Deciding what to report on
We believe a wide range of non-financial issues affect our business and we try to define clearly what these are.
Non-financial risks - including social, environmental and ethical considerations - are treated in the same manner as any other matters that may affect the sustainability of our business. Our risk management policy helps us to identify, measure, manage and mitigate as well as to prioritise any issue that can pose a potential risk or offer us an opportunity for improved performance. We disclose in our Annual Report and Financial Statements the principal business and regulatory risks faced by our operations.
This process will help us prepare for the new UK Operating and Financial Review (OFR) regime, which becomes a legal reporting requirement for us in 2006. The OFR will require all companies to publish a broad view of the risks and uncertainties facing them so that shareholders can make informed decisions about a company's direction.
O2 engages with a wide range of communities, such as customers, employees, pressure groups and regulators. We have developed a method to track how well we identify, manage and mitigate all social, environmental and ethical issues in response to input from regular dialogue. This method will be applied starting from 2005/06.
The impact of any issue on our business is measured against how it would affect our:
- business value;
At the same time our ability to manage the issue is weighed against three other factors:
- the quality of our engagement with relevant stakeholders;
- the level of control we have over any issue;
- the urgency of an issue or the time it takes to manage it.
Each issue or group of issues is then scored and plotted on a dashboard, similar to the one we use for assessing other risks. By using this new method - which recognises both the views of stakeholders and our ability to manage corporate responsibility issues - we have been able to customise AccountAbility's 5-part materiality test, which we applied as a desk-based research tool for last year's report. As a result, we now have a way of mapping corporate responsibility issues for O2 that fits within our overall risk management process and that can be applied through our recently acquired online system.
This system allows us to see how our management of key social, environmental and ethical issues is evolving. It is based on the input we receive from stakeholder engagement and is tailored to fit alongside similar systems that track all the risks we face.
The initial research findings in developing this new method and other stakeholder input, such as media reports or opinion leader research, has helped us to prioritise issues to be included in this Corporate Responsibility report. This report is aimed at anyone who has an interest in our business. We have also issued operating business reviews on the flipside of this report and on our website for those who would like to know more about local activity in their area.
O2 plc publishes corporate responsibility reports annually. The previous report was published in July 2004. This report covers our operations up to 31 March 2005. The report covers O2's fully owned operating businesses, excluding joint ventures.
The report is structured around the Global Reporting Initiative indicators as well as around the Business in the Community reporting framework. Both reporting frameworks are referred to at the beginning of each chapter and a detailed GRI reference table is available on our website. The majority of our report is reviewed by our assurance providers Ernst & Young LLP and the Involving-community section has undergone a detailed review and assessment of our community investment activity by our second assurance providers - The Corporate Citizenship Company.