Orange 2014 CSR Methodology Note

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Orange

2014 Corporate Social


Responsibility

Methodology note

The Group has been publishing a sustainable development and corporate social
responsibility (CSR) report every year, since 2002.
For the first time in 2014, the Orange Group publish its report solely online, within the
CSR section of the corporate Orange website. Since this section to be regurlarly
updated, all along the year, it is agreed that, for the sake of clarity, the so-called 2014
complete CSR report includes the documents listed under the web page "2014
complete CSR report", and in particular the following documents:
 the forewords bu Stephane Richard and Christine Albanel
 the 2014 achievements review
 the environmental data table
 the social data table
 the GRI table
The detail of policies and actions taken is in the pages "Engagement", as well as in
the pages on our three CSR pillars: Trust – Development- Environment.

The 2014 CSR report aims to provide a fair and balanced view of the Orange Group's
overall performance during the 2014 calendar year. It strives to meet the main
expectations which have been expressed by the Group's stakeholders (customers,
shareholders, credit rating agencies, employees, suppliers, public authorities and
local communities).

REPORTING PERIOD
The 2014 CSR report applies to 1 January - 31 December 2014. It also includes
several qualitative elements dated beginning 2015 (outstanding achievements).

METHODOLOGY SCOPE AND REPORTING


The report is based on selected indicators which take into account the main
economic, social, societal and environmental impacts of the Group's activities. The
chosen indicators take into account recommendations from relevant international
institutions such as Global Reporting Initiative (GRI), the United Nations Global
Compact, the OECD guidelines and the ISO 26000 standard on social responsibility.

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The indicators were collected, calculated and consolidated with the help of dedicated
IT tools. Unless stated otherwise, the presented data covers the Group's global
activities and countries where the Group is established.
As regards environmental information, the reporting scope covers an average of 98%
of the Group's turnover. The coverage rate, estimated as a percentage of the
turnover of entities included in the reporting scope, is provided for each
environmental indicator in the environmental data table:
http://www.orange.com/en/responsibility/reporting/CSR-
database/Spreadsheets/Environnemental-data

For social data, the coverage rate estimated as a percentage of the Group's
employees is provided in the social data table:
http://www.orange.com/en/responsibility/reporting/CSR-database/
Spreadsheets/Social-data

REPORT AUDIT
As with previous years Orange commissioned one of its auditors to review objectives
set in the 2013 CSR report, to check a selection of environmental, social and societal
indicators, the application of the AA1000 APS (2008) standard principles, and the
self-assessment based on GRI guidelines.
The information that have been checked by the external auditor, are identified by 
and  symbols according to the level of insurance covering the indicator
("moderate level of insurance" and "reasonable level of insurance" respectively).
The conclusions of this audit are detailed in the insurance report by Deloitte and &
Associés.

APPLICATION OF THE AA1000 STANDARD PRINCIPALS


The elaboration process of the 2014 corporate social responsibility report adheres to,
in material respects, the three principles of the AA1000 APS (2008) standard
(inclusion, materiality and responsiveness). This guide to corporate social
responsibility focuses on taking shareholders' expectations into account.
http://www.accountability.org/standards/index.html ).
Inclusion
Identifying our stakeholders' expectations is a decisive element in our process of
identifying the challenges of sustainable development. Consult the Group's main
shareholders by clicking on this link:
http://www.orange.com/en/responsibility/commitment/Stakeholder-dialogue

Materiality
The selection of the most relevant indicators to reflect its sustainable development
challenges, given the Group's activities, takes into account the expectations
expressed by shareholders and a regularly updated internal risk prioritisation.

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Reactivity
The identification of sustainable development challenges for the Orange Group's
activities results are listed in yearly revised action plans which are published in the
roadmaps on page "2014 complete SCSR Report"
(http://www.orange.com/en/responsibility/our-publications/2014)

This report is an essential element of response to the expectations expressed by the


Group's shareholders. It is published annually and provides an insight on the impacts
and progress made in relation to commitments made with shareholders.

COMPLIANCE WITH INTERNATIONAL REPORTING GUIDELINES


GRI (Global Reporting Initiative)
This report was designed according to the Global Reporting Initiative G3 guidelines,
while integrating G4/"core" level indicators. The reporting table is available on page
"2014 complete SCSR Report"
(http://www.orange.com/en/responsibility/our-publications/2014 )

Conformity with the Global Compact


Orange joined the United Nations Global Compact in July 2000.
On this basis, Orange is committed to publishing a yearly Communication on
Progress report. The response to this commitment is presented in the reporting
guidelines table of correspondence on page "2014 complete SCSR Report ".
(http://www.orange.com/en/responsibility/our-publications/2014)

Conformity with the ISO 26000 standard


The international ISO 26000 standard provides organisations with social
responsibility guidelines. The ISO 26000 standard is based on seven principals
covering various areas of action in terms of social responsibility of organisations.
To consult the answers to these different guidelines, turn to the reporting guidelines
table of correspondence on page "2014 complete SCSR Report".
(http://www.orange.com/en/responsibility/our-publications/2014)

SOCIAL DATA
The social reporting in this document is based on a different information system (HR-
Info) to that which was used for the annual report, and the Registration Document
(Magnitude), as only HR-Info enables a distinction to be made by gender and socio-
professional category.
Men-women ratio in management (permanent contracts at the end of the
period)
The rule for calculating the "management staff" indicator is based on the total active
workforce with permanent contracts (CDI).

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The "management staff" indicator includes staff in the "senior executive" category
which corresponds to the consolidation of the CCNT's (National collective convention
of telecommunications) E, F and G levels.
Sites outside France use a document which describes each CCNT level so that each
member of staff may be placed in the appropriate CCNT category.
Percentage of women in the "leaders" network
The "leaders" network is a management network comprised of 1112 managers at the
end of 2014. These managers hold highly strategic positions within the Orange
Group.
Number of departures
The "number of resignations", "number of redundancies" and the "number of
departures per gender" only take into account active permanent staff. In this way, the
permanent departures of staff who are temporarily out of the office (inactive:
extended sick leave, lay-offs, leave without pay, etc.) are not included in these
indicators.
Training hours
The reporting is currently in a stabilisation phase on an international scope. It now
covers more than 97,5% of staff.
Health and safety indicators
The coverage rate for these indicators is more than 95% of staff by end 2014 which is
more than 98.9% for France alone. Accidents reported by countries comply with local
regulations.

Definitions
TFRAC: the frequency rate of workplace accidents (TFRAC) corresponds to the
number of workplace lost-time accidents per million of theoretically worked hours in
the year.
TGRAC: the accident severity rate (TGRAC) corresponds to the number of lost-time
days per million of theoretically worked hours in the year.
The number of theoretically worked hours in a year varies according to country. It is
calculated using the number of full-time staff, the number of theoretically worked days
in the year and the number of theoretically worked hours per day in each of the
countries where the Group is present (last two elements sourced from ILO).

ENVIRONMENTAL DATA
The environmental reporting in this document is based on an information system
(Indicia). Only the countries in the Yearly Report took part in the CSR reporting. With
regards to the change in the 2015 reporting scope: when compared to that of 2014,
the changes are as follows - deleted countries: Kenya (not consolidated), Dominican
Republic (sold) and Uganda (sold). It is worth noting that this reporting is based on
quarterly reporting campaigns. The fourth quarter values are real or, if the data was
unavailable, are estimated by the country and corrected the following year.
Corrections from 2013 have therefore been applied to the 1st trimester of 2014.

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Energy
The energy consumption of data and network centres which share this with other
operators is partially or fully counted according to the relevance and availability of the
information. French mixed equipment consumption (network and mobile) is fully
applied to the indicator covering network consumption, except for mobile activity.
Energy consumption in premises, especially shops, for which the Orange Group does
not pay a direct bill are not included.
Energy consumption from district heating plants is not accounted for given the
difficulty in estimating the associated CO2 emissions.
Polish energy consumption (TPSA) is calculated using a sample of statistics from
paid invoices during the fiscal year. In the same way, electricity consumption for
Orange Spain and France is partly based on estimates.
The "fuel consumption" (all buildings, all purpose) indicator includes the following
fuel: domestic (vehicles not included), diesel, petrol, heavy oil and marine diesel for
the FT Marine subsidiary.

Transport
Train and plane transport data comes mostly from Carlson Wagonlit which covers
more than 80% of the kilometres travelled by employees. Distance travelled by train
and plane during business trips are estimated using the great circle distance (the
shortest distance between two points on the earth's surface). The CO 2 air transport
"short haul" emission factor of the GHG Protocol (180g CO2/km passenger) was used
for all flights (short, medium and long-haul). The CO2 rail transport factor was taken
from the "Bilan Carbone" ™ method when the latter was available in the relevant
country.
In the other countries, a standard measure of 100g CO 2/km passenger is applied.
The local travel agencies, not including Carlson Wagonlit, who provided a reporting
are also taken into consideration as well as expatriates' family trips.

CO2 emissions
For CO2 linked to electricity consumption, the updated January 2015 IEA CO2
emission factors were applied to all countries from 2006 to 2014. CHG Protocol and
ADEME emission factors (electricity) used for reporting during previous years were
replaced by those of the IEA.
The coefficients used for the other means of fuel (gas, oil, coal, petrol, diesel and
LPG) were not changed and come from GHG (2007). The reporting of refrigerant
emissions, as taken into account in CO2 emissions in Scope 1, is not yet
comprehensive. The Group is working on improving the follow up of these emissions.

Collected customer electrical waste (e-waste)


The WEEE (Electric and electronic waste) from individual customers corresponds to
WEEE (mobile telephones, landlines and multimedia) brought to stores, sent by mail
or collected by Orange service providers.

This indicator includes the Group's employees' mobile telephones. It includes


batteries and accumulators which are part of a device when it is brought to the store

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by the customer and the other types of batteries and accumulators s in the various
collection points.

In France, business customers' WEEE (OBS France) are not included in this
indicator. They are included in the internal WEEE indicator (network).

Evaucated and recovered waste


The reporting for waste takes into account the idea of discharged waste (i.e. waste
which is no longer stored on the Group's premises or is no longer handled by the
Group and has been transferred to an external handler with or without financial gain)
and recovered waste (i.e. waste which has been recycled in terms of material or
energy use). This is applied to European countries.
For non-European countries, and given the fact that there is frequently no identified
waste treatment channel for certain types of waste, the quantities of recovered waste
concern, in broader terms, all the quantities of discharged and sold waste.

The waste indicators reporting is not comprehensive for the following reasons: on the
one hand, due to the current identification process and the sustainability of the
collection and waste disposal channels in AMEA; on the other hand, due to difficult
access to outsourced contract data within the network of certain European countries.
Commun waste has not been taken into account since 2012, except for France,
where in 2014, some commune waste were included in framework agreements in the
reporting of other non-dangerous waste.

Furthermore since 2012, fluorescent bulbs, "PCB" (polychlorinated biphenyl) and


printer cartridges are included in "other dangerous waste".

In France for tertiary networks and waste other than WEEE from clients, only waste
handled by a contractor with whom the Orange Group has signed a framework
agreement is integrated in the reporting. This excludes cables and other Orange
Marine hazardous waste and a limited amount of Orange Marine waste (including
mud and oily water).

Orange launched the telephone booth dismantling project in 2013. This represents a
total of 9600 dismantled telephone booths and 1965 tons of recovered waste.
Different contractors are involved depending on the type of waste concerned (copper
cables, paper, network equipment, wooden poles etc.). Special attention is paid to
wooden poles in order to ensure that they are not reused, in line with restrictive
regulations, and to ensure that they are correctly disposed of. For leased sites,
household or similar waste is not reported as this is the lessor's responsibility.

Water
The main areas of water consumption within the Orange Group are water fountains,
the sanitary facilities, corporate restaurants and data centre ventilation systems.
Having studied the relevant volumes, the Group has reached the opinion that the
latter are not high enough to justify setting up a measuring and data consolidation
process where water consumption is concerned.

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Environmental management system
The "rate of Group ISO 14001 certification" KPI is the ratio of electrical energy used
on the ISO 14000 certified perimeter of the total electrical energy used by the Group
or, for a country, by the country.
A special method of calculation is applied for France, since process certifications
exist (for which consumed energy makes no sense) as well as site certification:
- the total number of staff working on the certified perimeter is divided by the total
number of staff in France to obtain a ratio;
- then, in a second step, this ratio is applied to the total energy used in France. This
gives an "equivalent" energy which can be aggregated with results obtained for the
Group's other organisations.

Orange Business Services International


Reporting for Orange Business Services International is limited to 11 countries (or 17
sites) out of the 200 where it is present. The countries make up 81% of Orange
Business Services International workforce and 62% of the surface of its occupied
offices (in m2). The countries are Australia, Brazil, Switzerland, Egypt, Germany,
India, Mauritius, Russia, Singapore, the United States and Great Britain.

OBS International bases its electrical energy consumption on 257 sites in 46


countries where OBS is present. These countries represent 82% of the surface of its
used premises (in m2) outside France.

CET (CUSTOMER EXPERIENCE TRACKER)


The published indicator corresponds to the average Orange customer ratings in
answer to the following question "[…] Would you recommend Orange mobile/high-
speed internet to your friends and family?"
The people questioned give a rating from 0 to 10. The results are averages and are
multiplied by 10 to get a mark out of 100.

LOCAL PURCHASES
The percentage of orders placed with local suppliers is calculated for each country (in
the geographical sense).
The data comes from the Group Sales (Gold) data consolidated in the information
system's (IS) and includes per entity:
- the order total;
- the total order from local suppliers.

The following are defined as


LOCAL:
- suppliers not belonging to a group;
- suppliers belonging to a national group.

EXTERNAL:

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- suppliers belonging to an international group .

If data is not exhaustive, it is not reported.

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