The Board takes regular account of the significance of social, environmental and ethical matters to the business and the Company.

During the year, the Board of mmO2 plc was briefed on eight occasions on a range of social, environmental and ethical issues facing the Company.

The topics covered included community investment, health and safety, industrial relations, adult content and child protection, as well as environmental protection. A specific report on business ethics was presented to the Audit Committee.

The Board has identified and assessed the significant risks to the Company's short- and long-term value arising from social, environmental and ethical matters, as well as the opportunities to enhance value that may arise from an appropriate response.

Social, environmental and ethical issues are integral to all aspects of the business and are included in our risk-management procedures. We aim to include any social, environmental or ethical risks in our risk registers to ensure they are fully integrated in our day-to-day operations.

The Board has received adequate information to make this assessment and account is taken of social, environmental and ethical matters in the training of Directors.

All new appointees to the Board receive training on a wide range of issues including elements of corporate responsibility. Existing Directors can receive training on request. In addition, the Directors attend a two-day off-site conference covering – among other things – specific social and ethical matters. The Board is briefed at least twice a year on corporate responsibility matters.

The Board has ensured that the Company has in place effective systems for managing significant risks which, where relevant, incorporate performance management systems and appropriate remuneration incentives.

Our risk-management procedures are guided by the Combined Code developed by the Turnbull Committee. In common with other risks, we manage social, environmental and ethical risks by assessing their potential impact on the Company, measuring our appetite to manage them and by developing strategies to mitigate them.

A number of Directors of Group companies and other employees have explicit corporate responsibility objectives to meet. All those charged with managing risks are remunerated on the basis of their success in meeting clearly defined targets. This has been an important step in encouraging good ethical conduct in all our dealings and in providing a framework for managing, measuring and accounting for the impact of our business. During 2004/05 we aim to align the management of corporate responsibility to the Company's performance management process.

A description of social, environmental and ethical related risks and opportunities that may significantly affect the Company's short- and long-term value, and how they may impact on the business.

Two particularly significant corporate responsibility risks confront mobile communications companies: public concerns about the safety of handsets and other portable equipment and worries about the siting of communication masts. A detailed review of these and other risks are included in this report.

A description of the Company's policies and procedures for managing risks to short- and long-term value arising from social, environmental and ethical matters.

Our risk-management policy describes in detail our procedures for managing risks. All social, environmental and ethical risks are covered by this policy.

A description of the extent to which the Company has complied with its policies and procedures for managing risks arising from social, environmental and ethical matters.

Controls for risk-management are constantly scrutinised through internal audits. The Audit Committee is regularly updated about our risk registers and the progress of mitigating risks.

A description of the procedures for verifying social, environmental and ethical disclosures.

Corporate responsibility matters are included in our internal audit reviews, where appropriate, and reported to the Audit Committee. The content of this corporate responsibility report has been externally verified by our assurance providers, Ernst & Young. In addition, our environmental and health and safety risks are subject to third-party audits through operational risk reviews, which form part of our insurance programme. Our compliance with the industry-agreed Ten Commitments on responsible mast siting in the UK is subject to third-party review.