Chairman’s Letter
 
When I became the chairman of Telecom Italia at the end of 2007, I was very impressed with the wealth of professionalism, motivation and technological competence I found in the Group. I was already aware of that, but not up to the level I experienced. I also found it reassuring the deep-rooted culture of transparency and integrity.

Such culture does not imbue just the system of rules and procedures governing business management, decision-making and dialogue with the market. More generally it imbues all the relations with the stakeholders interacting with the Group in its business activities.
This obviously stems not only from ethical or reputational reasons, but from the awareness that the creation of value is sustainable in time if we are able to effectively integrate the expectations of the context in which we operate, while pursuing our economic goals.

I see this awareness expressed in strategies and facts.

Let’s consider the environment. We are living in a period of many growing concerns about climate change, depletion of natural resources, and increasing prices of energy supply.

We are aware of the fact that telecommunication services may considerably contribute to the elimination or containment of greenhouse gases emissions. Videoconferences, telework, infomobility services, telemedicine are but a few among the solutions offered by new technologies, permitting to rationalize and reduce transfers of people and goods and the related emissions. We are also aware, however, that these services absorb energy.
The more they are used the more traffic on networks increases and the curve of consumptions shoots up, unless we strive to achieve an ever higher level of efficiency. Telecom Italia is doing this. In 2007 our eco-efficiency, measured as the ratio between traffic units and energy consumed, showed further improvement.

We are currently experimenting with several solutions for the use of alternative energy sources, ranging from cogeneration to photovoltaic plants, wind farms and fuel cells.
The first results are rather interesting, as are the ones coming from interventions on heating systems, on corporate car fleet (also involving significant reductions of emissions) and on the handling of technological waste produced by telecommunication activities.

Conducting energy and environmental efficiency pays: it is good both for the planet and for businesses. You could say it is twice as good for businesses: not only for the economic fall-out effects but also as an incentive to technological innovation. A sustainable company is a more innovative and competitive company. The financial market recognizes and rewards it.

We are greatly satisfied with the inclusion, also in 2007, in the most important sustainability indexes, both at national and international level, and with the inclusion in the group of 20 companies most often selected at European level by “Green Social and Ethical” funds.

I mentioned the environment, but I could just as well recall the great effort made by the Group to significantly reduce the digital divide in Italy. In Telecom Italia the concept of sustainability is wide-ranging and involves many applications, as the following pages illustrate with a wealth of detail, data and quantitative targets on which the Group wants to be evaluated in a transparent way.
Transparency is one of the main goals of the Alliance, launched in March 2006 by the European Commission, companies and stakeholder representatives, in order to make Europe a pole of excellence in the field of Corporate Social Responsibility. Telecom Italia is going to give special support to this initiative also in 2008.

We mean to continue on this same path: doing business in a sustainable way and create value are as a whole. Starting from this standpoint we confirm our commitment to support and spread the values and principles of the Global Compact, the initiative originated under the aegis of UN to promote the respect of human rights and working standards, to safeguard the environment and to fight corruption.

We have the honour to be among the protagonists in a sector, such as telecommunications, having a key role in the economic and social development. This honour involves many responsibilities, which we don’t consider as a burden but rather as an incentive to do better and better. And this is for everybody, and for the world which we would like our children to inherit in even better conditions than the world we’ve found.
 
     
   
   
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