides a way access to over 65,000 works of art. Hitwise. of London. ‘Done in a day’ schools voluntary understand the technology available for people to get involved locally by projects in the US invite local young to them. donating their time to community Online traffic to the Tate website The Tate sponsorship has won two Connected Earth - On-line people to experience a day of activities. has increased to more than 5 million Hollis Sponsorship Awards - in 2003 The Connected Earth online museum corporate life. BT people are also Employee giving visitors a year since our partnership for the best use of PR in a sponsorship complements the exhibitions with over involved in supporting partnerships Give As You Earn We believe that volunteering and began. campaign, and in 2005 in the 500 pages of content exploring the between schools in Spain and the We operate one of the UK’s largest working successfully in unfamiliar continuity category. The sponsorship history of communications in the past UK through a web-hosted platform. payroll giving programmes, through teams requires good communication Since September 2001, BT has has also won a Golden World Award 200 years. It charts how people have which over 10,000 BT people have and relationship skills. worked with Tate Online on a number from the Institute of Public Relations. radically improved their ability to Employee volunteering donated money to the charities of of innovative and exciting projects, transmit information, ideas, words, Many of our employees give their time their choice in 2004/5. BT matched Our support extends to server and including most recently: We are also working with National pictures and, most importantly, to work as volunteers, helping causes funds to a maximum of £1 million. website facilities, and we have •‘An Introduction to Modern Art’ - Theatre, the British Film Institute and speech itself, across the globe. of their choice, supported by BT. developed a Corporate TimeBank - an on-line learning resource developed the Philharmonia Orchestra to make Volunteering in the community brings The Charities Aid Foundation runs a packaged volunteering programme in partnership with Tate and the City theatre, film and music more readily The site had over 700,000 visitors mutual benefits: employees learn new the programme on BT’s behalf. Its that will help companies develop Literary Institute (Spring 2004) available to schools and pupils. in 2004 and 126,500 in January skills that help them at work and the figures show that in April 04 to March volunteering programmes of their own. • ‘Let’s Play 66’ - an online quiz we 2005 alone. community benefits from their 05 financial year, the total amount helped create as part of Tate’s ‘Art BT’s heritage collection expertise. given by employees was more than BT promotes the 2005 ‘Year of and the 60s: This was Tomorrow’ Connected Earth BT Archives £1.9 million. the Volunteer’ campaign through show (Summer 2004) BT inherited a rich collection of BT has retained its documentary, We encourage our people to take part its own community communications. historic telecommunications artefacts, image and film collections, held in company volunteering initiatives. If BT pays all the administrative charges The campaign is led by a partnership • An additional 6000 catalogue texts documents, images and films - a at BT Archives, which is open to the their line manager considers this part incurred by the Charities Aid Foundation. between Community Service available at Tate Online and a new collection of acknowledged national public by appointment. of their personal development, they Volunteers (CSV) and a Volunteering glossary of 300 art terms, several with significance which we are committed are given paid time off. Employee awards England Consortium, and is funded British sign language interpretations. to preserving for educational and BT Community Champions by the Home Office. (Autumn 2004). cultural purposes. Support for BT people’s voluntary work in their local communities is recognised by the BT Community Champions Awards, open to all employees.

Information and data on this page Information and data on this page has been verified by Lloyd’s Register has been verified by Lloyd’s Register Quality Assurance Limited Quality Assurance Limited BT Social and Environmental Report Community 04 Arts and heritage continued Regional activity

Case Study BT is committed to making a project officer whose objective is the basics of how to use the computer BT preserves an essential piece of BT engineers dismantled the large BT is committed to the long-term difference in society and our national to find innovative and creative ways so I decided to give it a try. Once I got the UK’s telecommunications history tuning coil with help from conservation preservation of our nationally programmes are supported by to overcome the barriers that deter over the fear factor and put the idea An essential part of what was once the staff and transported it to the Science significant heritage and to ensure activities which ensure that local people from taking advantage of being too old to learn out of my most powerful telegraph transmitter Museum in Wroughton, Wiltshire. It access to collections for as many heritage, cultures and traditions of the opportunities that exist on mind, I was fine. The course was really in the world - the Rugby tuning coil - will be put on public display in the people as possible. Our on-line are represented. the Internet and from having at least interesting and of course I had Sophie has been donated to the UK’s Science summer of 2005. John Liffen, curator museum of the history of basic ICT skills. and Chloe on hand to help me with Museum. The coil has been used in of communications at the Science communications, Connected Earth, the homework! I now have my own PC international communications at BT’s Museum, said: “The Rugby tuning coil operates in partnership with the About BT Cymru/Wales Internet Rangers and have just started another course Rugby radio station in the Midlands is a wonderful reminder of worldwide Science Museum and others. Our dedicated team under BT A new BT-sponsored website for 8-4 - this time in desktop publishing.” since 1926. radio communications in their early Cymru/Wales Director, Ann Beynon, year olds www.internetrangers.co.uk, pioneering days. We’re delighted to is helping to boost information and is part of a campaign launched in Free websites be receiving this equipment from BT.” communication technology (ICT) skills 2004 to help young people get their Some community-based organisations and opportunities in Wales. Working families on-line. cannot make the most of the Internet with the Welsh Assembly and key as a communications tool because it is Case Study stakeholders, BT Cymru/Wales Our case study about children in difficult for them to find the time, BT helps people explore Tate Britain Let’s Play 66 quizzed players’ of this inspirational decade in the supports BT’s national corporate South Wales illustrates how younger money and expertise needed to create from anywhere in the world knowledge of 60s art and culture, comfort of your own home thanks social responsibility (CSR) strategy family members can often be the and maintain a website. ‘Whose 1967 album cover was and allowed people around the world to BT and Tate Online.” and focuses on local community most effective way of encouraging designed by Andy Warhol?’, ‘Who to access images from the exhibition. projects where our expertise can reluctant parents or grandparents BT has teamed up with the IT invented the mini skirt?’, ‘What BT is the exclusive sponsor of Tate really make a difference. onto the Internet. company, ik Software, to make free, happened during Yoko Ono’s Online, the gallery’s website. simple-to-build websites available for performance of Cut Piece?’ These Digital Inclusion BT Wales Case Study UK charities, schools and community were some of the questions in an Sixties icon Honor Blackman, who BT Wales/Cymru is committed to BT Internet Rangers help promote groups to help them raise their profile on-line quiz to complement the Tate launched the initiative, said: “Even tackle digital exclusion and ensure digital inclusion on the Internet. Britain exhibition ‘Art and the Sixties’ if you weren’t around in the 60s, that everyone in Wales has access in 2004. you can discover the art and culture to digital technology. We have several Sophie (11) and Chloe Davies (nine), For more information visit initiatives to achieve this goal. from Neath in South Wales, have www.communitykit.ik.com been budding Internet Rangers since Broadband Christmas 2000 when they got their BT Community Connections BT Cymru/Wales provides access first computer. The girls use the BT Community Connections is a to broadband through ADSL, which Internet mainly for homework and national awards scheme which is now available to more than 92% emailing friends, but last year donates IT equipment, including of houses and offices in Wales. We persuaded their grandmother, Pat computers, software and BT Yahoo! have increased this figure from 34% (70), to try using the Internet. Anytime subscriptions, to community in January 2003 by implementing groups. a new programme to make broadband Sophie says: “Grandma needed quite accessible to some of the most a lot of persuading as she didn’t think We have donated more than 4700 remote communities in Wales. she’d be able to use the Internet. She computers throughout the UK since also said that there wasn’t anything the scheme started in 2000. The 106 EverybodyOnline she’d want to see on the net but Welsh organisations that received BT has formed a unique partnership Chloe and I found a site with lots awards in the 2005 financial year with the UK charity, Citizens Online, of pictures of Neath in the old days included the Upper Sirhowy Valley to bring its EverybodyOnline and one on how to be a gardener. Community First Partnership, programme to areas of the UK where I think we helped change her mind.” Wrexham Neighbourhood Watch Internet take-up is below the national and Mid-Wales Lymphoedema average. After a few lessons with the girls, Support Group. Pat enrolled on a computer class Three of the eight EverybodyOnline at her local community centre. For more information visit projects across the UK are in Wales: www.btcommunityconnections.com. at Bettws and Clydach Vale in the Pat says: “I had the opportunity of south and Rhyl in the north. doing a number of different classes Each project employs a full-time but the girls had already shown me

The BT Education Programme Llandrindod Wells BT Volunteers We have a dedicated Welsh Language About BT Scotland UK charities, schools and community As a communications company, we Around 4000 people are registered Bureau and offer services on request for: groups to help them raise their • Llangattock C In W Primary School, can use our networks and expertise as BT volunteers across the UK. They • Welsh speakers to answer emergency BT Scotland’s Community Investment profile on the Internet. Crickhowell to support the development of support our education programme calls, operator services and Programme promotes social and communication skills. BT supports a • Llangedwyn Primary School, Oswestry by running school workshops to help international operator services digital inclusion, encourages strong For more information visit number of programmes in Scotland: improve communications skills. communication skills and supports www.communitykit.ik.com. • Milton Infant School, Newport • Welsh language directory enquiries Scottish heritage and culture such BT Schools Communications • Radnor Valley Primary School, BT also supports many our of • Welsh language billing as Gaelic language initiatives. BT Community Connections Roadshow Presteigne employees who give their time BT Community Connections is a • Welsh language business advisors. The roadshow is run by a team of to work as volunteers in their local We believe that communication national awards scheme which • Rhayader C.I.W. Primary School, actors who perform a sketch which communities for the causes of their and enterprise skills are essential donates IT equipment, including Rhayader Most of our marketing material, illustrates the importance of good choice. to children and young people and computers, software and BT Yahoo! publications and general information communication skills. An interactive • Tregwyr Junior School, Swansea Welsh Culture and Heritage will better equip them for the future. Anytime subscriptions to community is available bilingually. workshop allows children to put into National & Urdd Eisteddfod As a communications company, groups. • Trewen Primary School, Newcastle practice what they have learnt. In the BT Cymru/Wales sponsors two Welsh we can use our networks and expertise Emlyn Charities and Fundraising 2005 financial year, the roadshow organisations, Urdd and National to support the development of We have donated more than 4700 ChildLine visited 32 schools in Wales. • Waunarlwydd Primary School, Eisteddfodau, to help preserve and these skills. computers throughout the UK since BT is supporting ChildLine’s biggest- Swansea promote the Welsh language and the scheme started in 2000. The 113 ever fundraising appeal. We have BT Schools Awards culture. Welsh people living all over Digital Inclusion Scottish organisations that received • Willows High School, Cardiff raised more than £3.1 million across Each year, BT offers up to 240 awards the world can participate in activities Everybody Online awards in the 2005 financial year the UK â?? the largest sum we have of £2000 to schools across the UK • Ysgol Emrys Ap Iwan, Abergele through the Internet and view BT Scotland is sponsoring a three-year included Dundee International ever raised for a single charity. for projects which improve children’s webcasts of events taking place on social inclusion pilot in Glasgow, run Women’s Centre, Food for Thought • Ysgol Gyfun Gwynllyw, Pontypool speaking and listening skills and help the ‘maes’. by the charity Citizens Online. The in Glasgow, North Ayrshire Young BT people all over Wales are young people become responsible • Ysgol Maes Gwyn, Aberdare aim is to provide basic Information Carers and Victoria After Schools Club contributing to the appeal by citizens. Winners also compete for For more information, see and Communications Technology in Newhaven. • Ysgol Pennant Primary School, organising raffles and other three development awards of www.eisteddfod.org.uk and skills and access to the Internet for Oswestry fundraising events. We are also £10,000. In the 2005 financial year, www.urdd.org. homeless people. Other partners in For more information visit working with ChildLine Cymru to 20 projects were funded in Wales. this project include Glasgow City www.btcommunityconnections.com. Teaching Awards ensure that the issues young people Council, homeless charities and BT Cymru/Wales supports the face in Wales are recognised and that For more information see BT Schools Welsh Language Services hostels. Education and Enterprise National Teaching Awards because strategies are put in place to help. Awards website. BT’s Welsh Language Code of As a communications company, we we believe that good communication BT Wales/Cymru Schools Awards - Practice sets out clearly which services Internet Rangers can use our networks and expertise is at the heart of good teaching. ICT For more information visit Winners 2004 are available to customers in Welsh. A new BT-sponsored website for 8-14 to support the development of is playing an increasingly important www.childline.org.uk. • Builth Wells High School, Builth Wells BT is committed to communicate with year olds, Internet Rangers, is part of communication skills. BT supports a role in education and we want to help its customers openly and helpfully, a campaign launched in 2004 to help number of programmes in Scotland: • Cadle Primary School, Swansea teachers get the most out of new and demonstrate its genuine care and young people get their families on- on-line resources and new ways of • Conway Road Infant School, concern for Wales’s economic and line. BT Schools Communications working. The awards celebrate the Colwyn Bay social well-being and its cultural and Roadshow achievements of teachers and raise natural environment. BT offers these For more information visit The roadshow is run by a team of • Hafod Y Wern Junior School, awareness of the profession. services voluntarily, to meet www.internetrangers.co.uk. actors who perform a sketch which Wrexham customers’ needs, unlike government illustrates the importance of good Pam Roberts of Park Street Infant • King Henry VIII Comp School, bodies, local authorities and other Free web sites communication skills. An interactive School in Abergavenny won the 2004 Abergavenny public sector organisations that are Some community-based organisations workshop allows children to put into BT Award for Teacher of the Year in obliged to provide bilingual services cannot make the most of the Internet practice what they have learnt. In the • Lansdowne J&I School, Cardiff a Primary School. under the 1993 Welsh Language Act. as a communications tool because 2005 financial year, the roadshow To find out more, go to • Llanbister Primary School, it is difficult for them to find the time, visited 32 schools in Scotland. www.teachingawards.com. money and expertise needed to create and maintain a website.

BT has teamed up with the IT company, ik Software, to make free, simple-to-build websites available for

BT Schools Awards Prince’s Scottish Youth Business Scottish culture and heritage About BT Northern the North Belfast Sports Forum and BT School Awards winners 2004 - Each year, BT offers up to 240 awards Trust (PSYBT) Tobar an Dualchais (Well of Omagh District Cultural Association. Northern Ireland of £2000 to schools across the UK for BT Scotland works in partnership Heritage) Ireland For more information visit • Armstrong Primary School, Armagh projects which improve children’s with PSYBT to help young people BT Scotland supports the conversion www.btcommunityconnections.com • Braniel Primary School, Belfast speaking and listening skills and help who want to set up their own ICT of Gaelic and Scots language audio BT Northern Ireland is committed young people become responsible businesses. We provide start-up recordings on tape and vinyl - to provide a wide range of regional Internet Rangers • Donegall Rd Primary School, Belfast citizens. Winners also compete for grants and loans at preferential rates including music, interviews, literature programmes to support education A new BT-sponsored web site for 8-14 • Dungannon Primary School, three development awards of through the BT Scotland Young E- and poetry - to digital format to help and preserve heritage across the year olds, Internet Rangers, is part of Dungannon £10,000. In the 2005 financial year, Enterprise programme. Fifteen new preserve them for future generations. country. Bill Murphy, Managing a campaign launched in 2004 to help 20 projects were funded in Scotland. businesses benefit each year and Director of BT Northern Ireland and young people get their families on- • Integrated College Dungannon, the most successful receives the BT BT Regions, leads BT employees in line. Dungannon For more information see Scotland E-Enterprise Award and a BT Volunteers supporting initiatives which help to • Kesh Primary School, Enniskillen BT education. £1000 cash prize. The 2005 award BT volunteers from across Scotland make a difference to people’s lives. For more information visit went to Nick Lobnitz, a 25-year-old support the BT Education programme www.internetrangers.co.uk • Kilmoyle Primary School, Balleymoney Schools Awards Winners 2004 - mechanical engineer, for effectively by running workshops on Digital Inclusion • Macosquin Primary School, Coleraine Scotland using e-commerce to boost his new communications skills in schools. Free websites Education and Enterprise • Abronhill High School, Glasgow bicycle luggage company, Carry Some community-based organisations As a communications company, we • Nazareth House Primary School, Freedom. Other winners include Scottish volunteers also support a cannot make the most of the Internet can use our networks and expertise Londonderry • Andersons Primary School, Forres Clarifye, a specialist company that range of community-based projects, as a communications tool because it is to support the development of • Oakgrove Integrated College, • Bellsquarry Primary School, Livingston helps UK organisations build or including the BT Scotland difficult for them to find the time, communication skills. BT supports a Londonderry redesign their websites to make Ambassadors rugby youth money and expertise needed to create number of programmes in Northern • Chapelgreen Primary School, Glasgow them fully accessible for people with development programme and the and maintain a website. Ireland: • Omagh County Primary School, • Cleland Primary School, Motherwell disabilities and Emma Laird, owner Scottish Business in the Community Omagh of Foresterseat Caravan Park in Forfar. Ì?’Closing the Gap’ project which aims BT has teamed up with the IT BT Schools Communications • Gadburn Special School, Glasgow • Parkhall College, Antrim to improve success rates at schools in company, ik Software, to make free, Roadshow • Glasgow Gaelic School, Glasgow Scottish Education Awards deprived areas of Glasgow. simple-to-build websites available for The roadshow is run by a team of • Portora Royal School, Enniskillen In partnership with the Scottish UK charities, schools and community actors who perform a sketch which • Highway Day Nursery, Eyemouth • Portstewart Primary School, Executive and the Daily Record, Charities and fundraising groups to help them raise their profile illustrates the importance of good Portstewart • Invergordon Academy, Invergordon BT Scotland sponsors the Scottish ChildLine Scotland on the Internet. communication skills. An interactive Education Awards which highlight BT Scotland’s nominated charity workshop allows children to put into • Poyntzpass Primary School, Newry • Inverkeithing High School, good practice in schools. receives approximately 4000 calls For more information visit practice what they have learnt. In the Inverkeithing • St Anne’s Primary School, from Scottish children each week. We www.communitykit.ik.com 2005 financial year, the roadshow Londonderry • Killearn Primary School, Glasgow National Gaelic Schools Debate work closely with ChildLine Scotland visited 57 schools in Northern Ireland. BT Scotland sponsors this debating to help ensure that all calls are BT Community Connections • St Brigid’s Primary School, • Knockburn Primary School, Glasgow competition which aims to improve answered promptly and sensitively. BT BT Community Connections is a BT Schools Awards Londonderry • Lhanbryde Primary School, Elgin communications skills and help to Scotland supports the charity’s national awards scheme which Each year, BT offers up to 240 awards • St John the Baptist Girls Primary preserve and promote the Gaelic fundraising initiatives with a dedicated donates IT equipment, including of £2000 to schools across the UK for • Linlithgow Bridge Primary School, School, Belfast language in Scotland. ‘Am I Listening?’ week for our computers, software and BT Yahoo! projects which improve children’s Linlithgow employees each year. A fundraising Anytime subscriptions to community speaking and listening skills and help • St John’s Primary School, Maghera • Longniddry Primary School, The Finals event for the 2004 National ball in November 2004, supported by groups. young people become responsible • St Patrick’s High School, Lisburn Longniddry Gaelic Schools Debate took place in BT Scotland, raised over £37,000 for citizens. Winners also compete for the new Scottish Parliament building ChildLine Scotland and we donated a We have donated more than 4700 three development awards of • Trench Road Primary School • Meadow Park, East Lothian and was broadcast live on BBC Radio further £5000 as part of a Football Aid computers throughout the UK since £10,000. In the 2005 financial year, Londonderry • Our Lady & St Patrick’s High School, Scotland. The Nicolson Institute, event in the summer of 2004. the scheme started in 2000. The 93 21 projects were funded in Northern Dumbarton Stornoway, won the debate and Northern Irish organisations that Ireland. runner-up was the Gairloch Academy, received awards in the 2005 financial • St Ambrose High School, Coatbridge Rosshire. year included Gingerbread Northern For more information see BT education. • Turriff Academy, Turriff Ireland, the Men’s Advisory Project NI, • Williamsburgh Primary School, Paisley

Teaching Awards Sentinus Young Farmers Clubs of Ulster Culture and Heritage Lislea Drama Festival Charities and Fundraising BT Northern Ireland supports the Sentinus provides business education The Young Farmers Clubs of Ulster Belfast Festival - BT Talks Lislea Drama Festival, supported by ChildLine National Teaching Awards because we programmes that promote the (YFCU) is run by and for rural young The Belfast Festival at Queen’s has BT, attracts performers and audiences BT is supporting ChildLine’s biggest- believe that good communication is at development of enterprise and people. The clubs are open to all been an international showcase for from all over Northern Ireland and the ever fundraising appeal. We have the heart of good teaching. ICT is communication skills in the UK. It young people aged 12-25 who have a performers and artists for more than Republic of Ireland. raised more than £3.1 million across playing an increasingly important role offers awareness and skills keen interest in the countryside. 40 years. BT sponsors the Talks (BT the UK - the largest sum we have in education and we want to help development programmes in Talks) at the festival from writers, The Playhouse Theatre Company, ever raised for a single charity. teachers get the most out of new on- secondary schools throughout BT supports the YFCU programme to poets and media personalities. Londonderry line resources and new ways of Northern Ireland. BT provides financial involve young people who are Speakers have included Sir Ian BT supports The Playhouse in Derry, BT people all over Northern Ireland working. The awards celebrate the support for two Sentinus excluded from other social activities. Kershaw, Richard Eyre and Tony Benn. which offers high-quality theatre and are contributing to the appeal by achievements of teachers and to raise programmes, Experiences of Work We have helped the YFCU develop an other community arts activities, organising raffles and other awareness of the profession. and the Science and Engineering interactive website for club members Ulster Orchestra including a range of programmes fundraising events. BT Northern Ambassadors in Schools. to organise and publicise their BT Northern Ireland has worked with for people with disabilities. Ireland hosted ChildLine’s 18th The 2004 category award for Teacher activities. the Ulster Orchestra for many years birthday party in our Belfast offices of the Year in a Primary School went BT volunteers can get involved in to encourage children’s interest in Arts and Business and we have helped the charity to Anne McGuinness, a teacher at St several initiatives, for example helping Other education projects classical music. For example, the BT works closely with Arts and benefit from activities organised by John the Baptist School in Craigavon. children to develop their interview BT Northern Ireland supports a Orchestra played the musical score Business - an organisation funded by the Northern Ireland Chamber of skills and teaching them about number of other education of ‘The Snowman’ at a Christmas the Arts Council for Northern Ireland Commerce through our commercial To find out more, go to business. BT Northern Ireland also programmes. For more information, concert while the film was shown and the Department of Culture, Arts sponsorship. www.teachingawards.com. participates in the Sentinus ‘Year in see culture and heritage. on a large screen. and Leisure - to form partnerships Industry’ programme by taking on a with arts organisations. For more information visit Young Enterprise school-leaver to work for a year before BT Volunteers also help out at their Moving on Music www.childline.org.uk BT Northern Ireland supports Young going to university. local schools. Moving on Music promotes musical Funding that the groups receive from Enterprise to provide a range of performances and education. BT BT is matched by Arts and Business. practical business education National Trust Partnership BT Volunteers has partnered the organisation in its programmes in schools and colleges. BT Northern Ireland has worked in Many BT Northern Ireland employees regional tours of jazz, classical and We provide financial support for the partnership with the National Trust on give their time as volunteers to traditional music for three years. Junior Achievement Primary School its education programme for ten support local schools and a wide Programme, which was the first years. Six education centres at range of programmes through primary schools enterprise properties in Northern Ireland have organisations such as Young programme developed in the UK. hosted 350,000 school visits during Enterprise and Sentinus. Over 18,000 pupils take part each this time. Costumes and crafts help year in Northern Ireland and the bring history to life at National Trust They also volunteer to support special programme has now been established houses and gardens. causes, including Children in Need across the UK. and Comic Relief. The Prince’s Trust’s Wired Up Many BT volunteers are involved in Programme Many BT employees also support Young Enterprise. The organisation BT supports the Prince’s Trust Wired charities through sponsorship for presented a Gold Award to Gerry Up Programme in Northern Ireland is personal challenges such as McClory for his longstanding support designed to help young entrepreneurs marathons or international treks. at Corpus Christi school in Belfast. succeed in their businesses. The programme offers small businesses the opportunity to raise their profile through effective use of marketing and information technology.

Information and data on this page Information and data on this page has been verified by Lloyd’s Register has been verified by Lloyd’s Register Quality Assurance Limited Quality Assurance Limited BT Social and Environmental Report Community 08 BT and the environment % % % 4 0 8 3 6 % % 5 % 6 7 4 2 4 BT and the environment 2

03 04 05 03 04 05

Global Warming CO2 emissions – Waste to recycling – expressed as a percentage of our percentage of total 1996 emissions level waste recycled

Telecommunications is perceived as ISO 14001 certification helps keep us We are in the process of establishing We recognise, however, that in our BT is committed to prevention of encourage the implementation of an environmentally friendly focused on reducing the environmental an EMS that covers all BT Global day-to-day operations we inevitably pollution and minimising the impact sound environmental practices by technology. But as one of the UK’s impact of our operations during a Services’ activities in every country impact on the environment in a of its operations on the environment all BT people. largest companies - and biggest time of very significant business, of operation and we have recently number of ways and we are committed by means of a programme of continuous • Monitor progress and publish details energy consumers - we have organisational and cultural changes completed our pilot project in BT to minimising the potentially harmful improvement. In particular BT and its of our environmental performance an inevitable impact on the for BT. Ireland to produce an EMS that is effects of such activity wherever and wholly owned subsidiaries will: in our Social and Environment report, environment. effective, robust and transferable to whenever possible. • Meet all relevant legislative and other as a minimum, on an annual basis. In the 2005 financial year: all countries, cultures and activities. requirements, and where appropriate We have a duty to manage this and • BT in the UK was awarded a renewed BT Ireland was certified to ISO 14001 This policy statement provides the exceed or supplement these by Environmental prosecutions to report on our performance - as we ISO 14001 certificate after a full in March 2005. framework on which our environmental setting our own exacting standards. BT recognises that it has clear legal have done since 1992. re-assessment audit programme is based. This enables us • Seek to reduce consumption of obligations for the management of Additionally, we integrated BT to set targets and measure progress • BT Spain’s certificate was renewed materials in our operations, reuse its environmental programmes. Here we explain: Openworld and BT Payphones into as well as strive for continuous rather than dispose whenever • Our Environment management • BT Ireland was certified for the first the UK-certified EMS in the 2005 environmental improvement. possible, and promote recycling and During the 2005 financial year, there system time. This model will be used to financial year. the use of recycled materials. were no environmental prosecutions extend our EMS to other regions. We have undertaken to help every BT • Our Environmental Policy in the UK. Our Environmental Policy person understand and implement the • Design energy efficiency into new • Environmental prosecutions (none Our main environmental impacts Our Environmental Policy establishes relevant aspects of this policy in their services, buildings and equipment and in the 2005 financial year). in the UK are: our targets in sustainable day-to-day work through the regular manage energy wisely in all • Benefits environmental improvement and communication of objectives, action operations. Environmental management compels us to measure and monitor plans and achievements. • Emissions to air • Reduce wherever practicable the level system (EMS) our performance regularly. of harmful emissions. Our experience shows that good • Fuel, energy and water We will also ensure that BT’s joint environmental management saves We communicate the Group’s ventures and other partners are aware • Develop products that are safe to use, • Local impacts money and improves business environmental objectives, action plans of this policy and promote the principles make efficient use of resources and efficiency. BT’s environmental • Procurement and achievements because we want of sound environmental practice. which can be reused, recycled or management system (EMS) complies to help every BT person understand disposed of safely. • Product stewardship with ISO 14001, an international and implement the policy in their The Chief Executive Officer of BT • Work in partnership with our suppliers standard for the certification of • Transport daily work. has ultimate responsibility for the to minimise the impact of their environmental management systems. company’s environmental policy • Waste operations on the environment Policy and performance. The Company’s through a quality purchasing policy. These are three of its key In pursuit of our intention to be the Corporate Social Responsibility Our decision to classify our requirements: best provider of communications Steering Group (CSRSG) oversees • Seek to minimise the visual, noise and environmental impacts by category, • The organisation shall identify services and solutions, BT seeks the implementation of all social and other impacts on the local each with an ‘owner’ (rather than by and assess the significance of the to maximise opportunities for the environmental programmes across the environment when siting our location), has proved sound. Since impact its activities can have on provision of services and solutions, BT Group. The chairman of the CSRSG buildings, structures and equipment. 1999, BT has undergone many radical the environment. These impacts are which can help to reduce environmental is a member of the Management structural changes, but we have • Work with external groups and described as environmental aspects. impacts, and which may provide Council and is also BT’s overall CSR retained the ISO 14001 certification organisations to promote the significant environmental benefits. Champion. BT’s Environment • Objectives and targets designed for all UK operations. concepts and practices of Electronic communications are often Champion - with personal responsibility to reduce the organisation’s environmental protection. used as a substitute for travel or for environmental policy development, environmental impact shall be In the 2005 financial year, for the first paper-based messaging and this implementation and co-ordination - • Include environmental issues in established and a programme for time, we report on energy, water and contributes to environmental is a senior operational manager and discussions with the BT unions and achieving these objectives and targets waste data for our Global Services protection and resource conservation. is also a member of the CSRSG. the BT training programmes, and shall be in place. operations. • The company’s Environmental Policy must contain a commitment to continuous improvement, prevention of pollution and compliance with relevant environmental legislation, regulations and other requirements.

We are one of the UK’s biggest Trends in energy use Energy awareness We work with our suppliers to increase In 2004 we made a strategic alliance We will also further explore the use of energy users. Here we describe how Investment in energy management We have continued our energy capacity and we are investigating with Wind Dam, commissioning the fuels made from plants (biofuels) to we manage our fuel and energy us has enabled us to decrease the awareness programme, through in- housing our own renewable company to build and test two 2.5kW replace the diesel used in our electricity we use in our office estate house publications, and an intranet generation systems, such as wind turbines in Cornwall, UK. emergency generators. Biofuels are This section covers: consumption by 77GWh. However, guide to our ISO 14001 certification. turbines, at suitable sites. considered to be carbon neutral • Energy consumption as expected, the energy used by our Workshops with our suppliers and We are trialling a small vertical axis because the plants store as much networks increased due to the success contractors help us jointly to maximise Using renewable energy has major wind turbine on the roof of one of our carbon in their growth as that emitted • Energy initiatives of Broadband rollout. This has resulted our environmental performance. In environmental benefits, including telephone exchanges in Cornwall. when the fuel is combusted. • Energy benchmarking and surveys in an increase to our network the financial year 2004, BT won a reductions in: When connected, this could provide electricity use of 143GWh. Total Liveable City award in the contribution • Air emissions between 5 and 10 per cent of the Energy benchmarking and surveys • Energy management electricity consumption was 2139GWh to air quality and climate change energy used at the exchange. Our contracted facilities management • Greenhouse gas emissions, • Premises energy (offices and compared with 2074GWh in the 2004 category. The judges acknowledged team continues to conduct energy particularly CO2, SO2 and NOX buildings) financial year. BT’s commitment to lessen the If successful, this turbine could be surveys at poorly performing sites, to impact of its operations on air quality, • Particulates that contribute to used in urban environments, where it minimise energy and water • Process energy (networks) We are working hard to improve by reducing its carbon dioxide breathing problems. would be less visible and noisy than consumption. Web-based electricity • Fuel tanks our network growth forecasting and emissions worldwide. Our initiatives traditional wind propellers. reports, updated every half-hour, have to accurately assess the impact of in this area include research on the We participate in a number of helped our building facilities supplier • Water use. broadband and 21st Century Network use of urban wind turbines, initiatives to promote the use of Powering major UK sites from wind to focus further on waste. This has (21CN) on energy demand. government lobbying on global renewable energy, particularly in the Last year we reported that three large been supported by energy surveys Energy consumption warming and moving to low emission development of new technologies wind turbines would have been from BT within our network buildings, We continuously monitor energy We are continuing to reduce our and renewable energy sources. using wind energy. sufficient to power one of our large and surveys carried out by specialist consumption, using one of the UK’s use of heating fuel (gas and oil) with satellite communications sites in the consultants as part of the government largest computer-based monitoring improvements shown when the data Renewable energy The Carbon Trust partnership UK. Following a meeting with the Action Energy programme. and targeting systems. We collect is corrected to take into account We are committed to meet and, We created a partnership with the MOD on site, we now agree with data at half-hour intervals from over weather conditions throughout the where possible, exceed the UK UK’s Carbon Trust to investigate the them that this is not practical. Home working 6000 sites. year. Gas consumption continues Government’s sustainability targets suitability of using BT buildings to Therefore, we are now proposing to BT continued its home-working to rise because of oil to gas heating to buy renewable energy. house wind turbines for trials in the install two smaller turbines at the programme. This enables many of our Our investment in new electricity conversions. 2005 financial year. The Carbon Trust site’s visitor centre. This would, we people to travel less and allows us to meters - these monitor consumption In the 2005 financial year, we signed has listed the 250 windiest sites, hope, become a tourist attraction and close some of our older, less efficient every half-hour - has helped us Energy initiatives a three-year contract with npower including microwave towers, radio provide an opportunity to offices. identity wastage earlier rather than Here are some of the ways we try and British Gas that will see nearly stations and telephone exchanges in demonstrate the benefits of relying on a monthly bill. to improve our energy efficiency. all of BT’s UK electricity supplied rural areas. renewable energy while celebrating Contract and supply strategy by ‘environmentally friendly’ energy. the history of radio and satellite Like many UK organisations, we have Energy consumption for BT’s network Plant replacement This makes us the world’s largest Rooftop wind turbines communications. found that imprecise electricity bills and estate during the financial year We look at the whole life of our plant purchaser of green energy. We support turbine specialist, Wind have hampered our energy efficiency 2005 was 2624GWh. This is made when we assess its cost, including its Dam, in its development and Photovoltaics and biofuels programmes because poor data up of: energy efficiency, which influences the The electricity will be supplied from deployment of rooftop vertical wind Using sunlight to power small makes it difficult to judge progress. • 1854GWh electricity (approximately) cost of running the machinery. Buying renewable sources and combined heat turbines. This innovative system is not telephone exchanges holds great We tackled this problem at a supplier, to run our networks more efficient equipment helps save and power (CHP) plants. as popular as traditional horizontal promise but the cost of photovoltaics industry and regulatory level and have • 286GWh electricity (approximately) energy and can reduce demand for wind turbines that use propellers. The is prohibitively expensive. Nevertheless, seen a slow improvement. During this used at our office premises cooling, cutting the cost of the plant We believe this initiative will reduce outer blades of the Wind Dam turbine in the 2006 financial year we have set year we have negotiated new over its whole life. Further cost savings our carbon dioxide emissions by follow the prevailing wind and guide two targets to install both small-scale contracts, which include performance • 485GWh (gas and oil use) for all our can be made by replacing refrigerant- approximately 325,000 tonnes a year, the energy towards the inner blades. wind and PV systems. measures on billing accuracy. sites. based cooling (air conditioning) with equivalent to that produced by It is discreet and ideal for use on automated fresh-air cooling systems approximately 100,000 cars. rooftops. See Data and targets for emissions. (which also reduce the use of refrigerant gases, such as HCFCs and HFCs). Building management systems that integrate heating and cooling, further eliminating waste, are now installed as standard.

Information and data on this page Information and data on this page has been verified by Lloyd’s Register has been verified by Lloyd’s Register Quality Assurance Limited Quality Assurance Limited BT Social and Environmental Report BT and the environment 02 Fuel, energy & water continued

Eliminating waste In addition, our energy management Process energy Six years ago, we began a programme Investigation process Water use Energy targets help us to cut waste. team is still working effectively in Process energy includes all the to test all our fuel tanks. At the end of BT’s Wholesale Power Technology We use water mainly for catering, They cover: partnership with the owners of the electricity to power more than 6300 the financial year 2005, we had spent Support team investigates fuel-related washing and toilets. All our sites have • Installation of renewable energy BT estate. This will help us speed up transmission stations, satellite earth £15.9 million on the testing and environmental incidents. The team’s water meters. A concerted effort solutions our energy efficiency improvements. stations and telephone exchanges remedial work. This has substantially investigative skills, technical to reduce our water consumption that support our voice, data and reduced the risk of pollution from our understanding and legal/regulatory (leak detection, underground pipe • Process energy (networks) See Data and targets. internet networks. oil storage tanks. awareness help to improve our replacement and water-saving • Premises energy (offices and performance in this area. devices) has led to a reduction in buildings) Premises energy We generate electricity on site using A specialist company visited 726 sites, consumption of 6.1 per cent (from Premises energy includes all the our own generators. This is done to tested 874 tanks, passed 735, failed In the financial year 2005, a total of 2.04 million cubic metres in the 2004 • Metered water use. electricity, oil and gas required for provide extra electricity at peak times 135 and provided detailed six oil-related incidents were recorded, financial year to 1.91 million cubic more than 1000 offices, warehouses and during supply failures. In the recommendations for remedial action. a reduction of two from the previous metres in the 2005 financial year). In the financial year 2005, BT and depots. financial year 2005, we generated Four tanks were found to be foam year. Of these, three were classified as Wholesale invested £5.9 million in 15GWh of electricity. filled and were not tested. A number serious, one as significant and two as We are very close to the economic its energy management programme. As we rationalise and refurbish our of remedial actions have been local. As a result of our investigations, benchmark for optimising water This has resulted in savings of over premises, our overall energy use is We still expect to see an increase identified. various remedial works have been efficiency in most of our buildings. 16.3GWh. decreasing. Although it is a fact that in the demand for energy to power instigated and recommendations for Despite this we will continue to target See Data and targets for details. air conditioning increases energy our fast-expanding networks but are Incident reporting improvement have been adopted to metered water use. consumption per square metre, our working hard to improve our network Even with good controls, spills avoid recurrence on similar plant. Energy management rationalisation and refurbishment growth forecasting and to accurately happen. To reduce the number and For more information, see Our energy management programme programme enables us to use our assess the impact of broadband on severity of these incidents, it is The known quantity of oil discharged Data and targets. helps us maintain our: office buildings more efficiently (more energy demand. important that they are investigated was 613 litres. • Energy efficiency accreditation (with people, less empty space). This helps promptly, lessons are learned and any the UK National Energy Foundation) us reduce energy use per person. Fuel tanks changes are made quickly. BT A reported loss at one site is still being • Fuel storage tank environmental We have several thousand fuel storage classifies environmental incidents as: investigated and ground water testing and remedial works In the financial year 2005, premises tanks, many below ground. The fuel • Serious - where the spill has entered, monitoring by a specialist contractor programme energy consumption decreased by 15 is used for heating and to supply or is likely to enter, either the continues. After a 6-month period no per cent, compared with the previous standby diesel generators used to drainage system or topsoil oil has been detected at ground water • ISO 14001 certification. year. In the same period, weather power the network during a power level. This will continue for a further 6- • Significant - where the spill covers a corrected (using degree days) heating failure. If spilled, the fuel poses a month period. We consolidate our energy wide area but is confined to a hard energy was down by 6.54 per cent. threat to drinking water supplies, management and plant replacement standing area only and there is no Average degree-days for the year were particularly in sensitive areas close Oil recovery strategy into business-as-usual evidence of entry into the drainage approximately 5 per cent lower than in to water abstraction points. This is In the 2005 financial year, over activity, in conjunction with our system or topsoil the previous year. a highly regulated issue. 785,083 litres of oil have been supply-chain partners in property, • Local - where a minor spill is removed from tanks that have been facilities management and energy Case study Testing, repair and decommissioning contained within a very small area. decommissioned as a result of our fuel supply. In Spain, we buy around 15 GWh of fuel tanks are a vital part of BT’s tank integrity testing programme or of renewable electricity each year programme to reduce the risk of For significant and serious incidents, conversions from oil to gas-fired Throughout the financial year 2005, for our head office and main network pollution from fuel storage. a specialist contractor cleans up. heating systems. This has been sent we continued to invest in energy nodes in Madrid. In the 2005 financial for reuse in the manufacture of road efficiency and embedding it in our year, we reduced our electricity For serious incidents in the UK, the surface material. business. This integrated approach consumption in Madrid by just over Environment Agency (EA) or the See Data and targets. makes it more difficult to isolate the 5 per cent despite increased growth Scottish Environment Protection cost savings we make through energy in our business. We did this through Agency (SEPA) are also informed. efficiency initiatives. conservation, such as increasing the air-conditioned temperature at our sites by 1 degree C, which produced a saving of 7 per cent in consumption.

See Data and targets.

We produced over 110,000 tonnes The BT Waste Forum Recycling paper Performance against key waste of waste in the 2005 financial year. We have a waste forum, made up Much of our waste paper is recycled. targets Of this, we recycled 37,000 tonnes of key people across BT. Its role is to: In the 2005 financial year, we recycled and sent 73,000 tonnes to landfill • Set and monitor waste environmental over 1200 tonnes of paper and over Target by March 2005 Achievement Comment (eight per cent less than last year). targets 5700 tonnes of cardboard. Increase the amount of items recycled Completed The target was exceeded by a • Review contractors’ environmental To retain our ISO 14001 certification Our facilities management supplier, (in tonnes) by 5%, measured against considerable amount largely because performance we must run an efficient and effective Monteray, works with contractors the March 2004 outturn figure. of recycling of computing equipment, waste management system. We are • Ensure we comply with all to collect and recycle large amounts standby generators and engine sets. tenants in much of our property and environmental legislation of office paper. The paper is sent to our building facilities are managed by processing plants where it is graded Review the drainage infrastructure of Completed Discussions with the Environment • Manage our packaging obligations a contractor. We work in partnership according to colour, weight and pole stacks to determine the preferred Agency have been continuing. A trial with them to ensure effective waste • Promote and communicate quality - this determines what end cost-effective drainage solution to is going ahead at one of our key sites management. environmental initiatives and product it can be used for. The best ensure environmental compliance; in East Anglia. awareness quality paper - about 20 per cent - arrange a trial to prove the Here we describe: is likely to be turned into photocopy effectiveness of the recommended • Consider any new ideas on waste • The types of waste generated paper, while the rest is recycled as solution management. hand wipes, kitchen towels or toilet • The BT Waste Forum paper. For further details see Data and Recycling • Recycling targets and BT’s Waste recovery Of the 110,000 tonnes of waste we In the 2005 financial year, our human Model. • Performance against key waste generated in the 2005 financial year, resources team recycled old paper targets we recovered 37,000 tonnes for records. This generated 74 tonnes Working with our property partners recycling. In the 2005 financial year, • Working with our property partners. of paper. Nearly all of our properties are owned we recycled over 34 per cent of our by Telereal and our facilities total waste, around eight per cent For further detail on type of waste and In the 2005 financial year, we were management is carried out by more than the previous year. recycling data see BT’s Waste recovery one of the first major companies Monteray. We work closely with them Model and Data and targets. to introduce a new type of in partnership to ensure that our Much of our general waste is disposed environmentally friendly copier and waste is properly managed, ensuring of through materials recovery Types of waste printer paper. The paper contains a our continued certification to the ISO facilities. These are huge depots We generate different types of waste. minimum of 70 per cent reclaimed 14001 environmental management where paper and other recyclable • Category 1 - does not present a fibre from south-east England. The systems standard. materials, such as cans, plastic and danger of environmental pollution, balance is from sustainably managed paper cups, are sorted, separated such as paper forests. and sent for reprocessing. • Category 2 - not toxic or hazardous For more information on how in unmodified form, but which has the During the 2005 financial year, we e-business reduces our paper potential to become so if not treated took a number of initiatives to recycle consumption, see e-business. properly on disposal, such as cable redundant equipment, such as computing equipment, standby • Category 3 - inherently toxic or generators and mobile engine sets. hazardous and requires the most This increased the total tonnage of careful handling at all stages of the the materials we recovered by over disposal process, such as diesel oil. 10,600 tonnes. For further details see BT’s Waste recovery model.

We run a fleet of 31,969 vehicles, The reduction of our commercial fleet Company car policy Online ordering Fuel efficiency devices Electric vehicle trials managed under contract by our was possible because of a number of Our company car policy supports Our company car ordering system Tests on a fuel economy device found BT took part in the TH!NK@bout subsidiary, BT Fleet. initiatives and policies in place, such as: the key objectives of the UK for car drivers is completely web- it produced average fuel savings of 12 London mobility project, launched in • Engineering productivity targets Government’s emissions-based based, with links to all the vehicle per cent and reductions in diesel 2001 and supported by Ford. The We use our considerable purchasing company car taxation initiative. manufacturers and to all new vehicles’ smoke emissions of 36 per cent. But it silent, zero-emission electric car • Operational policies, optimising power to ensure we achieve the best It offers the following benefits: fuel consumption and CO2 emission risked damaging the fuel injection provided by TH!NK@bout London was vehicle use possible value for money and lowest • Increased allowance to employees data. Information to help drivers system and the device was rejected. used by a network planning team for costs for the full life of our vehicles. • Vehicle replacement cycles, which who opt out of company car ownership minimise their impact on the light delivery work and site visits in BT Fleet is responsible for the ensure the fleet benefits from latest environment is included. This enables Noise suppression and around the capital. • Improved tax efficiencies for employees management of our transport technologies and emission standards, drivers to make fully informed choices We have worked hard to develop who opt for lower-emission cars environmental impacts. This is while delivering greater reliability and when buying cars and supports the specifications that minimise noise for Ford has halted work on the electric part of BT’s UK certified ISO 14001 lower maintenance frequency and costs • Advice and communications to UK Government’s aim to encourage our operators and those in the vicinity car and the TH!NK car has been environmental management company car drivers, encouraging the use of lower-emission cars. of our specialist cabling vehicles. Over returned. • Vehicle pools, which provide services system (EMS). users to choose lower-emission cars. the years we have: for those people who cover few miles Alternative fuels • Developed the vehicle specifications BT Fleet is investigating the feasibility Here we discuss: • Utilising pools of larger or specialist BT company cars are provided on Our fleet is mainly medium and large to include higher horsepower engines of a replacement. • How we operate our commercial vehicles to help reduce the number either a three years or 60,000 miles, vans - nearly all diesel-powered. There (allowing operation at lower engine vehicle fleet of these vehicle types. or a three years or 70,000 miles are alternative fuels, but each has its revs) Awards replacement cycle. Better car design, drawbacks: In the 2004 financial year, BT • Our company car policy • Introduced sound-deadening panels We participated in a seminar held by increased intervals between servicing • We could replace diesel with petrol received two London Liveable City behind the engine • The use of alternative fuels and the UK Government Transport Energy and improved vehicle life, means in vehicles, but this would reduce fuel Awards, which recognise and promote fuel efficiency devices Best Practice programme and debated the future we will replace cars in four economy because petrol vehicles are • Revised the hydraulic valve sustainable business. our environmental systems with years or 80,000 miles. less efficient than diesel equivalents. component to reduce noise. • Noise suppression efforts specialists in the field. We may BT won the award in the Air Quality • Liquid Petroleum Gas (LPG) is the • Electric vehicle trials consider taking further specialist We are now providing the Vauxhall Despite increased power demands, we and Climate Change category. The cleanest-burning fossil fuel, but advice on fleet efficiency offered by Astra Estate 1.7 CDTi for our ‘business have reduced noise to a level where judges recognised our efforts to • Awards. supplies are limited. Furthermore the the programme eg motivate scheme. need’ drivers. This achieves an extra operators no longer have to wear ear reduce the impact of our worldwide additional space needed for LPG tanks seven mpg fuel efficiency compared to defenders. operations on air quality and cut our Commercial vehicle fleet on the vehicles would mean replacing In the 2006 financial year we will: the previous model used, and carbon CO2 emissions. In the financial year 2005, our existing vehicles with larger, less fuel- • Aim to reduce our commercial fleet dioxide emissions are 19g/km lower. We specify that all vehicles fitted with commercial fleet was reduced by efficient models. by a further 500 vehicles BT also benefits because the road hydraulic systems return to tick over We were also ‘highly commended’ two per cent, with a corresponding fund licence for this model costs less. • Vehicles using both LPG and petrol when not powering the system. This in the Traffic Reduction and Transport reduction in fuel consumption of • Test potential fuel savings from a (duel fuel) are being assessed as we reduces fuel usage and exhaust Management category for our 3.5 per cent. new speed limiter function on vans, Reducing fuel consumption await clarity from the UK Government fumes, and keeps operating noise to a innovative conferencing technologies See full details in Data and targets. report on driver feedback and make The UK tax regime, which no longer on fuel duty. minimum. and flexible home-working initiatives. recommendations rewards high mileage, has helped The award recognised the significant We removed 664 vans from the • Aim to review our approach us to reduce mileage. We penalise Further details are available in Data reduction in the amount of travel by commercial fleet during the year. to alternative fuels. company car drivers with cars that and targets. BT people, including in and around This was achieved despite an return less than 23 miles per gallon the congested area of London. The unusually high level of telephone See further details in Data and with a £20 per month surcharge. judges also praised our efforts to line faults during the autumn 2004 targets. encourage business customers to (making BT engineers travel) and The company car fleet size has reduce the environmental impact our decision to accelerate the reduced by eight per cent (932 of their transport activities. implementation of the next vehicles) over the previous year. generation of BT’s network and This reflects the downward trend services infrastructure (21CN). in the fleet size and mileage, with a reduction of over 12 million miles compared with the previous year.

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Emissions to air are gases released The electricity will be supplied from Fresh air cooling We continue to monitor available As one of the UK’s largest purchasers, into the environment, such as car renewable sources and combined Where possible, our communications refrigerants that comply with the we have an environmental influence exhaust fumes. This is a highly heat and power (CHP) plants. equipment complies with the requirements of the European Union that extends well beyond that of our regulated area because some requirements of the European 2000/2037 Regulation on the use of own staff and workplaces. emissions are harmful and others, We believe this initiative will reduce Telecommunications Standards ozone-depleting substances. Where such as carbon dioxide from our our carbon dioxide emissions by Institute. This means we can make possible, we will use ozone-friendly We present the key aspects of our vehicles, contribute to climate approximately 325,000 tonnes a full use of fresh air cooling - with HFC refrigerants in new and existing relationship with suppliers and how we change. year, equivalent to that produced its inherent lower energy and plants. promote environmental good practice by approximately 100,000 cars. maintenance costs - for about 70 in all our purchasing activities in the We closely monitor our air emissions. per cent of the year. For further details see Data and Procurement and the environment For more on the CO2 Model and a targets. section of Suppliers. Here we explain our: CO2 equivalent emissions chart, see We will also be adopting a fresh air • Action on climate change Data and targets. cooling policy for our 21st century Product design network rollout wherever possible. Through our active participation in • Ozone depletion and refrigerants. Ozone depletion and refrigerants the European Telecommunications Wherever possible, we use fresh air to Refrigeration cooling Standards Institute (ETSI), we Action on climate change cool our telecommunications Our key environmental concern here continue to explore opportunities to Since August 2000 we have been equipment. But on warm days we is to prevent the accidental release improve the energy/cooling efficiency reporting on our impact on global have to use air conditioning. We are of refrigerant gas. of the equipment we purchase. We warming, using the UK Government working to improve electronic try to influence the design of future guidelines. These recommend that equipment so that it needs less All cooling units purchased since communication equipment to ensure the impact is measured in equivalent cooling. February 2000 use an ozone-friendly, that standard cooling practices can tonnes of CO2. We have achieved: chlorine-free refrigerant gas, R407C. be applied. • A 71% reduction in CO2 emissions We report on our ozone-depleting All refrigeration units are hermetically since 1991 because of improved emissions - as defined by the Montreal sealed. One of these initiatives addressed the energy efficiency Protocol - in accordance with the problem of increasing heat dissipation • A 40%reduction in CO2 emissions requirements of the Global Reporting In addition, air-conditioning units are out of communication equipment since 1992 because of improvements Initiative (GRI) Sustainability fitted with pressure transducers, a racks and cabinets. BT has been to our commercial transport fleet. Reporting Guidelines. new control system, and are designed instrumental in the process of updating to be operated without the need for the current ETSI standards and in This is equivalent to an annual saving We control the net amount of refrigerant analyser gauges through the proposal to include a thermal of almost 1.4 million tonnes of CO2. refrigerants purchased (the quantity which refrigerant gas can escape. management standard for equipment purchased minus the quantity installations. Our emissions savings already exceed returned or recycled) so that it is no We introduced a newly designed the UK Government’s target to reduce higher than 4 per cent of the total type of fan (the EC-motored fan) greenhouse gases emissions by 20 per refrigerants held. In the 2005 financial that brings considerable energy cent, by 2010 (from a 1990 baseline). year, the end-of-year total was 2.88 savings compared to the usual fan This goes beyond the Kyoto Protocol per cent. in November 2003. Since then, all target of a 12.5 per cent reduction new units have been supplied with by 2010. We have also reduced the number of the new fans as standard. ozone depleting HCFC/CFC air- In the 2005 financial year, we signed handling units in our network by over a three-year contract with npower 8 per cent in the last two years. This is and British Gas that will see nearly in line with our policy to use the less all of BT’s UK electricity supplied polluting R407C gas in all our new by ‘environmentally friendly’ energy. units. This makes us the world’s largest purchaser of green energy. For further details and a CFC-11 equivalent emissions chart, see Data and targets.

Why product stewardship is so Practising product stewardship brings The approach considers the entire Legal drivers We have created a company standard We gave BT’s response to the important benefits to the environment and to life-cycle impacts of a product and An estimated one million tonnes of to help us select products that comply first, second and third round of Our world runs on electronic products. business. For example, designing its packaging by: electrical and electronic equipment is with EU legislation and are more consultations carried out by the The drive to make them better, faster products to use the minimum • Minimising the actual amount thrown away every year. Some of that sustainable. Our pre-tender process UK Department of Trade and Industry and cheaper is good for customers resources during manufacture, use of material used waste is hazardous to people and the (GS19) requires that suppliers provide on the implementation of the WEEE and business, but it creates waste. and disposal can reduce costs and environment. information about their products and RoHS directives. • Reducing or eliminating the use environmental impacts. Refurbishing and how they propose to comply of toxic materials When we buy products for our own used products for reuse can increase Two EU directives address the with EU legislation. Find out more about the EU business or for resale, we place revenues and reduce landfill. • Minimising the energy used in problem: Waste Electrical and legislation, and ICER. demands on the Earth’s resources. sourcing, processing, manufacturing Electronic Equipment (WEEE) and the Before awarding contracts to For example, we may not mine Here we report on the legislative and and transport Restriction of the use of certain suppliers we also consider their Working with our suppliers minerals ourselves but through our business initiatives that are driving Hazardous Substances (RoHS). overall environmental and safety Since 2002, the Product Stewardship • Extending product life by supply chain we inevitably support product stewardship. performance. team has been monitoring the incorporating ‘future-proofing’ into the extraction of minerals. The Both directives aim to minimise responses to our supplier the design, to maintain/enhance products and services we sell Why we have to manage our products the use of hazardous materials in A more demanding directive, called questionnaires (GS19). The team functionality and durability. inevitably lead to consumption BT’s business relies heavily on electrical and electronic equipment, Energy-using Products (EuP), was works closely with our buyers to make and waste. electrical and electronic equipment to minimise the amount of hazardous published in August 2003. It proposes sure that we are making the right We do not make products ourselves (EEE). We buy vast amounts of the waste going to landfill, and to that EuP products have their purchasing choices. The information (those that bear our name, such as Although manufacturers are primarily equipment to run our own business encourage the reuse of materials. environmental impact assessed gathered from the questionnaires is telephones, are made by others), but responsible for their products, and to serve our customers. This, Setting targets for collection, at design or development stage, needed to ensure that BT meets its we use electrical equipment in our we combined with the regulation on treatment, recycling and recovery of and/or meet minimum environmental obligations under EU law, intended own network and in our customers’ all share responsibility for: the disposal of EEE, means it is crucial waste EEE helps comply with the law. requirements, such as energy to encourage suppliers to design premises (eg, routers, servers, • Reducing the use of hazardous we improve the way we manage the efficiency. The CE mark, which products that have less environmental modems, telephones). materials in the manufacture of equipment. We must also continue The directives embrace the concept confirms that products sold in the impact, increase recovery and products to improve the management of non- of extended producer responsibility, EU conform to minimum safety and recycling, and reduce hazardous To sell their products in the European electrical equipment, such as telephone requiring manufacturers to finance environmental standards, will have materials in new equipment. • Minimising the energy consumed Single Market, manufacturers need poles, exchanges and towers. the cost of taking back equipment to be carried by all energy-using during their life to ensure that their equipment - and at the end of its life. This means that products. For example, the questionnaire asks if components - comply with the • Enabling their reuse, recycling and How product stewardship supports we have producer responsibility for products contain materials described European directives on EEE. safe disposal. sustainability BT-branded products as well as other Contributing to legislation in the RoHS directive and if suppliers Product stewardship reduces the products that we distribute. BT continues to contribute to have programmes to phase out: Product stewardship - the height of Product stewardship is a set of environmental impacts of products, legislative developments by working • Lead the indicator (left) shows environmental principles designed to reduce the particularly electrical and electronic The directives ban the use of with industry bodies, such as the benefit, eg, reuse - has a greater • Mercury environmental impact of a product equipment. hazardous materials, including lead- UK Industry Council for Electronic benefit than remanufacture. (or service) throughout its life. based solders, mercury, cadmium and Equipment Recycling (ICER). ICER • Cadmium brominated plastics. These materials provides forums for discussion with • Hexavalent chromium will have to be treated before trade associations and gives feedback landfilling, which will significantly to the UK Government. • PBB brominated flame retardant reduce the risk that they will enter • PBDE brominated flame retardant. the food chain and potentially harm Through ICER, we work closely with human health. We welcome this manufacturers and recyclers with groundbreaking legislation because similar responsibilities on ways to it supports our efforts to contribute solve issues such as how to meet legal to a more sustainable society. targets, data provision and ways to organise waste collection.

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Improving what we do who decide what products enter spares and shows which items can Achievements Plans The RoHS directive requires us to BT supply chain. We do this in be recycled. 1. Set up a database of all the We will continue to: monitor what we and suppliers do several ways: hazardous materials (as required 1. Improve our product stewardship • A returns service to repair and to ensure products and components • Our computer-based training under the WEEE Directive) for all pre-tender process for EEE equipment refurbish faulty meters and test comply with the law by 1 July 2006. programme (CBT), designed to raise telephones made since 1970. so that we make informed buying equipment used by our engineers. We meet regularly with our buyers awareness of product stewardship, decisions and comply with legislation. 2. Trained over 4,000 employees in and waste management people to includes the latest legislative • A national campaign to encourage the principles of product stewardship. 2. Encourage our suppliers to design discuss ways to reduce further the developments. BT people with surplus computing products that have less environmental environmental impacts of our equipment to hand it back. 3. Provided BT’s response to the first, • Our regular bulletins to our product impact by making it easier to recover products and operations. In the 2005 second and third round of managers and buyers help them materials and recycle and reduce the financial year, we successfully tested Our partnerships consultations carried out by the UK understand what they must do to use of hazardous materials in new a kit that provides a quick, cost- Sustainability through producer Department of Trade and Industry comply with the WEEE and RoHS equipment. effective method to check if a product responsibility (DTI) on the implementation of the directives. For example, they have has been made with lead-based We continue to work with the Green WEEE and RoHS directives. 3. Support the phase-out of lead to check that our suppliers switch to solder. This means we can physically Alliance, a UK-based environment solder, hexavalent chromium, products made with lead-free solder. 4. Designed, developed and launched check the information we gather from organisation, on a project called brominated flame-retardants and a pre-tender process (GS19) to help suppliers on the solder components. • Our recent training programme for Sustainability through Producer all the other materials covered BT buyers consider the whole-life buyers emphasised the importance for Responsibility. This is a collaboration in the RoHS directive (we ended the impacts of electrical and electronic Product stewardship in BT suppliers to complete the pre-tender of business, government and non- use of cadmium as a pigment in all products. BT has a well-established questionnaire if they intend to supply governmental organisations. Its telephones in 1989). environmental management system BT with electrical and electronics objective is to examine the potential 5. Improved our core network 4. Contribute to the dialogue on the (EMS) of which product stewardship products. impact of producer responsibility installation requirements to include EuP directive within the stakeholder is one of eight aspects (or main programmes on the use of resources. product stewardship principles. group co-ordinated by the UK environmental impacts). An important Product stewardship in action It also seeks to develop a set of widely 6. Presented BT’s position at the Government. part of this management system is Equipment reuse agreed guidelines to design and European Telecommunications to identify, assess and manage the We have systems in place to help us implement producer responsibility 5. Work with all people in the various Network Association (ETNO) environmental impact of our business reuse as much equipment as possible. initiatives in the UK. lines of business to ensure that BT can Sustainability conference on the activities. This reduces costs and wastage by meet its obligations under the WEEE implementation of the WEEE and maximising the life of our equipment. For more information, see and RoHS directives. RoHS directives in the UK. We have been reviewing what product Initiatives to encourage reuse include: Green Alliance. stewardship means in BT. We accept • A database that lists switch 7. Established a test to confirm that we have a responsibility for the equipment available for reuse and To find out more about the that EEE products are lead free (as products we sell to customers as well allows the products to be reserved UK Government guidelines required by the RoHS directive). as those we use to run our business and tracked until delivered. on sustainability, see DEFRA. 8. Conducted a major review of and networks. This assessment has • A local returns system at BT Exact to product stewardship in BT in the 2005 helped us determine where we can Looking to the future recover, refurbish and re-issue surplus financial year. This has given us a further improve. BT’s product stewardship team is personal computers. This better understanding of our roles and working with the Imperial College in complements a BT-wide system. responsibilities. Training London (on behalf of BT Wholesale) We make sure that our people are • A programme introduced by BT Retail to carry out a life-cycle analysis of kept up to date with the latest during the 2005 financial year that alternative materials to make poles developments, especially the rebuilds and reissues surplus stock to hold telecommunication cables. environmental legislation affecting to meet all requests for new personal This will help us make an informed electrical and electronic products. This computers. decision on the future of our overhead is particularly important for buyers, network distribution system. • A web-based management system product managers and all the people at BT Payphones that lists available

The impact of our activities, such • Environmental management Street furniture environmental impacts, such as We have an impact on biodiversity Campaigning and public debate as the visual intrusion of telephone Our roadside cabinets are sometimes tree roots and hedgerows. This is through our use of natural resources, We work with others to ensure • Campaigning and public debate wires or the disruption caused by vandalised with fly posters and graffiti. particularly important in areas of energy and transport. These impacts that we implement our policy and construction work, affects people’s • Environmental complaints We are working with a number of local outstanding natural beauty, on listed are covered by our our environmental stimulate debate and learning about immediate surroundings. authorities and community groups buildings and in other protected policy and environmental management biodiversity. • Special projects in the UK. to improve streetscapes and find areas. systems. We take every opportunity to The infrastructure supporting our commercially viable solutions to the promote and encourage biodiversity. We published Variety and Values Visual amenity 28 million customer lines in the UK problem. Radio masts to advance the discussion of global The UK Government defines visual includes around 4 million telegraph Radio communication remains an Biodiversity action cultural and biodiversity issues. amenity as ‘the preservation of a view poles, millions of manhole covers, The UK law on anti-social behaviour important part of our network, Protecting biodiversity is integral or prospect available to a member of thousands of roadside cabinets, has been changed and will be fully in particularly in rough terrain, such as to our environmental management We commissioned Forum for the the local community from a public 24 tunnels running under cities force in our financial year 2005. We the Scottish Highlands. We have system. This ensures that all our Future, a UK-based sustainable location which is designated as and hundreds of radio stations. Our will report on how it affects our work around 300 radio stations in the UK. activities, from procurement to waste development charity, to study the protected’. network is expanding and changing in improving streetscapes. management, take biodiversity into impact of the telecommunications as technology progresses. We are Radio masts can impair the beauty of account. sector on biodiversity and best- It can be difficult to strike the right conscious that this has a potential Street works and new housing the landscape. We are experimenting practice business approaches to balance when installing equipment. impact on the environment - on the developments with the use of satellite Environmental management manage biodiversity. The studies For example, replacing overhead wires countryside, on skylines and cityscapes We are committed to follow the UK communications, but radio masts will Here are some examples of our showed that nearly all major with buried underground cables has - and concerns all our stakeholders. Government’s revised framework on have to be used for some time. actions to conserve biodiversity: companies manage some of their both benefits and drawbacks. street works. We work closely with • Our procurement policy specifies that biodiversity impacts in broader Underground cables may have less Our approach to local impact is developers of housing estates to We continue to share space on radio we only buy telephone poles from environmental, social or sustainability visual impact, but burying wires embedded in our network planning minimise the impact of construction masts and towers with many other sustainably managed forests. management strategies without consumes much more energy and rules and procurement policies. We activities when extending our radio operators. This prevents drawing these together under the materials. • We no longer use volatile organic have established channels to help network. Our agreement with the unnecessary structures and minimises biodiversity umbrella. solvent paints and use only water- stakeholders communicate with us House Builders Federation ensures a the number of antennas. We are also Our telephone poles are made from based alternatives on our radio towers about these issues. We support the co-ordinated on-site approach by all working with other service providers We work with UK schools to promote timber grown in sustainably managed in areas high in biodiversity. four principal elements set out in service providers. to use existing street equipment - biodiversity. In the 2004 financial forests and can be regarded as a the UK Government’s sustainable lamp posts, telephone kiosks and • We have a comprehensive recycling year, we sponsored GLOBE UK which renewable resource. Underground development agenda: Our network optimising system helps telegraph poles - when installing local programme for BT and our customers, is part of an international installation requires plastic ducting, • Social progress which recognises the our planners minimise the installation mobile telephone networks in cities preventing nearly 37,000 tonnes of environmental education project that concrete and metal manhole covers, needs of everyone of underground plants on new and towns. waste a year ending up in landfills (34 encourages pupils to explore and which are made from non-renewable development sites as part of our per cent of our total waste). measure their local areas, and report • Effective protection of the environment sources. commitment to reduce local impacts. Biodiversity Operational plants, cable, batteries, their findings on the Internet. • Prudent use of natural resources Biodiversity is the variety of life on oil, mobile phones, paper, toner We remain committed to work with Wires and cables Earth and is protected by UK law. Its cartridges and telephone directories The initiative links students and • Maintenance of high and stable levels local authorities and other interested Complaints about our wires and conservation is a key test of sustainable are all recycled. scientists in 107 countries as they of economic growth and employment. parties to achieve a balance between cables range from the visual intrusion development, because biodiversity: exchange and collect data about their visual impact, cost and the use of • Many of our new office buildings and in the landscape to the noise and • Enhances quality of life environment and enter it on the Here we discuss: resources. telephone exchanges use fresh air mess created by birds sitting on wires. GLOBE database. • Visual amenity • Provides natural assets from which rather than refrigerated cooling, to We also recognise the unique value economic benefits can be derived minimise the use of ozone-depleting • Street furniture Our asset assurance programme deals Classroom activities encourage the of the UK’s national parks, their (eg, pharmaceuticals) gases. Many buildings have bird and with issues arising from the impact of scientific gathering of data, which can • Street works breathtaking scenery, rare wildlife bat boxes to encourage local our vast network of overhead wires • Demonstrates that the environment be compared over time, between and cultural heritage which provide biodiversity. • Wires and cables and cables. is in good health schools and between countries. The a haven for quiet enjoyment for all. data serves as a basis for discussions • Radio masts BT is a founding member of the • Enables future generations to meet When installing new telephone poles on how we can change our lifestyles to Corporate Forum for National Parks their needs. • Biodiversity or replacing old ones, we consider promote sustainable development. and is committed to work with the • Biodiversity action Council for National Parks to help them meet their objectives.

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Environmental complaints technical facilities, purpose-built, The use of information and ADSL: Data conferencing: GS13: The number of environmental innovative classrooms and a lecture communications technology (ICT) Asymmetric Digital Subscriber Line. A conference that enables users to BT’s environmental procurement complaints received represents less auditorium on the site. has the potential to benefit business ADSL transforms the existing twisted book conferences over the internet, standard for suppliers. than 1% of the total complaints (greater efficiency), the people doing copper pairs between the local to share data or slides while in the • Adastral Park received by BT (based on data taken business (improve work--life balance) telephone exchange and the conference, and to receive recordings GS18: Adastral Park is a 99-acre site in the from our complaints system between and the environment (reduce customer’s telephone socket into a or transcriptions after the conference BT’s Sourcing with Human Dignity Suffolk Coast and Heaths Natural January and March 2005). However, consumption of finite resources). high-speed digital line. call. standard. Area. The BT site at Adastral Park we are working hard to ensure that shows that development can complaints related to local impacts ICT can support social and economic Audioconferencing: DEFRA: GS19: contribute to local socio-economic are monitored to help us target areas development by improving A conference enabling a number of The Department for Environment, BT’s product stewardship standard. stability without loss of biodiversity for improvement. communication and access to people to communicate by voice over Food and Rural Affairs (UK). if good environmental management information. The responsible use a telephone line. Halons: practices are adopted. To ensure we Special projects in the UK of ICT is part of BT’s approach to Degree days: A group of potent ozone-depleting optimise biodiversity at Adastral Park, We work with appropriate sustainability. BREEAM: Degree days are a measure of the chemicals related to CFCs used in we previously partnered with English conservation organisations to protect Building Research Establishment variation of outside temperature. many fire extinguishers. Nature on their Lifescapes initiative. biodiversity at our sites with We identify some of the key Environmental Assessment Method. Their use enables energy managers, This aims to achieve landscape-scale significant biodiversity importance. sustainability impacts of ICT, using building designers and users to HCFCs: changes to support wildlife through These sites include: quantified examples from our Brown Electricity: determine how the energy consumption Hydrochlorofluorocarbons. Alternative habitat re-creation, wildlife-friendly • Goonhilly Downs SSSI own experience. These include: Electricity produced by burning fossil of the building is related to the weather, to CFC refrigerants. land use and generally by building One of our satellite communications • The economic, environmental and fuels. and allows energy-saving measures a landscape that encourages centres, which is 171 acres in area social impacts of phone and video- within the building to be monitored Home-worker: biodiversity. and a component of the Lizard Special conferencing. Bunded fuel tank: and compared year-to-year. A person registered to work from Area of Conservation, is located on An above ground fuel tank with a home and provided with all the Case study • The social and travel implications of Goonhilly Downs, designated a Site protective wall to prevent leakage. ETNO: necessary furniture, equipment and Tunnel to curb otter deaths more flexible workstyles. We discuss of Special Scientific Interest (SSSI) for European Telecommunications communication links. Next to the Goonhilly complex, the pros and cons of teleworking as its rare lowland heath habitat. We CFCs: Network Operators Association. It has BT built an underpass tunnel to stop identified by the SusTel BT Pilot have an agreed site management Chlorofluorocarbons. Gaseous produced an environmental charter, ICT: the local population of otters being Report and the SusTel UK Survey. statement with English Nature (EN) compounds used as refrigerants and to which BT was a founder signatory. Information and Communications killed while crossing the busy Helston to maintain and improve the site’s propellants. Break down ozone in the Technology. to St Keverne road. Otters were • The social and environmental impact biodiversity. Examples from the work atmosphere. Green electricity: reintroduced to the area over of e-Business, such as paper-free plan are in the Earthwatch booklet The government defines green energy Intranet: recent years in a bid to stop a fall billing. Case Studies in Business and CHP: in two ways: An internet-based technology that in numbers but the road threatened Biodiversity. CHP is a very efficient technology for Old Green - This includes large-scale allows members of one organisation their long-term survival. The project, For more information on work-life generating electricity and heat hydro, uncertified CHP and waste-to- to share private information. backed by the Environment Agency balance, see Employees. • Madley Environmental Education together. A CHP plant is an energy. The green energy we currently and English Nature, was completed Centre (MESC) installation where there is purchase is old green and this in not IP: in February 2005. The MESC is a UK-based facility for simultaneous generation of usable exempt from the Climate Change Levy Internet Protocol. This is the set of environmental educational studies. heat (normally for space heating) and (CCL). communication tools that enables The centre, which is part of 218 power (usually electricity) in a single New Green - New green refers to the computers to ‘talk’ to each other over acres of land, owned by BT, has process. CHP typically achieves a 35- technology and not the date of the internet. made available 11 acres of wetland, 40% reduction in primary energy installation. Technology recognised as woodland and meadows where usage compared with power stations new green is: certified CHP; wind; ISO 14001: children and adults can study or just and heats only boilers. wave; small-scale hydro and An international environmental enjoy the wildlife. MESC is supported photovoltaic. New green energy management system standard. by the Environment Agency (EA), CO2: receives an exemption from the CCL Hereford Council and BT. We manage Carbon dioxide. on a specific building basis. the land’s wildlife and provide

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Kyoto Protocol: SOX: SUSTEL (Sustainable Teleworking): This page is for enquiries and comments Please note: If you have a general By telephone: A legally binding agreement signed in Oxides of sulphur. A two-year research project financed relating to BT’s environmental customer enquiry go to Contact us. Freephone: 0800 731 2403 Japan in 1997 to reduce emissions of by the European Commission on the performance and the way we report If you have a complaint about our International callers please use: a basket of six greenhouse gases. SO2: impacts of teleworking. on our environmental impacts. external operations or network - such +44 1793 547023 Sulphur dioxide. as the sighting of a pole or mast, Montreal Protocol: Teleworking: damage to property or graffiti - please By e-mail: An international agreement to phase Street Works Notice: Working from outside a conventional go to Complaints about our services. [email protected] out the major chemicals that destroy A requirement of the New Roads and office by using advanced ozone in the stratosphere. Street Works Act is that the Street telecommunications like video For complaints about the unsatisfactory By post: Authority must be informed of certain conferencing. state of BT buildings and/or grounds, BT Environment Unit NOX: types of street works when BT issues contact 0800 223388. For any Postal Point NS1A2 Oxides of nitrogen. a notice. A notice serves a number TRIAD: Payphone related issues, e.g. noise North Star House of functions: TRansmission Infrastructure And disturbance, contact 0800 661610. North Star Avenue NO2: • It is part of the co-ordination process, Demand charge. Agreements to Swindon Nitrogen dioxide. especially in traffic sensitive streets use standby generators in order It is important that you use the Wiltshire SN2 1BS and major projects to manage electrical loads at times appropriate channel because it OFCOM: of peak demand. enables us to direct your enquiry or • For emergency and urgent works it Office of Communications (UK complaint to the correct can prompt emergency procedures regulator for the communications UNEP: department, follow it of other organisations industries). United Nations Environment up and keep you informed. • It triggers the inspection regime Programme. UK’s Packaging Regulations: This page is for feedback or questions • It forms the basis of the records These regulations require certain Videoconferencing: (not complaints) relating to BT and for guarantee purposes businesses to recover and recycle A meeting where two or more people the environment. Please contact us packaging waste. Targets for • It can help prevent damage communicate through networked with your questions and comments individual businesses are based on the cameras that relay pictures and sound at the following: • It provides a basis of assessment overall amount of packaging (on to all of the participants. whether works have been products) that they supply to their unreasonably prolonged (in England customers. VOCs: only). Volatile organic compounds, a widely PCNs & PCBs: used group of chemicals which when Sustainable business: Substances classified as hazardous. released into the atmosphere help A business that can sustain its own to form damaging low-level ozone, needs environmentally, socially and PM10 particulate: harmful to human health and animal economically. Fine airborne particulate less than 10 and plant life. microns in diameter. Sustainable development: WEEE: Development that allows us to meet Recycled paper: The EU Waste and Electronic the needs of our own generation Paper made from discarded and Equipment directive. without compromising the ability of previously used paper. future generations to meet their needs. SDH: Synchronous Digital Hierarchy.

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03 04 05

UK Addressable Broadband Market – the geographical reach of broadband

Access to Information and We are members of the Alliance for year early. We are on track to meet benefits of broadband as widely as PC Access organisations in the education Communications Technology Digital Inclusion (ADI), a collaboration our target earlier and make possible. This will help to bridge the Over 99 per cent of people use a community on a shared vision of e- (ICT) can improve people’s lives, between businesses and the charity broadband available to exchanges digital divide. personal computer to access the learning excellence. opening doors to education, jobs, Citizens Online. The Alliance works to serving 99.6 per cent of UK homes Internet and there is a growing trend entertainment and personal promote the use of information and and businesses by summer 2005. By the end of 2004, BT was involved to use mobile phones too, according BT offers free educational materials contacts. But many people - in communication technologies (ICT) for in 46 public/private partnerships to the UK Office for National Statistics for schools and not-for-profit developing and developed countries social benefit. ADI’s other members By 2007, we expect: across the UK to bring broadband to (October 2004). organisations (such as Trades Unions) - have neither the opportunity nor are: AOL UK, Cisco Systems UK, IBM • The UK economy could be boosted by areas where exchanges had not been as well as training products for the necessary skills to use the UK, Intel UK, Microsoft UK and T- up to £7.5 billion through productivity enabled. During the last year we In an effort to boost Internet use and companies. technology. Mobile. gains attributed to broadband, developed further partnerships to help spread the use of computer skills, the according to the Centre for Economic increase understanding of the UK Government promotes a By promoting speaking and listening Progress is being made on closing the The launch of the ADI in October and Business Research potential benefits of ICT, and in many programme providing subsidised skills, we aim to give young people in digital divide between the North and 2004 coincided with the release cases provide training and support for home computers. This is organised the UK the best possible start in life. • Up to 16 billion fewer miles could be South - the World Bank says half the of a report by the UK Government’s potential users. through employers. UK companies Broadband has the potential to driven as broadband enables more world’s population now has access to Digital Inclusion Panel. It identifies can save on their National Insurance distribute high-quality curriculum people to work from home and shop a fixed-line telephone and 77 per cent social groups most at risk of digital In Cornwall, UK, a European Union payments and provide cheaper home materials to all pupils. BT’s on-line, according to the UK to a mobile network. But there is still exclusion and the actions needed funded partnership project, ACTNOW, computers for their staff (up to a 40 LearningStream 8 and Department of Transport much to do to spread the benefits of to encourage them to use ICT. offers subsidised packages to small per cent saving). LearningStream 34 services have been computing and telecommunications. • Every school child in Britain will be businesses. designed specifically for education. In 2004, BT commissioned the Future able to learn via broadband, according BT, along with Intel and Microsoft, is a They can be used by schools, colleges In the UK, research shows that age Foundation to conduct an to the UK Department of Education Over 1300 BT Payphones have been member of the Home Computing and public learning centres to create and income are the most significant independent study the potential and Skills converted to Internet kiosks enabling Initiative Alliance. Find more here. on-line learning communities and factors that determine who uses the future impacts of the digital divide web surfing, emailing, text messaging share resources. They help build • Millions of hospital outpatient Internet. People over 65 and those in 2025. and telephone calls. There has been a strong demand from learning communities by linking appointments will be booked over with a low income are most likely to BT employees for subsidised home schools, colleges, libraries, learning broadband, according to the UK ignore the Internet, according to a See case studies for examples Our wireless networks in public places computers, with over 25,000 of our centres and Citizens Advice Bureaux. National Health Service. 2004 UK government report called of our work to promote inclusion. enable Internet access from portable employees now taking advantage of Enabling a Digitally United Kingdom. computers. Our network of Openzone BT’s Home PC Scheme. We provide a subscription on-line Broadband is a critical factor in the A 2004 survey by the UK Office for Connectivity and partner access points - over 7800 learning resource that helps families success of the UK economy, but its National Statistics showed that while We provide a range of different - are available at airports, hotels, Community Connections access educational material linked to wider benefits are constrained by the the majority of UK adults had used connections, from home dial up lines railway stations and fast-food outlets. Since 2000, BT Community the school curriculum, to expand and rate at which people make use of the the Internet, 34 per cent had never to Internet kiosks and high-speed Connections has provided 3400 develop their knowledge and key technology. One of the solutions is to done so. broadband. See BT Retail for our Driving demand Internet-ready PCs to a diverse range skills. It helps children revise for exams work in partnership with others and to products and services. We use a range of market incentives of groups - from dance groups, (SATs, GCSE/Scottish Higher and provide the on-line facilities that We want everyone to participate in to encourage the use of broadband. hospices and homeless drop-in mocks), research core subjects and people need. the digital revolution. Here we discuss Broadband provides a fast ‘always-on’ These range from rewards for those centres to sports groups. The gain access to useful websites. how we promote digital inclusion, in connection to the Internet via a who introduce their friends, discount scheme provides an NEC Internet- For example, BT’s on-line payment three ways: conventional telephone line. It is the schemes and offering incentives for ready PC and Microsoft software For more information, see BT Learning system, called Click & Buy, enables • Provide greater access to most significant technical advance for charities to become resellers via their package worth more than £1300 to Centre and case study Internet users with an account to pay communications technology - consumers and small businesses. Its websites. In the 2005 financial year, voluntary and community on grandparents and computers. for small transactions, such as a Connectivity availability promotes social inclusion. we further reduced - by around eight organisations so they can provide subscription page in a journal archive. per cent - the wholesale price of Internet access to their local • Encourage communication and its On-line shoppers maintain their Click Telephone exchanges have to be broadband connections. communities. An estimated 85,000 use for social and economic benefit - & Buy account by paying with a credit upgraded to provide broadband. people have benefited directly and Content or debit card, direct debit or by Because of the cost, this is being done We hope that the purchasing power of indirectly from the awards. adding Click & Buy transactions to • Help groups and individuals use gradually in the UK, often working in the public sector will encourage their BT bill. This promotes on-line technology - Capability. partnership with government and greater uptake of broadband. We Education shopping by making it easier to pay regional development agencies. continue to support a Government Our well-established education team for small transactions. initiative to provide broadband focuses on raising educational We connected our five-millionth services to public service standards throughout the UK by New approaches customer to broadband at the end of organisations, offering competitive improving opportunities for learning We are developing new marketing March 2005, meeting our target a prices. and development. Our objective is to approaches to ensure we spread the work with professionals and

Reports Content • BT Resource Bank - resources Each project is co-ordinated by a the Internet than older people. Being Awards with their certificates at Connected Community The amount of information available for teachers, parents and children locally based project officer. The role EverybodyOnline is working to ensure 30, St Mary Axe in London on 14 Organisations - Can They Help on the Internet is vast, but there is still on communication skills, including of the officer is to foster a network of that elderly people are given the March 2005. As Carol says: ‘It’s really to Overcome the Digital Divide?, a great need for content that brings animated tutorials, quizzes and local facilities, programmes, partners opportunity and encouragement to great for BT to be involved in SustainIT, December 2003 benefits to communities, small classroom activities. See more and volunteers. Using various forms use the Internet. celebrating success. The entries have businesses and individuals. This is why at Resource Bank. of communication, the officer will shown a huge range of innovation, ‘Broadband use by community we work with others to promote new work with the local community to Income levels also have an impact on demonstrating how ICT can bring organisations can help to overcome content (see examples in case It is essential to ensure that websites understand their needs and to create the level of interest, with poorer people together. Selecting winners the digital divide, as well as breaking studies). These are some of the are accessible to people with poor a co-ordinated action plan to people being less interested than the from such a strong field was not easy.’ down social barriers and improving organisations we have helped: eyesight. Since 2000, BT has worked overcome the barriers to increased well-off. These conclusions should not organisational effectiveness. It can • Charities - We have teamed up with closely with its own publishing ICT and Internet access. be taken as absolute because there BT has supported the awards, which also extend and deepen their links IK software, a business providing communities to set best practice are other influencing issues, such as recognise creative and inspirational with external bodies - but only if the specialist Internet solutions, to make standards through the audit of sites EverybodyOnline runs taster sessions regional differences in behaviour and use of communications technology to organisation already has a culture free, simple-to-build websites by the Royal National Institute for the where project officers equipped with the level of education. deliver environmental and social which recognises the importance available to UK charities and Blind (RNIB), benchmarking with other wireless laptops visit places where benefits, since their inception in 2002. of organisational networking.’ community groups (see charities organisations and ensuring that our people meet, such as community For more information, see BT also sponsors the Digital Inclusion website leaflet for more information). own publishing community continues centres, retirement homes and church EverybodyOnline and case studies. and Disability Action category awards. ‘Broadband has helped to overcome This is an extension of our existing to cater to the needs of all users. halls. People are encouraged to try As Mike Hughes, BT’s Head of social barriers between users and had work with UK schools. Four thousand out the technology and explore the Children help promote Environment and CSR campaign, a very significant or significant impact schools have already created some Capability opportunities provided on-line. The digital inclusion says: ‘BT has long recognised the on the community - although the excellent new sites, developed and Our digital inclusion campaign sessions have proved popular and A BT-sponsored child-friendly benefits that creative use of forms this takes varies between maintained by pupils and teachers. demonstrates how communications some early participants now website, called Internet Rangers, communications technology brings. organisations’ (See case study on how a mountain can help improve society. confidently shop and bank on-line. is part of a campaign launched in Our sponsorship of the eWell-Being rescue team benefited) 2004 to help young people get their awards forms an integral part of our Sustainable Development in A key element is the Everybodyonline See our case study about Margaret’s families on-line. contribution to a more digitally Broadband Britain, Forum for the • Connected Earth - This museum on programme, supported by BT and experience at the Welbeck Green inclusive society.’ Future, March 2004. the Internet, launched in 2002, is one Microsoft. The project is run by Bungalows’ taster session. Our research found that children - ‘Broadband internet access provides of the largest virtual museums, Citizens Online, aa UK-based charity particularly young teenagers - are the The Glasgow Homeless Network runs the opportunity to enhance and providing information on the history promoting the use of Information and “The real value of the EverybodyOnline most effective spur to encourage the Homeless Information Pages (HIP) multiply social ties, though in some of telecommunications (see Communications Technology (ICT) for project is its use of ICT as a tool reluctant parents or grandparents on project and won the award for Digital cases may also contribute to social Connected Earth for more all members of the community. for engaging with a community and to the Internet. Nearly one-third of Inclusion. The project delivers training isolation. information). helping the most disadvantaged parents and grandparents have been and advice to those in need through Working with local governments, acquire skills which may lead to taught or encouraged to surf the mobile drop-in facilities which visit Fast, always on internet access makes • Tate Online - We sponsor the UK’s communities and service providers, new life opportunities.” John Fisher, Internet by a child aged between 13 hostels, and day centres across the a wide range of applications more leading modern art museum’s virtual EverybodyOnline aims to ensure that Chief Executive of Citizens Online. and 16 years. city. The project is delivering the skills user-friendly and more likely gallery, the UK’s most visited arts those people disadvantaged by needed to help people return to work to be successfully employed. Reports website. The site is powered by BT, location, lack of skills or economic EverybodyOnline - measuring Nearly one in five parents and as well as allowing them to keep in list areas from education and health which provides technical support, factors do not miss out on the progress grandparents have either learned a touch with their families through to democratic participation and hosting and on-line broadcasting (see benefits of new technology. An independent research company new skill or been educated via the email. In the words of the judges: “A agriculture as areas that are likely case study and Tate online for more measures the progress of web following on-line help from a child well integrated project, addressing the to benefit.’ information). EverybodyOnline is being piloted in EverybodyOnline, using three core aged between five and eight. issues of access to and skills and several small disadvantaged indicators: Internet usage behaviours confidence to use communications • Netmums - Netmums websites, communities in the UK. The and attitudes, barriers to use and For more information see our case technologies for a difficult to reach supported by BT, provide local and communities are the size of an intentions to connect. The results studies Children teach their part of society.” general information for mothers electoral ward and have been chosen provide evidence of the project’s grandparents how to surf the net and looking after children, including because they have below-average qualitative impact and help project Children help promote digital Funky Flamingo is a Cambridge club contacts for new friends, where to find household Internet connectivity. They officers develop their plans. inclusion. for disabled young people which a toddlers’ group and help on rank among the most disadvantaged won the Disability Action award. The returning to work communities in the UK on the Research in the areas where eWell-Being - Celebrating great club is run by and for the youngsters multiple deprivation index. EverybodyOnline operates shows a practice who are able to use all sorts of • UK National Council for Voluntary steady increase in Internet use and Carol Borghesi, Managing Director, communications technology to Organisations - The Council’s website confirms independent findings that Customer Contact Centre, presented organise and create the content for provides a comprehensive online younger people show more interest in the winners of the third annual eWell- their club nights. Using computers resource for voluntary organisations.

Information and data on this page Information and data on this page has been verified by Lloyd’s Register has been verified by Lloyd’s Register BT Social and Environmental Report BT and digital inclusion 02 Quality Assurance Limited Quality Assurance Limited BT and digital inclusion continued BT and digital inclusion Case studies

they create their own music, lighting Global projects The Glasgow Homeless Network, Margaret-Ann Branjes. “Then we had important to the people who are and videos. As Lorraine von Gehlem, LifeLines India Homeless Information Pages (HIP) to make sure that the site was taking part, so finding a way of being project coordinator says: “ICT levels The future success of Indian Paula Miller is beginning a tutorial on accessible to the people who needed in touch through email can really the playing field and allows disabled agriculture - now labour-intensive - how to use the Internet. Three men it most.” mean a lot to them. people to do what we do, participating will increasingly rely on knowledge are sitting in front of wireless laptops in the community and sharing creative and information. BT is working with as Google shimmers on the screens. The key to its success, she believes, is “And sometimes people just want to experiences, not just with people in OneWorld, the development charity, She barely finishes her first sentence good partnership working, using print out a special poem and send it the next village, which they could not to provide farming information over when Gerry, who is attending his decent equipment - and making sure to their child or their mum. That can do before, but all over the world.” the telephone to poor Indian villagers. second session, has already typed a the funding is in place. The project is be really touching.” word into the search engine: currently bidding for £215,000 to Other award category winners were: The LifeLines India project is being ‘acupuncture’. keep it going for a further three years. Article written by Jennifer Trueland, tested in 58 villages in northern India. for the Society Guardian eWell-Being • eGovernment (sponsored by I&DeA) Villagers can use the telephone to get “Me and Thomas had it last night and In the last two years, HIP in Glasgow Awards supplement 16/3/05. • Birmingham Libraries for their project information on agriculture, animal it was brilliant. Best night of sleep I’ve has delivered training to around 500 Copyright Guardian Newspapers helping children with their reading and husbandry and agribusiness. The ever had. I want to find out a bit more individuals and, since October 2003, Limited 2005 writing skills through the ‘Stories from information is supplied by agricultural about it, like,” he says. the website has had more than 4000 the Web’ initiative scientists in India. visitors. Around 20 people have This class is taking place in the Dolls moved on to mainstream training, • Environmental Efficiency (sponsored Our partners include Cisco and House, a small building which is part but, importantly, the vast majority of by Brother) MahindraBT. of Turning Point, a drug crisis centre those who have taken part have felt • UK Phenology Network, an ambitious in Glasgow. This turquoise-painted the benefits. “There are often queues project using IT to record changes in room is one of 13 settings for HIP in of people wanting to check their email flora and fauna caused by our Glasgow, the Homeless Information when the tutor arrives,” says Branjes. changing climate Project run by the Glasgow Homelessness Network - winner in the Certainly Gerry is thrilled. The • Mobility (sponsored by Local digital inclusion category. unemployed father-of-two has had a Transport Today) rough time lately. His relationship • Plymouth City Council for their The project is aimed at people broke down, then his mother network of street kiosks providing affected by homelessness and involves developed cancer and he ended up real-time public transport information a mobile ICT unit which travels to living in a hostel for homeless people as well as access to confidential free places which homeless people before going to Turning Point in an advice 24/7 on issues such as frequent, such as hostels, day centres attempt to “sort my head out”. domestic violence and missing and crisis accommodation. It offers persons tutoring in computer skills and the Now, with a bit of help from Miller, chance to move on to further training he’s found an acupuncture map of the • Wireless (sponsored by Vodafone) in IT. But most of all it gives access to body which he’s copied and pasted • South Witham Broadband, a a world which otherwise might be out into another file, which he’ll take away community broadband initiative of reach of the target group. with him on a floppy disk to print off. bringing wireless broadband to a rural community. “One problem is that homeless people Thomas, a chef from a small town can be excluded from places where near Glasgow, has also had some More information on the awards is you can access the Internet,” says success. available at www.sustainit.org or in Miller, HIP learning resource worker in the ePublic section of the Guardian IT training. “For example, you need “My son’s always been on at me to (media partner for the awards) on 16 proof of address to use it at libraries.” learn about computers but I haven’t March 2005. liked to,” he says. “But I’m going to Although it started in 2002, the ask him his email address when I project has been running properly for phone tonight and maybe I’ll be able two years. “The starting point was the to send him an email next week.” need for a website for people affected by homelessness to access Miller has been working for the project information that was relevant to for two years and clearly finds it them,” says development coordinator hugely satisfying. “Family is often very

Disability Action winner they could not do before, but all over and steering group members, Chris Children teach their grandparents Children help promote digital Learning difficulties no barrier Funky Flamingo the world,” says Mongalen. They can Butler, who says it has given him the how to surf the net inclusion to gaining IT skills Anyone who doubts the liberating do this via a website allowing them to experience of working in a team. The Grandparents to School event Sophie, 12, and Chloe Davies, 10, Peoples First, based in Porth, Wales, power of computers should visit a post profiles of themselves, although held at St Stephen Churchtown from Neath in South Wales, have helps people with learning difficulties Funky Flamingo club night in Mongalen says there is some way to Yet there is so much more that can be Primary School, Cornwall, UK, been budding Internet Rangers since gain IT skills. The organisation Cambridge. At first glance there is go before this becomes fully done with IT to improve quality of life in February 2004 attracted 100 Christmas 2000 when they got their is sponsored by EverybodyOnline, nothing unusual about the club, interactive. for the disabled, even with currently grandparents to learn about first computer. The girls use the an initiative run by charity Citizens populated with young people dancing available equipment and software, computers and the Internet. All Internet mainly for homework and Online, supported by BT and Microsoft. to the latest pop music. But, in fact, it So far, Funky Flamingo’s greatest says Mongalen. It all comes down to classes in the school had a half- emailing friends, but last year is a rare experience for both achievements have been in facilitating funding in the end, and, hour slot in the IT suite with their persuaded their grandmother, Informal IT courses organised by participants and organisers, all of local interaction through music and unfortunately, Funky Flamingo’s grant grandparents and many of the Pat, 71, to try using the Internet. Peoples First, were such a success that whom are disabled, some severely, video. One innovation enables runs out in September. “It would be children proved to be experts at larger premises had to be found to and this is reflected in the level of disabled people to control sound and tragic if we had to say to these people helping their relatives surf the net. Sophie says: “Grandma needed quite accommodate the demand. Many of their enjoyment and the exuberance video using their fingers to interrupt that the club is ending,” says a lot of persuading as she didn’t think the learners were students who could of the occasion. an infra-red beam. “We used a system Mongalen. But hopefully the opposite “Our feet didn’t touch the ground until she’d be able to use the Internet. She step up to more formal learning using called Soundbeam that originally used will happen and similar clubs will open the grandparents and grandchildren also said that there wasn’t anything their new IT skills to gain formal The scene is largely the result of infra-red beams to control audio clips, and flourish up and down the country. stopped for lunch,” said Ann Tomkins, she’d want to see on the net but qualifications. advances in software and gadgetry for but we’ve brought in ICT specialists a project officer with EverybodyOnline, Chloe and I found a site with lots of accessing computers, sound or video who have developed a way of using it Article written by Phil Hunter for the a project run by UK charity Citizens pictures of Neath in the old days and Dawn Price from People’s First says: production systems, and DJ to trigger video clips,” says Mongalen. Society Guardian eWell-Being Awards Online with the support of BT. one on how to be a gardener. I think “It has been such a benefit for our equipment that make it possible for supplement 16/3/05. Copyright Working with local governments we helped change her mind.” clients to be able to see what the the disabled not just to participate but “It means people only have to move a Guardian Newspapers Limited 2005 and service providers, the project Internet has to offer and to learn also organise and create the content little finger to express themselves.” aims to ensure that those people After a few lessons with the girls, on up-to-date equipment.” for such nights. disadvantaged by location, skills Pat enrolled on a computer class Such features clearly impressed the Online access to mountain rescue or economic factors do not miss out at her local community centre. Although club nights, usually held competition judges. “Picking a winner information on the benefits of new technology. three or four times a year at the was tough, but we plumped for Funky A Scottish mountain rescue team Pat says: “I had the opportunity of Junction club in Cambridge, are the Flamingo because it had that bit of is one of more than 1000 voluntary doing a number of different classes focal point, the real achievement of extra flair and excitement about it,” organisations that have taken up our but the girls had already shown me Funky Flamingo has been in making it says John Lamb, one of the judges offer with web-builder ik.com to make the basics of how to use the computer possible for disabled people to and editor of Ability magazine, a free, easy-to-build websites for UK so I decided to give it a try. Once I got overcome their limitations. Through campaigning publication for people charities and community groups. over the fear factor and put the idea workshops held once a week, and who have difficulty using ICT. of being too old to learn out of my interaction via the Internet, club “We had been considering creating a mind I was fine. The course was really members can enjoy the artistic But the people most impressed are website for a good couple of years but interesting and, of course, I had experiences taken for granted by the the club members themselves, many no-one had the time or expertise to Sophie and Chloe on hand to help able-bodied in music, video of whom have happy memories do it,” says Stuart Ballantyne, me with the homework! I now have production and creative writing, says contributing and participating in the secretary of the Trossachs Search and my own PC and have just started Lorraine Mongalen, Funky Flamingo events. “I still keep thinking and Rescue Team in Scotland. “Thanks to another course - this time in desktop project coordinator. dreaming about the club night. That’s BT and ik.com we now have our own publishing.” going to stay in my mind for a long website and although it’s in its infancy “ICT levels the playing field and allows time,” says Max Roberts, one of the we are receiving positive feedback disabled people to do what we do, club’s DJ trainees. from other organisations and the participating in the community and public. We found creating the site sharing creative experiences, not just Being able to perform as a DJ also very easy and editing is simple too - with people in the next village, which appealed to one of the club’s band ideal for voluntary groups such as us.”

Budgie fancier finds fellows on-line Keeping young people Giving community groups the “I did not even know how to switch off the streets opportunity to acquire new ICT skills a computer on, let alone use it,” Young people in Audley and Bignall BT supports EverybodyOnline’s says Frank Jones, 72, of Audley End, UK, complained that they had initiative to organise taster sessions in Staffordshire, UK, a budgerigar nowhere interesting to go to keep for people with no experience of fancier and amateur gardener. them off the streets. This is why computers, to give them a chance Youth4Audley was set up in 2003 to explore the opportunities provided After lessons from Ben, his 14 year- and immediately developed a project by information and communications old grandchild, failed to get him using art, media and information technology (ICT). started, Frank signed up for a course technology. at the local adult centre run by Margaret Temple is one of 41 EverybodyOnline. This is an initiative Showing extreme resourcefulness a residents aged between 60 and 90 devised by the charity Citizens Online, venue was found, personal computer at the Welbeck Green Bungalows supported by BT and Microsoft. applied for (and gained from BT) and housing complex, near Newcastle funding found from a charity and local on Tyne, UK. The residents have Frank soon learned the basics. “I have government. Working with been regularly visited by an joined an on-line budgerigar group, EverybodyOnline (supported by BT) EverybodyOnline project officer since with a membership of 250, who live and others, the young people met May 2003 and provided with Internet all over the world. I now correspond with many of the elderly residents access from laptop computers and with fellow fanciers from Australia, to find out what the area had been mobile telephones. Margaret has Canada, New Zealand, Pakistan and like in their youth. They then built up learned how to use Microsoft Word, the USA. We talk about our hobby a digital library of stories and photos, send emails and search the Internet and discuss general subjects. I receive past and present. for information. photographs on a variety of subjects, in the form of email attachments, In March 2004 Youth4Audley Margaret is a lay preacher and which I print and share with friends.” presented a multi-media show previously used a typewriter to celebrating Audley and its people produce her sermons. She is planning The use of digital pictures on the and bringing together old and young to buy a laptop computer and printer. Internet led Frank to buy a digital in the communities. She has also decided to take more camera on-line and he is now learning training to further improve her IT skills. how to manipulate and enhance images.

“It’s a whole new world out there, just waiting for you,” he says.

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We base all our relevant BT policies For example, we are a signatory to However, we recognise that Supply and use chains Privacy BT’s Caller Display and Call Return and procedures on the principles set the UN’s Global Compact, an worldwide respect for human dignity We have the potential to affect Article 12 of the Universal Declaration services in the UK can make customer out in the United Nations Universal initiative that strives to motivate is more than just a click away. human rights in two ways: of Human Rights states numbers available to the people they Declaration of Human Rights, business and industry around ten • The working conditions of those “No one shall be subjected to arbitrary are calling. 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But Customers are able to screen out commitment to protect and enhance Global Compact principles - see of the top CSR risks of doing business developments in ICT, such as the most direct marketing calls by Supply chain the human dignity of every BT Global Compact Site Index. Through in 153 countries, including a specific ability to tailor services to meet registering with the UK Telephone We want working conditions in our employee, and everyone who has the Global e-Sustainability Initiative assessment of the Human Rights risk. personal needs, have created fresh Preference Service. British supply chain to meet the standards dealings with us. This is (GeSI) we engage with ICT service It helps managers make decisions dilemmas. Telecommunications plc (BT) operates of the Universal Declaration of Human communicated to our employees providers and suppliers, and alliances on new and existing business under a licence granted by the Rights and the International Labour around the world in eight different focused on improving supply-chain acquisitions, purchasing and other Protecting online customers Secretary of State for Trade and Organisation Conventions. This languages. working conditions, such as the deals or partnerships. We aim to We have to find a balance between Industry, under section 7 of the UK commitment is one of BT’s top seven Ethical Trading Initiative. include this risk assessment in key offering tailored customer service Telecommunications Act. This means CSR risks. See more at Human rights Here we describe our approach to the Representatives at a GeSI supply- global business cases from 2006. with protecting the privacy of our we only use personal details for the in the supply chain. We believe - and human rights issues, under these chain working group meeting in April customers. reason that they were entrusted to us it is part of our business case for CSR - headings: 2005 discussed ways in which Like many of the rights enshrined in and don’t pass them on to other parts that improving working conditions in • Principles companies can ensure quality the Universal Declaration of Human For example, if our customers in the of the business. our supply chain means the products compliance with labour laws and the Rights, new technological advances UK wish to use our website to manage • BT products and services we purchase are of better quality. implementation of monitoring codes. bring new challenges to, and their account, check their bill and buy Sometimes personal details do have • Supply and use chains interpretations of, free expression. various products or services, they to be disclosed - for example, in the The feedback received from workers During the 2005 financial year, we have to register first - which involves prevention or detection of a criminal • Privacy interviewed during ad hoc assessments improved the performance aspect Our stakeholders have identified the disclosure of certain personal offence. of our suppliers is collated in reports • Freedom of expression. of our ethics indicator by adding these the misuse of the Internet by criminals information. We have a specific provided to both suppliers and the two questions to our annual employee as a major concern. We address this privacy policy covering this situation. We address trade-offs between relevant BT buyers. Principles survey: Is BT trustworthy, and Is it issue in two of our independently advancements in networked We use the Universal Declaration safe to speak up in BT? For more written Hot Topics: BT also has a detailed Acceptable technologies and the risks to personal Use chain of Human Rights to ensure all our information see Business Principles. • Abuse of the Internet, by Solitaire Use Policy that shows how we protect privacy rights in our most recent Hot The main concern is the misuse policies enhance human dignity. Townsend of the consultancy Futerra, the privacy of our on-line customers. Topic - Privacy in the Digital of our products and services, for But new challenges and opportunities BT products and services considers issues of the extreme abuse This is balanced with our expectations Networked Economy. The researchers example using the Internet for crime. arise all the time, and we can’t rely The best way to implement our of the Internet. of customers’ behaviour towards each considered the views of BT’s Our Hot Topics, Abuse of the Internet on policy alone to make sure we commitment to human dignity is other when using our services. stakeholders, including anti-tagging • Virtual Vice, by James Wilsdon and and Virtual Vice cover these issues. address human rights issues properly. to enhance the positive impact our lobbying groups. Paul Miller of UK think-tank Demos, We will continue to monitor and products and services can have on Customer preferences can be tracked examines BT’s approach to issues address these concerns where possible. All our employees have access to human rights. on-line to offer personalised services such as hacking, copyright infringement Other issues are privacy and freedom the Universal Declaration on our and special offers. Customers can opt and spamexamines BT’s approach of expression. intranet, and an outline of our Freedom of expression is a out of this service. to issues of concern such as hacking, approach is included in the guidance fundamental human right, and a copyright infringement and spam. We balance our support and investment document accompanying our critical means to promote human Protecting all customers in new technologies with research statement of business practice. rights in general. Greater access We know that privacy is very We hope that the economic potential into their implications for our to information and communications important to all our customers, not of e-commerce and the increased customers, for example on privacy. We are in contact with expert groups technology (ICT) can be a source only those on-line. BT complies with, transparency brought about by new and information sources that can help of openness in otherwise closed and is registered under, the Data technologies will have an overall us implement our commitment to societies. ICT provides an extremely Protection Act in the UK, and we take positive impact on human human dignity and improve our fast, efficient and safe way to all reasonable care to prevent any rights. Our Hot Topic Modern procedures if necessary. disseminate information and can be unauthorised access of personal data. Communications and Quality of Life invaluable to organisations dedicated explores this potential in more detail. to promoting human rights.

BT employees But technological advances bring Content provision We have several policies and codes new challenges to the right to BT acts on complaints about content relating to the use of BT telephones, freedom of expression and new hosted on our servers. We sit on the email and the Internet by BT interpretations of it. funding council of the UK UK Internet employees. Watch Foundation, which notifies us We offer easy feedback channels for of illegal content stored on our servers All employees have been made aware stakeholders, such as the Your Views and webspace. that email and Internet access may email address. be monitored and that certain types We have contributed to the work of message and use of the Internet Freedom of expression vs of Independent Committee for the are considered inappropriate while child protection Supervision of Standards of Telephone at work and using our system. This A key challenge is to balance the Information Services (ICSTIS). Part is common business practice. BT right to freedom of expression with of ICSTIS’s remit involves registering does allow reasonable use of personal the need to protect children on-line. certain types of phone services email. in the UK, such as dating services, BT is a board member of the Internet betting, fundraising and services of During the 2005 financial year we Content Rating Association (ICRA), a sexual nature. This safeguards the have developed guidelines for all an international organisation that right to freedom of expression while employees on how to manage the aims to protect children from ensuring protection of users, legality new risks and challenges to privacy potentially harmful material and and quality. posed by the digital networked protect free speech on the Internet. economy. Examples include the We have published two Hot Topics technology and process of radio The ICRA asks web authors to give that explore the problem of misuse frequency identification (RFID) details of what is and is not present of the Internet: tagging and the location registration on their site. From this, the • Abuse of the Internet, by Solitaire of mobile communication devices. organisation generates a content Townsend of the consultancy Futerra, label (a short piece of computer code) considers issues of the extreme abuse Freedom of expression which the author adds to the site. of the Internet. Article 19 of the Universal Declaration It enables users, especially parents of Human Rights states: of young children, to set their Internet • Virtual Vice, by James Wilsdon and “Everyone has the right to freedom browser to accept or reject access Paul Miller of UK think-tank Demos, of opinion and expression; this right to certain types of content. The key examines BT’s approach to issues includes freedom to hold opinions point for freedom of expression is such as hacking, copyright without interference and to seek, that ICRA does not itself rate Internet infringement and spam. receive and impart information content - the content providers do and ideas through any media and so if they wish to participate. To address the problem of child abuse regardless of frontiers.” on the Internet, BT has introduced Our own programme, BT Safe Surf, CleanFeed, a software filtering system Freedom of expression is a gives detailed information for parents that automatically blocks access to fundamental human right and a and provides user-friendly training websites blacklisted by the Internet critical means of promoting human for children. Watch Foundation. This includes rights in general. those sites considered ‘illegal to view’ under the 1978 Child Protection Act.

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BT is one of the world’s largest Distributing wealth Direct economic impacts Suppliers • BT’s share of the UK residential fixed- telecommunications companies and a BT’s direct economic impacts Direct economic impacts are those • Total spend with suppliers: voice call market, as measured by significant economic force in its own that involve the inflow or outflow of approximately £4 billion. See more volume of fixed-to-fixed voice minutes right. money as a direct result of our detail on operating costs on page is 64%. business activities - most are 34 of the 2005 Annual Report and • BT’s share of the business sector We employ 102,100 people, provide measured with traditional financial Form 20-F. fixed-voice call market is 42%. services and products that improve indicators, such as turnover, dividends • Total capital expenditure: £3,011 economic efficiency, and buy goods and wages paid. million. See more detail on Profit and re-investment and services worth billions of pounds a expenditure on page 34 of the • Profit retained was £938 million. year. These indicators show our impact on 2005 Annual Report and Form 20-F. some stakeholders in the 2005 • Return before goodwill amortisation This section describes our main financial year. and exceptional items on the average Shareholders and creditors economic impacts and summarises capital employed was 16%, compared • Total dividend paid to shareholders: our financial performance. See the Customers with 15.3% in 2004. £883 million. Sustainability section for a discussion BT turnover of £18,623 million, on the dilemmas that economic distributed as follows: • Net debt reduced from £8,425 million growth can create. BT Retail: £12,115 million to £7,786 million. BT Wholesale: £3,812 million • Net interest payable £801 million. BT Global Services: £2,671 million • Total amount falling due to creditors within one year: £12,461 million. Other: £25 million See more details on page 80 of the Total turnover is boosted to £19,031 2005 Annual Report and Form 20-F. million when our share of associates’ and joint ventures’ turnover (£408 Governments million) is added. • Total taxes paid to governments were £523 million, comprising £539 million Find more details in the BT profit and on the profit before taxation, goodwill loss account on page 75 of the 2005 amortisation and exceptional items, Annual Report and Form 20-F. offset by tax relief of £16 million on certain exceptional charges. Employees More details of our total taxes paid • BT employs 102,100 people around are available on page 36 of the 2005 the world, including 90,800 in the UK. Annual Report and Form 20-F. • Total expenditure on employees: Wages and salaries £3,656 million Breakdown by geography and market share Social security costs £319 million • UK £16,967 million (91%) Pension costs £465 million • Europe (excluding UK) £1,396 Employee share million (7%) ownership £11 million • Americas £190 million (1%) Total £4,451 million • Asia and Pacific £70 million (<1%)

Indirect economic impacts Total impact A global information society The ICT sector’s contribution to GVA for the ICT sector grew by 109.8 As the OECD highlights, the diffusion Our indirect economic impacts include BT’s total economic impact (income The growth in communications growth and productivity per cent between 1992 and 2001, of new technologies can be slow and the ways our activities enhance the generation and employment) is technology has enabled business, We contribute to economic growth by compared with growth of GVA for the companies can take a long time to ability of others to create economic calculated by adding the direct, personal and cultural connections helping to improve the productivity of whole economy of 61.2 per cent over adjust while they change operational value. This happens in two ways: indirect and induced impacts. between billions of people. These enterprises, industrial sectors and the the same period. arrangements, re-skill people and • First, through our own expenditure connections help to enable further wider economy. implement new business processes. which injects several billion pounds Total Income and Employment development, both regionally and This money has been distributed Other factors, such as the regulatory into the economies where we operate Impact of BT in the UK globally. The character of these impacts can be to various stakeholders: environment, the availability of skills best understood using data for the • Employees (67.3%; £42.8 billion) - and organisational change, affect the • Second, through our sale of ICT goods Income Developments in communications UK Information and Communications highly labour-intensive ability of firms to seize the benefits and services, which stimulate £ million Employment technology mean a better business Technology (ICT) sector. of ICT. economic growth and productivity. • Operating Surplus (31.1%; £19.8 Direct 2.974 122,423 environment globally. Information billion) exchange takes place far more rapidly There are two main types of impact: The OECD concludes that it is too Indirect employment and contracting Indirect 2.616 135,550 than at any point in history, allowing 1. The ICT sector - its size and • Government - taxes on production early to tell for certain how the role Income and employment Induced 3.354 173,780 ideas, goods and services to be technological progress - has a direct (1.5%; £1 billion). of ICT growth and productivity Our expenditure in the UK injects delivered more effectively, virtually impact on national-level growth and performance will develop, but some over £2.6 billion into the UK economy Total 8.944 431,753 anywhere on the planet. productivity figures. Contribution of ICT capital general trends are emerging to suggest every year. This indirectly supports Source:DTZ Pieda Consulting, investment to GDP growth that ICT will continue to drive growth. the employment of almost 135,600 2. The use of ICT by companies to February 2004 The 1999 United Nations Human 1995-2002 people. improve their own efficiency and Development Report focused on the For example, the OECD cites evidence BT’s activities provide almost 1.7 per productivity has a significant impact France Over 0.3% theme of globalisation. It explored that those sectors that have invested Indirect income and employment cent of all jobs in the UK. on national-level growth and the potential of the Internet to drive Germany Over 0.35% most in ICT - such as financial services, created in BT suppliers productivity. efficiency improvements, but also health, retail, business services, Notes Italy Over 0.4% to empower small businesses and However, we recognize that economic wholesale trade - have experienced Income • These figures take account of organisations, and to provide remote growth in itself may entail trade-offs Japan 0.5% more rapid growth in productivity £ million Employment ‘leakages’ of expenditure from the communities and poorer countries for society and the environment; not than those that have not. ICT is more From capital local economy in the form of non-UK Spain Under 0.45% with cheap and easy access to all growth is necessarily ‘good’. We appropriate for some sectors than expenditure 918.7 47,600 purchases, savings and national taxes. information. explore some of these trade-offs in UK Over 0.7% others and is not suited to all business They are calculated using ‘input- From revenue depth in our Sustainability section. models. Agriculture, mining, output’ tables showing the flows of Source: Organisation for Economic expenditure 1,697.4 87,950 However, these potential impacts - manufacturing, construction have expenditure between sectors of the Co-operation and Development while desirable and possible - will not 1. The ICT Sector benefited less from the ICT revolution. Total 2,616.1 135,550 economy and allow the impact of a (OECD) necessarily benefit those who need Information available from the UK given level of expenditure on income Source: DTZ Pieda Consulting. Based them most, as improved access is Office of National Statistics enables This is supported by the OECD’s and employment to be calculated. 2. The use of ICT by others on the following 2003 financial year likely to be of most immediate benefit an assessment of the impact of ICT figures for the contribution of various Indirect impacts are not restricted to Some characteristics of ICT - such as figures for BT: to the relatively wealthier in societies, activity on the UK economy. sectors to aggregate productivity the ‘first round’ effect of purchases by increased bandwidth and processing • Total Supplier Expenditure: £3.7 whose skills, education and growth in the UK between 1996 and BT. Suppliers to BT will purchase some power and the plummeting cost of billion opportunities allow them to take The rapid growth in both ICT 2002: of their inputs from other suppliers in communications - enable organisations immediate advantage of them. production and investment was an • ICT manufacturing: >0.1%. • Total Capital Investment: £2 billion the UK and so on. and economies to become more Furthermore, globalisation, made important contributor to UK economic efficient and productive. • ICT producing services (for example, • The study is based on BT employing easier by telecommunications, puts growth and productivity growth Induced impact telecommunications): <0.25%. 122,423 people in the UK, either communities of all sorts into direct throughout the1990s. Further indirect (or ‘induced’) impact In Getting the Measure of the New directly by BT or as contractors. competition with one another for jobs • ICT using services (e.g. financial is created when income created Economy, a report from the Work and investments. In 2001 (the most recent data services, retail, etc): >0.8%. directly and indirectly by BT is spent. Foundation’s iSociety project, Diane available), the contribution of ICT to This encourages further employment. Coyle and Danny Quah argue that UK Gross Value Added (GVA) was it will take time, indeed decades, for £63.5 billion of a total of £880.9 DTZ Pieda Consulting estimates ICT to filter through into the whole billion - 7.2 per cent. induced impacts produce £3.4 billion economy. We are only beginning of income and support 173,780 jobs. to see the wholesale restructuring of The contribution of the business, industrial and organisational telecommunications portion of the models made possible by the diffusion ICT sector grew from around £12.1 of ICT. billion in 1992 to around £21 billion in 2002.

Competitiveness We believe that ICT has much to The European Union established a offer society in terms of improving strategic goal in Lisbon in 2000 to economies and enabling improvements become ‘the most competitive and in peoples’ lives; however, these dynamic knowledge-based economy improvements must not come at in the world... regaining the conditions the cost of potentially negative for full employment and to strengthen consequences of economic activity social cohesion.’ for society and the environment. The European Union’s Lisbon Strategy - This ‘Lisbon Strategy’ sets out a while a substantial and important number of strategic aims to improve piece of work - may in the long run the competitiveness and dynamism undermine the EU’s commitment of the European economy, including: to sustainable development (via the • Investing in research and development ‘Gothenburg Strategy’), and we urge decision-makers to join up their • Boosting innovation thinking. We explore the Gothenburg • Adaptable workforce Strategy and BT’s contribution to sustainable development in the • More and better skills. Sustainability section. The interim review of implementation of the Lisbon Strategy, released in November 2004, notes that improving performance on attaining a ‘knowledge society’ - and encouraging the further use of ICT - is a critical element in meeting the strategy’s aspirations.

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The concept of sustainable • ICT sustainability impacts This is a challenge facing Europe environmental protection (climate achievement of sustainable social and consumption of finite materials and development has increasingly come in its attempt to “refocus the Lisbon mitigation, resource efficiency, economic development goals to improve the work-life balance • Sustainable Development to represent a new kind of world, agenda on actions that promote monitoring and information gathering) of our people. in Broadband Britain where economic growth delivers a growth and jobs in a manner that and poverty eradication • The Internet enhances the capability more just and inclusive society, at • BT raising awareness on sustainable is fully consistent with the objective of those with access in the fields of Here we identify some of the key • Countries at all stages of economic the same time as preserving the development of sustainable development”. education and health, as well as sustainability impacts of ICT, using development should recognise ICT as natural environment and the world’s providing new opportunities for quantified examples from our own • BT working in partnership. an integral component of sustainable non-renewable resources for future In the economics section we economic activity and democratic experience. These are: development strategies, not merely generations. demonstrate how ICT contributes participation • The impact of phone and video- BT’s approach as a valuable industry in its own right to economic growth, and later in this conferencing on travel This report identifies and quantifies • All sectors can improve the impact Achieving sustainable development section we show how some specific • Relevant international and regional our social, economic and environmental of their operations, reducing • The social and travel implications requires a degree of international ICT services such as flexi-working can institutions should develop a strategy impacts, and set targets to improve. their use of resources through of more flexible workstyles consensus and a great deal of multi- deliver immediate (direct) for the use of ICT for sustainable smart energy management, institutional support. environmental and social benefits. development and as an effective • The impact of e-business. We use the term corporate social more efficient transport, transport However, the wider (consequential) instrument to help us achieve the responsibility (CSR) more often than substitution, dematerialisation, The term ‘sustainable development’ environmental impacts may not all be UN’s Millennium Development Goals For more information on work-life sustainable development. CSR is the electronic commerce and substitution has many different interpretations. positive, as the Forum for the Future’s (MDGs) balance, see Employees. voluntary action a company takes to of services for products. The European Union (EU), for example, assessment of Sustainable contribute to the wider societal goal • Governments and the private sector has developed a high-level strategy Development in Broadband Britain Conferencing of sustainable development, such as should implement different ICT sustainability impacts to promote sustainable development, shows. Conferencing by video, phone or the the EU’s Gothenburg Strategy. instruments that can help to extract ‘ICT is a wonderful tool for creating known as the Gothenburg Strategy. web is more time- and cost-efficient the maximum benefits from ICT and value, creating an inspired work This sets out a series of high-level Certainly, the UK has a long way to than meeting in person. It improves CSR requires a co-ordinated approach speed the development of environment and an opportunity for strategic aims to counteract a go to decouple economic growth from the quality of life for those who travel to managing social, economic and sustainability solutions throughout people to develop themselves’ growing number of unsustainable its environmental footprint, and data frequently. It is also a major benefit environmental issues right across the society Ben Verwaayen, BT CEO, 2002 trends in society. presented by the UK Sustainable for BT’s 9000 plus home-based workers company. See business principles for a Development Commission shows • Tools should be developed to evaluate and a growing number of those who description of our CSR governance Communications technology not only No individual country, business nor no improvement in life satisfaction the environmental and social impacts occasionally work from home. framework and our CSR health benefits business, but the people organisation can become sustainable despite a 75 per cent growth in Gross of ICT use checks. doing business. ICT is changing the on its own. But it can improve and Domestic Product (GDP) since 1973. BT Conferencing provides all BT’s • ICT should be integrated into the way business is done, especially contribute to a more sustainable world. internal phone, video and e- However, sustainability is not just mainstream of sustainable through the Internet and wireless The following are recommendations conference facilities, as well as about having the right systems, development. technologies. The technologies This report concentrates on how to governments developed by the providing conferencing for customers. checks and balances in place. BT provide the possibility of productivity BT contributes to sustainable Global e-Sustainability Initiative (GeSI) aspires to lead by example, and this ICT and sustainability gains similar to those of the industrial development through its own for the World Summit for Sustainable Impacts of conferencing section considers the practical steps ICT brings many potential benefits revolution. activities. This section explores the Development (WSSD) and World In October 2004, an independent poll we are taking to raise awareness of, to society. issues through the broad lens of the Summit for the Information Society of BT people who use conferencing and participation in, sustainability. Furthermore, ICT can support social Information and Communications (WSIS): showed that: In its submission to the World Summit and economic development by Technology (ICT) sector’s activities • Markets should be open to new • 71% thought their last conference A sustainability vision on Sustainable Development the transforming communication and and contributions, and considers the technologies and new approaches call had definitely or probably replaced ICT drives productivity and economic Global e-Sustainability Initiative access to information, helping to potential conflict between ICT-driven a meeting growth. For this to make a direct • Governments should aim for highlighted how: bring about the powerful social and economic growth and sustainability. contribution to sustainable harmonisation of standards and stable • ICT provides the infrastructure of the economic networks needed to bring • 73.5% believed they had saved development it must be managed regulatory frameworks knowledge economy and can enable sustainable development to emerging at least three hours in travel time Here we discuss: in the right way. If not, it will lead other sectors to move towards economies. • BT’s approach to sustainable • Public-private partnerships should be • 46% of trips avoided would have to further inequalities and greater sustainability development encouraged to develop infrastructure been by car consumption. The use of BT’s own products and and applications in areas where the • Low penetration of ICT in less- • A sustainability vision services enables us to reduce our • 78% of trips avoided would have market needs support, eg, developed economies inhibits the

been at peak travel times (showing Information Society Technology (IST) Report. average additional weekly travel of 60 the books, which are reprinted every • It saves paper that conferencing helps to relieve programme. The survey assesses the SusTel UK miles at BT and 16 miles for BAA year and delivered to every UK • Itemised call details can be sorted congestion on roads and free space economic, social and environmental The SusTel UK report summarises staff. But average weekly commuting household, now include a classified and analysed by customers on public transport) aspects of teleworking. the UK results of the SusTel survey, fell by 253 miles at BT and 61 miles advertising section. Our billing • Online VAT statement, supported by a European Commission research at BAA. operations saw an increase in • 35% of meetings replaced would have Customs and Excise, can be printed SusTel BT Pilot Report project on the social, economic consumption of 13 per cent, which been in London. The report summarises an on-line and environmental consequences More information and full data are includes billing undertaken by BT on • Customers can download billing data survey (carried out in October 2002) of telework. available in the UK SusTel Summary behalf of our customers. to their PC. We estimate that every conference of employees registered with Report, or on the SusTel website. call saves a minimum of 32kg of Workabout, BT’s official teleworking In the autumn of 2002, the SusTel Despite these increases, resulting In the 2004 financial year, BT ran travel-related carbon dioxide programme. Answers were received team conducted 30 case studies SusTel, in collaboration with BT and from changing business models, we a pilot with the Woodland Trust, the emissions. BT conference calls each from 1874 people, a response rate and a total of six surveys, one each other companies in Europe, has also have seen significant reductions since UK’s leading woodland conservation year save at least 47,400 tonnes of of 36.5 per cent. in Denmark, Germany, Italy and developed the Telework-Sustainability April 2000. charity, to encourage business carbon dioxide. the Netherlands and two in the Assessment Tool (SAT). This provides • From increased use of email and e- customers to use paper-free billing The main findings of the survey were: United Kingdom. a simple way to assess and improve business: internal printing has by planting trees on behalf of those For full data, see BT Conferencing • The majority of respondents felt that the sustainability of telework decreased by 42% who signed up for this service. BT Conferencing Survey Report. they had a better life using teleworking The main UK surveys were carried programmes in organisations. Following the success of this pilot, • the use of paper forms has decreased than if they commuted to an office. out with the UK airports company, we are extending the offer to For more information on by 62%. Many reported an increased BAA, and BT. e-Business (e-BT) residential customers during the teleconferencing with BT, contribution to domestic and Increased use of electronic 2006 financial year. see BT Conferencing. And from efficiency gains: community activities, while a small They found that most people reported transactions in BT has clear • Billing has reduced by 19% number believed that they would an improved quality of life, although environmental benefits. Paperless payments Flexible work-styles be unable to do their job without many teleworkers worked longer • Printing for customers has reduced Customers can pay their bills by Technology enables flexible working telework hours. The companies also benefited, Since the financial year 2000, we have by 46%. direct debit without completing any that suits the needs of individuals and especially from reduced absenteeism been transforming BT into e-BT, by paperwork. This can be set up on businesses, giving people the freedom • Most teleworkers reported an increase and job turnover. And the survey reducing the number of paper-based See Data and targets. the phone or on our website. Each to work while away from the office in working hours - of over nine hours found a net reduction in travelling transactions and trading more paperless sign-up saves us mailing with all the resources they need to per week for almost half the despite an increase in teleworkers’ electronically. This has reduced the Customer solutions one paper direct debit instruction, do their jobs effectively. respondents. This increased working personal journeys. use of paper, ink and other stationery Online Directory one leaflet explaining payment time was the main reason given - the use of copier paper has fallen by BT’s on-line directory enquiries options and one return envelope - We have supported and sponsored by the small minority of respondents Key points: 42 per cent since 2000. provide telephone numbers. Users are as well as the original envelope. the development of workstyle choices who felt teleworking had a negative • Most respondents felt that entitled to ten free searches a day and for our people for a number of years. effect on their lives. teleworking had a positive influence Paper consumption can search by name, town or the For more information on residential & More than 9000 BT people are full- on career development, although Since the summer of 2004 all our initial letters of the post code. business billing, see http://www.bt.com. time home-based workers, Paradoxically, although people work a minority (15%) of BT respondents copier paper has been produced from experiencing personal benefits while longer hours, they also feel their disagreed 70 per cent recycled post-consumer eBilling reducing the environmental impact quality of life has been enhanced. waste collected in London. This stock BT produces millions of bills every of their commute. This is because less commuting frees • Respondents felt isolated from work provided 66.7 per cent of the copier year, using millions of sheets of paper. time for work and private life and also colleagues and, to a lesser extent, paper we used last year. We are developing ways to use our Here we discuss the pros and cons greatly reduces stress. Also, from non-work contacts - something technology to reduce the amount of of teleworking as identified by two teleworking enables people to which did not matter to most of them Our billing and telephone directories paper we use and to improve linked studies. multi-task. They can, for example, but did for a large minority of BT staff operations account for most of our customer service. do domestic jobs during work breaks. • Three of the six case study companies consumption of print and paper. The An internal BT survey, which acted This gives them more quality time showed major reductions in office use of paper in phone books has risen Business online paper-free bill as a pilot for an external survey at evenings and weekends. space requirements by 30 per cent, compared with the The advantages of on-line paper-free conducted by SusTel, on teleworking, 2004 financial year. This is because billing are: funded by the European Union’s For the full data, see SusTel Pilot • Non-work-related journeys resulted in

Sustainable Development in However, the environmental effects and software company, we have • Adding Values (2001) provides an Partnerships The future Broadband Britain of broadband are more mixed. developed a web-based environmental insight into why and how to account We often work with external partners ‘Advanced telecommunications During the financial year 2004, we management solution. for a company’s economic to deliver BT branded projects and services are one of the few asked Forum for the Future to look Reductions in travel by teleworkers performance and effects programmes. achievements of our consumer society at broadband from a sustainable and more effective use of office The software is fully integrated with that could be accessible to, and used • Variety and Values (2000) gives a development perspective. Taking accommodation are offset by: a BT managed application enabling We get many invitations to participate by every person on earth without review of globalisation and its linked social, economic and environmental • The increase in energy consumption it to be web based with full as a partner in activities co-ordinated exceeding sustainable limits on effects on cultural and bio-diversity concerns together, we wanted to by BT operational security and external by external agencies. We select those resource-use and environmental loss know how the roll-out of broadband hosting. The solution can be used where we have something to offer impact.’ • Possible changes in consumer Internet access will affect the UK’s by anyone in any location with • Changing Values (1999) considers and gain, especially through mutual Peter Johnston of the Information behaviour ability to deliver a better quality of web access. the role of business in a sustainable learning and the exchange of ideas. Society Directorate of the European life and a better environment for all • Waste associated with consumer society. Commission in the future. demand for ICT products. Designed to ensure full compliance Particularly relevant would be our: with ISO 14001, EMAS, ISO9001 Participation • Support for the United Nations To achieve this goal, we need: The roll-out of broadband is a The full presentation is available here and OHSAS18001, Envoy covers We often participate in discussions on Global Compact, an international • Networks powered by energy derived strategic priority for BT and therefore as a PDF download. See what actions environmental, quality, and health the role of business in sustainable commitment to principles on bribery from renewable sources has a significant impact on our have been taken which address some and safety (EQS) management and development and sponsor events and and corruption, human rights, labour • Equipment and cables made from contribution to sustainable of the recommendations made in the monitoring. conferences on the subject. and the environment non-oil derived plastics (probably development in the UK. Forum for the Future report. • Support for the Global Reporting coming from agricultural products) Raising awareness We are members of a number Initiative in its development of The report concludes: ACTNOW partnership We want to understand our impact of organisations that attempt to • Polymeric conductors to be used in sustainability reporting guidelines Large positive economic impacts are The UK Regional Development and stimulate debate on sustainable influence public policy on matters place of metals expected from the roll-out of Agencies see e-business as key development and corporate connected with corporate social • Inputs to multilateral dialogues via • Fibre-optical switches and computers broadband by: to economic development. BT has responsibility. To do this, we need responsibility (CSR) and sustainable the Global e-Sustainability Initiative (as glass is derived from a plentiful • Enabling more efficient business worked with the South West Regional to consult and talk to people, and development, such as: (GeSI), an ICT sector initiative supply of sand, fibre-optic processes - most marked in the small Development Agency with promote awareness and dialogue • CSR Europe promoting technology that fosters components could reduce the need business (SME) sector considerable success to spread on the issues. sustainable development, and the • Forum for the Future for metals and conventional broadband to remote rural areas. European Telecommunications • Stimulating economic growth - semiconductor materials). Through the Cornish partnership Publications • Green Alliance Network Operators (ETNO) through productivity gains and access ACTNOW, a total of nearly 45,000 We produce a series of occasional to the global market. • Business for Social Responsibility • Work with the UK Centre for Our services can also help to build a broadband connections have been papers designed to address the Economic and Environmental more productive and inclusive society set up since the project began in complex inter-relationships between • Global e-Sustainability Initiative The Internet is expected to have a Development (UK CEED), an with improved democratic participation, 2002. Many of these connections companies and society. The papers, significant impact on society, and the independent charitable organisation more efficient provision of health and are to small businesses in Cornwall, which aim to stimulate debate rather We respond to formal consultations arrival of broadband accentuates and aiming to raise environmental education services, unlimited access 76 per cent of which claim they have than provide definitive answers, such as the UK Government slightly modifies that by: standards through research and to other people and to knowledge. experienced direct economic benefits. include: sustainability strategy and the EU • Allowing more efficient delivery of policy development, and SustainIT. • Just Values (2003) asks the question green paper on CSR. educational, health and other public It is estimated that the project has ‘What happens when responsible services created or safeguarded over 3300 business doesn’t pay?’ by examining BT is keen for the Government to • Offering the opportunity to enhance jobs and made a £39 million impact the relationship between the business make changes to the legal and fiscal and multiply social ties on regional GDP. case for sustainable development and frameworks, which will enable the moral imperative. business to survive and flourish from • Helping community centres work Web-based environmental sustainable business practice. For more efficiently • Enlightened Values (2002) offers management software more information, see Public policy. a practical business case for • Enabling telework. In partnership with Entropy accountability and stakeholder International, a management systems engagement

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In this section you will find: From here specific indicators were women declined from 22.7% to 22.4% During the 2005 financial year, short of our Sourcing with Human the level they were at in 1996. • BT’s 12 non-financial key performance derived from a consultation involving we introduced a new Employee Dignity standard is at its highest. Also important is the disposal of our • Global Warming CO2 emissions down indicators (KPIs) for a quick overview report users such as investors, Engagement Index, replacing the waste. This year we have increased of our social and environmental customers and employees, together • Waste to landfill down People Satisfaction Index. The Two hundred and forty ethical trading the percentage of the total waste we performance with outside experts such as the BT new index helps us understand how risk assessment questionnaires have recycle from 26% to 34% and reduced • Lost Time Injury rate per 100,000 Leadership Panel. Our KPIs includes engaged or disengaged a team been completed and 11, on-site our waste going to landfill from • Our social and environmental hours worked is 0.480 cases, at least one indicator for each of our is and covers issues such as team assessments have been undertaken 79,677 to 73,201 tonnes. performance data compared to 0.620 in the 2004 four important stakeholder groups working; senior management and and improvement plans are in place financial year • Our social and environmental (customers, employees, community communication and work-life balance. where required. We are continuing to Integrity performance targets, including our and suppliers) and reflects key issues • 240 Ethical trading risk assessment focus our action on high and medium In today’s world, integrity and fulfilling progress against the targets set in of social concern (integrity, digital questionnaires completed by suppliers We have achieved our target of risk areas. our promises are increasingly critical. previous financial years. inclusion and environment). with 100% follow up sustaining 8% of our employees being from an ethnic minority background, Community Our Statement of Business Practice, • Ethics Performance Measure of 70% Key performance indicators In the 2005 financial year, one new which rose to 9.2%. However, whilst We have made the commitment to The Way We Work, is a key document, Key performance indicators indicator was added and several • Direct community investment of £9.1 the number of disabled employees in provide a minimum of 1% of our UK setting out the principles that apply Our 12 non-financial key performance existing KPIs were changed: million plus £11.7 million in further BT rose from 2.1% to 2.2%, we failed pre-tax profits to activities in support to BT people all over the world. indicators (KPIs) are designed to • For the first time we have included a funding and support in kind. to meet our target to increase the of society, either through direct provide a quick overview of BT’s social measure of our sickness absence rate level of disabled employees to 2.5%. funding or through support in kind. During the 2005 financial year, we and environmental performance. Below is a summary of our Similarly, we failed to increase This year we provided £9.1 million to developed an Ethics Performance • We have broadened our Significant They help you understand what performance in the KPIs during the the representation of women in BT activities in direct support of society, Measure (EPM). It includes our Incident Rate KPI to cover all Lost our stakeholders, and we, consider 2005 financial year. More detailed as a whole, which has fallen from plus £11.7 million in further funding existing Awareness of the Statement Time Injuries to be the most important issues. information can be found by following 22.7% to 22.4%. This suggests that and support in kind. of Business Practice measure, plus an • an Employee Engagement Index the links to the relevant sections. retention rather than recruitment external benchmarking study and two The KPIs have been used to establish (replacing the People Satisfaction is the barrier to progress. Environment questions from our annual staff a set of strategic social and Index) Customers Telecommunications is seen as an attitude survey. It moves us away environmental targets to drive We did not meet our target to reduce Providing a safe place to work and environmentally friendly technology. from a purely perception-based • an Ethics Performance Measure performance improvement across customer dissatisfaction by 25% promoting a healthy lifestyle are But the sheer scale and reach measure towards one of performance. (replacing the Awareness of Business the business. a year over the 3 years to the 2005 critical to our employee relationships of our business create a sizeable Our target is 71% in 2006. Practice target). financial year, a key target in our and we are seeing some excellent environmental footprint. For example, You can view our performance data drive to deliver the highest levels of progress in these areas. Our BT is one of the largest consumers Download the KPI performance data We will be carrying out a major review and targets summary for all our KPIs customer satisfaction. However, we significant incident rate (the reported of industrial and commercial electricity and targets sheet as a PDF document of all KPIs in the 2006 financial year. here, with further information and still managed a creditable reduction number of injuries, diseases and in the UK. commentary below. of 23% on a compound annual basis dangerous occurrences) was down Summary over the past 3 years. from 87 accidents per 10,000 We are expecting the roll out of This performance relates to the 2005 All other performance figures full time employees in the UK broadband to increase our electricity -financial year, compared with 2004: are available in the social and BT is determined to spread the to 61 this year. use - though investment in energy • Customer dissatisfaction down environmental data section benefits of broadband as widely as efficiency enabled us to minimise the of this site. • Broadband now available to of all possible. Broadband is now available Suppliers overall increase in consumption to UK homes and businesses, up to to 95% of UK homes and businesses. It is vitally important that our 3.1% during the 2005 financial year. Key performance indicator selection over 95% By the summer of 2005 we expect to suppliers provide working conditions The primary reference point in the have extended coverage to 99.6% of consistent with international We have set a target to cap our 2010 • Employee Engagement Index identification of KPIs was BT’s the UK population. guidelines such as the UN’s Universal CO2 emissions at 25% below those of up to 65% from 64% Statement of Business Practice. Declaration of Human Rights. 1996. This compares favourably with This sets out our business principles • Increase in the percentage of ethnic Employees the UK Government’s own target for together with the specific aspirations minority employees from 8.9% to 9.2% People continue to feel committed We continued to roll out our ethical CO2 reduction of 20% below 1990 and commitments that apply in our and disabled employees from 2.1% and satisfied with working for BT. trading programme to those places levels by 2010. BT’s global warming stakeholder relationships. to 2.2%, though the percentage of where we believe the risk of falling CO2 emissions are now 53% less than

Information and data on this page Information and data on this page has been verified by Lloyd’s Register has been verified by Lloyd’s Register Quality Assurance Limited Quality Assurance Limited BT Social and Environmental Report Data and targets 01 Key performance indicators and targets

Category Indicator 2005 2004 2003 Target 2006

Employees Employee Engagement Index – 65% 64% Not available‡ To achieve 66% by a measure of the overall March 2006 success of BT’s relationship with its employees

Integrity Ethical Performance 70% Not available‡ Not available‡ To achieve 71% Measure – a measure of our by March 2006 progress in acting with integrity

* revenue weighted † this is a revenue-weighted measure and is combined with a target to limit the levels of dissatisfaction to March 2005 levels ‡ measure not used that year – see archived reports for earlier measures ∆ risk assessments are based on completed questionnaires Information and data on this page has been verified by Lloyd's Register Quality Assurance Limited BT Social and Environmental Report Data and targets 02 Social and environmental data Data and targets This sub-section only contains trended and analysed data. Other one-off quantified data is included and explained within the various sections of our report. Fuel, energy and water Waste

Energy consumption by BT's network & estate Water used by BT’s network & estate Approximate Emissions of Nox Waste arising and management

Excludes BT Global Services outside the UK. Excludes BT Global Services outside the UK Excludes BT Global Services outside the UK Excludes BT Global Services outside the UK. Source: Invoices (not weather corrected). Figures include BT plc, BT Source: Invoices (not weather corrected). Figures include BT plc, BT Source: Emissions derived using Government conversion factors. Figures Source: Contractors Northern Ireland & Manx Telecom. Figures exclude Subsiduary companies Northern Ireland & Manx Telecom. Figures exclude Subsiduary companies include BT plc, BT Northern Ireland & Manx Telecom. Figures exclude and BT Tenants and BT Tenants Subsiduary companies and BT Tenants

Energy Consumed per £m Turnover Water use per £m Turnover Approximate Emissions of SO2

Excludes BT Global Services outside the UK Excludes BT Global Services outside the UK. Excludes BT Global Services outside the UK Source: Annual Report & Accounts, Energy Database Source: Annual Report & Accounts, Energy Database Source: Emissions derived using Government conversion factors. Figures include BT plc, BT Northern Ireland & Manx Telecom. Figures exclude Subsiduary companies and BT Tenants

Waste Type (tonnes) Year 2001 Year 2002 Year 2003 Year 2004 Year 2005 Waste Type (tonnes) Year 2001 Year 2002 Year 2003 Year 2004 Year 2005

Cable Transport related waste

Switchboard cable 931 817 685 559 630 Lubricating oil 209 202 246 241 256 Mixed cable 1227 1284 965 577 1411 Oil filters 52 28 90 71 86 Aerial Self Supporting cable 932 744 874 806 728 Antifreeze/water mixture 8 6 21 8 11 Polythene covered cable 800 663 790 765 699 Brake fluid 2 1 1 1 1 Lead covered cable 471 697 235 259 203 Mixed fuel 18 15 3 2 4 Optical fibre cable 1198 1204 746 474 670 Oil contaminated waste 7 8 12 12 12 Blown fibre cable 395 346 138 204 285 Paint solvent/thinners 1 0 0 1 0.11 Total 5954 5756 4434 3645 4626 Tyres 545 496 404 485 438 Total 842 755 777 822 808

Telephone exchange equipment Misc Electrical Equipment 823 1441 3377

Miscellaneous equipment 935 1007 823 537 1906 General Scrap Metal 1213 853 1411 4416 Miscellaneous Metals 1293 1004 1202 912 2082 Telephone directories 442 616 359 268 920 Payphone equipment 136 172 223 38 218 Telegraph Poles 3852 3926 6551 5103 6122 Telephones 580 516 431 464 697 Computing Equipment 104 832 443 755 1470 Total 2944 2700 2679 1952 4902 Clothing 2 3 3 2 0 Catering Oil 80 44 25 Other (eg wood, glass, etc) 25 21 Office & Packaging waste Catering Equipment 19 15 Fluorescent Tubes 11 Office Paper 2116 1790 6264 1379 1277 Total 4400 6590 9112 9069 16378 Cardboard 1050 2250 1366 6288 5792 Plastics 31 Nil 14 34 0 Total waste recycled 21738 23456 27429 26714 37421 Toner Cartridge 39 43 50 16 13 Silica desiccant 34 8 10 5 4 General Waste 117196 90900 89878 79677 73201 Aluminium cans 2 2 2 14 10 Plastic cups 12 11 12 15 9 Total weight for all catagories 138934 114356 117308 106391 110622 Total 3284 4104 7719 7751 7105

Waste recycled (as % of total waste) 18% 21% 24% 26% 34% Batteries

Ni-cad rechargeable batteries 8 20 16 34 27 Total income £4.0 million £4.2 million £4.26 million £3.9 million £2.9 million Exchanged lead acid batteries 4281 3483 2632 3408 3536 Vehicle Lead Acid Batteries 26 47 61 35 37 Total 4315 3550 2708 3477 3601 Total expenditure £7.0 million £8.1 million £8.29 million £9.9 million £7.4 million

Landfill tax savings £0.28 million £0.3 million £0.36 million £0.38 million £0.54 million

Total savings/costs - £2.7 million - £3.6 million - £3.7 million - £5.6 million - £3.96 million

Fuel, energy and water Transport Waste

Quantities of scrap cable recovered for recycling Number of Vehicles in BT's Commercial Fleet Total Number of Vehicles in the Company Car Fleet Distance Travelled per £m Turnover

Excludes BT Global Services outside the UK. Excludes BT Global Services outside the UK Excludes BT Global Services outside the UK. Excludes BT Global Services outside the UK Source: Contractors Source: BT's Vehicle Database Source: BT's Vehicle Database Source: Annual Report & Accounts, Transport Database

Distance Travelled by the Commercial Fleet, Company Transport emissions by Commercial Fleet, Company Quantities of batteries recycled Fuel used by BT's Commercial Fleet Cars & Private Vehicles on BT Business Cars & Private Vehicles on BT Business

Excludes BT Global Services outside the UK. Excludes BT Global Services outside the UK Excludes BT Global Services outside the UK. Excludes BT Global Services outside the UK. Source: Contractors Source: BT's Vehicle Database Source: BT's Vehicle Database & Business Expense Claims Source: NETCEN (AEA Technology)

Information and data on this page Information and data on this page has been verified by Lloyd'sLloyd’s Register has been verified by Lloyd'sLloyd’s Register Quality Assurance Limited Quality Assurance Limited BT Social and Environmental Report Data and targets 05 Data and targets

Emissions to Air

CO2 Model

BT Carbon Dioxide (CO2 Base Year equivalents) Model

96/97 00/01 01/02 02/03 03/04 04/05

Emission Source Amount (kg) Amount (kg) Amount (kg) Amount (kg) Amount (kg) Amount (kg)

Electricity 1,202,340,000 870,616,653 643,384,535 625,042,555 596,870,724 440,251,967 Gas 110,770,000 95,606,308 87,599,284 91,629,939 92,599,797 81,196,740 Oil 66,500,000 31,149,226 21,863,202 18,597,767 15,677,851 14,352,750 Commercial Fleet Diesel 167,232,000 165,411,269 166,479,057 146,286,919 131,282,272 126,699,464 Commercial Fleet Petrol 18,480,000 1,730,012 1,491,142 2,115,145 9,951,175 9,603,799 Company Car Diesel 24,021,000 6,539,183 6,120,716 7,794,778 8,182,973 11,153,473 Company Car Petrol 16,296,000 30,378,257 38,127,971 25,238,685 25,513,068 17,303,091 Cars on BT Business (Diesel) Note 1 794,318 822,231 581,916 600,521 600,826 Cars/Motorcycles on BT Business (petrol) Note 1 4,710,125 4,954,311 3,508,096 3,584,361 3,785,867 Refrigeration Gas Note 2 9,634,849 11,312,680 6,422,045 7,613,771 10,170,556 Rail travel Note 2 11,331,224 11,159,653 11,873,532 12,168,782 13,484,611 Air Travel (short haul) Note 2 10,375,194 7,666,251 5,544,424 4,711,583 6,006,193 Air Travel (long haul) Note 2 14,674,189 5,638,300 3,982,182 7,000,831 9,866,11 Hire Cars (Diesel) Note 2 23,954 943,227 1,745,243 1,163,209 2,670,362 Hire Cars (Petrol) Note 2 2,888,259 20,154,402 8,726,216 12,316,408 12,777,391 Total CO2 emissions (kgs) 1605639000 1,255,863,020 1,027,716,962 959,089,442 929,237,325 759,923,191

Total CO2 emissions (Mtonnes) 1.61 Mtonnes 1.26 Mtonnes 1.03 Mtonnes 0.96 Mtonnes 0.93 Mtonnes 0.76 Mtonnes

Source Invoices, BT vehicle database, BT refrigerants database, BT expenses unit, BT travel management, DETR, AEAT NETCEN Notes 1 Included in company car data Notes 2 Data not available

Fuel, energy and water Employmentter Fuel, energy and water

CO2 equivalent emissions CFC-11 equivalent emissions Diversity Descrimination Litigation

Excludes BT Global Services outside the UK. (96/97 is the CO2 Excludes BT Global Services outside the UK. Source: Accenture database Source: Group legal target base year) Source: Refrigerant database Source: Invoices, BT vehicle database, BT refrigerants database, BT expenses unit, BT travel management, DETR, AEAT NETCEN Benefits

CO2 per £m Turnover BT Paper Consumption Employee Tribunal cases

Excludes BT Global Services outside the UK. Excludes BT Global Services outside the UK Source: Group legal Source: Annual Report & Accounts, CO2 Model Source: BT Buyers

Health and Safey water Health and Safey water International Data

Sick Absence due to Accidents Ill health cases with OHS referal Bt Global Services Energy, Water and Waste data te Electricity Gas Oil Water Waste Waste

kWh kWh litres litres Hazardous / Special Tonnes General Tonnes

Spain 1,208,739 0 0 5,700,000 0.09 20 Switzerland 70,443 0 0 0 0 4.16 Americas 4,137,289 0 0 1,399,360 0 0 Germany 63,500,000 0 0 0 0 341 Hong Kong 276,554 0 0 0 0 0 Taiwan 47,042 0 0 467,000 0 0 Seoul 11,032 0 0 0 0 0 Beijing 2,400 0 0 0 0 0 Tokyo 149,781 0 0 0 0.3 5.8 Singapore 129,705 0 0 0 0 8 KL 29,456 0 0 0 0 0 All figures (from 03/04 onwards) are now global All figures (from 03/04 onwards) are now global Bangkok 159,822 0 0 0 0 2 Source: Accenture database Source: Accenture database Manila Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 India 234,396 0 0 18,431 0 0 Sydney 487,715 0 0 1,182,800 0 13 Melbourne 82,656 73,061 0 16,425 0 0 Netherlands 29,265,463 504,961 500 8,693,000 0 149 Significant incident cases Ireland 21,662,184 1,424,774 796 0 0 233.1 CEE 303,114 0 100 0 0 0 France Note 2 Note 2 Note 2 Note 2 Note 2 Note 2

TOTALS 121,757,791 2,002,796 1,396 17,477,016 0 776

Notes 1 Data insignificant. Manila operations comprise 6 people in a shared office. Notes 2 Data not available

All figures (from 03/04 onwards) are now global Source: Accenture database

Business Principles Community

Target status report Target Description Update Target Target Description Update Target We have established a set start date end date status start date end date status of targets to improve our social April 2005 March 2006 To help embed CSR into the New April 2005 March 2006 We will provide a minimum New and environmental performance. business and ensure that of 1% of our 2004 financial year corporate responsibility becomes UK pre-tax profits to activities Details of all our targets are given part of our day-to-day activities, in support of society, either below. We also provide interim we will ensure that due through direct funding or updates on progress against our consideration to CR opportunities through support in kind. targets on a quarterly basis (with and risks are included as a part the exception of quarter one) of our business case authorisation April 2005 March 2006 We will extend the existing New on the Better World website. process and our integration sponsorship of an Indian school process for newly acquired programme (based in a deprived Those social and environmental businesses coming into Global area of Delhi) to a second school targets which have been identified Services (Albacom, Infonet and in Pune. as particularly important feature Radienz). Additionally, we will in key performance indicators. ensure that awareness of CR April 2005 March 2006 We will launch the LifeLines New is raised through focussed India community investment NB: interim target updates (where communication across Global programme (in support of the indicated) ARE NOT verified by LRQA. Services. UN Millennium Development LRQA verifies progress against targets Goal, aimed at bridging the on an annual basis only. April 2005 March 2006 95% of managers and 90% New digital divide in a developing of team members will have country). Performance against targets completed regulatory Our 2004 Social and Environmental compliance training. April 2005 March 2006 We will extend our volunteering New report included 45 targets. Of these, and charity matching activities 33 were completed, 3 remain on April 2005 March 2006 We will increase our Ethics New to employees based internationally target, 2 are delayed and 7 failed. Performance Measure score to give something back to the to 71% from 70%. key communities in which we We have introduced 58 new targets are present around the globe. this year and progress on these, April 2004 March 2005 We will maintain the awareness Survey for Completed Following research on local fit, as well as our 5 ongoing targets, of the BT Statement of Business all employees a programme of country will be tracked on a quarterly basis. Practice (The Way We Work) shows implementation with appropriate amongst UK-based employees awareness volunteering and charity matching at a minimum of 75%. of >75%. activities, funding and measures will be agreed with the Global April 2004 March 2005 We will develop a new, index- A new index Completed Services Executive. based indicator to measure our has been effectiveness at implementing developed. April 2004 March 2005 We will provide a minimum The target was Completed BT's Statement of Business of 1% of our 2003 financial achieved with Practice (The Way We Work). year UK pre-tax profits to a total figure activities in support of society, of £20.8 million April 2003 March 2005 Indicators on the awareness Global have Completed either through direct funding representing of BT's Statement of Business undertaken or through support in kind. 1.1% of pre tax Practice will be extended to a separate profits for the incorporate BT's wholly owned survey for 2004 financial year. international activities. people outside the UK.

Customers Employees continued

Target Description Update Target Target Description Update Target start date end date status start date end date status April 2005 March 2006 We will increase the number New April 2005 March 2006 We investigate whether, or not, New of extremely and very satisfied the statistical distribution of customers by 5% and limit the performance ratings amongst levels of dissatisfaction to ethnic minority employees is March 2005 levels (revenue- a “normal distribution” (using weighted measure). the ethnically white workforce as a comparison). If this is not April 2004 March 2005 We will reduce the number Despite failing Failed the case we shall put in place of dissatisfied customers by to achieve this a plan to start to identify any 25% over 3 years (2002-2005) target, we still underlying causes. according to a revenue- managed a weighted calculation. creditable April 2005 March 2006 We commence a comparison New reduction of 23% of the demographic distribution on a compund of BT ethnic minority employees annual basis over with the ethnic distribution of the the past 3 years. national (UK labour force), in order to understand where, if necessary, we need to prioritise action in future years. Employees April 2005 March 2006 We will work with our Executive New Target Description Update Target Search companies to ensure that start date end date status they are able to provide diverse recruitment lists for our senior April 2005 March 2006 We will achieve a 4% reduction New management vacancies. in the incidences of ill health meriting referral to occupational April 2005 March 2006 We will ensure that there is proactive New health which may be possibly diversity management of the talent attributable to work activity within pool for executives initially through the UK expressed as cases per analysis of sample short lists for 10,000 people in post. executive positions by gender.

April 2005 March 2006 We will maintain or improve on New April 2005 March 2006 We will be continuing to work to New our 2005 representation levels ensure that BT's policy and practice of women, ethnic minority and reflect the spirit and intent of our disabled employees. disability vision.

April 2005 March 2006 We will maintain or improve New April 2005 March 2006 We increase the Employee New representation levels of people Engagement Index to 66%. over 50 in BT, proportional to that which exists in the UK labour April 2005 March 2006 We will achieve a 4% reduction New force (currently BT 24.9% and UK in the total sickness absence Labour force 33.34%). expressed as Calendar Days lost.

April 2005 March 2006 We will conduct a strategic New April 2005 March 2006 We will have no successful New review of our gender related prosecutions or prohibition activities, to understand how notices served against the company. we can best focus our resources in future years to improve the representation of women in BT.

Employees continued Employees continued

Target Description Update Target Target Description Update Target start date end date status start date end date status April 2005 March 2006 We will achieve a 15% reduction New April 2004March 2005 We will hold the percentage Achieved, with an end Completed in the Lost Time Injury rate, of BT people that are from of year total of 9.2%. expressed as the number of ethnic minorities to at least 8%. incidents per million working hours. April 2004 March 2005 We will understand and address We now have a Completed April 2004 March 2005 We will introduce new country- The BTGS Diversity Delayed the barriers to greater ethnic greater understanding specific diversity training in BT's Awareness training minority representation amongst of the barriers to non-UK operations where is now coming towards BT's senior management. representation at the culturally and legally possible. the end of it's senior level and plans development stage. have now been laid to The training was pushed implement a number back due to operational of actions throughout issues and is now due 05/06, which will address to be rolled out in Q1 these issues. of 2005-6. The UK version of the training April 2004 March 2005 We will understand and address We now have a Completed is currently being piloted. the barriers to greater female greater understanding The 15 country versions, representation amongst BT's of the barriers to with both specific country senior management. representation at the legislation and policy, senior level and plans are planned for completion have now been laid to and roll out in June 2005. implement a number of actions throughout April 2004 March 2005 Within the UK, we will achieve The reduction achieved Failed 05/06, which will address a 70 per cent reduction in the was 56.8%. these issues. number of sick absence days lost as a result of accidents at work. April 2004 March 2005 We will undertake health The health-checks have Completed checks on the equality and now been incorporated April 2004 March 2005 Within the UK, we will achieve The reduction achieved Completed diversity practices of BT outside into the development a 50 per cent reduction in was 64.9%. the UK of the Diversity training. incidencesof ill health meriting The training refers to referral to occupational health local and BT wide policy which are possibly attributable and practice and therefore to work activity. in the development of the training, a full round up April 2004 March 2005 Within the UK, we will achieve a 50 The reduction achieved Completed of 15 countries policy per cent reduction in the number of was 58.5%. and practices was obtained Significant Incidents resulting in the to ensure that we provide requirement to send a report to the local HR policy where possible. Enforcing Authorities. Further health-checks on specific "hotspot" areas April 2004 March 2005 We will increase the percentage Failed, end of year Failed such as disability will be of BT people that are women figure was 22.4%. carried out in 2005/6. to 25%.

Environment: Fuel, energy and water Environment: Fuel, energy and water continued

Target Description Update Target Target Description Update Target start date end date status start date end date status April 2005 March 2006 BT will, subject to planning restrictions New April 2005 March 2006 BT Ireland will complete energy New and financial viability, develop surveys of 50% of its key sites. and install two small-scale wind installations developing direct April 2005 Installation Completion BT will, as a direct result of the New integration technology solutions installation of its new 21st Century with the communication power multi- service access network, deliver equipment. a 30% line for line energy reduction.

April 2005 March 2006 BT will, subject to planning New April 2004 March 2005 We will Integrity Test fuel tanks Completed. PSL have Completed permission, install Photo voltaic at 611 BT sites. The main focus reported they have visited electricity generation at one key will be on buried fuel tanks that 726 BT sites to perform 21st Century network site evaluating were first tested in 1999. an Integrity test. This has the integration options and output. exceeded the target set at the beginning of the year. April 2005 March 2006 We will produce a business case New describing the costs and benefits April 2004 March 2005 We will investigate the The wind energy surveys Completed of replacing all network underground suitablitity for embedded have all been completed fuel tanks with internal double-skinned wind generation across the BT by the Carbon trust with tanks, over various time-spans ranging operational estate (6000 Sites). business cases completed from one year to 7 years. This will The top 4 suitable sites (as as required. allow senior management and Finance identified by the joint audit to make an informed decision as to process with the Carbon Trust) the best approach to follow. will be developed to full business case with appropriate technology April 2005 March 2006 BT will install and evaluate the New identified. benefits of installing remote profile water metering at 20 typical sites. April 2004 March 2005 To have fully investigated and A Bio diesel blend is Completed trial where practicable the uses currently being trialled April 2005 March 2006 BT will reduce the energy consumption New of biodiesel in standby generation at Goonhilly Downs Earth required in wet heated building by i.e. equipment at major sites where Station, with a view to gas and oil by 2% weather corrected combustion exceeds 20MW. further roll out where from the 2004/5 outturn. (N.B. excludes economically and network electrical consumption) technically viable.

April 2005 March 2006 Through implementation of energy New April 2004 March 2005 We will reduce metered Water A 6.1% reduction in Completed efficiency measures, BT will implement used BT in Premises by 2% metered water use energy efficiency measures to reduce from 2003/4 out-turn. was acheived exceeding electrical consumption by 12GWh the target of 3% reduction within the BT Wholesale estate or by 3.1%. process estate. April 2004 March 2005 We will reduce the energy Our heating efficiency Completed April 2005 March 2006 We will pressure test fuel tanks New consumption required to in wet improved by 6.54% at 400 BT sites. heated building by i.e. gas and weather corrected, oil by 3% weather corrected against our targetof 3%. April 2005 March 2006 We will replace 100 underground New from the 2003/04 outturn. (N.B. This is the sixth year in a tanks at high-risk locations with excludes network electrical row we have continued double-skinned internal tanks. consumption) to improve our heating efficiency.

Environment: Fuel, energy and water continued Environment: Waste

Target Description Update Target Target Description Update Target start date end date status start date end date status April 2004 March 2005 Through implementation of Our energy efficiency Completed April 2005 March 2006 We will increase the waste recycled New energy efficiency measures, measures delivered by 5% (recorded in tonnes) based on we will reduce our electrical savings of 16.3 GWh our 31 March 2005 totals. consumption by 10GWh within this year. the BT Wholesale estate. April 2005 March 2006 We will review the current processes New in connection with paper and cardboard recycling to ensure BT April 2004 March 2005 We will reduce the energy Our premises energy Completed is achieving the best possible results consumption required to run dropped by 15% to our in this key area. The review will include its Premises i.e. all gas, oil lowest estate energy the contribution made to recycling and electricity, by 3% from the usage figure since figures by using Materials Recovery 2003/04 outturn. (N.B. excludes energy management Facilities. network electrical consumption). records started. April 2005 March 2006 BT Ireland will have drainage plans New April 2004 March 2005 One hundred locations where Unfortunately, we only Failed at all sites with standby generators. the operational underground managed to decommission storage facilities have been 92 tanks. Additionally, April 2005 March 2006 BT Ireland will investigate the need New identified by the 'Environ' action 5 high-risk sites from for, and develop if appropriate, plan as presenting the highest the Environ action plan a new recycling route for Aluminium environmental risk will be were not included. Cans at its key sites. decommissioned and the facilities upgraded. April 2004 March 2005 We will review the drainage The EA have now Completed infrastructure of polestacks responded and although April 2002 Sept 2005 We will eliminate all bowsers It is still our intention On target to determine the preferred cost there are some issues still from the BT fleet, which are to eliminate all existing effective drainage solution to under discussion, we used to transport gas oil to Bowsers from the BT Fleet ensure environmental compliance have progressed the trial remote sites. September 2005. Our and arrange a trial to prove the at Kings Lynn TEC and Networks fuel tanks will effectiveness of the recommended the works order has been then be refuelled by one solution. placed on our external of a variety of mechanisms suppliers. the company has available. April 2004 March 2005 We will increase the amount The target was exceeded Completed of items recycled by 5% by a considerable amount (recorded in tonnes) and and we achieved 36% measured against the March against our taget of 2004 outturn figure. 5%. This was largely due to initiatives to recover computing equipment, standby generators and mobile engine sets, all of which had a significant impact on the total tonnage recovered for recycling, increasing it by over 10,694 tonnes.

Environment: Transport Environment: Emissions to Air

Target Description Update Target Target Description Update Target start date end date status start date end date status April 2005 March 2006 BT will put into action and provide New April 2005 March 2006 BT Ireland will identify the total New subsequent recommendations on volume of refrigerant used in its a field trial that has been developed estate cooling plant. to assess the fuel economy and driver feedback by limiting the maximum April 2005 March 2006 We will maintain a 100% training New speed to 70mph on a selection of record for Power Operations WTM's medium size commercial vehicles. who handle refrigerant. This training can be accredited to either City and April 2004 March 2005 We will develop a pilot to assess The technical instruction Completed Guilds or the CITB. the fuel economy from enabling for activating the function the Speed Limiter function has been established April 2005 March 2006 We will verify the amount of refrigerant New (limiting maximum speed to 70mph) from Ford Mo Co along stock held by our Facilities contractor on a sample of medium size with the production build Monteray with a view to target setting commercial vehicles. ranges of BT vehicles on usage for 2006/7. that can be suitably adapted. Our service April 2005 March 2006 We will control the net usage of HCFC New bulletin and managers /CFC refrigerant to no more than 4% guides are complete and of the total refrigerant held. the pilot is about to go live for 50 vehicles. April 2005 March 2006 We will reduce the amount of CFC/ New HCFC'sinstalled in the BT operational April 2004 March 2005 We will reduce our commercial The commercial fleet was Failed estate by 5%. fleet by 2000 vehicles. reduced by 664 vehicles from 32,633 to 31,969. April 2005 March 2006 We will control the net usage New Although we did not of HFCrefrigerant to no more meet our target, given than 9% of thetotal refrigerant held. the increases in engineering activity, April 2004 March 2005 We will control the amount of net Actual achievement Completed which resulted in a refrigerant (quantity purchased was 2.88%. need for additional minus quantity returned for employees, we are disposal/recycling) purchased still pleased with this by our operational network to improvement. no more than four per cent of the total refrigerant held.

April 2003 March 2010 We will reduce our carbon Current CO2 emissions On target dioxide emissions (measured reduction is 53%, in tonnes CO2 equivalent) compared with 1996. to 25% below 1996 levels.

April 2003 March 2005 We will reduce the amount This target has been Completed of CFC/HCFC installed, as completed with an 8.34% a percentage of the Operational reduction in Networks Networks Estate installed/stock installed CFC/HCFC stock. of CFC/HCFC, by 3.5 per cent.

Environment: Procurement Environment: Local Impacts

Target Description Update Target Target Description Update Target start date end date status start date end date status April 2005 March 2006 BT Ireland will assess the potential New April 2005 March 2006 Using the data derived from New to replace its current Photocopier Local Impact related complaints paper with 100% recycled paper and enquiries we will instigate as per the new BTUK contract. an agreed number of root cause analysis focus groups/meetings April 2004 March 2005 There will be evidence that Action is taken Completed in order to identify key areas continuous environmental within three months. for improvement. improvement is being driven within 3 months with any supplier April 2005 March 2006 We will have continued our New identified as requiring this, involvement with the Council following their 'environmental for National Parks (CNP) in order risk assessment'. to assist with delivery of those aspects of the CNP business plan that relate to CNP forum membership commitments. Environment: Product Stewardship April 2005 March 2006 We will report on the impacts and New Target Description Update Target costs of graffiti and fly posting on start date end date status our external plant. April 2005 March 2006 We will have reviewed the application New April 2005 March 2006 We will have completed an New of the Product Stewardship Generic appropriate study to determine Standard (GS19) for buying Electrical the specific level of impacts relating and Electronic Equipment. to both the aesthetic lighting and the lighting of the various BT April 2005 March 2006 BT will have assessed the RoHS New facilities within the UK. compliance programme for BT Retail. April 2004 March 2005 We will develop a suitable We have continued to Completed April 2004 March 2005 We will publish its roadmap A WEEE and RoHS Completed database to ensure all Local maintain a log of issues of compliance to the RoHS Compliance Guide has Impact related customer that may fall outside Directive. been published and complaints/enquiries received our normal CCH process. supplied to over 1000 outside the normal Customer However, in order to Product Managers in BT. Complaint Handling process, reduce the number of are suitably logged, owned issues falling into the non April 2004 March 2005 We will assess a lead free A suitable lead test kit Completed and dealt with in a timely CCH category we have and potentially RoHS compliant has been identified and manner to minimise customer amended our web contact product ahead of the 2006 evaluated. A report was dissatisfaction. pages to assist our deadline set in the Directive. produced following customers with the correct assessment of a telephone channels for reporting. and its mains adaptor This has had a positive manufactured using lead impact on the environment based solder and one helpdesk and issues to the manufactured using lead Local Impacts Team have free solder. This will now been minimised. We are be used to check, when also measuring the necessary, whether or not complaints received through our suppliers of Electrical CCH channels for trends. and Electronic Equipment (EEE) are providing products that are manufactured using lead free solder.

Environment: Local Impacts continued Suppliers

Target Description Update Target Target Description Update Target start date end date status start date end date status April 2004 March 2005 We will enter into constructive BT has maintained its Completed April 2005 March 2006 We will coach and share best New dialogue with representatives membership of the CNP practice with a Tier One Supplier of the Council for National Parks forum and through our by effecting a joint CSR assessment (CNP), to develop a better membership we have within the supply chain. understanding of communal been involved with the targets and objectives. agreement of the CNP April 2005 March 2006 We will hold a workshop with our New business plan. We have Tier One Suppliers to share best continued our dialogue practice and drive progress towards with both the CNP and our CSR standards. other interested parties and have assisted CNP April 2005 March 2006 There will be evidence of follow up New members with updates action taken within 3 months with on projects that may all suppliers who have been affect the national parks. identified as requiring continuous We also attended a joint improvement as a result of workshop with the Friends completing our CSR questionnaires. of the Lake District and hope to continue April 2005 March 2006 We will take forward our dialogue New communication in this area. with the NGO/Stakeholder community to drive continuous April 2004 March 2005 We will set up a new forum, The Forum is established. Completed improvement. attended by appropriate and The forum now operates suitably knowledgeable members, on a quarterly basis as April 2005 March 2006 We will repeat a measure of BT’s New to discuss, resolve and promote agreed by the Forum supplier relationship and achieve issues relating to Local Impacts members and BT's more than 90%. in order to raise visibility both Local Impacts 'owner'. within and outside BT. April 2004 March 2005 We will have analysed responses to Analysis completed and Completed our supplier relationship survey and copies of The Way We identified areas for improvement. Work sent out to suppliers. Environment: General April 2004 March 2005 There will be evidence that action Action is taken within Completed within three months has been three months Target Description Update Target conducted with all contracts start date end date status identified as high or medium risk following a GS18 Sourcing with April 2005 March 2006 50% of BT Ireland people will New Human Dignity risk assessment. complete the CBT environmental awareness training package. April 2004 March 2005 We will establish a trade union and BT, as part of the GeSI Completed NGO group to provide advice on (Global e-Sustainability April 2003 March 2004 We will have collected We have collated data Delayed BT's supply chain human rights Initiative) Supply Chain international data on BT's key related to energy/water activities. Working Group, held a environmental impacts, energy use for GS activities. At this Stakeholder Forum on 8th use, transport, waste and stage we have not included April 2005. We actively emissions to air, for BT's wholly transport or emissions to sought feedback on our owned international activities. air as we've decided to supplier questionnaire, concentrate on our key and the direction of the environmental impacts. working group. Earlier surveys revealed that our activities outside the UK do not have any significant impacts around transport /emissions.

Stakeholder Dialogue Digital Inclusion

Target Description Update Target Target Description Update Target start date end date status start date end date status April 2005 March 2006 The percentage of BT employees New April 2005 March 2006 Engage with Age and Disability New agreeing with the statement that stakeholders to address 'BT takes its responsibilities to recommendations of Digital Divide society and the community very 2025 report. seriously or seriously' will remain at 90%. April 2004 March 2005 We will publish the results of our Report for year 02-03 Completed EverybodyOnline (information and added to betterworld April 2005 March 2006 The percentage of all UK Adults New communications technology and reports section in participating in the MORI survey community development) projects October 2004. who agree with the statement that with UK-charity campaign group 'BT takes its responsibilities to Citizens Online. society and the community very seriously or seriously' will reach April 2004 Sept’ 2005 We will make Broadband available On target 51% up from 50%. to exchanges serving over 99% of UK homes and businesses. More April 2004 March 2005 The percentage of all UK Adults Survey result was 50%. Failed than 95 per cent of UK homes participating in the MORI survey and businesses are now connected who agree with the statement that to broadband-enabled exchanges 'BT takes its responsibilities to and that figure will reach 99.6 per society and the community very cent by this summer, putting the seriously or seriously' will reach UK ahead of any other G7 country 55%, up from 52%. in terms of DSL availability.

April 2004 March 2005 The percentage of BT employees Survey result was 90%. Completed agreeing with the statement that 'BT takes its responsibilities to society and the community very seriously or seriously' will be 88%, up from 85%.

April 2004 March 2005 The percentage agreeing with the Failed, survey result Failed statement that 'BT takes its was 49%. responsibilities to society and the community very seriously or seriously' in a UK Opinion Leader Survey will be 58%, up from 55%.

About the report Chairman’s introduction Our Corporate Social Responsibility Chief Executive’s message The UK is committed to take action issues in the countries where we Our Social and Environmental report Helping our customers to benefit programme has a key role to play in I am convinced that being a on climate change. As one of the operate underline the importance of is part of our Better World website, from improved communications and meeting our stakeholder’s responsible company through living country’s largest users of electricity our CSR activity. In addition, our which is updated regularly. increased connectivity continues to expectations and encouraging them our values (trustworthy, helpful, we have a responsibility to help make increasing sales in networked IT be at the heart of BT. to invest in us, buy from us or work inspiring, straightforward and heart) that happen. This year we became the services have highlighted the potential The report covers all externally verified for us. Full details of the programme brings us business advantage. world’s largest purchaser of green privacy implications of the digital content (as indicated by a symbol at Achieving this responsibly and in a and our performance in the last year energy and now meet almost all our networked economy. the bottom of the page) and our way which contributes to society is are available in our online Social and Our major business and government UK energy needs from independently written ‘Hot Topics’. important to us. This year there have Environmental report. customers are increasingly concerned environmentally friendly sources. In The big opportunity is to use ICT been a number of accomplishments about our CSR performance. Growing carbon dioxide emissions savings, it products and services to promote The report is complemented by that demonstrate this commitment. We endeavour to manage our social, stakeholder, legal and regulatory equates to an additional 325,000 sustainability, not only in the way we other content on our Better World ethical and environmental issues to pressures mean our customers expect tonnes each year, on top of the run our own business, but by helping website - latest news, our occasional For example, broadband. We are grow shareholder value and I am us to provide the solid CSR credentials considerable savings we have already our customers to benefit too. papers, studies and reports, video case confident that we will connect always pleased when we achieve that help them provide a trusted made in the last ten years. This is a studies and our better business game. virtually every UK community during external recognition for our attempts service to their own customers. substantial contribution to tackling You can find details of how we are 2005, which is a vital part of the role to do this. climate change. responding to these challenges and We only publish our social and we play in spreading the benefits of Our Performance opportunities in our online Social and environmental performance online broadband. And we have made real This year we maintained our position We publish 12 non-financial key Accountabilit - challenges Environmental report. The report has because the innovative use of progress with our digital inclusion as the top telecommunications performance indicators. These provide and opportunities been prepared in accordance with the information technology offers initiative, Everybodyonline, which is company in the Dow Jones a snapshot of our performance on the As we continue transforming our 2002 Global Reporting Initiative possibilities to communicate more working to help deprived communities Sustainability Indexes for the fourth key measures that underpin our business we must maintain our guidelines and is independently effectively and to engage in a two-way enjoy the benefits of broadband year running, which recognises our financial performance. Our progress vigilance on matters of corporate verified. I commend it as a dialogue. The internet is a critical tool technology and develop new skills. work in a wide range of areas from on these measures includes: reducing social responsibility. For example, we demonstration of how living our to help promote greater transparency business principles, ethical supply customer dissatisfaction; connecting are increasing our international values helps us deliver long-term and accountability in business. I am particularly proud of our efforts chain management and work-life the majority of UK communities to footprint, through the evolutionary shareholder value. in response to the Asian Tsunami balance to customer service and broadband; maintaining a motivated, growth of our global services business, Here you will find our: which struck on 26 December 2004. corporate governance. diverse and secure workforce; by making strategic acquisitions and Ben Verwaayen • Chairman’s introduction Our knowledge and expertise, minimising ethical risks in our supply through the rise in outsourcing and in- Chief Executive together with the commitment of our For the year ahead, business chain; and massively reducing our sourcing as a key part of BT’s business 18 May 2005 • Chief Executive’s introduction people, enabled us to work alongside transformation is critical to delivering carbon dioxide emissions. model. Different approaches to the Disasters Emergency Committee growth to our business. This will bring corporate governance and ethical We also explain our reporting to ensure the largest ever volume of new challenges for our Corporate methodology and approach in: online and telephone donations were Social Responsibility programme, • Triple Bottom Line reporting taken quickly and securely. We also which I am confident it will meet. • Scope of the Report had 16 volunteers who went out to the region to assist in the re-building Sir Christopher Bland • Key Performance Indicators of local and international Chairman • Assurance communication links. 18 May 2005 • Standards • Navigation.

Our Summary and highlights document provides an overview of the Social and Environmental report. It can be downloaded as a pdf file or you can order a printed version (email: [email protected]).

Triple Bottom Line reporting organisations to find new ways of externally verified content (as Business practice established a set of key performance • Quantitative – can be presented as Our Social and Environmental report reporting their total contribution indicated by a symbol at the bottom This year we have introduced an indicators (KPIs) to help you a number is part of our Better World website, to a more sustainable society in of the page) and our independently Ethics Performance Measure and we understand what our stakeholders and • Practical – interface with existing which is updated regularly. a way which fully includes the written ‘Hot Topics’. have measured awareness of our we consider to be the most important company processes social, environmental and Statement of Business Practice in our issues. Our KPIs condense complex The report covers all externally verified economic dimensions. The report is part of our Better World international operations. issues into 12 key measures of non- • Directional – we know when we are content (as indicated by a symbol at website, which is updated regularly financial performance which have getting better the bottom of the page) and our This is what we try to achieve in our and also contains archived content. Financial, regulatory and corporate been used to enable a strategic • Actionable – are sufficiently in our independently written ‘Hot Topics’. Social and Environmental report. The Better World website includes governance information is approach to target setting. control to effect change. latest news, occasional papers, our predominantly located in the Annual This concept of ‘triple bottom line’ or As well as reporting on our better business game, video case Report & Accounts, while background The indicators were derived from a ‘sustainability reporting’ has become performance, we also include ‘Hot studies and other studies and reports. information about BT is set out in the consultation involving report users We recognise the final indicators are a common feature of large companies. Topics’ on some of our more Corporate Information section of the such as investors, customers and far from perfect. While there was We believe it provides an invaluable controversial social impacts, such Geographical coverage BT website. employees, together with outside general consensus on the spheres of holistic view of the company, making as extreme abuse of the internet, In the 2005 financial year, BT’s experts such as the BT Leadership measurement - integrity, community, connections between aspects of offshoring and the implications UK operations accounted for Find our Regulatory Compliance Panel. The indicators are: customers (including digital divide), performance previously evaluated for privacy in the digital approximately 91% of BT’s turnover report in the Business 1. Customer Dissatisfaction employees (including health and separately and aiding our transition networked economy. and 90,800 of our 102,100 employees. Principles section. 2. Addressable Broadband Market safety), environment and suppliers - to a more joined-up approach to the 3. Employee Engagement Index it was often difficult to identify a management of social, environmental We have included these because Wherever possible we cover all BT’s Diversity 4. Percentage of Women, Ethnic single indicator that reflected all the and economic issues. readers want a qualitative insight wholly-owned activities in the UK Existing data are based on ‘self- Minorities and Disabled Employees intricacies and manifestations of these into the way BT (and the industry and internationally. declaration’. However, different legal 5. Lost Time Injury rate broad areas. This reflects the We also believe that companies have generally) responds to its frameworks outside the UK mean that 6. Sickness Absence rate difficulties in measuring the non- a responsibility to disclose the social stakeholders. They want to see Where data are not available or relate collecting data on diversity for our 7. Ethical Trading financial performance of companies. and environmental performance how we put our values into practice, only to activities in a particular international operations is not always 8. Greenhouse Gas Emissions information that their stakeholders - and how our products and services country, we try to be clear about possible. Working within these 9. Total Waste (including During the 2005 financial year, the customers, employees, shareholders, can help contribute towards precisely what is covered. limitations, during the 2005 financial recycling rate) People Satisfaction Index has been suppliers and communities - need to sustainable development. year we have focused on gaining a 10. Ethical Performance Measure replaced by an Employee Engagement make informed decisions. Environmental scope better view of our global workforce 11. Community Contribution Index, which better reflects the BT The flexibility of the internet enables Although BT’s environment policy profile. For example, we are now 12. Supplier Relationships values, strategy and our commitment Our approach has been recognised by us to show the connections between covers the entire BT Group, the scope collecting data on ethnicity for our to keep people engaged with their a number of external bodies and in the social, environmental and of the environment section is in line operations in the US. The KPIs complement the colleagues, work and customers. the 2005 financial year we were joint economic dimensions of sustainability with our ISO14001 certification which comprehensive set of social and winners of the ACCA award for the through our reporting. We do this by currently covers all British Global Reporting Initiative environmental performance figures We have also developed and best web-based sustainability report. using links between the different Telecommunications Plc Operations This report has been prepared in in Data and targets, where our latest introduced a measure to provide sections of the report and by giving in the UK; BT Ireland and BT Spain. accordance with the 2002 Global performance information and a more information on our performance The future the reader the chance to navigate the The exception to this is BT Global Reporting Initiative (GRI) detailed explanation for each KPI are across a range of corporate The concept of triple bottom line site according to different indexes, Services operations in the UK and Sustainability Reporting Guidelines. found. We will publish the latest governance issues. Called the reporting suggests that there are such as the Ten Principles of the UN overseas excluding Ireland and Spain, We have also used the GRI Pilot figures every year and make Ethics Performance Measure, this three separate and distinct bottom Global Compact or the Global which are not covered within the Telecommunications Sector appropriate adjustments to them replaces our Awareness of Statement lines - each of equivalent standing. Reporting Initiative (GRI) Guidelines. environment scope. Supplement in preparing this report. if circumstances change. of Business Practice with a broader Full details are found in the GRI Index. measure of ethics performance within We believe that, in the context Scope of the Report This year, for the first time, we are The KPIs create BT’s sustainability the company. The Awareness of of sustainable development, it’s This report covers all of BT’s main including energy, water and waste Key Performance Indicators dashboard. This gives an at-a-glance Statement of Business Practice is impossible to consider the economic social, economic and environmental data for BT Global Services in the There is a huge amount of view of the company’s performance. one of the indicators within this dimension in isolation from the social performance areas for the 2005 environment section. information in our Social and To achieve this, we had to identify new measure. or the environmental, and vice versa. financial year (ending 31 March Environmental report. We have indicators that are: We think the time has come for 2005). The report covers all

During the 2006 financial year we will The LRQA Statement outlines the Materiality To ensure that the remainder of the Peer Review Completeness conduct a comprehensive review of way in which they undertake the The starting point for our report incorporates all other relevant Once a year we undertake a review of The report will be complete provided our KPIs to check if they are still the assurance, together with their determination of materiality is the information that our stakeholders sustainability reports published by that all material issues have been most appropriate key measures of our recommendations on how future BT Statement of Business Practice. may require to make informed other telecommunications companies captured. non-financial performance. reports might be improved. This defines BT’s world-wide business decisions about our company we: to identify any content gaps in BT’s principles and sets out the specific • Construct the report in accordance sustainability reporting. This is This requires two criteria to be met: Assurance The Leadership Panel also plays a aspirations and commitments that with the Global Reporting Initiative achieved by comparing the key or 1. The process for determining This report has been assured against part in ensuring that difficult or apply in our relations with (GRI) guidelines material categories presented in peer materiality has been inclusive and the AA1000 Assurance Standard. uncomfortable issues are not stakeholders. It was compiled in reports with BT’s KPIs and overall is, in its own right, complete. • Use the GRI guidelines Pilot This stipulates that three specific neglected. Members of the Panel an inclusive fashion and makes sustainability report content. 2. The reporting boundaries have not Telecommunications Sector principles must be met: were selected on the basis of their explicit reference to our legal been drawn so as to create an Supplement • Materiality: the report must include independence of thought, obligations and mechanisms of This year, 12 competitors and ICT exclusion of any material issues. information about our sustainability experience and insight - as well regulatory compliance. • Undertake a review of sustainability companies were selected covering a performance to help readers make as their knowledge of reports from peer companies variety of geographical areas, The first criterion is covered in the informed judgements, decisions corporate accountability. From this we have defined seven including those companies known to section on materiality. • Review relevant prosecutions and and actions. material categories of non-financial have performed best in the field of international sustainability standards The Leadership Panel statement sets performance: sustainability reporting. Based on the The second criterion is dependent on • Completeness: the report must out their perspective on the report • Business practice • Publish ‘Hot Topics’ on specific results of our peer review we believe the completeness of the reporting include all material aspects. and BT’s performance and was last issues of concern. we have not missed any key aspects. boundaries as described in the Scope • Community • Responsiveness: the report must updated in May 2005. of the report section. To check this Our approach to materiality is demonstrate that BT has responded • Customers Prosecutions and Standards we have reviewed the scope to designed to ensure we cover all to stakeholder concerns, policies and Further technical details are available We have made sure that all ensure that: • Employees relevant issues, particularly relevant standards and adequately later in this assurance section on how compliance and prosecution • All BT’s main operating divisions are highlighting via our KPIs those communicated these. we determine our critical aspects, • Environment information relating to equality and included which have greatest significance indicators and targets in line with the diversity, environment, employee • Suppliers to our business. • All BT’s principal operating Lloyd’s Register Quality Assurance AA1000 Assurance Standard relations and regulatory affairs have subsidiaries as listed in the 2005 Limited (LRQA) has been contracted principles of materiality, completeness • Digital inclusion. been included in the report and that Global Reporting Initiative Report and Accounts have been by BT to assure the report against this and responsiveness. reference has been made to critical These categories then guided us The term ‘in accordance with’ has a assessed for any issues that would standard and is supported by BT’s international sustainability standards. towards a set of key (or material) specific meaning in the GRI context alter our interpretation of materiality Internal Audit Department. The information in the Social and performance indicators which were and our assurance providers have and completeness for this report. Environmental report - and its ‘Hot Topics’ selected following extensive ensured that we meet these In addition to their overall assurance presentation - is the responsibility Finally, the readers of our report have In addition, the report coverage consultation, both inside and outside requirements. In essence it means role, LRQA ensure that we don’t of BT. told us that the traditional, triple extends beyond the direct BT. Each KPI is accompanied by a that we meet the GRI reporting provide unreliable data or make bottom line reporting described operational impacts of BT to include strategic (or material) target. principles - similar in many ways to claims that we can’t back up. This The Leadership panel and LRQA above still does not tell the whole our supply chain and various the AA1000 AS principles - and that includes identifying and assessing the statements are available in our on-line story. It provides comparable considerations of the sustainability These material categories, indicators we include all GRI core indicators. data gathering systems and validating report under Assurance. measures of performance, but impacts of our products and services. and targets - described in more detail The latter are important as they were data samples. doesn’t describe how the company in the Data and targets section of the developed through a stakeholder applies its values when dealing report - cover the most significant inclusive process and are designed to The work of LRQA is complemented with difficult and often and strategic components of BT’s by the role of BT’s Internal Audit controversial issues. sustainability performance: be “relevant to most reporting department, which undertakes This is why we include in our report Seven material categories. organisations and of interest to most substantial work to validate data and a series of ‘Hot Topics’ that have, stakeholders”. information. LRQA rely heavily on the Twelve material key performance over time, covered matters such work of BT Internal Audit in forming indicators. as extreme abuse of the internet, We also use the GRI Pilot their conclusions. offshoring and the privacy Twelve related material strategic Telecommunications Sector implications of the digital networked targets. Supplement. economy. ‘Hot Topics’ are selected by our Leadership Panel.

Responsiveness Award for Enterprise in the Guidelines for Telework in Europe Global Compact BT was industry co-chair during the Universal Declaration of Human It’s important that we not only listen sustainable development category Welcomed by the European BT is a supporter of the UN Secretary multi-stakeholder process to establish Rights (UDHR) to the views of our stakeholders but and are consistently at the top end of Commission, these guidelines have General’s Global Compact initiative. the pilot telecommunications The UDHR applies to all member also reflect our response to those important rankings such as the Dow been signed by BT and its trade supplement to the GRI Guidelines. states of the United Nations. While views in our policies, operations Jones Sustainability Index. unions. The guidelines stress that The activities described in this report We also use these guidelines in the there are numerous other conventions and objectives. telework constitutes a form of work are intended to demonstrate how we preparation of our report. and codes from the UN and others, Standards organisation whose increasing use is a apply and promote the Compact’s the UDHR stands as the iconic That’s not to say that all our There are many different guidelines, clear sign of a trend towards a more principles. You can navigate the site Investors in People definition of human rights. BT has stakeholders always agree with each standards and codes of practice that flexible and mobile workplace. according to the ten principles of the Investors in People (IiP) is a quality assessed its relevant policies and other on our priorities of resource companies are encouraged to sign up Global Compact by using our Global standard for effective investment in procedures to ensure a consistency allocation. Even single stakeholders to. In this section we describe BT’s Under the guidelines, teleworkers are Compact index. the training and development of with the UDHR. More details are can offer paradoxical and conflicting approach to some of the most granted equal treatment with people to achieve business goals. BT available in the human rights section. views - for example, often expecting prominent. employees working in traditional Global e-Sustainability Initiative gained corporate accreditation for all the lowest possible prices and the office environments, with equal access The Global e-Sustainability Initiative its UK activities in October 1998, and Report index highest possible levels of non- AA1000 AS to training and career opportunities. (GeSI) is a voluntary industry initiative has since been successfully reassessed We provide four separate indexes: profitable service for the wider good. The AA1000 Assurance Standard in partnership with the United Nations on five occasions. • Alphabetical provides a systematic approach to Guidelines for Customer Environment Programme and the • Global Reporting Initiative (GRI) As we say in one of our occasional ensure that public sustainability Contact Centres International Telecommunications During the 2005 financial year BT Guidelines - to read the report in papers, Enlightened Values: reporting adheres to particular In a groundbreaking initiative to Union. BT chairs the initiative and successfully achieved accordance with the GRI structure “As all groups of stakeholders rarely reporting standards and guidelines. support fair and professional working continues to support its goals and re-accreditation as an IiP. We remain and to aid comparability with other reach a consensus, a company must conditions in e-communications, actions. GeSI is currently co- one of the largest companies to reporting organisations. select the appropriate balance point This Social and Environmental ETNO and the pan-European labour ordinating a major ICT cross-industry measure up to this challenging and make, and be seen to make, report is assured against AA1000 organisation, Union Network initiative covering ethical and outcomes-based test. • Statement of Business Practice, responsible decisions. Assurance Standard. International (UNI), have jointly environmental impacts in the The Way We Work - to identify defined a new set of principles to supply chain. ISO14001 performance against our business Corporate social responsibility is ETNO Sustainability Charter govern the operation of customer Details of the coverage of our principles, aspirations and then about being held to account for In 1996, BT led the team at the contact centres. Global Reporting Initiative environmental management system specific commitments. those decisions in an open and European Telecommunications The Global Reporting Initiative (GRI) certification can be seen in the Scope • Ten principles of the United Nations transparent way.” Network Operators’ Association The new principles lay down high is a multi-stakeholder international of the report section. Global Compact. (ETNO) that created its Environmental standards of employment and undertaking whose mission is to The section on stakeholder dialogue Charter. In 2004, ETNO launched a training, working conditions (eg ways develop and disseminate globally We are in the process of extending describes our overall approach to new ‘Sustainability Charter’, which to ease stress on the job, respect for applicable sustainability reporting our environmental management informed decision making and at calls on signatories to review overall family-versus-work obligations and guidelines. It is for voluntary use by system to our most significant various junctures of the report we company policy in order to implement employee rights, including the organisations reporting on the international operations. BT Ireland describe how such engagement has sustainable growth in the widest, freedom to join a union) while economic, environmental and social was certified to ISO 14001 in March influenced our policies, targets most integrated manner possible. The guaranteeing safe and flexible working dimensions of their activities, 2005. This added to the certificates and indicators. new charter includes commitments on conditions for all our customer contact products and services. already held for BT UK and BT Spain. business ethics, employee relations, centre employees. We believe our long history of publicly human rights, community investment Our Social and Environment report OECD Guidelines for disclosed sustainability targets and environmental management. Endorsed by the member companies has been prepared in accordance with Multinational Enterprises demonstrates our commitment to Seventeen signatories, with a of the European Telecommunications the 2002 Global Reporting Initiative Although it is primarily the allocate the necessary levels of combined turnover of around 150 Network Operators’ Association, the (GRI) Sustainability Reporting responsibility of governments resource to improve our performance billion Euros have now signed the principles will apply to each signatory’s Guidelines. An Index based on the GRI belonging to the Organisation for and the external recognition we have charter. ETNO produce a call centre operations across the Guidelines is provided to help you Economic Co-operation and achieved for our actions is further sustainability report every two years globe. ETNO represents 41 major read the report using the GRI Development (OECD) to demonstrate evidence of this. For example, we to summarise the progress made by operators in 34 countries. structure and to aid comparability compliance with their guidelines, BT have been awarded the Queen’s Charter signatories. with other reporting organisations. is supportive of the basic principles, which are covered in this report.

Information and data on this page Information and data on this page has been verified by Lloyd’s Register has been verified by Lloyd’s Register BT Social and Environmental Report About the report 04 Quality Assurance Limited Quality Assurance Limited Regulation of Communications BT's Compliance Report for 2004/2005 Contents Group Finance Director's foreword and summary 02

1 Our compliance policy and the regulatory context 03 1.1 The context and general policy of compliance 03 1.2 The regulatory environment 03 1.3. Ofcom's Strategic Review of Telecommunications 03 1.4 BT Group plc 03

2 An effective compliance programme 04 2.1 The leading role of senior management 04 2.2. Within BT 04 2.3 With Ofcom 06 2.4 With the industry at large 06

3 Organising our compliance regime 07 3.1 BT Group's compliance structure 07 3.2 BT's compliance operating framework 07 3.3 BT's approach to compliance in its separate lines of business 08

4 BT's risk reviews and performance measures 10 4.1 Our risk review procedures 10

Annex I: BT's compliance programme working with industry 11

Information and data on this page has been verified by Lloyd's Register Quality Assurance Limited Group Finance Director's foreword and summary

This is my first year as BT Group The Strategic Review of • Benchmarking our compliance champion for regulatory compliance. Telecommunications undertaken performance against other This report, part of our Social and by Ofcom is a significant ongoing industries in the UK and other Environmental Report (http://www. development. At the time of writing telecommunications providers btplc.com/Societyandenvironment/ind Ofcom was still considering its course in Europe. ex.htm), reflects the energy and of action in the light of the responses investment applied to this core to this review. It is, however, worthy Our investment in compliance will business activity. of note that Ofcom says in its Phase continue over the coming year. 2 consultation document that “BT Supported by the Board, the Director We have made significant currently applies significant resources of Internal Audit and Regulatory improvements to our compliance to regulatory compliance”. Compliance, and the collective energy programme over the past year, while of our management team, I know that maintaining the same basic principles: The main elements of our the year ahead will bring even higher • Our fundamental compliance principle Compliance programme are: standards of compliance. is for BT to be fully compliant with the • Increasing transparency within our regulatory regimes in which we industry through a series of events Hanif Lalani operate around the globe. and workshops held as part of the BT Group Finance Director and Group Telecommunications Industry Compliance Champion • My colleagues on the BT Board Regulatory Forum and all of our senior management (http://www.tirf.co.uk/) (see Annex I) Key contacts regarding this report are fully committed to ensuring we work to the highest standards of • Establishing best practice in Keith Read, regulatory compliance. We have a compliance within the regulated Director of Regulatory Compliance. strong compliance function headed by industries of the UK through the Tel (01252) 352478. the Director of Internal Audit and Regulated Industries Forum Email: [email protected] Regulatory Compliance. As a result, (http://www.tirf.co.uk/docs Chris Waring compliance is embedded in the /RegulatedIndustriesForum.htm) (report owner). principles of BT's overall corporate (see Annex I) Tel: (01344) 863075. governance and social responsibility. • Continuing our robust risk reduction Email: [email protected] • As well as being a good corporate programme by conducting risk reviews citizen, BT believes that compliance is across all lines of business (see good for our customers, good for our section 4.1) business and good for the industry as • Training over 27,000 managers and a whole. 38,000 team members in the key • We have established clear compliance elements of compliance standards to operate in markets where • Publishing a comprehensive BT has been determined as having series of key performance indicators Significant Market Power. relating to non- discrimination BT focuses on particular requirements on the BT Wholesale website such as not to share inappropriately (http://www.btwholesale.com/index.jsp) any information between separate parts of our business.

Information and data on this page has been verified by Lloyd's Register Quality Assurance Limited BT Social and Environmental Report Regulation of Communications 02 1. Our compliance policy and the regulatory context

1.1. The context and general policy 1.2. The regulatory environment 1.3. Ofcom's Strategic Review of compliance Significant changes in the of Telecommunications BT has been subject to extensive regulatory and competition regimes Ofcom is considering its course and specific regulation since the in the UK include: of action in the light of responses Telecommunications Act was passed • The Communications Act 2003 to this review. A brief summary of in 1984. Originally this was because it (http://www.opsi.gov.uk/acts/acts200 the compliance context of this review was the privatised incumbent. Today, 3/20030021.htm) created a new is included in the Finance Director’s BT is subject to specific regulation framework for the regulation of foreword of this report. For BT's derived from EU legislation because electronic communications networks full response, see Ofcom it has been designated by Ofcom as and services in the UK. The Act has (http://www.ofcom.org.uk). a Universal Service Provider and replaced the licensing regime which determined by it to have Significant existed under the Telecommunications 1.4. BT Group plc Market Power in particular markets. Act 1984. It gives Ofcom significant BT Group plc is our listed holding Ofcom has now set out its ideas for powers in connection with the setting, company. See www.btplc.com for future regulation in its Strategic enforcement and modification of further details and information on Review of Telecommunications Phase regulatory obligations, and thus our main businesses. 2 document. Whatever the outcome reinforces the commercial imperative of the review, we are committed to to comply, by reason of the ensuring that BT is fully compliant implications and consequences with the obligations imposed on it of non-compliance. and conducts its business with • The Competition Act 1998 integrity and that this commitment (http://www.opsi.gov.uk/acts/acts199 extends throughout the BT 8/19980041.htm) prohibits anti- community – from directors and competitive agreements, concerted executives to managers, other practices and abuse of a dominant employees and contractors. position. Breach of this act can result in a penalty of up to 10 per cent of It is BT’s policy to be fully compliant group UK turnover over the previous with the regulatory regimes in which business year, the agreements being the BT Group operates whilst declared void and unenforceable, encouraging innovation, BT’s adverse publicity for the company competitive spirit and its willingness and the possibility of being sued for and ability to take informed and fully damages. ‘Dawn raid’ powers are assessed commercial risks. available to the Office of Fair Trading and Ofcom, and non-cooperation with an investigation and the deliberate or reckless provision of false or misleading information are criminal offences. • The Enterprise Act 2002 (http://www.opsi.gov.uk/acts/acts200 2/20020040.htm) makes participation by individuals in certain types of cartel a criminal offence punishable by imprisonment for up to five years. The Act also provides for disqualification for up to 15 years for directors of companies that breach competition law.

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2.1. The leading role of senior 2.2. Within BT Training management Corporate governance We provide education and support on Our senior management team leads Regulatory compliance is embedded regulatory compliance for our and supports our compliance policy. in our corporate governance and employees, including computer-based The team is developing our social responsibility principles. training, briefings, seminars and team compliance regime to ensure The Director of Internal Audit and briefings. compliance is part of BT’s culture at Regulatory Compliance reports to all levels of the company. the Board Audit Committee to We have improved our computer- maintain the independence of the based compliance training to offer Our senior managers are subject to compliance team. individual training. The e-learning our high standards of compliance system provide details of mandatory and lead by example to ensure that Our confidential hotline gives training for each part of the business, every member of BT learns and everyone at BT the opportunity to identifies when refresher training is applies these standards appropriately. raise any potential compliance issues needed and enables all BT people to They are responsible for ensuring anonymously, safely and securely. take personal responsibility to ensure that BT business activities do not All compliance-related calls to the their training is up-to-date. violate applicable regulations and hotline are handled by our compliance are conducted fairly, legally and team to ensure objectivity and In the 2005 financial year, we with integrity. independence. Our policy is to ensure re-launched our foundation course on that no employee will suffer adverse regulatory compliance in a range of Led by our senior management, BT action for honestly raising an ethical formats to meet the needs of people has undertaken a large number of or legal concern. in different parts of the company and compliance activities in the 2005 help them apply what they have learnt financial year. We work to ensure that The compliance team includes a to their work. The course, ‘Winning our regulatory compliance programme dedicated risk review group which Through Compliance’, is mandatory is consistent with the best practice set conducts risk reviews across BT and for all BT people to raise awareness of out in ‘The Way We Work’ (a provides reports and compliance messages across the statement of our business principles) recommendations to management business. We have also introduced to ensure we act commercially and through the Director of Internal Audit new types of training for BT’s ethically. Our programme consists of and Regulatory Compliance. We have suppliers, including an internet three main elements: increased the number of work days training package – ‘Working with BT: • Within BT dedicated to compliance reviews by Delivering Regulatory Compliance’. more than 500 days in the 2005 • With the Regulator financial year. For further details of Compliance messages are also • With the industry at large. our risk review programme, see included in other job-specific training section 4.1. where appropriate. This makes compliance an integral aspect of our day-to-day operations.

Compliance training throughout BT Winning Through Compliance (percentage of managers trained) (percentage of team members trained)

Competition Act Wholesale Data Protection and Privacy Retail Information Retention Exact Sharing Information Global Winning Through Compliance BT % 92 93 94 95 96 97 98 99 100 % 84 86 88 90 92 94 96 98100

Actual Target Actual Target

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Our strategy, business principles, We have tailored our compliance Disciplinary measures leadership capabilities and people programme to fit BT’s company Senior management has made it clear values all include clear statements on structure and business activities. that individuals who breach BT the corporate and personal integrity Rules on sharing information are of compliance policy will face disciplinary we demand of all our people. great importance for our business. actions, including dismissal. We have met our commitment to Leadership capability: Having Oftel (Ofcom's predecessor) in May Monitoring the effectiveness of our personal integrity and ensuring 2003 for all our managerial and compliance culture compliance with all legal and professional staff to have completed Since 1998 we have commissioned regulatory requirements. the computer-based training (CBT) a biennial review on our compliance package, 'Sharing Information', culture. The 2004 survey was People value: Being reliable and and new recruits are put through conducted by DVL Smith, an acting with integrity the course as soon as possible after independent market research agency. Brand value: Being honest and joining the company. This course is Feedback was positive and showed delivering on commitments included in our mandatory refresher the development of a culture of training programme to raise compliance within the company. Business principle: Acting within awareness of this important topic. See the Regulatory Compliance Report the law and meeting our 2003/04 for details of the survey regulatory obligations We maintain dedicated intranet (http://www.btplc.com/Societyandenvi websites, promote hot topics and ronment/Socialandenvironmentreport/ It is mandatory for all our UK-based produce leaflets and other literature Archivedreports/index.htm). managerial and professional staff to on compliance and regulatory complete training on applicable rules practices and procedures. In February 2005, we asked the and regulations, and to pass on what More specialised materials are also Compliance Institute (http://www.com they learn to their teams where provided locally for use at team plianceinstitute.co.uk/index.asp), an appropriate or ensure they undertake meetings and briefings. organisation that offers compliance the training themselves. Additional staff the benefits of professional status detailed knowledge and expertise is Internal communications and opportunities for professional required for BT people who are We use our well-established internal development, to review our engaged in key activities affected communications channels to raise compliance programme with particular by regulation. awareness of regulatory compliance attention to our compliance culture. throughout the business. These channels include our internal magazine, regular briefings and team meetings for all BT people including frontline engineers and call centre advisors. In the 2005 financial year, we launched our Regulatory Compliance Awards and included a compliance award in the My Customer Challenge Cup to promote awareness and reinforce the importance of compliance issues across BT.

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Extracts from the report by the 2.3. With Ofcom 2.4. With the industry at large Compliance Institute: We communicate regularly with In the 2005 financial year, we worked Compliance culture does not come Ofcom and maintaining a good within our industry (through the cheaply, and the commitment in relationship with the regulator is a Telecommunications Industry terms of cost, resource and time key element of our compliance policy. Regulatory Forum) and with other has to be considerable and ongoing. regulated industries in the UK However, there is no evidence that BT In the 2005 financial year, we (through the Regulated Industries visualises any diminution of that established a system to track all Forum) to research and develop best commitment; on the contrary, requests for information received practice for compliance. We a number of initiatives are well on by BT, establish ownership of each compared our compliance culture with the way to completion, or are being request and ensure a full response is that of the UK finance sector (with the developed, which will strengthen the made promptly. help of the Compliance Institute) and compliance regime even more. benchmarked our compliance We have kept Ofcom informed of our performance against other European A Compliance culture may be said to risk review programme and shared companies in our sector. See Annex I exist when Compliance is an integral our strategy at a meeting attended by for further details. part of the firm’s operations, rather the regulator and representatives of than the prerogative of a remote the industry. By working more closely with the Compliance department. It should industry, the number of issues raised have the explicit and full-hearted We analysed the data published by with us directly rather than through backing of senior management, Ofcom in the Competition Bulletin Ofcom has increased. This has also and be seen by all members of staff (http://www.ofcom.org.uk/bulletins/ been welcomed by the regulator. as applying to them. The Compliance comp_bull_index/). During the 2005 Institute is pleased to be able to financial year, Ofcom closed ten cases confirm that in its view, a vigorous involving complaints against BT’s Compliance culture does prevail conduct under competition law or within BT. regulation: six were found for BT; two were neutral and two were found I therefore feel confident in assuring against BT. In this context, neutral BT that there does exist within the means that Ofcom’s decision required organisation a secure and both parties to take action or that the well-functioning Compliance culture target takes minor corrective action such as some companies within the and Ofcom closes the case without a financial services sector would be final determination. pleased to enjoy. BT was the subject of eight disputes closed by Ofcom during the financial year 2005, one of which was found against the company.

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3.1. BT Group’s compliance • Liaison with the Regulator and the • Continuous Improvement & structure Industry – Maintain effective Business Excellence – Active Our regulatory compliance structure communications to ensure promotion of both the efficiency and ensures that compliance is the understanding, not necessarily effectiveness of compliance practices responsibility of all BT people agreement, on legal and • Product Development & Change throughout the business, from our call regulatory issues Management Controls – A structured centres to the BT Board. Details of • Industry & Regulator Complaints – approach to embed compliance issues this structure were included in last Complaint-handling system is in new product and service year's report. The Regulatory systematically reviewed to identify development and other change Compliance team is integrated in our compliance issues for resolution and management initiatives corporate social responsibility (CSR) future risk reviews governance and is part of the • Risk Control & Self-Assessment – Practitioners’ Forum and the CSR Integration of self-audit Organisation Steering Group. The CSR Steering requirements within general business • Allocation of Responsibility – Heads Group discusses targets, performance improvement initiatives to embed of business units are responsible for measures, compliance issues and regulatory compliance throughout establishing and maintaining effective Ofcom rulings. the organisation compliance programmes • Independent Monitoring & 3.2. BT’s compliance operating • Appropriate Resources & Budget Validation of Control Effectiveness – framework Allocation – Resources are provided Adequate levels of independence are To ensure common and shared to implement and maintain an established to monitor the objectives across the Group we have effective compliance management effectiveness of compliance created a compliance framework that programme is being monitored by our Measurement compliance team: Training & Communications • Reporting Standards & Criteria – • Monitoring and Communicating Structured and effective control Principles Changes in Regulatory Obligations – framework to notify senior • Compliance Policy, Vision, Structure Structured arrangement to ensure management of material & Scope – An integrated and effective that substantive changes to relevant compliance issues business wide compliance framework, legal and regulatory obligations are measured against best practice • Performance Management – communicated to and understood by principles and standards, which Integration of compliance obligations relevant parties supports BT's strategy embodied in into divisional performance evaluations both our brand and values • Visibility & Regular Communication • Management System – Clear • Identification of Compliance – Effective communication of key guidance on compliance obligations Obligations – Identification of key messages reinforcing our commitment integrated with BT's business situations created by the activities of to compliance principles, The Way We Work the business that result in compliance • Education & Training – Managers • Performance Measurement – obligations and team members are adequately Establishment, monitoring and review • Code of Conduct – High corporate trained on key compliance obligations of a robust and comprehensive set of and personal standards of honesty regulatory compliance metrics. and integrity supported by internal Process disciplinary procedures • Assessment of Operational Implications – Identification of business and operational activities exposed to the greatest compliance risk and linked to BT's risk register

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3.3. BT’s approach to compliance • Providing communications on • Revising the Compliance Induction in its separate lines of business compliance designed to meet the process for new joiners and developing BT is organised into several lines of needs of the LoBs. improved training for managers business (LoB). The main LoBs are • Designing a set of key performance BT Wholesale, BT Retail, BT Global Compliance within BT Wholesale indicators (KPIs) on non-discrimination Services and BT Exact (OneIT). Each BT Wholesale (http://www. to compare the performance provided of these has a dedicated compliance btwholesale.com) is the part of BT by BT Wholesale to BT Retail with that team responsible for ensuring that that provides network services and provided to external service providers. compliance is part of day-to-day solutions to fixed and mobile network These have been published monthly business activity and best practice operators and Service Providers on the BT Wholesale website is employed. At the end of the 2005 including BT Retail and BT Global (http://www.btwholesale.com) since financial year, we began to Services. It is responsible for January 2005, in line with Ofcom consolidate some of the LoB functions maintaining the network requirements. The KPIs were defined into the central team. infrastructure, including 121 million by Ofcom and reviewed by the Risk kilometres of copper network, to Review team before publication The compliance team for each LoB enable an average of 288 million is responsible for: calls every day. • Arranging a series of meetings with • Promoting a culture where 29 BT Wholesale customers and compliance with BT's regulatory In the 2005 financial year, the BT handling queries raised directly commitments and competition Wholesale Compliance with BT Wholesale law requirements is recognised as programme included: • Continuing the Compliance Citation an essential element of all activities • Providing additional training on Award programme to encourage throughout the LoB specific areas of compliance through people to act as compliance presentations at meetings with senior • Identifying the risks of ambassadors for their colleagues and managers, three compliance non-compliance with BT's regulatory teams. Awards were made during the roadshows and compliance workshops commitments and competition law year to employees who demonstrated that provide an opportunity for exceptional compliance behaviour • Putting in place any processes and employees to consult the programmes to mitigate those risks compliance team • Holding three compliance competitions to raise awareness of • Helping the LoB understand how to • Developing a communications plan compliance issues. meet our commercial goals within to promote compliance, including the compliance framework updates through internal communication During the 2005 financial year, BT channels and training on specific • Ensuring that all mandatory Wholesale trained almost 5000 issues. Briefings are available on the compliance training is completed managers and 17,000 team members BT Wholesale Compliance website. in compliance. • Maintaining registers of risk and (http://www.btwholesale.com/applicati appropriate actions taken on?origin=BT_navbar.jsp&event=bea. portal.framework.internal.refresh&pa • Reviewing major processes to ensure geid=typical&nodeId=navigation/node compliance is achieved /data/our_business/regulatory_compli ance/regulatory_compliance)

Compliance training in BT Wholesale Compliance training in BT Retail (percentage of managers trained) (percentage of managers trained)

Competition Act Competition Act Data Protection and Privacy Data Protection and Privacy Information Retention Information Retention Sharing Information Sharing Information Winning Through Compliance Winning Through Compliance % 92 93 94 95 96 97 98 99 100 % 92 93 94 95 96 97 98 99 100

Actual Target Actual Target

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Compliance within BT Retail • Providing a computer-based training integration on an agile IP BT Retail (http://www.btplc.com/The package to explain the launch of infrastructure) to multi-site group/Companyprofile/Groupbusiness digital Wholesale Line Rental (WLR) organisations, including corporate and es/BTRetail/) is a UK retail operation to ensure that BT Retail people government customers across Europe that provides its 21 million customers understand the impact of WLR and and the UK, as well as in Asia Pacific with communications products, are compliant when dealing with and the US. It has employees in 45 services and solutions. Our customers any enquiries different countries, including the UK. are consumers, small and medium • Assessing outsourced operations enterprises, and major businesses In the 2005 financial year, the BT to ensure that appropriate training based throughout the UK. Global Services compliance is in place. programme included: There has been much focus within • Undertaking a programme of • Delivering the mandatory courses the industry and from Ofcom on compliance reviews (health checks) to employees based in the UK or consumer protection issues and across BT Retail. whose work touches the UK mis-selling in the consumer arena. • Managing the BT Retail Compliance • Developing alternative training BT has encouraged Ofcom to take risk register and reviewing the courses for people based outside the further action. Internally, BT Retail associated systems and processes. UK relevant to the specific regulatory works to ensure that all its customer regimes where they operate interactions occur compliantly. We • Re-launching the BT Retail use Mystery Shopper and Call Quality Compliance website. • Assessing the compliance Monitoring to ensure the sales requirements of new acquisitions • Reviewing and updated compliance advisors in the customer contact and ensuring they comply induction packs where appropriate. centres follow our compliance policies, • Revising the BT Global Services and to identify if and where any • Adapting the regulatory compliance compliance risk register with specific additional coaching is required. aspects of e-Assistant, the web-based reference to new acquisitions job file used by field service engineers, In the 2005 financial year, to align with changes in regulation. • Producing a global risk reduction plan the BT Retail compliance based on the risk register. programme included: During the 2005 financial year, • Developing specific training in BT Retail trained over 9000 managers During the 2005 financial year, addition to BT Group mandatory and over 14,000 team members BT Global Services trained over 5000 computer-based training in compliance. managers and over 4000 team members in compliance. • Providing face-to-face training for Compliance within BT Major Business Sales, Product Global Services Compliance within BT Exact (OneIT) Management, Indirect Channels, BT Global Services http://www.btglob BT Exact (OneIT) provides BT with all Commercial Management and alservices.com/business/global/en/ind its IT systems and services. In the Directories, and updating the ex.html) provides global services 2005 financial year, the compliance Partner Regulation training package (managed networks, outsourcing, programme trained almost 5000 for Indirect Channel partners utility applications and systems managers and 1000 team members.

Compliance training in BT Global Services Compliance training in BT Exact (OneIT) (percentage of managers trained) (percentage of managers trained)

Actual Target Actual Target

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4.1. Our risk review procedures • Planning activities sources. While the plan is produced The Internal Audit (IA) function in for the start of the 2006 financial • Risk assessment BT operates to internationally year, we will continue to review and accepted standards set by the • Reviews with appropriate risk and update this in light of any changes to Institute of Internal Auditors. control evaluations risk and/or regulation. The plan The standard of work performed by proposes reviews within the following • Formal reporting to management IA is subject to annual review by BT’s main areas: on issues and actions. external auditors, who certify that they can place reliance on IA’s work. Significant Market Power (SMP) Actions are progressed to ensure In addition to this, BT Internal Audit Reviews that suitable ownership and resolution participate in the Institute of Internal Continue to assess the adequacy of plans are in place. This includes Auditors' annual benchmarking survey ownership and actions to meet escalation and reporting to the (known as the GAIN survey), covering specific telecommunications BT senior management team and about 650 audit departments regulatory conditions Group/Line of Business Board Audit world-wide, including 28 organisations Committees where appropriate. Risk in the communications industry. Compliance Awareness reviews are undertaken independently The 2004 GAIN survey continues to Continue our plan from the 2005 from line of business activities. indicate that the resources deployed financial year and focus on introducing and practices adopted are in keeping self-assessment reviews to enable us The risk review plan for the financial with the most up-to-date international to increase coverage across BT. year 2006 has been prioritised with practice of internal audits. consideration of compliance risk, In addition, we will undertake ad identification of key business The risk review team is a dedicated hoc case investigations and projects processes that are most impacted compliance review team that uses the as required. by regulation and feedback from externally recognised Internal Audit internal (BT’s regulatory team, methodologies, processes and operational management) and standards to provide an independent external (Ofcom, Industry, etc.) review service that includes:

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Introduction TIRF RIF In the 2005 financial year, the BT BT sponsors TIRF to encourage open We established RIF as part of the compliance team has worked closely and honest dialogue in the compliance development of our compliance with other compliance professionals community of our industry to increase programme. Over 50 representatives in the telecommunications industry trust and transparency. We participated from a range of regulated businesses and a range of regulated industries in all TIRF events and provided the attended the first RIF event held in in the UK. industry with an insight of policies, November 2004. The main aim of the processes and procedures on a range meeting was to determine how to Objectives of areas including: share best practice and feedback from The key objectives were to: • Our code of conduct and approach the event was extremely positive. • Improve trust and transparency within to discipline to any breaches of the telecommunications industry compliance We have now held several informal workshops and gatherings to share • Share and identify best practice to • The scripts used by our sales advisors best practice on various topics further develop BT’s existing • Detailed statistics regarding including risk reviews, training compliance programme compliance and discipline in our material and compliance frameworks. • Compare our approach to compliance customer contact centres We will continue to develop RIF and with other organisations and look to include other industries • Our approach to risk reviews industries to benchmark our and regulators. performance. • Demonstrations of our training material Comparisons and benchmarking These objectives were delivered by: To enable us to determine what • Detailed answers to questions • Working with the Telecommunications further development can be made raised by UK Competitive Industry Regulatory Forum (TIRF) to our compliance programme we Telecommunications Association (http://www.tirf.co.uk/) commissioned an independent report (UKCTA) about pricing policy and by the Compliance Institute which • Setting up the Regulated Industries product development. looked at: Forum (RIF) (http://www.tirf.co.uk • Compliance culture in the /docs/RegulatedIndustriesForum.htm) We also provided the opportunity for management chain the Fixed Service Provider Association • Commissioning and participating in (FSPA) and UKCTA members to visit • Scope, content and delivery of our independent reviews and our customer contact centre in compliance training. benchmarking studies. Newcastle to see BT's compliance policies and processes in action.

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Extracts from the report by the • BT spent the most on compliance Plans for the 2006 financial year Compliance Institute: training, although the spend per We took into account the findings We are pleased to report that employee was not the highest of the above reports in setting out our our overall impressions are very plans for 2006. We will continue to • BT was the only company to produce favourable indeed, and we believe develop our work with industry in the an annual compliance report and to from what we have seen that the coming year by: have a self-assessment programme programme is working well, that both • Publishing a joint approach on the management and more junior staff • BT was the only company to conduct development of the Regulated have a good attitude to Compliance, both internal and external surveys of Industries Forum to identify common and that it is taken very seriously customer satisfaction relating to themes and improve the regulatory indeed throughout the company. regulatory compliance performance, environment both of which were positive (the • Working with the Centre for In January 2005, we took part in a external survey showed that more Regulated Industries to look at how study with a number of other than 90% of those interviewed self-regulation can best be achieved members of a European believed that BT complies with all telecommunications association on relevant regulatory legislation) • Building on our comparative work regulatory compliance. The main with the telecommunications industry • Of the investigations into alleged findings were: in Europe breaches and disputes closed during • BT had the largest regulatory 2004, a much lower percentage was • Reviewing the operation of TIRF once compliance team (even compared found against BT than against others the Ofcom decision on the Strategic with a major European company that responding to the question. Review has been published. has about 50% more employees) Most of the report was very favourable but identified a few areas to investigate.

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