1、 Technology for goodEricsson Sustainability and Corporate Responsibility Report Ericsson|Sustainability and Corporate Responsibility Report 2017iiGirl Scouts of Northeast Texas STEM Center of Excellence.Ericsson has partnered with the Girl Scouts as part of our commitmentto increase the number of wo
2、men in ICT.1Ericsson|Sustainability and Corporate Responsibility Report 2017 01Introduction 2Ericsson in brief2Business model2About this report4Letters625 years of sustainability leadership8Ericsson in context10CTO voice on technology trends11Sustainability and CR strategy12Significant sustainabilit
3、y issues14Sustainable Development Goals16Partnerships for the goals17Stakeholder engagement02Conducting Business Responsibly19Overview and highlights20Governance22Anti-corruption24Human rights28Sales compliance30Responsible sourcing32Raw materials sourcing33Occupational health and safety36Our people
4、41Facts and figures03Energy,Environment and Climate Action43Overview and highlights44Circular economy45Latest research on ICT and climate change46Product energy performance50Leveraging the Internet of Things52E-waste management53Our own activities55Facts and figuresContents04Internet for All 57Overv
5、iew and highlights58Global context59Partnerships for progress60Boosting socio-economic development62Improving education64Supporting humanitarian response68Employee volunteer program69Awards and recognitions05Performance,Indices and Assurance71Engage with us72Objectives and achievements74GRI Index76U
6、NGP Reporting Framework Index78Independent Auditors Combined Assurance Report79Independent Auditors Report on Conflict Minerals80AcronymsCover photo:Ericsson Response volunteer working in disaster-afflicted area.Hurricane Maria(Category 5)struck the Caribbean in September 2017 and first made landfal
7、l on Dominica.While other islands were also heavily impacted,Dominica quickly became the focus of international humanitarian operations in the region.Connec-tivity through the Ericsson Response WIDER solution(support-ing UN WFP/ETC)wasprovided in Roseau and Marigot for+2,900 relief and humanitarian
8、workers.Ericsson|Sustainability and Corporate Responsibility Report 20172Ericsson in briefEricsson has been at the forefront of innovation for more than 140 years and as the market continues to transform and user demands con-tinue to change so does Ericsson.It all started in a mechanical workshop in
9、 Stockholm where Lars Magnus Ericsson designed telephones and Hilda Ericsson produced them by winding cop-per wire coils.Over the years,inclusion and diversity have remained important building blocks of the company,and are fundamental tothe culture and its core values of professio-nalism,respect and
10、 perseverance.Ericsson has revolutionized analogue com-munications with new switching techniques anddigital technology,and has led the develop-ment of mobile communications.When broad-band was in its infancy Ericsson was already working on the technology that would become 3G,and was developing 4G lo
11、ngbefore the smartphone became ubiquitous.Now 5G is around the corner and Ericsson is investing fortechnology leadership in 5G.Ericsson has its headquarters in Stockholm,and the Ericsson share trades on Nasdaq Stockholm and on NASDAQ,New York.Business modelWe create value for our stakeholders by pro
12、viding industry-leading,high-perform-ing,sustainable and cost-effective solutions to our customers.We have always driven our technology development with the inten-tion to improve peoples lives and contribute to the betterment of society,while at the same time providing shareholder value.Wetake activ
13、e measures to ensure that weare a responsible and relevant driver ofpositive change.About this reportThis report summarizes Ericssons sustaina-bility and corporate responsibility(CR)perfor-mance in 2017.It is our 25th such report.Addi-tional information is available on the company website.Sustainabi
14、lity and CR are central to Ericssons core business.We are committed to using the triple bottom line approach to evalu-ate our performance broadly including responsible environmental,social and eco-nomic development aspects as we believe this helps us create greater business value.The purpose of this
15、 report is to inform interested parties about our progress in line with our ambition to create positive impacts for our stakeholders and our business,while mitigating risks related to environmental,social,employee,human rights and anti-corruption matters.We take a full value-chain perspective to con
16、ducting business responsibly,working closely with our suppliers,our customers andsociety.Technological development Market innovations End-user trends and behaviour Sustainable development Geopolitical conditions and macro environment Standardization and cooperations RegulationsR&D employees23,600Com
17、pany purposeInnovating tech nology for goodStrategy Technology leadership Product-led solutions Global scale and skillMission Enabling the full value of connectivity for ser-vice providersWanted position sustainability and corporate responsibility To be a responsible and relevant driver of positive
18、change in societyNumber of patents45,000Services professionals55,000Employees worldwide100,735External factorsOur key assets,a foundation for stakeholder value creationOur business and operationsMarket needs and customer demandsDevelopGroup function responsibility Provide an effective support platfo
19、rm,drive synergies,align ways of working and driving the corporate agenda.Business area responsibility Develop competitive global business solutions.NetworksDigital ServicesManaged ServicesDevelop3Ericsson|Sustainability and Corporate Responsibility Report 2017 Sustainability Performance and Risk re
20、portIn accordance with the Swedish Annual Accounts Act,we prepared our first Sustain-ability Performance and Risk Report in 2017 and integrated it into our Annual Report.UN Global CompactEricsson has been a signatory since 2000.Wereport our Communication on Progress annually and according to the Adv
21、anced Level criteria since 2012.UNGP Reporting FrameworkThis is the fourth year that Ericsson has reported according to the UN Guiding Princi-ples(UNGP)Reporting Framework.The UNGP Reporting Framework Index is on page 76.Report boundariesUnless otherwise stated,all information and data pertains to a
22、ctivities undertaken from January 1,2017,to December 31,2017.Thereport covers the Ericsson Group,i.e.Telefonaktiebolaget LM Ericsson and its subsidiaries.The Ericsson Annual Report 2017 provides information about Ericssons struc-ture;the nature of our ownership and legal form;our subsidiaries;and ch
23、anges regarding size,structure,financial and non-financial performance.Technology for Good Ericsson is a leading advocate of using Tech-nology for Good.It is a concept we work with every day to address areas such as cli-mate change,poverty,education,human rights and humanitarian issues,and it is the
24、 overarching theme of this report.Global Reporting InitiativeThis report has been prepared in accordance with the Global Reporting Initiative(GRI)Sustainability Reporting Standards,and includes a GRI Content Index(page 74);a complete GRI compilation appears online.Ericsson Compliance LineTo report s
25、uspected violations of laws or the Code of Business Ethics via Ericsson Compli-ance Line,our whistleblower tool,visit: Assurance ReportThe report has been assured by Pricewater-houseCoopers(pages 7879).Forward-looking statementsCertain matters discussed in this report include forward-looking stateme
26、nts subject to risks and uncertainties.Readers are cautioned that our forward-looking statements are not guar-antees of our future actions or developments,which may differ materially from those described or implied.We disclaim a duty to provide updates to these forward-looking statements after the d
27、ate of this report,to reflect events or changes in circumstances or changes in expectations,or the occurrence of anticipated events.Links to any websites that appear in this report are for informational purposes only they have not been included in the report assurance.Core values Respect Professiona
28、lism PerseveranceGroup long-term(beyond 2020)financial targets Operating margin 12%Strong free cash flowCustomers in 180 countries Established relationship with world leading service providersOur key assets,a foundation for stakeholder value creationOur business and operationsDevelopDeliverSellNet s
29、ales SEK 201.3 billionOperating margin(%)negativeFree cash flow SEK 5.1 billionDividend SEK 3.3 billionTotal shareholder return 3%Shareholder value,2017CustomersEnabling the full value of connectivityEmployeesAttract,develop and retain the best talentSocietyResponsible and relevant driver of positiv
30、e changeShareholdersShareholder value creatorKey stakeholders and our focusMarket area responsibility Sell and deliver customer solutions.Managed ServicesEricsson|Sustainability and Corporate Responsibility Report 20174LettersBrje EkholmPresident and CEO2017 was a year of change for Ericsson as we c
31、ontinued on our mission to enable customers to capture the full value of connectivity.Its clear that telecom has become one of the greatest drivers of economic growth,innova-tion and human equality the world has ever seen,which makes our work more exciting with each passing year.We believe strongly
32、that ICT is an invaluable tool in achieving all 17 of the UN Sustainable Development Goals(SDGs)and it is encouraging to see the grow-ing recognition of this reality amongst decision makers around the world.Equally important,86%of employees surveyed believe that Ericsson is living up to the position
33、 of a rele-vant and responsible driver of positive change in society.5GExisting mobile infrastructure already plays acritical role in the development of societies,and 5G is set to provide a major boost because it is being built to support both humans as well as major industrial applications.In fact,
34、we have identified manufacturing as one of the single biggest opportunities for 5G with a business potential of more than 100 billion USD globally for service providers by 2026.We believe that the Internet of Things(IoT)also has great potential to create a more efficient and sustainable world,and th
35、is report high-lights many examples of how this potential can be harnessed.In all of our initiatives,westrive to engage our customers and stake-holders in creating positive impacts and sus-tainable business models,and each year this work grows in importance.Responsible business at our coreStrong res
36、ponsible business practices are at the core of Ericssons company culture and I believe they should be the foundation for how we conduct business.We strive to be proactive and at the forefront of evolving corporate responsibility(CR)standards.Our Code of Business Ethics is our guiding star and employ
37、-ees globally re-acknowledged the Code during 2017.We have strong initiatives in areas such as human rights,anti-corruption,occupational health and safety,and responsible sourcing.We also continue to support the ten principles of the UN Global Compact and the UN Guiding Principles on Business and Hu
38、man Rights.But it is the people at Ericsson that put this respon-sibility into practice every day.We take our commitment to responsible business seriously,and we continue to volun-tarily cooperate with inquiries from the United States Securities and Exchange Commission and the United States Departme
39、nt of Justice regarding compliance with the U.S.Foreign Corrupt Practices Act.Tracking our performanceI am pleased with our sustainability and cor-porate responsibility performance in 2017,particularly the progress we made in the areas of energy performance,climate action and circular economy(page 4
40、255).All of our sustainability goals are anchored at the top,and most of them were met.However,we still have more work to do in areas like e-waste management,anti-corruption and health and safety in our supply chain.In 2018 we will continue our work to turn around our business performance after a to
41、ugh period for the company.I remain con-vinced that integrating sustainability and responsible business practices into our busi-ness operations will be vital to our long-term success,and one of my goals will be to main-tain a strong tone from the top on the impor-tance of these issues.Elaine Weidman
42、-GrunewaldSenior Vice President and ChiefSustainability and Public Affairs OfficerTwenty-five years have passed since Ericsson published our first environmental report in 1993,in conjunction with the first Earth Summit in Rio,marking us as one of the early adopters of sustainability commitments and
43、reporting.Over time,the companys long-standing commitment to doing the right thing and taking responsibility for our actions has remained both proactive and progressive.While there is still much work that remains to be done,I think its important to acknowledge the progress we have made so far,which
44、was reflected in the Global 100 Most Sustainable Companies in early 2018,where Ericsson ranked#28 globally and#1 in Sweden.A purpose-driven companyI believe that the company purpose,“Innovat-ing Technology for Good,”is a strong direc-tional statement.As technology becomes increasingly complicated an
45、d touches on more and more aspects of our lives,issues like inclu-sion,new types of digital divides,security and privacy are all areas of growing concern that need to be addressed.Keeping our purpose statement in mind will help us determine what role we should play and what our responsibility is wit
46、hin our President and CEOSVP and Chief Sustainability and Public Affairs Officer5Ericsson|Sustainability and Corporate Responsibility Report 2017 Leif JohanssonChairman of the Board It has been an honor for me to serve as the Chairman of Ericssons Board of Directors and oversee the company as it has
47、 pursued its ambition to be a responsible and relevant driver of positive change in society.I believe that all global companies today must embrace a sustainability agenda and purpose or they will be left behind.Ericsson has been building sustainability and responsible business into its operations fo
48、r some time now,and its reward-ing to see that it is beginning to bear fruit.Triple bottom lineEricssons Board of Directors is keenly aware of the fact that proactive management of sustainability and corporate responsibility(CR)issues creates considerable value for a wide range of stakeholders in th
49、e short,medium and long term.Thats why our com-mitment to delivering results along the triple bottom line of financial,environmental and socio-economic performance is so important.We want to ensure proactive and meaning-ful results,and be as transparent as we can beabout our activities.By doing so w
50、e open ourselves up for feedback that can help us improve,as well as providing inspiration forothers.Risk managementFor all the good that they may bring,the types of technologies that Ericsson works with also present risks,including threats to the right to privacy and the potential for human rights
51、violations.We also need to consider,for exam-ple,health and safety risks in our supply chain and corruption risks in the countries in which we operate.The board is aware of these risks and receives regular updates to ensure that action is taken to address them when needed.Good governanceIt is encour
52、aging to see how seriously ESG(environmental,social and governance)issues have been addressed by the company during my tenure on Ericssons board.As I prepare to leave my post as chairman,I am confident that the compass is set in the right direction but,of course,the work must never stop.New challeng
53、es will arise,but the company has worked to establish a robust and systematic way to manage them.In particular,we have set out our commitment to conduct business responsibly in our Code of Business Ethics,a guiding framework that must be followed by everyone who performs work for Ericsson including
54、both employees and suppliers.In closing,I am confident that Ericssons focus on the power of technology to create positive change,together with its commitment to responsible business practices and sustain-ability,will serve the company well for many years to come.industry value chain.In light of this
55、,we are committed to ensuring that our company purpose is meaningful in employees daily work,and we see growing interest from employees to be part of a change for good.Sustainable Development GoalsSince they were first unveiled in 2015,we have advocated for the SDGs and used them to help us determin
56、e how best we can contribute to overcoming global sustainability challenges.Two years later,we have integrated the SDGs as a framework for how we describe our impacts on society and moved from the theo-retical to the opportunistic with several exam-ples of how ICT is enabling progress toward the SDG
57、s(see page 1415 for details).IoT as a game changerOne of the most promising technological developments for sustainability is the Internet of Things(IoT).The IoT is about connecting and remotely controlling previously uncon-nected“things”in both the virtual and physical worlds.When combined with the
58、mobile con-nectivity that 5G brings on an industrial scale,and the computing and analysis that the cloud will bring,our enhanced ability to sense the physical world around us may become the biggest game changer for sustainability ever.The examples in this report,ranging from connected mangroves to u
59、rban transport solutions to IoT farming,all highlight the potential.At Ericsson we are convinced that provid-ing internet access to the unconnected is both a great business opportunity and a powerful way to deliver on the SDGs.Our goal is to enable cost-efficient upgrade paths from 2Gto 3G to 4G to
60、5G and find viable ways toprovide Internet for All.As I conclude my tenure leading Ericssons Sustainability andCorporate Responsibility efforts,I firmly believe by y connecting our portfolio,our customers and sustainability,a strong foundation for thefuture is in place.Chairman of the BoardEricsson|
61、Sustainability and Corporate Responsibility Report 2017625 years of sustainability leadership19931992World highlightsEricsson highlights19941995199619971998199920002001200220032004Earth Summit,Rio de Janeiro.Launch of UN FrameworkConvention on Climate Change(UNFCCC)to reduce greenhouse gas emissions
62、.Launch of environmental standards,ISO 14000 seriesUN Global Compact announced/Launch of Millennium Development Goals(MDGs)Adoption of the Kyoto Protocol/Inclusion of extended producer responsibility principle in EU legislationFirst environmental reportFirst life-cycle assessment and CO2 measurement
63、sFirst Group Goal to save energy at every step of our operationsRelease of first Banned and Restricted Substances ListSupport formation of UN Global Compact/Establishment of Ericsson ResponseFirst UN Global Compact Communication on Progress integrated in our S&CR reportFirst Ericsson Response missio
64、n,Kabul,Afghanistan/First sustainability report following GRI guidelines/Worldwide EMS certificate according to ISO 14001First material declarationCertification of first factory in accordance with the Environmental Management UK standard BS 7750In hindsight it is clear that the Rio Earth Summit of 1
65、992 was an important landmark in the history of sustainability.It was there that more than 170 countries agreed for the first time to pursue sustainable development and take action to prevent climate change.The following year,Ericsson was one of a handful of companies that embraced the opportunity t
66、o start our journey toward becoming a corporate sustainability leader.While we acknowledge that there is still much work left to be done,we are proud to celebrate the 25th anniversary of the publica-tion of our first environmental report in 1993.The timeline below provides an overview our most relev
67、ant activities since then,in the context of major global milestones.7Ericsson|Sustainability and Corporate Responsibility Report 2017 2005201720062007200820092010201120122013201420152016UN endorsement of the Guiding Principles for Business and Human Rights(UNGP)Establishment of International Telecom
68、munications Unions(ITU)Broadband Commission for Digital DevelopmentUNFCCC launches Momentum for Change at COP17Ratification of international climate agreement by UN member states after Paris meeting in 2015 UN adopts the Sustainable Development Goals(SDGs)Join Business Leaders Initiative on Human Ri
69、ghtsExpansion of environmental policy to sustainability policyFirst Group OHSAS certificateCo-found Connect to Learn,a global education initiative/Join the Broadband Commission for Digital Development/Start partnership with Refugees UnitedFormalize our commitment to UN Guiding Principles on Business
70、 and Human Rights/Join the World Economic Forum Partnering Against Corruption Initiative(PACI)/Join the Leadership Council of Sustainable Development Solutions Network/First time reporting UN Global Compact Communication on Progress according to the advanced level criteriaFirst in the ICT sector to
71、report according to UN Guiding Principles Reporting Framework/First Conflict Minerals Report with the US Securities and Exchange Commission/First ICT infrastructure provider to sign GSMA Humanitarian connectivity charterFirst company to commit to the UN OCHA Connecting Business Initiative at the Wor
72、ld Humanitarian Summit/Publish first Statement on Modern Slavery and Human Trafficking in accordance to the UK Modern Slavery Act/Establishment of Ethics and Compliance Board/Ericsson CEO receives World Food Programme Hunger Hero award at World Economic Forum/Ericsson receives Momentum for Change Li
73、ghthouse award for Connected MangrovesAdoption of the SDGs as the framework for measuring company impact on society/Ericsson research shows the enabling effect of ICT to reduce global emissions by 15%by 2030Climate targets approved by Science Based Target Initiative/Signed“We are still in”declaratio
74、nJoin the UN-led Sustainable Development Solutions Network(SDSN)post-2015 agendaFirst ICT for develop-ment initiative to support the MDGs and the Millennium Villages ProjectFirst group-level carbon footprint reduction targetEricsson|Sustainability and Corporate Responsibility Report 20178Ericsson in
75、 contextOur company purpose Since Ericssons founding more than 140 years ago,we have been guided by the idea that access to communication is a basic human need.Since then,we have continuously deliv-ered innovative solutions and evolved technol-ogy to connect places,people,things and societies.In sho
76、rt,our company purpose is Innovating Technology for Good.We have always driven our technology development with the intention of improving peoples lives and contributing to the better-ment of society.Whether it was the first phone call,or bringing communications to Africa over a century ago,digital i
77、nfrastructure and the Internet of Things(IoT),or the artificial intel-ligence systems of the future,we take active measures to ensure that we are a responsible and relevant driver of positive change for humanity.While we have specific programs that help illustrate this,including Ericsson Response an
78、d Connect to Learn,our purpose to Innovate Technology for Good is much broader it applies company-wide,and is an important directional statement for all that we do.We believe that the potential of mobility,broadband and the cloud to address economic development,sustainability and CR issues remains h
79、ighly underleveraged.We are fully committed to scale the power of ICT so that everyone can reap its benefits.We believe that by connecting our portfolio,our customers,and our sustainability know-how,we can affect massive positive change in society as we build a strong and profitable company nowand f
80、or the future.“In short,our company purpose is Innovating Technology for Good.”Our latest Connected Mangroves project is in Bangkung Malapad,an islet located in Sasmuan,Pampanga,the Philippines.It is considered a critical habitat as it serves as a temporary home to migratory birds in the region.Loca
81、ted at the mouth of the Pampanga River,the mangrove forest also protects the coastal community against flooding and other natural disasters.9Ericsson|Sustainability and Corporate Responsibility Report 2017 Understanding the world around usWe live in a world characterized by rapid tech-nological adva
82、ncements that are enabling enormous efficiency gains for individuals,businesses and governments.The IoT,cloud,blockchain,big data,artificial intelligence,machine learning,advanced robotics,virtual and augmented reality the list of life-changing technologies continues to grow yearly.At the same time,
83、however,the world con-tinues to face major sustainable development challenges,such as climate change,resource scarcity,poverty and inequality.By recogniz-ing that the goal of ending poverty goes hand in hand with strategies that build economic growth,tackle climate change and improve environmental p
84、rotection,the UN Sustainable Development Goals(SDGs)are helping us to focus our efforts,work together with strategic partners,and maximize our positive impact.While new technologies are creating a wealth of opportunities to address develop-ment challenges,it is important to acknowl-edge the fact tha
85、t they can also pose risks.We know,for example,that our technology can be misused to intrude on individuals right to privacy and/or limit their right to freedom of expression.We are committed to addressing these risks across our business operations.For more information,see pages 2427.Mobile broadban
86、d According to Ericsson Mobility Report(November 2017),over 95%of the worlds population will be covered by mobile broad-band networks by 2023.This scale-up pro-vides an excellent opportunity to accelerate progress toward the SDGs.We are committed to enabling cost-efficient upgrade paths from 2G all
87、the way to 5G to support the process ofproviding everyone with the benefits of theinternet.ICT,and mobile broadband in particular,are increasingly recognized as basic societal infrastructure that provide critical solutions for national development from the social,eco-nomic,and environmental perspect
88、ives.In 2017,Ericsson Research and the Imperial College of London published a working paper that confirms that when a country adopts mobile broadband,the result is solid overall economic development(see page 58).Digital transformationOn top of its economic benefits,digitalization contributes to sust
89、ainability in a variety of ways.Perhaps most importantly,digitalization makes it possible to use fewer resources to do more things more efficiently.We believe that mobile networks are the most efficient and effective way to gather data.Thats why we have invested heavily in developing solutions to he
90、lp our customers leverage networks to generate data-driven insights that can drive automation and greater agility.Our customers can also use our technology to deliver similar benefits to their customers.By offering these capabilities to our customers we enable them to transform their operations and
91、seize newopportunities that spur sustainable development.The Internet of ThingsThe IoT is a network of physical objects embedded with electronics,software,sensors,actuators and network connectivity that enable them to connect and exchange data.Examples of IoT applications include wear-able devices t
92、hat track individual health data,smart meters,connected vehicles,and sensors that monitor water quality or weather pat-terns.The real-time data capture that the IoT provides is key to effective remote monitoring and control,and to making rapid decisions inindustrial and societal applications.By thee
93、nd of 2017,there were already about 0.5billion IoT devices with cellular connec-tions and this number is projected to reach 1.8billion in 2023.5GWe are committed to using our technology,solutions and expertise to create positive impacts for all of our stakeholders.Looking forward,we believe that one
94、 of the main ways we can make a difference in the world is by delivering and leveraging on 5G,the next generation of mobile broadband.5G will accelerate the digital transformation and enable more advanced IoT solutions.We expect the initial commercial 5G networks to be up and running in 2019,with ma
95、jor net-work deployments from 2020 and 1 billion 5Gsubscriptions forecast by 2023.We plan tohave the most energy-efficient 5G solution onthe market.AdvocacyAs an industry leader,we are strong advocates for the message that ICT can help shape more sustainable societies.We engage in public-private par
96、tnerships to advance shared aims and visions.Our work in the Broadband Com-mission for Sustainable Development contin-ues to drive the fundamental role of mobile broadband as the key enabler to realizing Internet for All.Ericsson|Sustainability and Corporate Responsibility Report 201710CTO voice on
97、technology trendsThe 3rd Generation Partnership Project(3GPP)announced the first 5G New Radio standard in December,setting the stage for large-scale trials and commercial deploy-ments as early as 2019.“While every previous network generation has brought significant enhancements to voice and mobile b
98、roadband services,whats special about 5G is that we have an alignment in time with transformations in other industries,”our CTO Erik Ekudden explains.“One example is the use of connected sensors in farming to more accurately measure soil conditions,improve yields and optimize irrigation.”He continue
99、s:“On the other side of the spectrum we see how high-speed,resilient and low-latency connectivity combined with distributed computing,the IoT,machine learn-ing and artificial intelligence enable industries Ericsson is committed to creating solu-tions that respect individuals right to privacy.This is
100、 one of the key reasons why we have been working closely with the GSMA for the past four years to develop Mobile Connect,an easy-to-use digital identity solution that ensures that users are in full control of their data when they interact with service providers.Our role in the project has been to do
101、 the backend work,developing the gateway between the service provider and the operator.A mobile phone number provides a strong basis for establishing a persons digital identity because it is both global and unique.Operators are well placed to actas identity providers because they already have enough
102、 information about their subscribers to start building their identities.Mobile Connect makes it possible for operators to take on the role of trusted identity providers.Users gain the ability to access digital services without the need to remember user names and passwords.We believe that the ability
103、 toprovide authentication and secure identity verification will help operators enhance consumer trust and ultimately allow digital service providers to deliver amore seamless user experience.One of the key benefits of Mobile Connect is that it is easy for users to separate services from each other a
104、nd prevent unwanted commercialization of their data.Personal data is only shared with the specific consent of the end user in the Mobile Connect eco system.Mobile Connect also has the potential to bring great value to people who live in countries in the developing world that lack national identifica
105、tion systems.It isestimated that more than one billion people worldwide currently have no proof of their identity,which makes it difficult for them to access public services and fully engage in the economy.The ability to gain access to a digital identity solution via their mobile phones could open u
106、p a world of new opportunities for many of these people.Mobile Connect a new standard in digital identityto transform their production processes toward a much higher degree of flexibility,supporting the fourth industrial revolution.”This is where 5G-Enabled Manufacturing(5GEM)comes in:a concept that
107、 leverages wireless and 5G-based communication to achieve radically increased manufacturing productivity,flexibility and competitiveness,with the highest security standards.“This approach can also address areas such as circular economy,improved energy perfor-mance and climate change,”Ekudden adds.“O
108、ur 5GEM pilot projects include manufac-turing system design,deployment,operation and maintenance:the key life-cycle phases for competitive,secure and sustainable manufac-turing,”he says.“This is just one example of the vital role the mobile industry has to play increating the foundation for new busi
109、ness in a broad range of industry sectors.”“5G is more than just a new generation of mobile technology”Erik Ekudden,Ericssons Chief Technology Officer(CTO)5G expands the addressable market and offers new revenue streamsMassive Machine Type CommunicationSmart meters,sensors and buildings Smart agricu
110、l-ture,air and water qualityLogistics and fleet managementVR/AR 4K/8K UHD Smart phonesEnhanced Mobile BroadbandSmart industrial applicationsTraffic safety&controlRemote healthcareCritical Machine Type CommunicationMobile/Wireless/FixedEnterprise HomeFixed Wireless Access11Ericsson|Sustainability and
111、 Corporate Responsibility Report 2017 Sustainability&corporate responsibility strategyAt Ericsson,we believe that sustainability and corporate responsibility(CR)are cornerstones of building a company for the future and creat-ing lasting value.We work on two dimensions:creating positive impacts using
112、 the SDGs as our framework,and reducing risks related to environmental,social,employee,human rights and anti-corruption matters.Our principal risks relating to sustainability and CR are identified in Ericssons risk management framework.Our sustainability and CR strategy is a core part of Ericssons b
113、usiness strategy,and it is embedded across the company.It focuses on three areas:Responsible Business;Energy,Environment and Climate Action;and Internet for All.Every year,we aim to deliver results along the triple bottom line of financial,environmen-tal and socio-economic performance.We are convinc
114、ed that proactive management of these issues creates value in the short,medium and long term.Integrating sustainability and CR into our business propositions helps us to manage group-wide performance and differentiate ourselves from the competition.We are con-fident that we have the innovative solut
115、ions and all the necessary capabilities to contribute to solving a wide range of business and devel-opment challenges that will ultimately enable the creation of a growing economy that is both inclusive and sustainable.Responsible BusinessOur CR standards are among the highest in the industry.We hav
116、e strong programs in areas such as human rights,anti-corruption,occupational health and safety,and respon-sible sourcing,and we continue to support the ten principles of the UN Global Compact and the UN Guiding Principles on Business and Human Rights.A robust approach that com-bines prevention and a
117、ccountability helps mitigate risks and reinforce employee aware-ness,which encourages them to do the right thing.For more details,see pages 1841.Energy,Environment and Climate ActionThe circular economy encapsulates our approach to environmental sustainability.Thisincludes the environmental impacts
118、of our company,products and services,as well as the use of ICT to reduce the environmental impacts of other sectors.We have become leaders by using a circular approach in the management of materials,waste and water,and in setting ambitious energy goals for 5G.We are committed to developing and deliv
119、er-ing solutions that support climate action by continuing to address energy and CO2e aspects in our own operations,our portfolio and our installed base,as well as further inves-tigating our ability to offset carbon emissions in society.For more details,see pages 4255.Internet for All Despite the ra
120、pid proliferation of mobile cover-age,more than 50%of the worlds population does not have internet access.We deploy solutions that improve mobile broadband(MBB)affordability and accessibility to all.In addition to connecting the world,we apply our technology,leadership,and innovation in areas such a
121、s education,improved livelihoods and humanitarian issues.With our network and coverage,we provide connection plat-forms for refugees,peace-building and dis-aster response,with the aim of scaling the impact of our Technology for Good initiatives.For more details,see pages 5669.Creating positive impac
122、ts and mitigating risksThe cornerstones of our sustainability and corporate responsibility strategyResponsible BusinessDrive proactive agenda beyond legal compliance to maintain Ericsson as a trusted partnerEnergy,Environment and Climate ActionProvide sustainable solutions and services through a cir
123、cular economy approach to contribute to Ericssons differentiation and create business valueInternet for AllDeploy innovative solutions that improve mobile broadband affordability and accessibility to allEricsson|Sustainability and Corporate Responsibility Report 201712Significant sustainability issu
124、esSetting our prioritiesTo provide a strong foundation for our strategy and decision-making,we regularly review our most significant sustainability and CR issues.Materiality assessment is a central compo-nent of our sustainability and CR strategy,target setting,risk management,and report-ing process
125、.We consider a wide range of economic,environmental and social impacts significant to our business,as well as those that substantively influence the views and decisions of our key stakeholders.We use a materiality matrix to review significant issues on an annual basis,taking into account emerging tr
126、ends,stakeholder feedback and other input.We also make adjustments as needed to incorporate critical issues as they arise.Our materiality processWe published our first materiality assessment in our 2012 Sustainability and CR Report.It continues to evolve year by year as we gather new information and
127、 sharpen our focus on ourmost significant issues.Some issues have long-term significance for the business,such as the right to privacy and security issues,while others may have relevance in the short to mid term.As a first step,we begin each year with abaseline,reviewing previous materiality assessm
128、ents,along with updates and devel-opments during the year.We draw on life-cycle assessments to identify and measure environmental impacts,and to identify oppor-tunities to increase our positive impacts along the entire value chain.Human Rights Impact Assessments and the sales compliance pro-cess are
129、 also helpful in identifying our salient human rights issues(page 24).Each material issue and applicable boundary i.e.,where inthe value chain the impact occurs is described in this report.Defining our approachOur materiality matrix(shown on the next page)is composed of four quadrants:Actively addre
130、ss and engage:Issues that are identified as most significant to Ericsson and our stakeholders are actively addressed.Where necessary,we investigate and adjust and/or implement new governance proce-dures to ensure business sustainability and accountability.We actively engage stakehold-ers on these is
131、sues through dialogue and advocacy,to discuss and mitigate potential risks and enhance positive socio-economic and environmental effects of mobility,broad-band and the cloud.Assess and engage:These are issues in which stakeholders express some interest.We moni-tor these issues,report on our performa
132、nce and continue dialogue as needed.Assess and Address/engage when appropri-ate:The issues in these two quadrants are ones that we engage with selected stakehold-ers about when appropriate.We have proce-dures in place to manage these issues,but we do not necessarily report on them.Stakeholder feedba
133、ckIn 2017,we conducted a focused employee survey on sustainability and CR.The results showed that 88%of employees surveyed perceive Ericssons work with responsible business to be a competitive differentiator;86%believe Ericsson is living upto the posi-tion of a relevant and responsible driver of pos
134、itive change in society;and 79%agree that Ericssons sustainability andCR strategy is integrated across the company.These results helped to inform our materiality assessment.Customers and investors are also impor-tant stakeholder groups for our company.We seek information from them through surveys an
135、d dialogue;for example,we are a member of the Telefnica Stakeholder Panel on Responsible Business(page 17).Our key issues in 2017 were anti-corruption,right to privacy,product energy performance and how the company is working with the SDGs.We value stakeholder input and welcome feedback and ongoing
136、dialogue on emerging issues relating to our business activities.Feedback or questions can be directed to 13Ericsson|Sustainability and Corporate Responsibility Report 2017 Conducting Business ResponsiblyA Anti-corruptionB Radio waves and public healthC Right to privacyD Freedom of expressionE Labor
137、standardsF Responsible sourcing G Diversity and inclusionH Occupational health andsafetyI Employee engagementJ Responsible taxInterest to stakeholdersHighHighLowAssess and engageAssessImportance to EricssonActively address and engageAddress/engage when appropriateIssues highlighted in the Sustainabi
138、lity Performance and Risk Report 2017Materiality matrix Energy,Environment and Climate ActionK Ericsson carbon footprint (GHG emissions)and climate changeL Product energy performanceM Materials usageN Life-cycle impacts of products and servicesO Water and wastewater managementP Contribution to low-c
139、arbon economyQ Sustainable cities Communication for AllR Strategic partnerships for socio-economic developmentS Access to education T Access to communicationU Humanitarian response(including disaster response)OJBIEGHDCAFSMRTLPUQNKEricsson|Sustainability and Corporate Responsibility Report 201714Sust
140、ainable Development GoalsWhen the Sustainable Development Goals(SDGs)were launched in New York in 2015,Ericsson was there,leading our industry in embracing the goals asa common framework for measuring impacts on society.In 2017,webegan using the GRI Practical Guide for Business on SDG Reporting to h
141、elp us make the linkages between our materiality assess-ment and the SDGs even stronger.As the fastest and largest global technology uptake in history,mobile broadband has the potential to positively impact all of the 17 SDGs.These two pages present a few examples of the ways Ericsson made a positiv
142、e impact in society and contributed toward the achievement of the SDGs in 2017.Cases marked with an asterisk(*)are IoT cases,which aredescribed in more detail on pages 5051 of this report.For more examples of Ericsson projects that address theSDGs,visit of projects that contribute toward the SDGs15E
143、ricsson|Sustainability and Corporate Responsibility Report 2017 Financial inclusion for the unbanked,PakistanRunning on Ericssons Mobile Wallet platform,Telenor Pakistans Easypaisa solution pro-vides customers with basic financial services,contrib-uting to the betterment of their lives.The service i
144、s one of the largest mobile money deployments glob-ally,serving over 16 million active users,and 70,000 agents in 800 cities.IoT farming,Japan*PS Solutions,affiliated with SoftBank,and CKD are using Ericsson IoT Acceler-ator together with artificial intelligence technologies tooptimize agricultural
145、processes.The platform provides integration of new IoT devices as agricultural-ists need them and immedi-ate access to devices after installation,enabled by the Ericsson IoT Accelerator platform.Saving lives with Massive IoT,China*We use narrowband IoT sensors to monitor land movement,so that when a
146、 landslide occurs the system can send data to a server and trigger an alarm.In 2017,at PT Expo China,Ericsson showed in a simu-lation how movement on amountain that is deter-mined to be a landslide is immediately communi-cated to a mobile phone.Launch of Connect to Learn in South AfricaMore than 1,0
147、00 students and teachers at rural schools in the Colesberg(Northern Cape),Mtuba-tuba(Kwazulu-Natal)and Kameelrivier(Mpuma-langa)districts are benefit-ting from the cloud-hosted,open-source learning solu-tion that Connect to Learn has rolled out in their com-munities.The system is designed to help te
148、achers with limited IT skills build their confidence.See page 63 for details.Supporting the Girl Scouts,USAWe built the fiber network and ICT infrastructure at aGirl Scout camp in north-east Texas.Their Camp Whispering Cedars trans-formed into a dedicated STEM(science,technology,engineering and math
149、e-matics)center with oppor-tunities in robotics,coding,botany,chemistry and more.The Girl Scouts have created a recipe for success to build a pipeline of women in STEM.MicroWeather,Sweden*In partnership with the Swedish weather agency,we developed a solution for monitoring rainfall using microwave n
150、etworks that provides accurate,high-resolution rainfall measure-ment.It has been launched as a commercial solution,and the development of proof of concepts for other usages,such as fog and snow,are in the planning aswell.Green Scheduler with Lean Carrier,South KoreaTogether with SK Telecom we have d
151、eployed an inno-vative energy efficient traf-fic scheduler with Ericsson Lean Carrier to achieve 15%energy savings on SK Telecoms total network.Ina live network traffic environment,we verified that Green Scheduler can provide power savings of around 30W(15%)even at10%cell load.Rural coverage,Tigo Ta
152、nzaniaThis public-private partner-ship resulted in an infra-structure that connects 13million rural people.The energy-efficient site solu-tions reduced the total cost of ownership by up to 40%for the operator Tigo.Previ-ously unconnected people will now be able to access the internet via mobile broa
153、dband,providing digital inclusion with new services and opportunities.Seepage 56 for details.BSC Modernization,BrazilThis base station controller(BSC)modernization proj-ect with an operator in Bra-zil has resulted in footprint and rental savings,lower hardware consumption,O&M(operations and maintena
154、nce)cost reduc-tion and hardware recy-cling.The BSC moderniza-tion,from HC/HD to EVO controller concept,consoli-dated 35 cabinets into three.See page 47 for details.Technology for Good Lab,So Paulo,BrazilThis digital inclusion proj-ect promoted local culture and entrepreneurship to children living i
155、n an at-risk environment.Approxi-mately 160 students between ages 14 and 18 are educated on audio-visual technology in the project every year.A lab hasbeen created and madeavailable for the whole community.Connected Urban Transport,Dallas,USA*We supported the City of Dallas to launch a region-ally s
156、pecified Connected Urban Transport system that makes it possible for regional stakeholders to see and make use of data to enhance end-user services.Ericssons IoT platform and solutions have made it pos-sible to transform data into real-time actions.E-waste,MTN CameroonWe gathered 53 tons of e-waste
157、from telecom oper-ator MTN Cameroon in 2017 and sent it to our recycling partner in South Africa.We were able to recycle 98%of all the mate-rials in the decommissioned electrical equipment.This E-waste initiative reduced the costs and risks associ-ated with disposal,as well as the carbon footprint.T
158、alking Traffic,the Netherlands*We helped build a nation-wide cloud solution for the ministerial program Talking Traffic(Beter Benutten).Ericsson Connected Urban Transport used the cloud to connect data sources(e.g.traffic lights)with smart services.25%of all traffic lights in the Netherlands and 5,5
159、00 intersections are connected.Water monitoring networks,Scandinavia*This public-private partner-ship led to an end-to-end solution that sources and distributes water,as well as handling sewage and storm water.It includes real-time monitoring of the water status,early warning and predictability func
160、tions.Asa result,water status knowledge for short and long-term analysis improved,and risks and costs for crisis handling andmitigation efforts decreased.Connected Mangroves,Philippines*Smart Communications Inc.and Ericsson have launched the Connected Mangroves project to help conserve the marine ec
161、o-system of Bangkung Malapad a critical habitat and ecotourism area in the Philippines.This IoT solu-tion uses wireless connec-tivity to capture data rele-vant to mangroves survival,such as water level,humid-ity,soil moisture and tem-perature,as well as hazards in the environment.Whitaker Peace&Deve
162、l-opment Initiative,UgandaIn partnership with WPDI,we have deployed ICT at schools in Uganda to edu-cate young survivors of the civil war.We established two computer centers with Connect to Learn.So far 151 peacemakers have received mediation and management training to enable them to start small bus
163、inesses to stimulate grassroots economic growth,and to then teach the next generation.See page 64 for details.UN WFP with Ericsson ResponseEricsson Response played a decisive role in re-estab-lishing communications and internet after the hurri-canes that hit the Carib-bean in 2017 by supporting the
164、UN and humanitarian agencies.In Dominica,Ericsson Response and the Emergency Telecommuni-cations Cluster(ETC)partners provided internet connectivity to more than 2,900 humanitarian work-ers and the affected local population at 18 sites.Ericsson|Sustainability and Corporate Responsibility Report 2017
165、16Partnerships for the goalsWorking together for the common good Partnership for the Goals(SDG 17)is at the heart of the SDGs,and public-private partner-ships play a key role in our approach.We also take a proactive leadership role in a number of high-level fora and collaborate with a wide range of
166、stakeholders to scale the impact of our sustainability efforts.Examples of fora where we were active in 2017 include the World Economic Forums(WEF)CEO Climate Leaders,WEFs IoT for the SDGs initiative,the UN Sustainable Development Solutions Net-work,the Business and Sustainable Develop-ment Commissi
167、on,and the UN Broadband Commission for Sustainable Development.As a member of the Business&Sustainable Development Commission we work to high-light the role of the private sector in achieving the SDGs.Through our engagement with the UN Global Compact we work actively with its 10 principles on human
168、rights,labor,environ-ment and anti-corruption.We are also part of the UN Global Compacts Caring for Climate initiative and The CEO Water Mandate,which commit members to take meaningful action to address climate and water challenges.Our focus area is the topic of how to leverage technology to achieve
169、 smart water manage-ment throughout the value chain.Climate changeThe closely interlinked global challenges of climate change and sustainable development make it imperative that we work together with a wide range of stakeholders and use all the tools at our disposal including ICT to create effective
170、 solutions.In 2017 we regularly engaged with cus-tomers on the topic of energy performance,and efforts to tackle climate change.For example,2017 was the third consecutive year that we gathered industry leaders in a CxO Energy Roundtable to discuss solutions to the global energy challenges that affec
171、t us all from the environmental effects of our sector tothe cost of energy.We also participated in the international climate meeting COP23 in Bonn in 2017.Mostnotably,we joined industry panels and Elaine Weidman-Grunewald at the World Food Programme(WFP)Data Week discussing the vital role of telecom
172、munications and data for development,and how Ericsson Response is helping address not only the needs of humanitarian workers but also local communities during emergencies.raised awareness of ICT as a solution.Our key message was the topic of how climate change is coupled with digitalization and IoT.
173、We also shared information about some of ourpilot projects related to smart sustainable cities,5Gfor agriculture and connected vehicles.Collaborating on climate researchFrom a research perspective,we are deeply engaged in the work of the International Telecommunication Union(ITU)to establish an agre
174、ed methodology for studies of the ICT sectors carbon footprint that will support us all as we work toward the Paris Agreements 2%trajectory.We are also advocates for ICT indicators in smart city initiatives,to improve the visibility about the critical role that it plays.Connecting the unconnectedThr
175、ough our work in the Broadband Commis-sion for Sustainable Development,the Alliance for Affordable Internet,the Internet for All Steering Group of the World Economic Forum,and the Smart Africa Alliance we aim to ensure that the benefits of the internet,which under-pin achievement of the SDGs,are aff
176、ordable and accessible to all.In these fora we are assessing existing efforts and progress towards connecting the 4.2 billion people not on the internet,and exploring multistake-holder business initiatives to bridge the digitaldivide.17Ericsson|Sustainability and Corporate Responsibility Report 2017
177、 Stakeholder engagementSharing,listening and learning Our approach to stakeholder engagement enables us to learn about our stakeholders concerns early,providing us with insight into risks as well as opportunities.Our stakeholders fall into four categories:customers,sharehold-ers,employees and societ
178、y.In the society category we include suppliers,governments,civil society,non-governmental organizations,industry partners,media,academia,and the general public.We engage with our stakeholders on an ongoing basis on a diverse range of topics,including supply chain management,energy performance,human
179、rights,anti-corruption,our Technology for Good programs,access to education and other sustainable development goals.The engagement takes a variety of forms such as employee engagement activi-ties,joint projects and initiatives,customer meetings,investor meetings,surveys,partici-pation in industry gr
180、oups,representation on decision-making bodies,research projects and stakeholder engagement in conjunction with our Human Rights Impact Assessments(HRIAs).We also gain stakeholder insight in other ways,such as research collaboration with academia,institutions,industry peers andothers.We leverage our
181、social media to extend the conversation.We have a steady and growing engagement with our“Technology for Good”focused social media channels,including our Technology for Good blog,Facebook page,and Twitter account.During 2017,we engaged in dialogue with investors on the topic of responsible business,p
182、roviding them with clear and transparent information about our practices.Topics of interest included anti-corruption,human rights and environment;Board engagement with sustainability;sustainability and CR target measurement;ensuring compliance with targets across the company;responsible sourcing inc
183、luding conflict minerals and occu-pational health and safety,and responsible handling of staff reductions.We are a proud member of the Stakeholder Panel on Responsible Business that began in 2016 at the initiative of our customer Telefnica,a Spanish multinational broadband and telecommunications pro
184、vider.The panel invites experts in environ-mental,social and ethical matters from companies and civil society organizations to meet quarterly to discuss sustainability trends and stakeholder concerns,and provide insight on global sustainability developments and best practices.This platform has provi
185、ded the opportunity for us to listen to and learn from other experts,and toshare our insights and experience.Stakeholder Panel on Responsible Business Energy Round Table at Mobile World Congress 2017 in Barcelona.From left to right:Bradley Mead,Ericsson;Andrea Calvi,TIM;Arnaud Vamparys,Orange;Elaine
186、 Weidman-Grunewald,Ericsson;Juan Manuel Caro,Telefnica;Nishant Batra,EricssonOur approach to stakeholder engagementWith whomdo we need to engage?When should the engagement take place?Which issues do we need to get engaged with?How should the engagement take place?02Conducting business responsibly is
187、 a corner-stone of our company strategy and corporate culture.Our ambition is to be a responsible and relevant driver of positive change.We work continuously to improve and strengthen our business practices,with a focus on building and maintaining trust,transparency and integrity.This makes us bette
188、r able to manage risks and respond efficiently as issues arise.Our approach focuses on:Assessing risks and challenges Implementing consequence criteria Strengthening internal governance and accountability Ensuring awareness.Our people are key to ensuring our success.We focus on attracting the best t
189、alent and no one is discriminated against;providing a safe and healthy work environment;and enabling a company culture that supports every employee to bring out the best version of Ericsson.Conducting Business ResponsiblySDGs highlighted in this sectionHighlights Setting the Tone from the Top Update
190、s to our Code of Business Ethics and Code of Conduct Fourth year of reporting according to the UN Guiding Principles Reporting Framework Further strengthening of our sales compliance process Operationalization of our Ethics and Compliance Board and establishment of Business Partner Review Boards Inc
191、rease in Occupational Health and Safety incident reporting Continued rollout of anti-corruption screening tool for suppliers“Strong responsible business practices are at the core of Ericssons company culture and I believe they should be the foundation for how we conduct business.”Brje Ekholm,Ericsso
192、n President and CEOEricsson|Sustainability and Corporate Responsibility Report 201720GovernanceBuilding on a strong foundationOur governance system is the foundation of our way of working.We have anchored our responsible business approach at the highest levels of our company,starting with the Board
193、of Directors,the CEO and Executive Team,who receive regular updates.Since 2016,our Ethics and Compliance Board has been responsible for the overall governance of compliance within the Group.It consists of the heads of each Group function and is chaired by our CEO.We brief our Board of Directors annu
194、ally onsustainability and corporate responsibility matters;more often if needed.In 2017,brief-ings covered governance updates;strategy execution including risks,performance,and results;specific topics like occupational health and safety(OHS);human rights,including modern slavery;advocacy activities;
195、and stakeholder feedback and perception.We also briefed the Board about the ongoing inquiries from the United States Securities and Exchange Commission and the United States Department of Justice,regarding the Groups compliance with the U.S.Foreign Corrupt Practices Act.In accordance with the Swedis
196、h Annual Accounts Act,we prepared our first Sustain-ability Performance and Risk Report in 2017 and integrated it into our Annual Report.Our way of workingGroup policies,directives and processes cover responsible sourcing,OHS,environmental management,anti-corruption,human rights,sales compliance,e-w
197、aste and other material topics.As critical parts of Ericsson gover-nance,the Code of Business Ethics(CoBE),the Code of Conduct(CoC),Sales Compliance Policy,OHS Policy and Sustainability Policy are all part of the Ericsson Group Manage-ment System.This ensures the integration of our sustainability an
198、d corporate responsibility(CR)commitment into every aspect of how we do business,wherever we do business.Through our Global Assessment Program,external assurance providers audit how we implement policies and directives,manage our risks and achieve our objectives.Our Code of Business EthicsThe CoBE i
199、s an overview of our fundamental Group policies and directives.It sets a clear requirement for ethical conduct and compli-ance with company policies as well as all applicable laws and regulations for every member of our staff.It guides our relation-ships among employees and with external stakeholder
200、s,reflecting ourcommitment to the UN Global Compacts 10 principles and the United Nations Guiding Principles on Business and Human Rights(UNGPs).The CoBE underlines our zero-tolerance for corruption in all its forms.Employees read and sign the CoBE at the time of employment and periodically througho
201、ut their term of employment.We updated the CoBE in 2017 to reinforce responsibilities regarding a num-ber of issues including anti-corruption.We also executed a re-signing process for all employees.By the end of December,99%ofthem had signed.Our Code of ConductOur CoC applies to employees,contractor
202、s and suppliers.It is based on the 10 principles of the UN Global Compact regarding human rights,labor,the environment and anti-corruption,and includes a commitment to respect all internationally proclaimed human rights.It also highlights our intention to imple-ment the UNGPs throughout our business
203、 operations.In 2017,we updated the CoC to reinforce responsibilities regarding anti-corruption and conflict minerals,and we adjusted the forced labor standards to incor-porate modern slavery.A statement on our approach to modern slavery and human trafficking can be found on our website.Chief Complia
204、nce OfficerSenior-management level attention on anti-corruption and compliance is crucial,as is ensuring that these matters are addressed from a cross-functional perspective.Since 2012 we have had an anti-corruption pro-gram headed by the Groups Chief Compli-ance Officer(CCO)and evaluated annually b
205、ythe Audit and Compliance Committee of the Board of Directors.In 2017,a decision was made that the CCO will henceforth report directly to the Audit and Compliance Committee.In addition to being responsible for the ongoing development of Ericssons anti-corruption program,the CCO ensures that complian
206、ce matters are regularly on the agenda of the Board and the Executive Team.The Audit and Compliance Committee receives regular reports from the CCO,and is also responsible for reviewing and evaluating our anti-corruption program at least once a year.To help us work more efficiently,in 2017 we streng
207、thened both the Compliance Office and the Corporate Investigations teams with more staff,and established a new compliance audit function within Corporate Audit.Both Corporate Audit and the Compliance Office are line organizations with a direct reporting line to the Audit and Compliance Committee In
208、2017 the Executive Team sup-ported a Group target to“Set the Tone from the Top”,which aimed to raise awareness about the impor-tance of conducting business responsibly throughout our global operations.To provide staff with guidance and reinforce Ericssons strong commitment to addressing and eliminat
209、ing unethical behavior,we used a range of communication tools including videos,surveys and weekly CEO letters to employees.We have also provided employees with a variety of real examples of good behavior,as well as explain-ing how inappropriate behavior has created risks for our company and our bran
210、d,and highlighting the consequences for the individuals involved.Setting the tone from the top 21Ericsson|Sustainability and Corporate Responsibility Report 2017Conducting Business Responsibly(through the Head of Corporate Audit and the CCO,respectively),whereas the Ethics&Com-pliance Board is the C
211、EOs body that governs various compliance matters in the company.Compliance LineEmployees,suppliers and other external par-ties can use our Compliance Line,an external whistleblower tool,to anonymously report suspected violations of law,the CoBE,or other policies and directives that:are con-ducted by
212、 Group or local management;and relate to corruption,questionable accounting,deficiencies in the internal control of account-ing or auditing matters or otherwise seriously affect vital interests of the Group or personal health and safety.Compliance Line is available via phone orsecure website,24/7,36
213、5 days a year,in 188 countries and in more than 75 languages.In 2017,412 alleged violations were reported.These incidents were classified into the following categories:26%related to fraud,corruption and regulatory breach 3%related to security 11%related to operations 35%related to human resources 11
214、%related to conflicts of interest 14%miscellaneous.Alleged breaches of the CoBE(reported at group level either through the Compliance Line or other channels)are forwarded to the Corporate Investigation team within Corpo-rate Audit.The Corporate Investigation team presents each new reported concern t
215、o the Group Compliance Forum,which is chaired by the CCO and made up of representatives from different functions.The Forum decides if the matter merits investigation and,if so,by whom(usually the Corporate Investigation team or the Market Area Compliance Forum).The Audit and Compliance Committee is
216、briefed about all reported concerns.To ensure that all aspects of our CoBE and CoC are respected by our staff and our business partners around the world,we provide training in a variety of forms.Code of Business EthicsAs part of the 2017 signing process,we released an internal video on living the Co
217、BE,which was part of a broader information campaign.It provided a short sum-mary of what the code means to us,and included exam-ples,case studies and other material to help employees choose the correct behavior.Anti-corruptionBy the end of 2017,92,950 active employees had com-pleted an anti-corrupti
218、on e-learning course aimed at raising awareness of risks,dilemmas and appropriate courses of action.We have also conducted additional anti-corruption trainings for key personnel in sales and other relevant functions,including Market Area leader-ship teams.Human rightsWe have had an e-learning traini
219、ng on human rights and business for all Ericsson employees since December 2015.We have also carried out specific human rights training for personnel within,for example,Corporate Audit and the regional compliance organization.Key personnel in sales and other relevant functions,includ-ing regional lea
220、dership teams,also receive additional specialized training.ComplianceOur compliance e-learning course focuses on anti-corruption,competition law and trade compliance.Training for suppliersWe offer free online training to all suppliers,and otherstakeholders,in four areas:the Ericsson Code ofConduct,a
221、nti-corruption,OHS for site service pro-viders,and conflict minerals.Training for employees and suppliers Ericsson|Sustainability and Corporate Responsibility Report 201722Anti-corruption Reinforcing a zero-tolerance culture Ericsson has zero tolerance for bribery and corruption.As part of our commi
222、tment to rais-ing business standards and contributing to greater transparency and accountability,weare signatories to the World Economic Forums Partnering against Corruption Initia-tive(PACI)a cross-industry collaboration toaddress corruption,transparency and emerging-market risks.We have embedded z
223、ero tolerance as a guiding principle at the highest levels of the company and implemented it throughout our global organization with a comprehensive set of policies and processes.Since 2016,our Ethics and Compliance Board chaired by our CEO has been responsible for the overall governance of complian
224、ce within the Group.We invest considerable time and resources each year to continuously improve our ethics and compliance program.Corruption carries serious legal and repu-tation risks;impedes business growth;dam-ages relations with staff,customers,share-holders,suppliers and society as a whole;and
225、is a considerable obstacle to economic and social development in countries around the world.With customers in 180 countries,many of which are considered to be exposed to a high risk of corruption,we are aware that prevention and accountability are paramount.Our approachAlthough we have achieved sign
226、ificant prog-ress in compliance and anti-corruption in recent years,we remain attentive and respon-sive to improvements that may be necessary.We continue to strengthen a comprehensive set of policies and processes that clearly set out our own high expectations for ourselves and ensure our ability to
227、 meet the increasingly stringent anti-corruption regulations that are emerging in markets around the world.Our CoBE and CoC are the two main policies that outline our anti-corruption commitment.We continuously reinforce our approach to anti-corruption at employee and executive-level meetings.Further
228、,we require that all of our Market Areas and Business Areas perform annual Group Risk Assessments that evaluate corruption risks.The Compliance Office also performs corruption risk assessments contin-uously.Moreover,improving employees understanding of the importance of anti-corruption is a regular
229、focus of our staff train-ing and internal communications.We have measurable targets that are regularly reported.Anti-corruption is one of the focus areas of theCorporate Audit,which means that it is included in selected audits every year.Ericsson aims to conduct its business in aresponsible and lawf
230、ul manner,and we require the same of all our contractors and suppliers.We reduce corruption risks by explicitly communicating our anti-corruption commitment to suppliers and other business partners through our CoC and anti-corruption e-learning,which is available in 16 languages.Inquiries from U.S.a
231、uthoritiesEricsson is voluntarily cooperating with inqui-ries from the United States Securities and Exchange Commission and the United States Department of Justice regarding its compli-ance with the U.S.Foreign Corrupt Practices Act.As of today,these inquiries concern a period from January 1,2007 an
232、d onwards.We will make additional disclosures regarding these inquiries as required.Notable in 2017During 2017,we adjusted the anti-corrup tion program based on a thorough assessment that was carried out by external expertise in 201617.The program has been expanded to include 10 elements to ensure f
233、ull alignment with the US Foreign Corrupt Practices Act(FCPA)guidelines.Senior manager vetting processIn 2017,Ericsson introduced a vetting process that focuses on ethics and compliance.So far we have used it for appointments to the Executive Team and for approximately 110 employees in exposed posit
234、ions,such as sourcing,finance and customer facing roles.All members of the current Executive Team Our anti-corruption tool kitCode of Business EthicsCode of ConductCompliance LineAnti-corruption programSenior manager vetting processAnti-corruption screening toolBusiness Partner Review BoardsTraining
235、Awareness raising23Ericsson|Sustainability and Corporate Responsibility Report 2017Conducting Business Responsiblyhave been vetted,and all future recruit-ments to these positions will also go through mandatory vetting.In designing the process,Ericsson has drawn on external counsel to ensure a best-i
236、n-class and robust process.Rollout of automated anti-corruption screening toolDuring 2017,we continued a global rollout of an automated anti-corruption screening tool to undertake due diligence of suppliers.In 2017 over 17,600 suppliers have been screened by this tool.Business Partner Review BoardsW
237、e established Business Partner Review Boards in all of our Market Areas in 2017.These Boards are made up of senior Market Area managers who generally meet on a monthly basis to review business partners from a compliance risk perspective to ensure that they meet our compliance and ethical criteria.To
238、 assist the Boards we have also engaged due diligence firms that are globalleaders.Face-to-face compliance trainingIn 2017,we strengthened our anti-corrup-tion program by providing face-to-face compliance training to the leadership teams in customer units around the world.These efforts will continue
239、 in 2018.Internal awareness campaignDuring the second half of 2017,we ran an internal awareness campaign on responsible business for all employees,focusing on financial irregularities and anti-corruption.Itincluded email messages from our CEO,videos with executives,and anonymized real cases of emplo
240、yees who violated the CoBE and the consequences that followed.99%of employees acknowledged the Code of Business Ethics.Anti-corruption was highlighted at all major leadership meetings during 2017.92,950 active employees have completed an anti-corruption e-learning course aimed at raising awareness o
241、f risks,dilemmas and appropriate courses of action.16 employees left Ericsson due to corruption,fraudand regulatory breaches.Key figures for 2017110562947381 Leadership and culture2 Policies and procedures3 Compliance organization4 Risk assessment5 Training and communication6 Rewards and sanctioning
242、7 Third-party management8 Allegations and investigations9 Monitoring and testing10 M&A due diligence and integrationKey elements of our anti-corruption programEricsson|Sustainability and Corporate Responsibility Report 201724Human rightsPutting respect into practiceEricsson is committed to addressin
243、g and inte-grating human rights across our business operations.Over the past several years we have worked to develop and strengthen our human rights framework to fulfil our responsi-bility to respect human rights according to the UN Guiding Principles(UNGPs)on Business and Human Rights.As societys u
244、nderstand-ing of the complexity of ICT and human rights deepens,we are fine-tuning our approach to keep pace with new issues and manage emerging risks.Understanding the contextICT delivers great value by improving peoples ability to earn a livelihood and empowering them to more fully realize their h
245、uman rights,from freedom of expression and freedom of assembly to economic,social and cultural rights.Governments use ICT to provide health,education and other government services,to assist in emergencies,as well as to fight crime and to protect citizens safety and security.Other societal benefits o
246、f ICT include the opportunity to use big data for social good,such as improving response to disease out-breaks and managing traffic flows in cities.The increasing use of ICT also brings challenges in security and privacy and risk management.Our focus is on providing end-to-end security solutions to
247、our customers and protecting critical assets in a rapidly changing environment and responding pro-actively to existing and emerging threats,so that both communications and the right to privacy are protected.When it is misused,ICT can contribute to the restriction or violation of human rights,such as
248、 when governments or other actors use it for illegitimate purposes.This makes it crucial to regularly balance the benefits of ICT against individuals rights to privacy and free-dom of expression.To address these dilem-mas,we engage with a variety of stakehold-ers,including other members of the ICT i
249、ndus-try.For example,in 2017 we joined the Global Network Initiative(GNI)as an observer(seepage 26).The UN Guiding Principles on Business and Human RightsAs reflected in our Code of Business Ethics(CoBE)and Code of Conduct(CoC),Ericsson respects all internationally proclaimed human rights.Since 2011
250、,we have been working to integrate the UNGPs on Business and Human Rights into our governance framework.The UNGPs set out the corporate responsibility to respect human rights,stating that business enterprises should avoid infringing on human rights as well as addressing the adverse human rights impa
251、cts with which they areinvolved.For the fourth year,we are applying the UNGP Reporting Framework for how busi-nesses respect human rights(page 76).Ericsson is one of the early adopters to report according to the Framework,as well as being the first ICT company to doso.Defining and addressing our sal
252、ient issuesThe UNGP Reporting Framework states that a companys salient human rights issues are those rights that are at risk of the most severe negative impact through the companys activ-ities or business relationships.We have The UN Guiding Principles on Business and Human RightsCompany duties to r
253、espect include:Policy commitmentsHuman rights due diligence Assessing impacts Acting on the findings Tracking effectiveness of responses CommunicatingStakeholder engagementRemediationState:Protect,Respect,FulfilCompanies:RespectState and companies:Remediate25Ericsson|Sustainability and Corporate Res
254、ponsibility Report 2017Conducting Business Responsiblydefined our salient human rights issues to be the right to privacy,labor rights and the right to freedom of expression.These are high-lighted in our CoBE and CoC.We identify and manage human rights issues in a number of ways,including Human Right
255、s Impact Assessments(HRIA)in high-risk countries,stakeholder consultations in conjunction with HRIAs,and internal pro-cesses such as sales compliance(page 28)and responsible sourcing(page 30).We dis-cuss our salient human rights issues in consul-tations with stakeholders such as employees,investors,
256、governments,customers,industry initiatives and civil society.We implement the feedback from these consultations along with the recommendations from our HRIAs into our management system and operations.Additionally,we have a Privacy Framework in place to ensure that we consider privacy from the beginn
257、ing of any product release and that it is an integral part of product development.We are fully committed to continuously addressing and monitoring human rights challenges.Conducting due diligenceThe UNGPs require companies to have a human rights due diligence process to iden-tify,prevent,mitigate an
258、d account for how they address their impacts on human rights.We have worked with Shift,the leading non-profit center of expertise on the UNGPs,to systematically embed a human rights frame-work across our company since 2012.This work significantly strengthened our due dili-gence processes within sale
259、s,sourcing,legal affairs,mergers and acquisitions,and opera-tions.We continue to strengthen these areas and each year we select particular focus areas or processes to address.In 2017 our focus was on responsible sourcing and the issue of modern slavery(page 30)as well as the con-tinued strengthening
260、 of our sales compliance process(page 28).Training and awareness raisingRaising employee awareness about human rights is key to our approach.We have a human rights and business e-learning avail-able for all employees and it is mandatory training for certain functions,including Legal Affairs,Security
261、 and from the end of 2017 also Corporate Audit.The training describes human rights issues,opportunities and chal-lenges for Ericsson,international require-ments,and key concepts used in the business and human rights framework.The aim is to help employees understand the scope of the issues and their
262、relevant risks and how we work with them.In addition to the e-learning,we have also conducted targeted human rights trainings for Regional Business Review officers and Corporate Audit.Taking action and remediationUnder the third pillar of the UN Guiding Prin-ciples,both states and companies have rol
263、es to play in ensuring that victims of business-related rights abuses have access to effective remedy.Remedy means taking action to repair any harm done to people.One way we provide remedy is through the Ericsson Com-pliance Line(page 21)where employees and other persons such as suppliers,customers
264、and other partners involved with Ericsson,canuse a whistleblower tool to report alleged violations of the Code of Business Ethics,including those in relation to human rights.We will continue to explore this aspect of the third pillar of the UNGPs.Building leverageAnother important way to take action
265、 in support of the UNGPs is to use leverage.Leverage exists where we can effect change in the wrongful practices of an entity that causes harm(principle 19,UNGPs).We have continued to work to explore this in our sales compliance process(page 28)by introducing the use of contractual mitigations as co
266、nditions.Within our HRIA processes we have also identified the use of leverage as important mitigation measures,including initiating stakeholder discussions about our salient human rights issues.Ericsson|Sustainability and Corporate Responsibility Report 201726Engaging in dialogueThe interrelationsh
267、ip between ICT and human rights is becoming increasingly clear toour stakeholders but at the same time,new technologies such as artificial intelligence(AI),automation,and the Internet of Things(IoT)bring with them new ethical dilemmas.In many areas there is growing awareness of the potential risks t
268、hat misuse of ICT poses to human rights,and rising expectations for greater transparency,including new legisla-tion relating to surveillance and other privacy topics.Given the complex and fast-changing landscape of ICT and its intersection with human rights,there is a need for routine dia-logue.We e
269、ngage with human rights organi-zations,governments,employees,customers and other stakeholders to better understand the responsibilities and challenges around human rights and business.Engagement in 2017A few examples of our engagement in 2017 are listed below:Global Network Initiative:The GNI is a u
270、nique multi-stakeholder group that is dedicated to protecting and advancing freedom of expression and privacy in ICT.In late 2017,Ericsson announced its deci-sion to join as an observer for 2018.This will allow us to engage directly on freedom of expression and privacy issues with inter-net and tele
271、communications companies and more than 35 human rights and press freedom groups,investors and academic members.Definition of a process for customized HRIAs:Consultations with human rights stakeholders helped us gather input to the customized HRIA that we piloted in Cuba.Labor issues were highlighted
272、 and we further strengthened our mitigation measures.The Circle of Innovators:Together with the Institute for Human Rights and Busi-ness(IHRB)we explored the subject of safeguarding human rights in the big data and AI revolution at the Circle of Innova-tors meeting.Together with other partici-pants,
273、Ericsson representatives addressed the interface of business and human rights within the context of this“disruptor”.The initiative built on previous Wilton Park events on safeguarding rights in the big data revolution.Shift Business Learning Programme:Ericsson has been a member of the Shift Business
274、 Learning Programme since 2012,which has the purpose to foster leading practice by companies and to gain insight,both for the organization,for participants and for the wider business and human rights community,about how to imple-ment the UNGPs.Human Rights Impact AssessmentsOur HRIA process consider
275、s potential adverse human rights impacts that Ericsson may cause or contribute to through our own activi-ties,or which may be directly linked to our operations,products or services via our busi-ness relationships.The aim is to ensure that we respect human rights withinthe scope of our business opera
276、tions and analyze the social,operational and human rights context for doing business in a country.Over the years,we have carried out HRIAs in a number of countries starting with Sudan in 2009,and then continuing with Myanmar in201314,Iran in 201415,Ethiopia in201516,and other selected countries.OurH
277、RIAs address all our salient human rights issues(right to privacy,freedom of expression and labor rights),and our experiences of carrying them out have pro-vided us with valuable insights about how these issues arise and how they can be miti-gated.The stakeholder consultations we conducted when deve
278、loping the HRIAs for Myanmar,Iran and Ethiopia provided us with important feedback for implementation of mitigating actions into our operations.We continue to evaluate the human rights situa-tion in these countries and monitor interna-tional developments.Customized HRIA in CubaBased on our experienc
279、e of carrying out HRIAs we decided to develop a simplified HRIA process in 2016 that would enable us to scale up and work more efficiently.Working together with Shift,we developed a custom-ized HRIA process that we are using as a complement to our more in-depth HRIAs for higher-risk contexts.We carr
280、ied out our first customized HRIA in Cuba in 2016,which identified the following topics:labor issues,transport and OHS,privacy and freedom of expression.During 2017,we acted on the identified mitigation measures.Examples include:Providing existing Ericsson training for employees,business partners an
281、d service providers in the area of transportation health and safety Following up on the implementation of therequirement in supplier contracts on driving instructions Exploring living wage levels in Cuba and opportunities to address this.27Ericsson|Sustainability and Corporate Responsibility Report
282、2017Conducting Business ResponsiblyAt Ericsson we devote significant time and attention to privacy assur-ance activities in the development of our products and services.Our Privacy Framework encompasses our corporate IT network,our prod-ucts and our services.It requires us to consider privacy from t
283、he outset of any product or service release as an integral part of development.We perform mandatory privacy impact assessments to manage the privacy-related risks of our products and services,so to design and oper-ate them in a privacy compliant manner.In addition,privacy is also addressed in the pr
284、oduct privacy impact assessments we perform for all our products major releases,according to our Security Reliability Model.We also use the results from all of these assessments within the sales compliance process(page 28).In recent years we have increased the development efforts on specific functio
285、ns and processes in our products and services that enable our customers to better pro-tect their end customers data.We do this by including in the product the relevant features and functions needed by our customers to respond in flexible ways to requests for the fulfillment of new rights,including d
286、ata portability and the right to be forgotten.These new capabilities are designed to help our customers meet the requirements of upcoming regulations such as the General Data Protection Regulation(GDPR)in the European Union.We also prioritize communi-cating to our customers about the possible privac
287、y impacts that using our products in their networks may have.One way we do this is by pro-viding a security and privacy user guide as part of the customer prod-uct information package,when relevant.These efforts ensure addi-tional transparency about the data processing performed by our prod-ucts and
288、 solutions and inform our customers about how to deploy them in a secure and privacy-compliant way.Spotlight on privacy assurance During 2017,we continued our work to break the silence about child sexual abuse.In addition to our salient human rights issues,the topic of respecting and promoting chil-
289、drens rights is important to us.Asa vulnerable popula-tion,children require special efforts to guarantee respect for their human rights.Ericsson works proactively on initiatives that focus on promoting and protecting child rights with a range of partners.For example,we have worked with World Childho
290、od Foundation and the non-profit organization Darkness to Light to develop the Stewards of Children Prevention Toolkit mobile app,which is designed to help anyone working with children to detect the signs of,and prevent,child sexual abuse.It has a built-in mobile learning module along with informati
291、on about where to get help.It is available at:www.socapp.orgWe work as a company to actively prevent child sexual abuse(CSA)and we are one of the leaders in the industry in terms of adopting a zero-tolerance policy.Our efforts in this area include a unique monitoring tool that scans all PCs used by
292、Ericsson employees and consultants to ensure that the PCs are notused to access or store CSA images(as defined by law enforcement authorities).Spotlight on childrens rights“Only through partnerships and collective action can we reach the SDG 16.2 ending abuse,exploitation,trafficking and all forms o
293、f violence and torture of children by 2030.The Stewards of Children Prevention Toolkit mobile app(Socapp)is a great example of how the private sector can contribute to protect children from sexual abuse and exploitation.”Dr.Joanna Rubinstein,President&CEO of Childhood USAEricsson|Sustainability and
294、Corporate Responsibility Report 201728Sales complianceSales compliance risk methodologyApplying a human rights lensWe have integrated human rights due dili-gence into our sales process to help us assess,prevent and mitigate potential negative impacts on the right to freedom of expression and the rig
295、ht to privacy two of our most salient human rights issues.Specifically,we aim to reduce the risk that third-parties use our technology,services and knowledge directly or indirectly in a way that impacts negatively on these human rights.We can see that technology evolution willrequire industry cooper
296、ation,which we discuss with different stakeholder groups suchasthe Global Network Initiative.Our processOur sales compliance process consists of two main steps:trigger,which is handled by Mar-ket Area Commercial Management(MACM),and evaluation,which is handled by the Sales Compliance Unit.During the
297、 trigger step,MACM uses an automated tool to assess each potential sale or business engagement according to two parameters:Portfolio and Country.If the automated tool determines that the risk is high for one of these parame-ters,or medium for both,the MACM submits an approval request to the Sales Co
298、mpliance Unit.During the evaluation step,the Sales Compliance Unit evaluates the engagement according to the sales compliance risk meth-odology.The benefit of this centralized evalu-ation process is that we can guarantee that all engagements are evaluated according to the same standard.Risk methodol
299、ogySales opportunities are evaluated according to the following criteria:1.Portfolio:Whether the sale includes sensi-tive products,services and knowledge2.Purpose:The purpose and context in which the customer intends to use the product,service or knowledge3.Customer:The type and ownership structure4
300、.Country:We use a third-party risk analytics firm to rank the countries accord-ing to risk and selected indices such as the Right to Privacy and Freedom of Speech,as well as Democratic Governance and Corruption.Inaddition,we routinely follow international developments.Management structureOur Sales C
301、ompliance Policy and Directive aim to protect the Ericsson brand and our stakeholders interest,and describe how we work to uphold our responsibility to respect human rights.The Sales Compliance Board,across-functional forum that consists of high-level representatives of all Group functions and busin
302、ess areas,is responsible for ensuring that all business engagements are conducted according to the Sales Compliance Policy.The cross-company Sales Compliance Core Team and the Sales Compliance Unit support the Board and have a delegated mandate to make decisions.The Sales Com-pliance Unit escalates
303、the engagements that it cannot resolve at unit level to the Sales Compliance Core Team.Likewise,the Sales Compliance Core Team escalates engage-ments that it cannot resolve to the Sales Compliance Board.The Board is informed about all cases,and is also accountable for thedecisions that it delegates
304、to the Core Team and the Unit.Total risk evaluationCountryCustomerPortfolioPurposeSales compliance process1)Review:Portfolio,Purpose,Customer,CountrySales Compliance Unit1)Sales Compliance Core Team1)Sales Compliance Board1)Market AreaCommercial ManagementApproval request29Ericsson|Sustainability an
305、d Corporate Responsibility Report 2017Conducting Business ResponsiblySales compliance cases 20132017Processed cases02004006008001,00020172016201520142013 Cases approved Cases approved with conditions Cases rejectedTaking actionA sales opportunity can be rejected,approved,or approved with conditions.
306、Our sales compli-ance process mitigates the risk for misuse through conditional approvals that is,techni-cal mitigations that prevent deployment of sensitive functionality and/or contractual miti-gations that prevent misuse.These conditional approvals enable us to apply leverage to influ-ence and po
307、tentially effect a positive change.The sales compliance process includes proce-dures to follow up on decisions and corre-sponding mitigation activities.In addition,the Sales Compliance Board can request a country HRIA if required to support decisions(page 26).Leveraging automationIn 2017,we integrat
308、ed our automated sales compliance tool into our global sales manage-ment system,which is fully integrated into our sales process.As a result,our sales compliance process covers sales and business engage-ments around the world,with every sales opportunity automatically screened for poten-tial risks.T
309、he tool uses the specific selected cri-teria and parameters described on the previous page to capture engagements that might pose human rights risks.When potential issues are identified,the tool automatically escalates the case to the Sales Compliance Unit for review.Cases in 2017In 2017,846 engagem
310、ents were reviewed for sales compliance(see graphs below).This corresponds to an increase of 41%compared to 2016.The increase is due to a combination of a more robust system and the introduction of automated case handling since we first implemented the process.We also started including our“Entering
311、into new country”evaluations as a formal component of the process.We continually work to improve both the sales compliance process and the adherence to it.A challenge is to ensure full adherence to the process and conditions,which is why we report the results at the executive level in order to secur
312、e responsibility and accountability.We work continuously to improve the process to better fit the needs of the company in light of global and technological developments.Sales compliance cases 201770%5%25%846 Cases approved Cases approved with conditions Cases rejectedSource:EricssonSource:EricssonEr
313、icsson|Sustainability and Corporate Responsibility Report 201730Responsible sourcingMaintaining high standards for suppliersManaging the social,ethical,environmental and human rights impacts in our supply chain is part of our value chain approach to embed-ding corporate responsibility throughout our
314、 business.Build capacity for our suppliers to meet high standards in all of these areas is afundamental part of our approach.Sustainable management of supply chains is of growing importance to our stakeholders,including customers and investors.We have set social and environmental requirements for ou
315、r suppliers for many years,including a ban on the use of forced or bonded labor and child labor.This issue is reflected in legislation,such as the UK Modern Slavery Act that passed into law in 2015.Ericsson Code of Conduct The foundation of our Responsible Sourcing Program is the Ericsson Code of Co
316、nduct(CoC),which includes a supplier supplement.All suppliers and sub-suppliers must comply with the Ericsson CoC.It covers four main areas:human rights,labor standards(includ-ing occupational health and safety),environ-mental management and anti-corruption.In 2017,we published an updated version of
317、 the Ericsson CoC that includes an expansion of the text related to anti-corruption and conflict minerals,and we adjusted the forced labor standards to incorporate the issue of modern slavery.The Ericsson CoC is available in 16 languages on our website,and it is a core component of our supplier cont
318、racts.Assessing risk All potential new suppliers must complete mandatory Supplier Self-Assessments,and existing suppliers must repeat this process once a year.We also carry out CoC audits of relevant suppliers that we identify using a risk-based approach.Prioritized risk areas include working at hei
319、ghts,road and vehicle safety,anti-corruption,labor rights(including modern slavery and specifically working hours),environmental management,and communication of requirements further down the supply chain.In 2017,we addressed 88%of all suppliers in the top 80%of supplier spend.For 2018,we have set a
320、target to address all suppliers in the top 90%of supplier spend.Contract complianceIn addition to CoC audits,we also conduct contract compliance audits to verify compli-ance with our agreements,covering areas like business continuity management,IPR,trade compliance,and information security and pri-v
321、acy.In 2017,we performed about 25 audits and in 2018 we plan to launch a new risk assessment model for contract compliance.Third-party auditors In 2017,we fully implemented third-party CoC audits of our suppliers.The benefits of using a third-party professional auditing company include enhanced cred
322、ibility towards custom-ers,investors and other stakeholders,and a more consistent and thorough audit process.Conformity Critical Warning Performance of audited suppliers after follow-up,per audit area,%020406080100Employee contract Labor legislationWorking hours,salary,overtime compForced and bonded
323、 laborOccupational Health and SafetyPhysical working environmentHandling of chemicalsPersonal Protective Equipment Records on incidentsSupply Chain ManagementEnvironmental Management System Source:EricssonPerformance of audited suppliers 2017 Conformity Warning CriticalSource:Ericsson 66%9%25%2017au
324、dits2017follow-ups80%6%14%31Ericsson|Sustainability and Corporate Responsibility Report 2017Conducting Business ResponsiblyThird-party auditors have brought with them additional and more tailored expertise that they have obtained through their extensive audit activities in various industries.Anti-co
325、rruption screening toolFollowing the pilot in 2016,in 2017 we started the rollout of an automated anti-corruption screening tool for suppliers and other third-parties to help ensure that suppliers meet our business integrity standards.Global rollout is completed for eight of our ten former regions,w
326、hich have been reorganized into our Market Areas.By the end of the year,we had uploaded 17,600 suppliers into the tool,which is screened on a weekly basis.Increased focus on modern slavery and human traffickingIn light of the focus on modern slavery,we have identified areas for improvements in cur-r
327、ent processes and are currently implement-ing several changes.To date we have:added modern slavery questions to the Supplier Self-Assessment updated the Ericsson CoC to enhance the language relating to modern slavery mapped supplier categories in relation to risk for modern slavery,and updated the t
328、hird-party auditor checklist to strengthen the focus on modern slavery(for more information see the Ericsson Modern Slavery Statement).Close collaboration Working together with suppliers with the aim of continual improvement is an important part of our approach.We offer free online training to all s
329、uppliers in four areas:the Ericsson CoC,anti-corruption,OHS,and conflict minerals.To date more than 25,000 supplier employees have completed our trainings worldwide.Outcome of audits 2017 In 2017,we engaged a third-party auditing company to perform 225 CoC audits on iden-tified high-risk suppliers.1
330、3 additional audits were also performed by Ericssons own CoC auditor.We view each audit as animprove-ment opportunity and expect suppliers to address all identified non-compliance.Audit results vary,but commonly identified areas ofimprovement include working hours,fire prevention,training andawarene
331、ss,use of personal protective equipment,and envi-ronmental management.Every year we aim to audit suppliers in different geographical areas.In 2017,we audited suppliers located in 52 countries.Joint Audit Cooperation We also engage with external stakeholders tomonitor our performance as a supplier.We
332、 participate in the yearly Joint Audit Coopera-tion(JAC)Forum that comprises 13 of our largest telecom operator customers.JAC members conduct supplier corporate respon-sibility audits of Ericsson factories and supp-liers and share results.JAC auditors have assessed several Ericsson sites in the past
333、 fewyears,with good results.JAC has also audited selected Ericsson suppliers.In those cases where issues were identified,our suppliers have implemented corrective action plans approved by JAC member companies.At the Ericsson Supplier Collaboration Day in 2017,our site services supplier Voimatel was recognized as the winner of the 2017 Sustainability&Corporate Respon-sibility Award,with the followi
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