Management 2023

Economic and
Financial Management

Direct economic value
generated and distributed

GRI Contents 201-1, 203-1

While 2023 was a challenging year in terms of the economic environment for the productive sector, which was under pressure due to the variability of macroeconomic indicators such as inflation, interest rates and the exchange rate, the Company achieved growth thanks to the acceleration of some products and services.

The Company increased to 25 million total customers with a year-on-year growth of 4.7% after presenting positive net profit with over 1.1 million customers in 2023. In contract, the increase is 222 thousand customers thanks to the dynamics of mobile and fixed service offers, leveraged by the digital service portfolio and by keeping churn at low levels.

In the fixed business, the fiber strategy has yielded the expected results, highlighting the repositioning of offers leveraged by the increase in speed up to 900 Mbps. Likewise, the fiber deployment was accelerated, which reached over 4.9 million homes passed and 1.2 million connected customers in 2023, representing growths of 37.7% and 43% respectively. This positions Movistar as a leader in this service, as it not only has the largest share of connected customers, but is also in more locations with this infrastructure, covering 69 municipalities with fiber. In Pay TV, IPTV accesses amount to 727 thousand and grow 34%, partly offsetting the fall in Direct To Home (DTH) television, which was 37.5% in 2023. In the Prepaid Mobile business, it also saw a year-on-year growth in customers of 6%.

In 2023, the Company achieved operational revenues of 7.1 billion pesos, reflecting a year-on-year increase compared to the previous year. Service revenues totaled 6.7 billion pesos, reflecting stability with no significant year-on-year change; even despite market tensions and mainly driven by the strengthening of the commercial dynamic that allowed the growth of fiber accesses, revenues from digital solutions and services for business clients, as well as those from postpaid, which offset the margin decline in the sale of mobile terminals.

While operating expenses increased by 3% year-on-year, they were below inflation thanks to an efficiency plan that, among other things, involved renegotiating closed contracts, evaluating better options, and synergies between teams to optimize resources and operational efficiency. Expenses were mainly due to the increase in connectivity services for fiber optics for the residential and corporate segments, and television content due to the demand for applications and licenses for corporate projects along with streaming services and premium channels, in addition to macroeconomic pressures on exchange rates and inflation. In any case, there was compensation for regulatory changes in interconnection service rates, among others.

Investments executed were around 584 billion pesos during 2023. These comprised the development of infrastructure to support mobile and fixed communications, as well as the strengthening of customer service platforms and systems.

EBITDA, an indicator that measures performance and operating results before depreciation and amortization, amounted to 1.56 trillion pesos, with a slight decrease from the previous year. EBITDA during 2023 is driven by the good performance of fiber optic service revenues, digital and fiber deployment services, as well as the capture of efficiencies in non-commercial costs and expenses, which were impacted by lower mobile terminal sales and lower prepaid revenues originated by the economic slowdown in households. Added to this are macroeconomic pressures and lower commercialization of non-strategic real estate sales. The EBITDA margin stands at 21.9% (2022 – 23.4%).

Sources and uses

GRI Content 204-1

The cash flow presents sources and uses for a total of 8.9 trillion pesos.

In 2023, uses included 4.9 trillion pesos for supplier payments, 1.7 trillion for payments to financial creditors, 584 billion pesos for payments to public administrations, 815 billion pesos in investments and others, 528 billion pesos for payroll payments, 361 billion pesos for payments to Group Companies.

With regard to collection, there was a performance higher than expected thanks to customer revenues, this despite the cash offenders such as the macroeconomic environment. By the end of 2023, the collection coverage was exceeded by 101% with 7.6 trillion pesos collected, generating a reduction in bad debt rates from 1.9% to 1.7%, which resulted in a benefit in OIBTDA of 9 billion pesos due to the reduction in bad debt expense.

●	Customer Revenue	7,840
●	New Debt	139
●	Other Sources	447
●	Initial Cash	480

●	Employees	528
●	Public Administration	584
●	Suppliers (Opex)	4,910
●	Payments to group companies	361
●	Investments	815
●	Financial Creditors	1,709

2023

8.906 B

*Interest and Commissions from Financial Operations and Sale of Fixed Assets. Figures in billion COP.

Sustainable Financing

The Company surpassed 1 trillion pesos in loans with Scotiabank Colpatria, Bancolombia and BBVA, with four loans linked to the performance of sustainability indicators, including the percentage of women in leadership positions, the percentage of third parties/allies trained in information security, energy consumption per unit of traffic, and consumption of energy from renewable sources.

In 2023, once the limited assurance report was issued by the auditor PricewaterhouseCoopers, the Company obtained the approval of the banks, confirming the achievement of the goals set for the year 2022. —

Environmental
Management

●
E – Building a greener future

The Company has implemented an Environmental Management System based on ISO 14001:2015, guaranteeing compliance with applicable environmental requirements, control of significant environmental risks and aspects, management of the footprint generated by processes with clearly defined objectives and goals that have been monitored throughout these 15 years, thus achieving continuous improvement in the Company’s environmental management.

Telefónica Movistar’s Environmental Management System has 5 Environmental Objectives, designed under two approaches, the first associated with the mitigation of environmental impacts and the second with the prevention of fines and penalties. The axes are: Resource Management, Energy and Climate Change, Circular Economy, legal requirement attention and continuous environmental improvement.

The Company adapts to global trends and is a leader in the sector in waste management, aligned with the circular economy strategy not only nationally but also globally. On the other hand, it promotes responsible environmental management in its Allies and contractors so that they can reduce their impact.

Each year, an environmental impact assessment is carried out analyzing the life cycle of the business and the interaction with the Company’s administrative, technical and commercial processes or activities nationwide. At the end of 2023, impacts associated with: consumption of resources such as water, energy and paper, etc., emissions to the environment from fixed and mobile sources and from waste generation and noise have been identified.

Different control and monitoring measures have been established such as working tables with critical allies for the environmental management system, on significant environmental aspects and indicators of circular economy and climate change, and on environmental legal compliance and timely reports to environmental authorities nationwide. This is complemented by the implementation of different environmental and energy efficiency projects. Telefónica has a corporate environmental policy that sets out environmental guidelines and commitments for all operators in the group. This Policy is based on different commitments such as:

Risk management and legal compliance in environmental matters.
Setting ambitious environmental targets for continuous improvement.
Improving internal eco-efficiency.
Promoting digital solutions to help customers address the major environmental challenges facing society as a whole.
Involving suppliers and partners in the Company’s environmental commitments.

The environmental policy is available to all stakeholders in
digital and physical media nationwide at experience centers and the website.

Likewise, the Company has an Energy Management Policy, defined within the framework of the Telefónica Group’s Environmental Policy, and develops environmental management principles in energy matters. This Policy aims to provide a common framework of reference for setting objectives and undertaking actions based on Telefónica’s commitment to consuming energy efficiently and reducing its greenhouse gas emissions, in order to move towards a company with net-zero carbon emissions.

Furthermore, the Sustainability in the Supply Chain Policy establishes compliance obligations with best practices in environmental matters.

Environmental
Program Management

Telefónica has geared its management towards environmental preservation and the reduction of CO₂ emissions, which is why it has defined clear goals in reducing emissions compatible with the development of products and services and the growth and expansion of the network.

The climate action plan frames the quantification of Greenhouse Gas (GHG) emissions and defines the objectives and actions aimed at their fulfillment for the Company’s different activities.

The reporting and quantification of energy consumption (electricity, fuel, refrigerant gases, etc.) are carried out annually, and the carbon footprint is calculated, with data verified by an external entity. In 2023, this was AENOR.

Likewise, data associated with the Company’s environmental management is consolidated and reported in order to monitor the effectiveness of the actions taken to promote the prevention of the environmental impact of its operations.

In relation to the Circular Economy, the Company has targets for the recovery of hazardous waste and electrical and electronic equipment to offer recovered or reused raw materials to other productive sectors in the country, such as aluminum, copper, iron, oils, lead contained in batteries, paper and cardboard, among others. In relation to the management of electrical and electronic equipment waste, the Company receives unused cell phones and accessories in all its experience centers nationwide, thus seeking to recover components and minimize environmental impacts. Likewise, the processes for returning modems and decoders by customers helps to reintegrate this equipment into the operation, minimizing the use of materials for the manufacture of new equipment, and reducing the waste generated by the services delivered to each customer.

●
Eco Rating

In 2023, Eco Rating continued to be promoted, and the label showing the environmental impact of the terminals in a simple and clear way based on 5 environmental aspects of interest to consumers was updated: durability, repairability, recyclability, climate efficiency, and resource use efficiency. This includes a score on a scale from 1 to 100 that assesses how sustainable the cellular equipment is. The higher the score, the more sustainable the equipment is with the planet.

Eco Rating seeks to help customers make more informed and sustainable purchase decisions, encourage suppliers to reduce the environmental impact of their devices, and align the telecommunications industry to improve transparency and reduce environmental impact.

Therefore, work is being done to increase the number of devices evaluated and to increase the visibility of the Eco Rating seal in the Movistar Online Cell Phone Store, where the catalog of terminals with these attributes is displayed, which are updated periodically. For more general information, please visit the site

●
Papiros Project

With the Papiros document manager, the Company aims to be more digital and within reach of the customer, facilitating processes and reducing service times.

In 2023, a significant achievement was made by successfully transitioning the Papiros On-Premise Document Manager to Azure. This change was more than just a migration of 40 TB of around 40 million digital information files in just 48 hours; it represented the implementation of a central tool that today optimizes and centralizes
key processes.

This milestone not only demonstrated the commitment to adopting cutting-edge technologies in the company, but also highlights the relevance of the tool in consolidating essential operations.

The transition took place without generating any impact on the managing areas, evidencing the meticulousness with which technological changes are addressed. By positioning the infrastructure in line with the latest technological updates, operational performance and flexibility are strengthened, placing the Company at the forefront of the industry.

In addition, by highlighting that there is now a central tool that facilitates digital signing and centralizes processes, the importance and relevance of this successful achievement on the path to efficiency and business modernization is highlighted.

Climate Change

Climate change impacts the Company’s global business strategy due to the direct impact and associated risks and opportunities. The energy and climate change strategy drives long-term value creation, through effective risk management and the leveraging of opportunities.

Movistar has defined specific objectives and indicators for the operation, aligning the Company’s efforts with the level of decarbonization required to limit global warming to below 1.5°C in line with the Science Based Targets initiative (SBTi). These indicators are monitored quarterly and include, among others, the emissions inventory and carbon footprint, detailed monitoring of electricity, fuel consumption, and the progress of projects being carried out. Once the risk associated with climate change is analyzed, the relevance is determined according to the significant impact under Telefónica’s risk assessment methodology and by the actions taken to effectively control the risk.

Risks and Opportunities
of Climate Change

GRI Content 201-2

To determine the financial implications, risks and opportunities arising from climate change in the operation of Movistar Colombia, a specific methodology has been developed, taking into account two fundamental axes: physical risks and transition risks; as well as the climate scope, the impact of the risk, the economic range and the probability of occurrence.

After analyzing the risks associated with climate change before establishing the necessary measures for their minimization or control (BaU Scenario), and taking as a time horizon the year 2050, the following conclusions are drawn:

Significant Monetary Impact: The Net Zero 2050 scenario presents transition risks with a considerable monetary impact for Movistar Colombia, reaching almost 40 billion pesos in 2050.
Outstanding Market Risk: There is a market risk of OPEX spending due to the increase in the price of electricity, which has the greatest impact, reaching almost 24 billion pesos in 2050, with a probability of occurrence of 90.5%.
Reputational Risk: Although it has a lower impact, the risk of offsetting emissions through the purchase of carbon credits stands out.

According to the analysis of each risk, opportunities have also been identified:

Business growth opportunity derived from the fight against climate change: It is identified as the biggest opportunity, with economic benefits derived from IoT and Cloud services, particularly Eco Smart products. The benefits could exceed 400 billion pesos, standing out as the main opportunity for Movistar Colombia in the transition scenario towards a zero-emissions economy.
Energy sources and PPAs opportunity: although it represents a lower monetary impact, the implementation of projects to improve energy efficiency, self-generation of energy and the use of cleaner sources represents a significant opportunity to reduce costs and improve operational efficiency. Improving energy efficiency involves optimizing the use of existing energy resources, leading to a decrease in operating costs associated with electricity, heating and cooling. This not only has a positive impact on the financial balance, but also contributes to the long-term sustainability of the Company.

In short, the Net Zero 2050 scenario poses considerable financial challenges to Movistar, but it also opens doors to significant opportunities for sustainable economic growth. Rapid alignment with new technologies and business models focused on combating climate change emerges as a strategic opportunity.

Energy

GRI Contents 302-1, 302-3, 302-4, 302-5

Movistar has a global corporate energy and climate change strategy, with quantifiable goals that are not only compatible with network expansion and service quality, but will also help make it more competitive.

It is in responsible energy consumption where the Company has the greatest opportunities to generate savings and efficiencies, through the implementation of energy efficiency projects, self-generation and consumption of alternative and cleaner energies.

In 2023, total energy consumption was 306,478MWh. 1% less than in 2022. —

This includes the Company’s direct consumption of two types of energy: electricity (including self-generation) and fuels:

	2022	2023
Total Fuel Consumption (MWh)	14,229	13,869
Total Electricity Consumption (MWh) + Self-generation	294,735	292,609
Total Energy Consumption (MWh)	308,964	306,478 *

In 2023, electricity consumption was 292,609 MWh for the entire operation. Of that total, thanks to the commitment and drive of efficiency and responsible consumption initiatives, the total energy consumption from renewable sources was close to 243 thousand MWh, that is, 89% of the energy consumed in own facilities and 83% of total consumption of the entire operation, including third-party sites.

Likewise, the Company continues to develop self-generation projects, which in 2023 generated 1,467 MWh from photovoltaic (solar) systems implemented in the second phase of the PPA On Site Project.

The Company’s total electricity consumption is distributed as follows: 88% is allocated for management in technical sites, 6.8% in Datacenters, 4.5% in the commercial front and 0.7% in offices.

Fuel is another source of energy used and serves as backup when the electricity supply is interrupted or not provided. In 2023, consumption was 1.1 million liters of Gasoil/Diesel, a 2% reduction compared to 2022, which is equivalent to over 25 thousand liters. This was provided thanks to the implementation of more efficient equipment and the control of Gasoil/Diesel consumption by allies and suppliers in the supply to the network nationwide.

Total Fuel Consumption Gasoil/Diesel (Liters)
2022	1,224,502
2023	1,198,616

The Company has also made great efforts to reduce fuel consumption in its vehicle fleet, increasingly using low-consumption vehicles and improving fleet management through the use of M2M solutions. Consumption in 2023 was 5% less than in 2022.

Total Fuel Consumption Gasoil/Diesel Fleets (Liters)
2020	133,052
2021	165,258
2022	209,700
2023	199,833

●
Energy Intensity

In 2023, the energy intensity per unit of traffic was 34.8 MWh/Pb reflecting the Company’s commitment to reducing energy while ensuring the deployment of the network nationwide.

Emissions

GRI Contents 305-1, 305-2, 305-5

Based on an annual analysis of energy consumption, the calculation of the carbon footprint of all Telefónica Group operations is carried out according to the GHG Protocol methodology applied to Scopes 1 and 2. To calculate the indicator, the 1.5°C scenario of the Paris Agreement and the calculation baseline of the results of consumption in 2015 were used for different aspects such as energy, fuels, and refrigerant gases, among others. The gases included in the calculation are CO₂, CH₄, N₂O, HFC.

The emission factors established for Colombia by the Mining-Energy Planning Unit (UPME) year after year have been taken as a reference for the calculation. It is important to highlight that in 2023, the CO₂ emission factor for electricity in Colombia was modified, changing from 126 g CO₂eq/kWh to 112 g CO₂eq/kWh.

The Company carries out an independent process of verification of energy data and emissions, in order to obtain quality information about the energy consumed by the Company and the greenhouse gases that it emits to the atmosphere in its activities.

This has allowed the identification of improvements in processes and the management of energy and carbon in a transparent way.

Likewise, based on this quantification and verification, compliance with global energy and climate change goals is evaluated.

Scope 1 and 2 emissions in 2023 were 15,699 tons. Thanks to the implementation of an ambitious energy efficiency program, the Company has reduced carbon emissions by 71% since 2015, the year since which the carbon footprint inventory began to be calculated and climate action commitments were established, that is, it has avoided the emission of over 38.661 tons of CO₂.

In like manner, the company continues to promote the model of electricity consumption from renewable sources, which in 2023 reached 88,9% of consumption in own sites; and 83% of total electricity consumption of the entire operation, including third-party sites.

●
This is the evolution of annual scopes 1 and 2 emissions:

	2015	2016	2017	2018	2019	2020	2021	2022	2023
Direct CO₂ emissions (Scope 1)	18,897	17,534	16,814	15,025	12,036	12,689	14,101	11,040	10,141
Indirect CO₂ emissions (Scope 2)	35,463	36,436	36,153	35,499	18,530	15,314	20,971	6,846	5,558
Total CO₂ -Tons-	54,360	53,970	52,967	50,524	30,566	28,003	35,072	17,886	15,699

Water

GRI Content 303-5

The Company has an efficient resource management program that seeks to control leaks, consumption and good saving practices, as well as to foster a culture of efficient use of the resource. In any case, water consumption is not significant, nor material for the Company’s operation.

In 2023, water consumption nationwide was 158,378 cubic meters, which was used for domestic water consumption and comes directly from the municipal water system. There was a significant 0.3% reduction in water consumption in the Company compared to 2022. This reduction is due to the actions undertaken by the administrative area in early detection and control of leaks, account cancellation, the rainwater harvesting project, as well as the participation of employees in environmental awareness campaigns. Water consumption for areas with water stress in Colombia has not been determined.

Water Consumption (M3)

Water consumption at operational. administrative and commercial sites
2022	158,800
2023	158,378

The water consumption measurement comes directly from the bills of the water companies that have a metering system through meters at each of Movistar’s sites nationwide. For this case, 14.7% of the total consumption is estimated since the billing is in the process of being generated by the public services company. Likewise, the water consumption of third-party companies located in the facilities is discounted.

Waste Management

GRI Contents 306-1, 306-2, 306-3, 306-4, 306-5

Telecommunications networks require preventive and corrective maintenance, which generates waste that is similar to urban waste, special waste (WEEE – rubble) and hazardous waste due to the use of different inputs such as filters, batteries, oils, refrigerant gases, paints, lights, spare parts, fiber, electrical and electronic equipment, among others. Different operational controls have been defined for these activities, and waste is managed in accordance with applicable environmental regulations.

In 2023, 5,717 tons of waste were managed, mainly coming from network operations and maintenance, electrical backup systems, and infrastructure deployment works. 99.1% of the waste is Non-Hazardous and 0.9% of the waste is Hazardous and, due to its characteristics, it is not reincorporated into the operation, but is used as raw material for other productive processes.

Waste Type	Residue	Unit	2022	2023
NON-HAZARDOUS	Paper and cardboard	Tons	13	83
	Cables. plastic pipes and metals	Tons	1,029	4,546
	Operations and offices WEEE	Tons	94	108
	Customer mobile phones	Tons	9	5
	Customer WEEE (except cell phones)	Tons	34	82
	Other non-hazardous waste (demolition and construction)	Tons	20	840

Hazardous	Fluorescent Lamps	Tons	1	1
	Batteries	Tons	50	15
	Other Hazardous Waste	Tons	15	8
	Used Oils	Tons	16	12
	Refrigerant Gases and Equipment	Tons	2	16
	Operations and Offices WEEE (CRT Screens, PCBs, with Oils)	Tons	0.3	0
	Total (Tons)		1,282	5,717

The Company relies on specialized and duly authorized allies to carry out proper waste management, handling, transportation and disposal of hazardous and special waste. Waste is not managed within the Company’s facilities, all of it is treated through these authorized managers at their respective plants.

Specialized working tables have been defined to monitor the generation and proper disposal of waste by Allies on a monthly basis, taking into account the type of waste generated, the proper disposal, the managers used and the type of treatment, always ensuring that this management is carried out within the framework of regulations and the implementation of adequate operational controls. In this way, the control and traceability of information on the process from generation to final disposal of waste is guaranteed.

The Company uses the GreTel tool to control waste data generated nationwide, which allows the uploading of information for each of the defined groups of waste generated in the organization. This platform also receives the uploading of information on waste managed by the Allies or different areas of the Company. In relation to hazardous waste, Movistar guarantees the corresponding annual report to the competent environmental authority.

Promotion of the Circular Economy

The Company has established different circularity mechanisms for waste, such as the refurbishment of modems and decoders returned by customers, which are no longer considered electrical and electronic equipment waste and re-enter the life cycle of the broadband service. In 2023, 399,021 equipment units were reused thanks to this mechanism, equivalent to 199 tons.

Likewise, preventive and corrective maintenance has been optimized in the Company, reducing the frequency of maintenance and waste, purchasing more efficient equipment, maintenance-free and with a longer useful life. The Company has a specialized manager for the handling of electrical and electronic equipment waste so that most of the electronic components can be recovered and used for other productive processes outside the organization.

Another circularity measure implemented by the Company is the national copper retal recovery, which allows copper to be reused for different production processes, reducing environmental liabilities and generating non-operating income from its sale. By the end of 2023, 4,422 tons had been recovered.

In 2023, 98.7% of the waste was recycled. —

On the other hand, 1,3% had other treatments such as landfills and incineration, and deposit in security cells, when there were limitations in access to the area or due to the characteristics of the waste.

Waste Type	Residue	Recycling	Landfill and Incineration	Others, e.g. Cells	Total
Non-Hazardous	Paper and Cardboard	83	0	0	83
	Cables, Plastic Pipes and Metals	4,508	0	38	4,546
	Operations and Offices WEEE	108	0	0	108
	Customer Mobile Phones	5	0	0	5
	Customer WEEE (Except Cell Phones)	82	0	0	82
	Other Non-Hazardous Waste (Demolition and Construction)	814	17	9	840
Total		5,600	17	47	5,665

Hazardous	Fluorescent Lamps	1	0	0	1
	Batteries	15	0	0	15
	Other Hazardous Waste	1	1	6	8
	Used Oils	9	2	1	12
	Refrigerant Gases and Equipment	16	0	0	16
	Operations and Offices WEEE (CRT Screens, PCBs, with Oils)	0	0	0	0
Total		42	3	8	52
General Total		5,642	20	55	5,717
% Type of Treatment		98.7	0.3	1.0	100

While waste management depends on the authorization generated in the environmental licenses of the managers who support it, the Company has a priority chain for waste management, where the first treatment must focus on the reuse, recycling or recovery of waste.

Sustainable Mobility

Movistar, true to its commitment to environmental responsibility, has carried out various initiatives throughout 2023. These actions have not only strengthened positive environmental management, but have also contributed significantly to community well-being and the promotion of sustainable development:

Free access to bicycle and scooter maintenance services for employees who commute to work, thus contributing to the reduction of the carbon footprint. This initiative not only supports the employees’ physical health, but also strengthens their economic stability.
In six stationary race days, over 90 cycling enthusiasts not only challenged their physical resistance, but also expanded their knowledge of their Planeta Movistar product and service portfolio. This unique combination of exercise and learning reflects the creativity and dynamism.
Basic mechanics and road safety training has been provided to over 200 employees, covering key issues such as the proper use of bicycles and the importance of protective gear. These initiatives reinforce the commitment to safety and well-being, promoting healthier and more sustainable mobility.
Through the car-sharing initiative, over 4,300 car and motorcycle routes have been published, connecting over 1,400 trips. This benefit is especially significant, as 33% of employees experienced safer and more efficient journeys.
A 30 km cycling tour was organized on the bike path, encouraging the use of bicycles as an environmentally friendly mode of transportation. This initiative encouraged 50 employees to adopt cycling as part of their lifestyle.
Through the “Movistar en Bici” initiative and the bicycle and scooter sharing program, over 800 users have been involved, using their own or shared bicycles, generating over 21,000 trips. These users have traveled a total of 277 thousand kilometers, resulting in a reduction of the Company’s carbon footprint by 69 tons. This positive impact is equivalent to saving over 3 thousand trees and has generated savings for employees of over 500 million pesos during the year 2023.
Road safety programs were developed with the Government of Cundinamarca, handing out reflective vests for visibility on the roads
of Cundinamarca.

Green Digitalization:
Eco Smart Seal

Movistar is committed to achieving a world where technology contributes to protecting the planet, which is why it focuses on digitalization, which plays a decisive role in decarbonization and the green transition. For this reason, the Company is committed to:

Promoting digitization and connectivity as key levers that help its clients to develop their activity in a more efficient and sustainable way. Telefónica’s digital solutions allow optimizing the consumption of resources such as energy and water, improving traffic planning and air quality in cities, reducing CO₂ emissions or promoting the circular economy.
Reducing the environmental impact of its networks: connectivity is the basis on which its business is sustained, and for that reason, it works to ensure that its network is low-emission and the most efficient in the sector.

With the aim of contributing to the decarbonization of the productive sector in 2023, the Company implemented and launched the Eco Smart Seal in Colombia, as one of the measures aimed at fulfilling the purpose of avoiding the emission of Greenhouse Gases through the deployment of digital and connectivity services to clients. This Seal visually shows the environmental benefits generated by a selection of Movistar Business digital products and services, with the aim that clients can quickly identify how they are contributing to protecting the environment when implementing them. The seal has 4 icons that represent different environmental benefits:

Energy saving

Reduction of CO₂ emissions

Circular economy

Reduction of water consumption

These solutions are aimed at companies of different sizes and key sectors – tourism, industry, logistics and distribution, retail or banking. Based on a renewable and low-emission network, Eco Smart services for cloud, IoT, big data and Artificial Intelligence reduce energy consumption, CO₂ and water emissions, and boost the circular economy.

To give the Seal greater relevance and recognition, it has been externally verified by the Spanish Association for Standardization and Certification – AENOR, which has verified that each solution objectively drives a direct and significant improvement in the client’s activity or process, or in the users of this client who use a solution or service.

Currently, 37% of the Movistar Empresas digital solutions portfolio in Colombia have been verified and have the Eco Smart seal; among others, Luca Transit, Intelligent Vehicle Management, KITE Managed Connectivity, Hosting, Virtual Data Center, Integrated Workstation (PDTI), etc. The company has made available to stakeholders a website with more information at: www.movistar.com.co/empresas/servicios-ecosmart

Environmental
Assessment of Suppliers

Within the prioritization carried out for suppliers and contractors in relation to environmental issues, different monitoring and verification parameters have been defined according to the services they provide to Movistar associated with the organization’s life cycle, but not discriminated by significant environmental aspects.

Environmental
Audits and Trainings

GRI Contents 404-1, 404-2

In 2023, the Company carried out 18 audits: internal and assurance, equivalent to 70.5 days of audit, with the aim of identifying timely improvements to the Management System, ensuring the planning of actions and strategies aimed at solving the identified deviations.

Movistar has a training program to strengthen the knowledge and training of employees and allies on environmental issues. In 2023, 831 sessions were held, equivalent to 3,472 hours of training in environmental topics such as: Telefónica’s Environmental Management, ISO 14001:2015 standard, reinforcement of operational controls defined in the Company, solutions for the green transition, voluntary carbon market, waste management and classification, reporting and monitoring in GreTel for ally loop, emergency preparedness and response, environmental training for auditors, among others.

Also, the ESG Academy was launched as a global space to train and promote the culture of sustainability in the Company available to all employees, which includes environmental training such as Eco Smart, Eco Rating, Taxonomy, circular economy and climate change, etc.

Furthermore, the Company makes available to its employees a corporate site (intranet) where they can consult environmental information such as: Environmental Policy, management programs, indicators, objectives, environmental performance results, tips, environmental aspects and impacts, among others.

Precautionary Principle

The Company complies with the precautionary principle that is framed in national regulation regarding the limits of exposure of people to electromagnetic fields (Decree 195 of 2005 and Resolution ANE 754 of 2016), which is associated with the telecommunications infrastructure installed. Likewise, it complies with national provisions on environmental matters (Law 99 of 1993) when the deployment is made in areas of environmental protection.

Regulatory Compliance

GRI Content 419-1

During 2023, the Company did not receive any fines or penalties related to non-compliance or violation of the Colombian environmental regime. —

Social Management

S – Help society prosper

Connectivity for
Digital Growth

GRI Contents 2-6, 3-3

2023 was a challenging year in terms of the social, political and environmental environment, variables that have a strong impact on economic variables. However, it was a year in which the Company focused on identifying opportunities and better ways to adapt to these effects and emerge stronger from these situations, reinventing itself and finding new growth models: guiding actions for the construction of more inclusive and sustainable societies.

Digitization is a key factor in making growth possible. The Company’s commitment is to put technology at the service of people accompanied by a transformation of local talent, which not only allows improving the country’s productivity levels, but also offering innovative alternatives so that people can enhance their talent even during times of crisis. Without neglecting the protection of the planet, reducing the environmental impact and offering clients solutions that allow them to develop their activity more efficiently and sustainably.

The digital ecosystem has the great challenge of working for a more connected, more equitable and inclusive country, levers that will drive competitiveness, well-being and sustainable development. Therefore, one of the Company’s main objectives is to promote the modernization and expansion of technological coverage of telecommunications networks to connect the unconnected and continue developing products and services that improve productivity and business efficiency models, as recognized today by over 282 thousand business clients in the B2B segment, of which 67 thousand implement Movistar Business digital solutions.

2023 was a challenging year for the operation, as super-connectivity and the high traffic generated caused the networks to become saturated. On the other hand, climate effects continue to affect the national territory, which leads to extended recovery times for failures. This, coupled with the difficulty in some regions with the flow of electricity and the increase in theft of infrastructure, created pressures on network stability that were successfully solved, maintaining an average availability above 99.92% throughout the network, 99.97% in basic lines, while for Broadband and Fiber optics in the internal plant an availability of 99.99% was obtained, and in the mobile access network 99.86% measured with the parameters of current regulation.

Movistar Fiber

GRI Contents 2-6, 2-7, 2-8, 405-1

2023 was the year of consolidation of Movistar Fiber, a technology that is fundamental for the country’s digital growth. However, despite the Company’s great efforts, it is necessary to make the regulation more flexible by imposing fewer burdens on deployment, encouraging new deployment models, and prioritizing negotiation over sharing, to allow a leap in connectivity in the coming years.

In 2023, Telefónica Colombia and the investment firm KKR, after receiving the corresponding regulatory authorizations, closed the transaction under which an independent company was formed to handle the deployment of Colombia’s largest neutral fiber optic network to the home (FTTH), from which all operators in the market could benefit.

In terms of commercial activity, Movistar positioned itself through the “Somos fans de lo que haces” (Movistar–Fans of what you do) campaign, which leveraged customer growth, especially of the fiber service, closing 2023 with over 1.2 million customers who have this technology. This positions Movistar as the only operator that has grown its Fixed Market Share. Competition is mainly evidenced in the higher internet speed to meet the vertiginous demand for data from homes and businesses. Offering input speeds of 500 Mbps and maximum speed of 900 Mbps. These figures are higher than those of all other operators in Colombia. In the strategy of further leveraging fiber and its benefits, the Company extended the benefits of higher speed to postpaid customers with the Movistar Total segment (Fiber + Postpaid) delivering benefits of higher speed, more data, and the entire Black program available to Movistar customers.

The deployment of FTTH is Movistar’s growth engine and, by far, the best technology available in the market. During 2023, and thanks to alliances, the Company took on the challenge of achieving one of the largest fiber optic network deployments in Colombia, achieving 4.9 million homes passed in 69 locations, which places Movistar as the Company with the largest deployment in the country.

With this fiber optic network expansion plan, it was possible to contribute to the country’s development thanks to the generation of over 5,300 jobs, making it possible to build the network under concepts of sustainability, equity, employability and social inclusion.

Likewise, in 2023, the fiber positioning strategy was continued through regional launches aimed at presenting advances in connectivity and the contribution of this technology to the country’s development, which is relevant due to the social, economic and environmental implications it generates.

●
Mujeres en Red

GRI Contents 2-8, 405-1

At the end of 2023, the number of women in the technical workforce of third parties increased to over 670. Nine allied or contracting companies support the implementation of this Program.

The “Mujeres en Red” (Women Network) program has positioned itself as a leading initiative in terms of employability and equity, and has been recognized by various entities:

Recognition of Good Practices in Sustainable Development in SDG 5 (Gender Equality) in version 022 and consecutively in 2023. The United Nations Global Compact and the Bogotá Chamber of Commerce awarded this prize. Finalists of the Andesco Sustainability Award 2023: Work Environment category. Special participation in the Congress of Differential and Intersectional Approach of the National Commission for Health and Safety at Work in the Telecommunications Sector – organized by the Ministry of Labor.

Furthermore, in 2023, for the first time, the Annual Allied for Equity Event was held to recognize the work of
“Mujeres en Red”, Allied Technical Diversity Personnel” and “Equity-Allied Contractor Companies”. —

Network Management
and Mobile Services

In terms of mobile and 4G deployment, over 550 solutions were deployed in 2023, including carriers and new sites. Likewise, 64 Indoor solutions were implemented for high-value customers, and the network was modernized at over 1,800 sites. All of this allowed improving capacity and coverage in over 400 municipalities in Colombia, but also strengthening the network to support the increase in mobile traffic, which was close to 30%.

In terms of commercial activity, 2023 saw a busy market dynamic, mainly due to regulatory changes focused on portability processes and offer innovations among mobile operators in the market. However, the postpaid offer continued to be positioned with segmented tactical actions that strengthened the value proposition, such as the launch of a unique alliance of the new IlimiDatos plans with Disney+ and Star+ included at no additional cost. Customers have enjoyed the best of entertainment with the video platforms that are a global trend. At the end of 2023, 49,322 customers were activated on these plans and approximately 19,184 people activated their Combo+ included benefit.

Likewise, differential attributes are maintained for customers in the Postpaid offer, such as ElegiApps to choose the favorite Apps of the plan and browse freely; Pasa Gigas to transfer and request gigas with other Movistar postpaid, and Roaming Data to use the gigas of the plan in up to 61 countries.
All of this, in addition to the benefits received by Movistar Total customers with up to 50% more gigas permanently in the plan, preferential benefits such as presales at the Movistar Arena, great strategic allies and preferential service for having fixed and mobile products.

Prepaid

In the prepaid segment, the Company continued to focus its management on improving the connectivity conditions of users, offering differential elements within the packages, such as unlimited access to high-demand applications, unlimited minutes to any operator, during the validity of the package, and long-distance minutes, as an additional benefit for, among other groups, migrant population.

The prepaid modality allows significantly expanding the reach of Movistar services to unbanked population, incidental uses or simply those who prefer this access modality. For them, the Company designed differential offers that encourage connectivity, rewarding the purchase of data, voice or both packages, through portals and digital dynamics. In the latter part of the year, the Company launched the “Prepago Pro” concept along with an improvement in the digital experience of its customers, which encourages the adoption of new ways to purchase their packages and recharges, such as mobile wallets and the website and app.

Digital Solutions
for Companies

Movistar has transformed into a technology company, and as a result, it now has a portfolio of solutions in four verticals: Big Data, Internet of Things, Digital Security, and Cloud, which are tailor-made services for large corporations, businesses and SMEs. In 2023, over 67,000 companies had at least one Movistar digital service:

IoT

Legacy IoT Connectivity
KITE Managed Connectivity
Vehicle Management
Geo-management
Online Business
Connected Industry
Industry IoT Networks
IoT Equipment

Cloud

FlexWAN
Azure
AWS
VDC- Virtual Data Center
Office 365
Google Workspace
Webex Calling
Team Talk – comunicación instantánea Push To Talk

Advertising

Business Messaging (MEPE)
Sponsored Data
Intelligent Campaigns
Omnichannel (Sendit,
One Inbox)

Big Data

Smart Steps: Luca Transit, Luca Store, Luca Tourism
Smart Digits: Luca ATP, Luca Match, Luca Scoring,
Luca consumption
R0B1M – robotic business process automation
1DOC3 – virtual medical guidance
Consulting and analytics services

Ciberseguridad

Multi-device protection- Endpoint protection license on PCs and mobile devices
Anti-DDoS Shield
Managed Security
SIEMaaS: Monitoring and Early
Warning Platform
Security Edge
Email Protection
Secure Traffic
Next Defense: Vulnerability and risk management SOC.
SMDM: Remote device restriction and
administration system

●
Major milestones in the business segment

Increased Anti-DDoS
Mitigation Capacity:

We increased the capacity by 10 GB, to expand the range of mitigation of distributed denial of service attacks. The shield currently supports the National Police, Ecopetrol and the Bogotá Aqueduct.

Launch of the Security Edge Service:

The Security Edge Service was launched in support with TCCT and Hispam Product, where through commercial training, pre-sales and projects, services offered by the platform were presented, aimed at providing security at the perimeter of the business, where the cloud and working from anywhere and on any device have been a radical transformation, allowing the client to both delegate the management of web browsing protection and access to corporate applications, as well as security incident management to an expert team (SOC), allowing them to focus on those tasks of greater value to the core of their business.

Innovation

The Company views innovation as a transformation lever and is guided by three foci:

More or new revenues through
process improvement, new products and/or services.

Spaces for innovation that allow for
the motivation of talent, in addition to its retention.

Relationship spaces with allies on different fronts for the strengthening of the ecosystem with the creation and solution of challenges that contribute to sustainable development, in addition to building spaces for learning.

In this framework, Wayra is Telefónica Movistar’s investment, innovation and support arm for entrepreneurship in Latin America, and for 2023, the startup figures were as follows:

28 Colombian startups in Wayra Hispam portfolio

Of 27 Wayra startups working with Telefónica Colombia, 17 are Hispam portfolio and 10 are local

Additionally, Wayra is Managing Partner in Corporate Impact Venturing Latin America & the Caribbean (CIV LAC), an initiative developed by BID Lab and BID Invest, which seeks to connect large Latin American companies and organizations, with technology startups that have solutions to cross-cutting problems in the region, such as social inclusion, education, support for SMEs and environmental protection. Telefónica participates as a member company.

Movistar ranked first in the telecommunications sector in the open innovation ranking of Connect and 100 open startups as the company that most promotes business collaboration and innovation in the country.

Agility and Digital Transformation

GRI Content 404-2

Agility defines the way Telefónica Movistar works and helps to accelerate results to ensure the delivery of value to the business with a digital and customer-centric vision. Today, it is part of the Company’s DNA, as there are now over 1,200 people working under agile structures, distributed across 15 Trains and 8 COEs (Centers of Excellence), and in turn, over 500 people working under the Business As Usual (BAU) management model, which takes the best agile practices and premises distributed across 17 BAU units throughout the organization.

During 2023, the Company raised its commitment to strengthening the Agile and Digital Mindset, which has allowed the strategic plan to be directed according to the line of transformation of the organization. In line with this, promoting the creation of digital ecosystems and process automation for the reduction of operational tasks, through methodological frameworks that imprint greater motivation and challenge has allowed for continuous and tangible value deliveries, maximizing the experience of its customers. This exercise has landed in events such as, for example, the Digital Transformation Summit, the Digital Minds Workshop for SMs and POs, applied innovation workshops with Wayra, and Power Bi and Power Apps courses (Power Platform environment) available to all employees; as well as, the creation of the Digital Transformation community and the Data & Analytics Community. All of this has allowed the mindset of over 1,000 employees to be increased, with new digital skills and an increase in the backlog of initiatives for digital solutions, making it part of the employees’ culture to rely on the Transformation team as that great enabler.

The Company continued to be a reference in the Telco market and the region in Business Agility, and this is reflected in the growth of the Agile Maturity Index (IMA), and with significant improvements in the Digital Maturity Index (IMD), achieving an increase from 3.66 (2022) to 3.86/5 at the end of 2023, and from 6.04 (2022) to 6.40/10, respectively.

These results are based on different dimensions that have been implemented, such as the enabling of innovation spaces and the strengthening of laboratories for this purpose, which have explored challenges with different proposals than those they had not imagined; the training of agile roles (SMs, POs and TLs) providing tools and knowledge to achieve greater maturity in mindset; the implementation of new methodologies to address challenges posed by the macroeconomic situation itself; the approach to leadership from new styles and ways of creating teams, continuous training and support for teams in strategic, tactical and soft skills. In addition to this, a constant inspection and adaptation of the design in agile structures, allowing flexibility in the creation and determination of teams to work on the foci as an organization, which during this year were cash and profitability, and a greater capture of efficiencies based on shared OKRs between trains and COEs.

The importance of keeping the Company in constant measurement for maturity on the evolution in Agility has led teams to increasingly recognize the value of implementing T2M, productivity and/or quality measurements to maximize their impact on the business, simplify processes and accelerate decision-making; 100% of the Agile Units are now challenging themselves to streamline a critical process every quarter through speed OKRs. 30 critical business processes have been streamlined, leading the Company to achieve improvements that allow for greater fulfillment of the customer promise. In addition, projects with a greater financial impact have been explored: in revenues, cash, costs and OIBDA, leveraged by a benefit analysis and applying the sustainable digitalization framework, for a total of 36.3 billion pesos captured thanks to much more automated processes.

Movistar is convinced that its Agile operating model has achieved great results thanks to the support and encouragement from leaders who drive transformation through openness, promotion and personal commitment. This has been backed up by an Agile Leadership Model that the Management Committee itself has been part of and is committed to evolving into an extraordinary leadership.

Human Talent Management

GRI Contents 2-7, 2-8

With people at the center of the strategy, the Company is convinced that maximizing the potential of employees and increasing their motivation are the enablers of change and sustainable growth. Their enthusiasm and commitment to Telefónica’s purpose and values are key to achieving goals.

In 2023, the Company continued to be a relevant player in employability in the country. In the six regions (Central Administration, Bogotá, Caribbean, Northwest, East and South), 4,950 employees were committed, 46% women and 54% men.

It is important to note that for all data in this chapter, the Company’s workforce as of December 31, 2023, was taken as the closing point. It does not include the Telefónica Foundation Payroll, nor temporary employment. Revenue and turnover indicators do not include temporary positions or interns.

●
Employees per contract type and gender

Contract Type	Women		Men		Grand total
Indefinite	2,167	43.8%	2,575	52.0%	4,742	95.8%
Temporary		0.0%		0.0%	0	0.0%
Apprenticeship	102	2.1%	85	1.7%	187	3.8%
Fixed	10	0.2%	11	0.2%	21	0.4%
Grand total	2,279	46%	2,671	54%	4,950	100%

*Does not include Foundation Payroll.

●
Employees per contract type and region

Contract Type	Central Administration		Bogota		Caribbean		Northwest		East		South		Grand total
Indefinite	2,339	47.3%	564	11.4%	427	8.6%	485	9.8%	408	8.2%	519	10.5%	4,742	95.8%
Temporary		0.0%		0.0%		0.0%		0.0%		0.0%		0.0%	0	0.0%
Apprenticeship	116	2.3%	7	0.1%	13	0.3%	22	0.4%	13	0.3%	16	0.3%	187	3.8%
Fixed	20	0.4%		0.0%		0.0%		0.0%		0.0%	1	0.0%	21	0.4%
Grand total	2,475	50%	571	11.5%	440	8.9%	507	10.2%	421	8.5%	536	10.8%	4,950	100%

Hiring and rotation

GRI Content 401-1

The total number and rate of new hires and employee turnover during 2023, by age group, gender and region.

Regional	Women
Regional	Less than 30		Between 30 and 50		Over 50		Total
Central Administration	106	51.0%	47	6.0%	6	6.7%	159	14.7%
Bogotá	19	40.4%	40	16.1%	3	25.0%	62	22.4%
Caribbean	20	55.6%	11	6.0%	0	0.0%	31	13.0%
Northwest	31	55.4%	31	17.4%	2	16.7%	64	26.0%
East	11	29.7%	23	13.9%	1	20.0%	35	16.8%
South	17	39.5%	28	13.6%	1	4.0%	46	16.8%
Grand total	204	47.9%	180	10.4%	13	8.0%	397	17.1%

Regional	Men								Grand total
Regional	Less than 30		Between 30 and 50		Over 50		Total		Grand total
Central Administration	118	47.4%	74	7.4%	5	2.7%	197	13.7%	356	14.1%
Bogotá	32	58.2%	38	17.5%	0	0.0%	70	23.0%	132	22.7%
Caribbean	8	32.0%	18	11.2%	2	9.1%	28	13.5%	59	13.2%
Northwest	18	43.9%	25	13.2%	0	0.0%	43	16.0%	107	20.8%
East	18	42.9%	27	16.1%	0	0.0%	45	19.1%	80	18.1%
South	19	65.5%	20	10.0%	2	4.2%	41	14.8%	87	15.8%
Grand total	213	48.4%	202	10.4%	9	2.5%	424	15.5%	821	16.2%

Total turnover rate year

16.2%

*Does not include interns or temporary workers

Diversity, Equity
& Inclusion

GRI Contents 404-3, 405-1, 406-1

The Company is convinced that companies are a reflection of the people who work in them. For this reason, Diversity, Equity and Inclusion (DEI) management is a key lever for driving the Company’s digital transformation and Responsible Business Plan.

The Company has a Global Diversity Committee, “Diversity Council”, and a local one, where all diversity actions, programs and initiatives are designed, implemented and monitored.

54% of the employee workforce are men, while 46% are women. —

Empleados(as) por categoría laboral

Category	Women
Category	Less than 30		Between 30 and 50		Over 50		Total
Middle Management	106	51.0%	47	6.0%	6	6.7%	159	14.7%
Rest of workforce	19	40.4%	40	16.1%	3	25.0%	62	22.4%
Total general	204	47.9%	180	10.4%	13	8.0%	397	17.1%

Category	Men								Grand total
Category	Less than 30		Between 30 and 50		Over 50		Total		Grand total
Middle Management	118	47.4%	74	7.4%	5	2.7%	197	13.7%	356	14.1%
Rest of workforce	32	58.2%	38	17.5%	0	0.0%	70	23.0%	132	22.7%
Grand total	213	48.4%	202	10.4%	9	2.5%	424	15.5%	821	16.2%

The Telefónica Group’s Board of Directors reaffirms this commitment through a Global Diversity Policy applicable to all companies that are part of the group, which incorporates principles that guarantee equal opportunities; the promotion of a culture of diversity and inclusion; non-discriminatory, fair and impartial treatment in all aspects of the organization; and positions them categorically against any conduct or practice associated with prejudice on the basis of, among others, nationality, ethnic origin, skin color, marital status, family responsibility, religion, age, disability, social condition, political opinion, serological and health status, gender, sex, sexual orientation, gender identity and expression.

To leverage a culture of diversity, equity and inclusion, a strategy has been developed to promote the equal value of all people who are part of Movistar through actions, initiatives, communications and safe work spaces. This strategy is based on key elements such as Key Performance Indicators, Organizational Diagnosis, Inclusive Culture and Diverse Employer Brand.

●
Key Performance Indicators

GRI Content 404-3

KPIs are established that allow for the precise measurement and evaluation of progress in terms of inclusion, closing gaps and diversity in the work environment. These indicators are essential for gaining a quantitative and qualitative view of efforts and results. In 2023, the performance evaluation exercise was applied to employees who joined the Company until September 30, 2023, in which a score of 3 was automatically closed for 46 people who were then validated in calibration with the Human Resources Business Partner.

●
Organizational Diagnosis

Diagnostic assessments are conducted to evaluate the organization’s current state across various diversity fronts, analyzing its level of progress. This approach provides a detailed
understanding of areas requiring attention and guides the implementation of effective strategies.

●
Inclusive Culture

Initiatives are implemented focused on fostering an inclusive work environment, promoting diversity in all its aspects. Additionally, the goal is to cultivate an organizational culture that values and respects individual differences. This approach not only aims at superficial changes, but at creating a collective mindset of respect and appreciation for diversity.

●
Diverse Employer Brand

Projecting the Company as a place that actively promotes diversity, equity and inclusion, so there is a focus on making these qualities visible and transmitting them to potential employees, thus consolidating an employer brand as synonymous with a diverse and respectful work environment.

These four strategic pillars constitute the basis of actions in DEI, leveraging a more inclusive and equitable organizational culture with a reach in 5 work fronts:

GENDER EQUALITY

IInitiatives focused on contributing to closing the gap and creating spaces with equality between men and women:

Execution of a recruitment and selection process with a gender focus, using transparent and bias-free methods, providing equal opportunities for all employees. Among the good practices and seeking to generate gender balance in leadership positions, it is guaranteed that at least one woman is included in the final shortlist and that the publication of vacancies is free of discriminatory criteria based on sex, age, marital status, appearance, height, weight, ethnic belonging, disability status, among others.
In 2023, the “Conscious Communication: Embracing Inclusion” workshop was launched. Its aim was to promote the use of inclusive and accessible language in all the organization’s communication channels, as well as in brand promotion. It is inspired by the Internal and External Communication Manual, designed specifically to promote inclusive and non-sexist language. The implementation of this tool has allowed the calibration of the people responsible (communication teams and agencies), ensuring that the brand’s communication is inclusive and attractive to all people in the Company.
With Futura, a women’s leadership program, the goal is to boost the leadership of women within the organization, achieving the development of different skills that allow them to take on new challenges in positions of greater level and responsibility. Futura provides training in 8 modules that allows participants to enhance

Goals have been defined to leverage equity and the promotion of female leadership in higher-level positions. By the end of 2023, the Company reached 41.6% women in managerial positions and has 39.1% women in leadership positions in its workforce.
Implementation of the measurement of workplaces free from sexual harassment for companies (ELSA). Definition and implementation of a structured work plan focused on eradicating situations associated with sexual harassment. This plan has been carried out with the support of Genderlab and the Inter-American Development Bank. This tool, leveraged by algorithm and artificial intelligence, has made it possible to recognize and take action against sexual harassment in the workplace.
The Company adheres to the Women’s Empowerment Principles (WEPs) of UN Women and the Global Compact, and strongly expresses its commitment to promoting gender equality and the empowerment of women, both in the workplace and in the community in general. This signature represents a significant step towards creating a work environment and a presence in the labor market that recognizes and strengthens the invaluable contribution of women.

GENERATIONAL

Implementation of actions and programs aimed at integrating people from different generations in the organization and launch of programs that connect with talent, opening doors to young people under 35, providing them with the tools and support they need to encourage them to participate in the creation of a new digital world through programs that promote their involvement in the organization. By the end of 2023, 38.1% of the workforce was young people under 35.

Generación Movistar (GM): a program aimed at connecting with young people and challenging them to maximize their talent in the organization, through a learning ecosystem that combines on-the-job training and the development of skills to meet the demands of the business’ digital transformation. This program has three specific elements:

Project: Participants are assigned a project with a duration of 1 year and presentations of progress are given every 4 months in ceremonies where leaders participate, with the aim of making their work and profiles visible.

Training: A learning ecosystem for developing soft and digital skills, receiving monthly training for 1 year.

Application: After 6 months in the organization, GM participants can apply for open vacancies in the company.

The Company is measured annually in Employers for Youth, a quantitative study that seeks to recognize and understand the expectations and behaviors of young professionals, as well as the attributes they value most in their companies. For 2023, Telefónica Colombia ranked 29th out of 100 in the country ranking, and is the first organization in the sector for its inclusion practices and youth development.

LGBTQI+² COMMUNITY

A safe work environment is promoted for members of the LGBTQI+ community, promoting respect and non-discrimination. This pillar also manages:

The creation of benefits that extend to the LGBTQI+ community (wedding time, mourning time, homoparental leave, school leave, among others), promoting their use through a communication campaign.
Launch of “Sostener”, (support network for LGBTQI+ people, family and allies) made up of over 700 members. In 2023, 6 awareness-raising spaces were generated, with knowledge and conversation on topics such as diverse orientations and identities, suicide prevention, non-binary population, trans population, etc.
Deployment of communication campaigns to raise awareness about respect and inclusion of LGBTQI+ community members, including the lighting of the Movistar Arena in Pride colors on July 28 as a symbol of commitment to working for the inclusion and non-discrimination of the LGBTQI+ community.
The Company is part of the Pride Connection initiative, a business network where it shares and adopts good practices for the inclusion of LGBTQI+ people.
The first Mixed Toilet was opened on the premises, a space designed to promote equality and value diversity, thus demonstrating the commitment to the well-being and inclusion of staff.

2. Lesbian, gay, bisexual, transgender, queer and intersex (LGBTQI)

PEOPLE WITH DISABILITIES

In 2023, the Company continued to promote the inclusion of people with disabilities in its workforce. By the end of the year, it had 21 Certified People with Disabilities. Additionally, the following actions were implemented:

Manual for people with disabilities, a guide that provides tips to eliminate the barriers that are imposed on a daily basis with the interaction of people with disabilities.
Generation of awareness-raising spaces on disability through talks, workshops, testimonials, panels within the organization.

MULTICULTURALITY

The Company promotes the integration of people from different backgrounds and ethnicities, through the deployment of training actions and communication campaigns to raise awareness about the integration of other cultures, ethnic communities and races. Workshops on migrant stories, intersectionality and racism have been some of the topics that were part of the training catalog for 2023.

Additionally, it has transversal initiatives such as Diverstars, which is a program that brings together employees to be knowledge multipliers on diversity. Through a training plan of over 20 hours, participants are trained on topics such as unconscious biases, new masculinities, disability, inclusive communication, among others.

Finally, the Company has a community hosted on Workplace with over 12,000 employees called “Diversaliad@s” where actions, communication, information, and workshops are shared to generate learning and awareness about diversity in general and in its 5 work areas. For 2023, over 60 training actions were carried out, impacting over 4,500 employees.

Additionally, it has transversal initiatives such as Diverstars, which is a program that brings together employees to be knowledge multipliers on diversity. Through a training plan of over 20 hours, participants are trained on topics such as unconscious biases, new masculinities, disability, inclusive communication, among others.

Finally, the Company has a community hosted on Workplace with over 12,000 employees called “Diversaliad@s” where actions, communication, information, and workshops are shared to generate learning and awareness about diversity in general and in its 5 work areas. For 2023, over 60 training actions were carried out, impacting over 4,500 employees.

With the aim of managing diversity and the risk of potential discrimination cases, the Company has the Workplace Conflict Committee, through which, during 2023, 10 complaints were managed for alleged workplace harassment and no complaints for sexual harassment and/or on the grounds of gender, of which, 2 complaints were withdrawn by the passive subjects of these conducts.

There were no repair plans, however, in response to the commitments made by the parties, given the management of the Workplace Conflict Committee, these were fulfilled internally, as they dealt with the harmonization of the employment relationship.

●
Freedom of Association

GRI Content 2-30

On the other hand, in line with the Principles of Responsible Business and the Human Rights policy, the Company guarantees the right of employees to belong to the union organization that represents them, and does not tolerate any kind of retaliation or hostile action towards those employees who participate in union activities and with the third Principle of the Global Compact (companies must support freedom of association and the effective recognition of the right to collective bargaining). For 2023, 2% of the total employee workforce was covered by collective bargaining agreements. It should be noted that the Company determines the working and contractual conditions for both employees affiliated with the union organization and those who are not, in accordance with what is established by law. There is an Arbitration Award dated May 3, 2016, and it only has an impact on workers affiliated with the union organization, the Communications Workers Union – (USTC).

Salary Remuneration

GRI Contents 2-19, 2-20, 2-21

For Telefónica Colombia, it is of great importance to have a solid and consistent salary structure, which recognizes individual performance, values the importance and impact of each position within the organization, and is competitive in the national salary market. This structure is based on a systematic process that covers everything from the description to the salary assignment for the organization’s positions, as well as constant comparison with the market to determine the competitiveness of salaries.

This process is carried out based on the position and its valuation and impact on the organization, not on its occupants,
so gender is not a determining factor in calculating the salary assignment, —
nor in evaluating its behavior in
the market.

■
Salary Structure

GRI Contents 2-19, 2-20 y 2-21

The Company has a structure based on job levels resulting from a valuation, which covers a range of 12 different levels, grouping the non-managerial positions in the organization. Each level is compared for internal equity and external competitiveness to determine the corresponding salary conditions, thus avoiding bias in salary assignments for higher levels. Consequently, the remuneration defined for the occupants of the positions corresponds to the functions, responsibilities, and impact on the organization; therefore, there is no comparison in the salary assignment of a Pre-Executive level compared to the average of the organization, considering that more than 60% of employees represent the lower job levels of this scale (4 to 9).

Remuneration for all levels of the organization is set based on criteria of external competitiveness (salary market), internal equity (comparison by levels and job families), and the organization’s economic context. According to the nature of the functions of each position, a compensation mix is set, which includes a fixed salary, commissions, and an annual bonus for organizational results.

Monthly Fixed Salary: It is established that no direct employee has less than the legal minimum wage in force each year.

Variable Salary (commissions): Applies to employees who perform commercial activities of sales or customer service and whose goals are defined and measured by the Commercial Planning area.

Annual Bonus: Applies to direct employees of the organization and is typically assigned to non-commercial positions. Its allocation percentage varies according to the impact of the role on achieving business objectives. To measure the results of each Telefónica operation, fundamental axes are established year after year with a specific weight that is measured at the end of each year to establish the percentage of bonus payment for results. For 2023, the KPIs are: NPS: 5%, NPS gap: 2%, emissions: 5%, and women: 3%.

■
Compensation Ratio

GRI Contents 2-21, 405-1, 405-2

In 2023, the compensation ratio was 208%, the result of the calculation of the highest compensation assigned versus the median compensation assigned. For the calculation, the Telefónica workforce was taken into account without interns, young professionals, the foundation, or executives.

Additionally, the percentage of increases was established for the company at an average of 11.4%, with 16% being the maximum increase, taking into account the increase established by law and the parameters for meeting performance indicator compliance. For the calculation, the Telefónica workforce was taken into account without interns, young professionals, the foundation, or executives.

The Company has the Equipares Gold Seal and has an action plan to close the gender gaps identified in annual salary gap diagnoses:

■
Employee Benefits

GRI Content 401-2

The usual benefits for full-time employees of the organization are:

Disability Assistance: For disabilities of common origin, the Company provides a benefit equivalent to 33.33% of the basic income of liquidation, in addition to the value of the disability recognized by the EPS for the first 90 days and 50% for the following 90 days, so that the employee receives a total payment of 100% of their income for the first 180 days of disability. This benefit may be modified if the Company so considers.
Life Insurance: This insurance aims to cover the death of the employee or total and permanent disability. The Company assumes 100% of the policy and it is a non-legal benefit that the Company offers from the initial moment of the contractual relationship.

Paid Time Off (does not include those stipulated by law):

Extended Maternity Leave: 2 additional weeks (14 calendar days) are granted to those established by law (18 weeks – 126 calendar days), thus extending the maternity leave determined in labor regulations, for a total of 20 weeks (140 calendar days). It also applies to adoptive mothers.
Extended Paternity Leave: 6 additional working days are granted to the paternity leave granted by law (8 working days), for a total of 14 working days. It also applies to adoptive fathers.
Gradual Return or Soft Landing: Once the father and/or mother have returned from maternity, paternity, or homoparental leave, as the case may be, as an additional benefit, they can make a gradual return to their duties, obtaining a reduction of one hour in their daily workday for a period of 30 calendar days, previously coordinated with their direct supervisor. This process also applies to adoptive mothers/fathers.
School Permission: Permission for employees, regardless of gender, who have school-age children, so that they can be absent for two half-days per year to attend activities related to the celebration of family events organized by educational institutions. Likewise, permission of three hours per semester for employees, regardless of gender, so that they can go to receive report cards, which show the performance of their children.
Wedding Time: Benefit that allows taking four (4) days of paid leave to attend wedding details or go on a honeymoon without having to use another benefit. Including same-sex couples.
Domestic Calamity Permission: They are entitled to paid leave for an event that is considered serious and that could affect the normal development of daily activities, in which fundamental rights of significant importance in the employee’s personal or family life may be threatened.
Leave in case of abortion or non-viable birth: In the event that one of their partners (wife or permanent companion, including couples formed by two women), during the course of their pregnancy suffers an abortion or premature non-viable birth, paid leave equivalent to two (2) weeks.
Homoparental Leave: Paid leave for those who are in relationships with people of the same sex and whose partners give birth or are adoptive parents of a minor. Whoever indicates having primary custody of the minor will have an equivalent to what is defined as maternity leave, that is, twenty (20) weeks (140 calendar days) or twenty-two (22) weeks (154 calendar days) in multiple births. Whoever indicates having secondary custody will have an equivalent to what is defined as paternity leave, that is, they will enjoy paid leave of fourteen (14) working days.

Well-being,
Remote Work, and
Work-Life Balance

GRI Content 401-2

The Company, through the Quality-of-Life area, has two main programs in terms of time:

■
UNO Benefits

UNO Benefits is the time-based benefit program that allows all direct employees of the organization, including interns and SENA apprentices, to program 1,000 and 500 credits, respectively, on an annual basis, and enjoy the benefits they want, according to their needs and interests. The goal is for the employees themselves to plan their time, decide how many credits to use, and how to manage them, so they can enjoy more free time with their loved ones and seek to achieve a balance between work and personal life. Currently, the program has 9 benefits:

Time for Yourself: Receive half a day (morning or afternoon) to enjoy your time as you like best.
Flexible Saturday: Enjoy half a day on Saturday. Applies only to employees in experience centers.
My Birthday: Enjoy a day off during the month of your birthday to celebrate this special date.
Eight is Better: Receive an additional day for scheduling and enjoying 7 to 14 consecutive vacation days.
15 = 17: Receive two additional days for the full vacation period scheduled.
Holy Wednesday: Enjoy midday on Holy Wednesday, working a continuous shift.
Christmas is Here: Enjoy two days off in December to prepare for the Christmas celebration.
Twelve Grapes and Two Days: Enjoy two days off in December-January to welcome the New Year.
Christmas Shopping: Enjoy half a day to shop during the Christmas season.

Several options for each employee to manage their credits in the way and when it is most convenient for them.

By the end of 2023, 90% of employees had scheduled at least one time-based benefit throughout the year, with 91% being women and 90% being men, demonstrating that the enjoyment of time-based benefits by gender is quite similar.

This program was also promoted in Experience Centers, where 89% of employees in that channel scheduled at least one benefit. This distinction is made because Experience Centers have different schedules and, although it is sometimes more difficult to enjoy these time-based benefits due to the relationship with the customer, the percentage has been increasing and is very close to the general, which demonstrates that a good job has been done in terms of communication, both with leaders and with the employees themselves.

■
Movistar Moments

Movistar Moments is a portfolio of activities and experiences aimed at employees, programmable according to their tastes and interests, under a “credit” redemption system. The Company has considered seven categories to enjoy them whenever you want: Rest, Culture, Sports Activities, Gastronomy, Recreation, Wellness and Beauty, and Tangible Products. There are options that can be shared with co-workers, friends, and family, according to the city where the employee is located.

Movistar Moments also include all those activities, workshops, contests, carried out by the area during the year that do not require credits.

By the end of 2023, an average of 89% employees were able to enjoy at least one experience during the year, 91% women and 88% men. This includes both experiences and tangible products from the portal, as well as area activities.

■
E-work/Work from Home

Since 2022, the Local Instruction of the Telecommuting scheme has been approved to enhance work in terms of meeting objectives and not in terms of face-to-face time in the workplace, increasing employee commitment, identity, and motivation towards the company and the tasks performed.

The employee must have behavioral competencies such as autonomy, time organization, assertive communication, self-learning, balance, and digital competence. The permanence of the telecommuting model will be the time that the company deems convenient and which may be modified at any time, prior communication to employees.

Following this instruction, the Company works under a hybrid model, in which employees in administrative positions attend the offices twice a week, and the other three days they work remotely. This, with the aim of obtaining the advantages of both the virtual and the face-to-face world and promoting digital disconnection, time management, and digital well-being.

The company facilitates connectivity for employees through an equipment plan with unlimited data, a value that the company assumes with the granting of the equipment plan and is not paid directly to employees. The Company also recognizes the value corresponding to the electricity service that the employees’ work tools consume, under the concept of Telecommuting Assistance (according to the current policies that apply). Additionally, it offers a plan available to employees so they can purchase Movistar services with a special discount.

■
Flexible Work Hours

The Company offers a series of benefits related to time and flexibility in the workday without affecting remuneration, the main objective of which is for employees to be able to choose the option that best suits their needs and preferences. These time-based benefits are
as follows:

Flexible Schedules

From Monday to Thursday, employees in administrative positions can choose to work in any of the following schedules, established by the Company:

6:00 a.m. 4:00 p.m.

7:00 a.m. a 5:00 p.m.

8:00 a.m. a 6:00 p.m.

9:00 a.m. a 7:00 p.m.

This should always be discussed with the leader and the rest of the team so that everyone can be aligned and respect the schedule of each member.

Unplugged Friday

Every Friday of the year, employees have the possibility to work on a schedule of 8:00 a.m. to 2:00 p.m. on a continuous shift. This benefit does not contemplate the recovery of hours or salary deductions and applies according to the role.

Employees in Experience Centers are not included in this measure. However, they can enjoy the benefit “Two Days for Friday Schedule” through SuccessFactors by means of which they access two consecutive days of paid time, in addition to their vacation period.

■
Parental Leave

GRI Content 401-3

In 2023, 144 employees requested parental leave: 82 women were entitled to maternity leave and 62 men to paternity leave.

Similarly, 113 employees, 61 women and 56 men, returned to their jobs in 2023 after leave, which may have started in 2022 or 2023. Currently, there are no cases that meet the condition of continuing 12 months after returning to work. 14 women are on maternity leave as of the end of 2023.

The return and retention rates of employees who took parental leave were 100% for both women and men.

The return and retention rates of employees who took parental leave were 100% for both women and men. —

Employee Development and Performance

GRI Contents 404-1, 404-2

The Company has a training policy that includes ongoing knowledge updates for all employees. During 2023, the following training programs were implemented:

The cultural training program was updated with a focus on Agile organization and organizational modes, reinforcing these skills through the Lean Agile Academy.
The bootcamp for the Scrum Master role
was updated, adding the roles of PO and
Agile Coach.

Training paths on the UDEMY platform continued to be developed, currently with over 500 paths, for digital and critical Company profiles to ensure continuous knowledge updates in areas that require constant innovation within the Company, such as BI, IT, Network, Digital Relationship, and Technology.
• The CX Academy was launched for the entire Company to drive a customer-centric culture that allows providing the best service and keeping the company at the forefront.
The Digital School was conducted in association with ITBA (Instituto Tecnológico de Buenos Aires) granting graduates certificates in Digital Immersion, Digital Expert or UX, according to the assigned specialty. Likewise, a training in UX/UI design was carried out in conjunction with the Hispanic Colombian Chamber of Commerce.
• The Master Leader program was launched for organizational Leaders, seeking to accompany these employees in the development of their professional and personal skills and competencies, providing tools for sharing and executing with their work team. Likewise, conversation circles were created that allow sharing best practices among peers. In 2023, 611 leaders from Colombia participated; this program will continue in 2024.
Training through the Dexway Language program continued, where employees could access an English, Portuguese and German language license. The average hours per employee was 69.5. In the case of men, the average was 56.9 and for women 83.8. However, by job level, the individual contributor had an average of 72.5 hours; in middle management it was 50.3, and at the Valora level (executives) it was 12.8.
On the other hand, the Company has developed the DesarrollaT skills program, that seeks to create spaces for collaborative learning that allow the enhancement of the professional and personal skills. There are 11 available topics so that they can continue developing their skills. The program was 100% virtual with online instructors. Each one has a range of workshops to participate in openly, anyone interested can register, with no limit on the number of courses to take, it can be through a webinar or selected from the E-Learning offer. In 2023, 542 people from Colombia participated.
There is also a wide range of programs in Universitas (Corporate University), based on a monthly offer that allows responding to the changing business context and conjuncture, which demands that companies have continuous reskilling, through courses that are designed to promote leadership and growth, both personal and professional. In 2023, 184 people from Colombia participated in the different programs. The Mentoring program seeks to develop people’s potential, through learning and transfer. In 2023, 51 mentees and 44 mentors participated.
In 2023, the ESG Academy was launched, a global space to train and promote a culture of sustainability in the Company, available to all employees as a repository of courses and information of interest related to ESG issues, that is, it incorporates transversal contents and topics that touch on any of the three dimensions of sustainability, from the environment to diversity, including cybersecurity, ethics and compliance, among others. The content includes internal and external courses, podcasts, webinars, videos or articles of interest, as well as reference web pages.

Occupational Health
and Safety of Employees

GRI Contents 403-1, 403-2, 403-5, 403-6, 403-7, 403-8, 403-9

The Occupational Safety and Health Management System (SGSST) is designed, developed, implemented and under the international standard ISO 45001 version 2018. An external audit is received annually to verify compliance and ratify the Certification issued by the Certifying Body. Likewise, for the management of the SGSST, there is a process for identifying legal requirements, taking as reference Decree 1072/2015 and Resolution 0312/2019 and others, within which an analysis is carried out of each of the regulatory requirements applicable to the organization in terms of Occupational Safety and Health, on which compliance is evidenced under the annual verification that is carried out.

While these requirements do not involve Certification of the Occupational Safety and Health Management System (SG-SST), an annual process of Minimum Standards Evaluation of the SGSST is carried out, under the checklist defined in Resolution 0312/2019. This validation is reported to the Ministry of Labor and the Occupational Risk Insurer. When the result is ACCEPTABLE, it means that it is equal to or greater than 86% and the Company’s result in 2023 was 97%.

The SGSST covers 100% of employees, that is, a population of 4,950 employees, activities and workplaces for each of the cities where the Company operates nationwide. The deployment of the SGSST is carried out throughout the year, with the participation of all the Company’s directors and managers. Workers from allied companies are determined within the Responsible Allies program.

The process for identifying hazards, assessing and evaluating risks is carried out under the methodology of the Colombian Technical Guide GTC45 version 201 People Focus and Site Focus.

In the people focus, Similar Exposure Groups are grouped (by job types) where each of the activities carried out by the Company’s employees is considered, as well as the risks related to the telework modality and the job types to which it applies.

The classification of the people focus is as follows:
IDEUR Matrix by Job Type – People Focus

Management

Perform their administrative activities, generally at a desk in front of a computer, at company premises and outside (teleworking).

Store (CE)

Perform their commercial activities, generally at a desk in front of a computer, with attention to the public who visit the workplace (commercial establishment).

Commercial/Management

Perform their administrative and commercial activities at the company and outside (teleworking), generally at a desk in front of a computer, with displacement outside the assigned workplace to carry out work or commercial activities.

Operational/Administrative

Alternate their tasks at the company and outside (teleworking), performing administrative activities (at the assigned workplace, generally at a desk in front of a computer) and operational activities inside or outside the assigned workplace (in the field), where they supervise and receive the work of contracting companies.

Operational/Heights

Alternate their tasks at the company and outside (teleworking), performing administrative activities (at the assigned workplace, generally at a desk in front of a computer) and operational activities inside or outside the assigned workplace (in the field), where they could perform work at a height greater than 2.0 meters (if so required by the operation), as they are authorized to carry out such work under the procedures defined by
the Organization.

Commercial/100% fieldwork

Perform their activities in areas with a commercial interest population (sale of fixed products door-to-door and mobile).

Under the Site Focus, two tools are considered that allow identifying and assessing the hazards and risks specific to each site, which are the Vulnerability Analysis and the Hazard Identification, Assessment and Risk Evaluation Matrix by site type. This input allows establishing specific controls according to the environment and the specific characteristics of the site, aimed at preventing unwanted events.

This matrix is the main input of the Occupational Safety and Health Management System, as it is where the priority risks that require management programs or epidemiological surveillance systems are determined, which allow the reduction of employee exposure to risk factors that have the potential to generate work accidents or occupational diseases.

In this sense, the matrix must be

updated as follows:

At least once a year.
When a serious or fatal work accident occurs.
When the risk is evidenced in an inspection and has a high potential to cause harm to people.
When a work accident occurs and the risks that caused it were not identified.
New legal requirements or changes to existing ones that impact the SG-SST.

The hazard identification, assessment and risk evaluation matrices are prepared by professionals with a valid license in Occupational Safety and Health.

Workers have various channels available where they can actively participate and consult the SG-SST, as well as report hazards or situations that pose a risk to their safety and health. Among these mechanisms, the observations provided by employees during the deployments of the Occupational Safety and Health Management System, the reporting of unsafe acts and conditions and communications sent to the Occupational Safety and Health Joint Committee, among others, stand out. Employees play a very important role within the System, therefore, their participation is permanent and is encouraged through open channels and within their reach.

The System includes the rights and duties of workers for the execution of activities, as well as communication channels with immediate superiors and Business Partners to report situations or news, which are evaluated by the SST team and determine the level of relevance and materialization. No employee is required to work under conditions that compromise their safety or health.

Work accidents are investigated under a specific methodology for Colombia, which considers the type of event that occurred, the hazards and risks existing in the event, the “5W+1H” methodology is applied to establish a clear description of the event, all information associated with the occurrence of the event is collected, under all verification of the information and description, a causality analysis is carried out to conclude with the root cause generating the event and establish the corrective and preventive actions to avoid repetition.

■
Occupational and Preventive Medicine

GRI Content 403-3

The occupational and preventive medicine process of the SG-SST focuses on occupational medical examinations, medical case monitoring, origin qualification processes, absenteeism due to medical reasons and indicators of prevalence and incidence of occupational disease.

In addition, all workers and five (5) of their family members have free access to 1DOC3, a health and wellness platform through telemedicine, in different areas: general medicine, psychology, nutrition, pediatrics, sexual and reproductive health and veterinary medicine, among others, 24 hours a day, 7 days a week.

■
Employee Participation and Consultations on SST

GRI Content 403-3

The Occupational Safety and Health Management System has various mechanisms for employee participation and consultation, such as:

Occupational Safety and Health Joint Committee – COPASST
Labor Coexistence Committee
• Road Safety Committee
Management review
Internal customer – Remedy
Reporting of absences due to health reasons
Reporting of health conditions
Business Partner, SST Team, administrative and regional leaders
Live events, campaigns and notes
Participation in hazard identification associated with the role
SST training
Participation in eNPS measurements
Employee culture and experience

The Occupational Safety and Health Joint Committee – COPASST, is the body composed of representatives of workers who are elected by vote nationwide and by the employer who are appointed by the representative of senior management, whose main function is to maintain permanent communication of the needs and results of the Occupational Safety and Health Management System. The committee has a term of two (2) years, is operational, meets regularly every month and, if required, extraordinary meetings are held, leaving a record of the activities and topics discussed in a freely available minute to employees nationwide.

■
Worker training on
occupational health and safety

GRI Contents 403-4, 403-5

In 2023, 800 training sessions were conducted, equivalent to 9,001 hours. Among the courses, the following can be highlighted:

50-hour course on the SGSST for new members of the Occupational Safety and Health Joint Committees (COPASST), Labor Coexistence Committee, Heights Coordinators
20-hour reinforcement of the SGSST course and general information on the Occupational Safety and Health Management System and the Environmental Management System
Preventive Management Training:
Prevention of Locative Risk on the Street in PAP and Prepaid, Prevention of Public Risk in PAP and Prepaid
Safe Mobility, Road Safety and Risks on the Street and Roads in PAP and Prepaid
Emergency Prevention (Earthquakes)
Hazard Identification and Assessment (risks associated with labor)
Induction/Re-induction of the Occupational Safety and Health Management System
Electrically Safe Work Condition:
Supervision of electrical maneuvers with and without voltage
Prevention of Behaviors that Affect Labor Harmony
Integrated Management System Course
Healthy lifestyle – Prevention of Musculoskeletal injuries, Therapeutic and Ergonomic School, Psychosocial Risk Talk, Lessons learned – Work Accident
Retraining of Workers Authorized for Heights and Safe Work Coordinator at Heights
Socialization of the Emergency Response Plan, First Responder (First aid and firefighting: Fire extinguisher), Reinforcement of Emergency Preparedness and Response (Firefighters) and Emergency Drill Practice

■
Promotion of health, prevention
and mitigation of impacts on SST

GRI Contents 403-6, 403-7

All Telefónica Movistar employees are affiliated with health promotion entities from the moment they join the Company, and health promotion and prevention activities are also carried out based on the results of health condition reports, absenteeism results due to medical reasons, and face-to-face and virtual activities are carried out with the objective of promoting employee participation.

In addition, information on mental health is shared through internal communication channels: Emotional intelligence, Stress management, as well as other topics of interest. Talks and workshops are also held on corporate happiness, breast cancer, how to act in a crisis situation, work-life balance, emotional regulation, laughter therapy workshop, coping with grief, learning to let go, among other topics of interest.

The Occupational Safety and Health Management System covers all activities, operations and employees, including sales channels. There is a hazard identification, assessment and risk evaluation matrix for similar exposure groups C1, C2 and C5, and within the deployment activities of the Occupational Safety and Health Management System, specific actions are carried out for employees of sales channels.

■
Work accident injuries

GRI Content 403-9

Although in 2023 the Company did not have any cases of death in operations, there were two events with major consequences for a rate of 0.1815. Likewise, there were 48 reportable work accident injury events for a rate of 4.356. For its part, the total number of man-hours worked was 11,019,564.

In the case of workers who are not employees, there were no deaths, however, there were 6 events with major consequences for a rate of 0.274, and 320 reportable work accident injury events for a rate of 14.613.

The total number of man-hours worked was 21,897,224. Both for workers and non-workers, among the most frequent types of accidents, the following occurred: sprain, strain, muscle tear, hernia or laceration of muscle or tendon without wound, blow, bruise, wound, multiple injuries, fracture and dislocation. The occupational hazards that pose a risk of work accident injury with major consequences are determined in the survey of the hazard identification, assessment and risk evaluation tool, where they are prioritized and a risk management program or an epidemiological surveillance system is determined focused on reducing accidents, with the implementation of intervention measures by risk control hierarchy. The hazards that have caused or contributed to the injuries have been: locative due to displacements, road dangers and in sports competitions.

Risk Management Programs are defined in order to determine specified actions focused on reducing risk and jaccidents. The rates were calculated for every 1,000,000 hours worked.

■
Occupational illnesses
and diseases

GRI Content 403-10

There were no employee deaths related to occupational diseases in 2023. However, there was one case of occupational disease in a worker with three diagnoses (carpal tunnel syndrome, lateral epicondylitis and radial styloid tenosynovitis); associated with hazards related to musculoskeletal disorder risks.

Among the measures taken to eliminate these hazards and minimize risks through the control hierarchy, there is an Epidemiological Surveillance System for Musculoskeletal Disorders in which control measures to be implemented are defined, including work station inspections at home and in the office, assignment of ergonomic elements, training on postural hygiene, and follow-up of symptomatic cases, among others.

Human Rights

GRI Contents 2-22, 2-23, 2-24, 2-27, 412-1, 412-2

Human rights are a material topic for Movistar. For this reason, the Company has made progress in developing actions that contribute to their management, following and monitoring their impact, through the implementation of a human rights due diligence process, as established by the UN Guiding Principles on Business and Human Rights. In line with these principles, Telefónica Movistar is responsible for respecting the human rights of all its internal and external stakeholders, in the development of its operation. While this responsibility is complementary to the State’s obligation to protect these rights, it does not exempt the company from ensuring them when the State and/or the national legal framework do not fulfill this responsibility.

Telefónica Movistar recognizes and acts aligned with high standards and international conventions on human rights. Defining corporate policies where human rights issues are integrated, such as Telefónica’s Responsible Business Principles – PNR (or Code of Ethics), which include the company’s commitment to respect for human rights. This commitment extends from employees to its commercial and operational partners from the moment it formalizes the commercial relationship with the company.

Similarly, it has a Human Rights Policy, aligned with the Responsible Business Principles and transversal to other corporate policies related to respect for human rights, such as gender equality; people with disabilities; diversity and inclusion; sustainability in the supply chain; the protocol for relations with communities; and the set of procedures that consolidate labor policy.

Telefónica’s commitment to respecting and promoting human rights has been developed around areas that cover its sphere of influence and in its relationship with employees, suppliers, customers and society in general, which is reflected in the following commitments.

Commitment to the customer: Privacy, security, freedom of expression, the development and responsible use of products and services, protection of minors, non-discrimination.
Commitment to the employee: Diversity, inclusion and equal opportunities, safety and health, freedom of association and the right to collective bargaining, forced labor and slavery, child labor.
Commitment to society: Anti-corruption, digital inclusion, environment and communities.
Commitment to respect for human rights in the supply chain and in relations with commercial partners.

Risk Management and
Remediation Measures
for Human Rights Impacts

GRI Contents 2-25, 412-1

The telecommunications sector and new technologies today play an important role in promoting human rights, as diligent management can contribute to the progress of countries and improve people’s quality of life. However, this new context and the accelerated use of technology bring with them a series of challenges associated with privacy, freedom of expression, equality, and employment. Therefore, in an increasingly digitalized world, today the Company’s challenges are that human rights are also guaranteed in the digital environment.

The Company seeks to favor and preserve the well-being of the social environments in which it is present, which is why it has been managing human rights since 2009 through the application of due diligence principles in its processes, in order to identify, prevent and manage possible risks of human rights violations.

In the Company’s operation, due diligence focuses on the promotion and application of the Global Human Rights Policy, risk impact assessments, transversal integration of human rights in processes, and the establishment of a complaint and claim mechanism attentive to human rights to foster stakeholder engagement.

Following the Corporate Risk Management Manual, the Company identifies Human Rights Risk as Basic, which is composed of 5 subjects, which may evolve over time. Each of the subjects encompasses several areas where it can have an impact on human rights, such as privacy, diversity and non-inclusion, and safety and health.

In this way, with the aim of fulfilling the new regulatory requirements in terms of human rights, a comprehensive analysis of the possible impacts of the Company’s activity on human rights is carried out every 3-4 years at the Group level, and thus observe the variations of the impacts over time. Likewise, the effectiveness of the action plans and response to risks is monitored through a semi-annual evaluation through indicators.

The main subjects associated with human rights risks are:

Operations for the development of activity: Risks resulting from the management of assets and the processes necessary for the provision of services by the Group.

Offer of products and services: Risks related to the marketing and end use of the products and services offered.

Management of suppliers and strategic partners: Risks emerging from the activities of suppliers and strategic partners.

Human Resources Management: Risks derived from the management of Telefónica employees.

Governance: Risks arising from the management of internal governance mechanisms.

Digital trust:

protected digital rights

In an increasingly digital world, it is essential that people can trust that their data is private, secure and managed transparently. Therefore, the company designs policies and processes that ensure complete transparency about how your data is collected, stored, used and protected, how Artificial Intelligence is used ethically, and how it promotes the responsible use of technology.

As a demonstration of its progress in 2023, Movistar reaffirmed its leadership, ranking first among all telecommunications companies in the country evaluated by the Karisma Foundation in its Where is my data? report, which in the last edition raised the level of demand for advertising indicators, in order to make information public and clarify all thematic axes. This initiative analyzes and makes more transparent the performance of Internet providers regarding the human rights of people and their commitment to the protection of the rights to freedom of expression and privacy, as well as its political commitments in matters of accessibility,

The Company takes special care in the handling of personal data of its users and identifies this responsibility as a possible source of negative impacts. In its role as data controller, it has implemented various actions to mitigate as much as possible the occurrence of any negative impact related to the right of users over their personal data, as explained below.

In terms of Personal Data Protection, the Company recognizes the importance of assuming a commitment within the Company that guarantees the due fulfillment and effective development of the Accountability or Demonstrated Responsibility Principle, as it is called in Colombian legislation. To this end, the Company has implemented concrete actions that allow it to increase its standards in terms of Personal Data Protection and Information Security, with the aim of guaranteeing its users an adequate handling of their personal information and the certain and efficient compliance with the current legislation on personal data protection. In accordance with the above, policies and programs have been developed that establish the internal guidelines for the proper fulfillment and implementation of these provisions contained in the Personal Data Protection Law, its regulatory decrees and/or other provisions of the Data Protection Authority and international standards, among which the following are included:

PQRs (petitions, complaints, claims) attention processes, data suppression, among others.
A Comprehensive Personal Data Management Program.
Continuous training courses and programs nationwide and for all Telefónica Group companies worldwide.
A Data Protection and Habeas Data Committee.
An Information Security Incident Committee.
Activation of security and information recovery protocols.
A Data Protection Officer.
A Corporate Data Protection Officer in charge of all DPOs (Data Protection Officer) of Telefónica Group companies.
A specific area for attending PQRs related to data protection.
A Personal Data Protection Center of Excellence at the Hispam level that reviews the topic of Personal Data Protection weekly in all Telefónica operations in Hispam.
Guides, guidelines and instructions through Internal Directives.
Personal Data Protection Policies at the local and corporate level.
Information Security Policies at both the local and corporate levels.
Online registration of Databases with the Authority.
Audits by the Internal Audit area and by Corporate Audit.
Audits of third-party data processors.
Audits by external companies specializing in Data Protection.
A technological tool that allows providing the necessary security levels and/or measures to databases and files that contain personal data, such as the CETI tool.
A technological tool that allows efficient administration of files and/or databases containing personal data, such as the

Privateca tool.

Personal Data Transfer and Transmission Agreements; DPAs (Data Processing Agreement); Data Processing Sheets between group companies; Binding Corporate Rules (Under review and approval by the data protection authorities of Spain and Germany).

As you can see, due to the size of the Company’s operations, both locally and globally, the commitment from senior management to the legal discipline of Data Protection is very serious and responsible.

The Company’s actions at the local level, in alignment with those of the Telefónica Group,
aim to continue fostering a culture of respect for the protection of personal data within the Company —
one that ensures that the data obtained is used exclusively for the purposes for which it was collected and authorized by the data subjects or owners.

Human Rights Commitments
and Working Boards

GRI Content 2-28

At Telefónica Movistar Colombia, we seek to favor and preserve the well-being of the social environments in which we are present, which is why we have been managing human rights since 2009 through the application of due diligence principles in our processes, in order to identify, prevent and manage possible risks of human rights violations.

A key element for the management of Human Rights is focused on the updating and permanent participation in spaces for dialogue and knowledge management on the matter, which is why the Company continued to participate in 2023 in initiatives that promote the responsible management of Human Rights in business environments.

Colombia Guidelines
on Human Rights

Telefónica Movistar Colombia continues to participate and be an active member of the multi-stakeholder initiative Guías Colombia on Human Rights (HR) and International Humanitarian Law (IHL). Within the framework of this initiative, the following activities were carried out in 2023:

Development of the first draft of the Colombian Guide on Human Rights Due Diligence in the Area of Climate Change and Just Transition, which will be launched in 2024.
Participation in learning sessions for the leveling of capacities in terms of trends and recent advances in the business agenda, human rights and responsible business conduct, aimed at all members of the initiative.
Territorial sensitization meeting on human rights due diligence for SMEs, held in the city of Medellín.
Monthly plenary sessions: Participation in eleven monthly plenary sessions to generate exchange and feedback on the contents of the initiative.
Movistar participated in the Guías Colombia Annual Event, which had wide multi-stakeholder participation, where dialogues were generated around the topic of the transition to a low-carbon economy.

●
Guías Colombia Human
Rights Self-Assessment

GRI Content 412-1

Telefónica Movistar Colombia implemented the Self-Assessment Tool for the Community Engagement Guide, which is composed of 9 transversal indicators of business due diligence in human rights and 42 specific indicators in terms of community engagement.

The self-assessment tool allows visualizing the company’s progress in the implementation of specific issues in terms of Community Engagement under a PHVA cycle approach, identifying opportunities for improvement and aligning internal areas and programs that strengthen this management.

% Progress Movistar Implementation
of the community engagement guide

The self-assessment yielded a progress in implementation of 82%: the transversal issues of business due diligence in human rights have a progress of 80% and the progress in the implementation of the specific issues of the Colombia Community Engagement Guide is 84%.

■
Other HR Participation Spaces

Participation in the Commission of Sustainable and Responsible ESG Companies, an initiative promoted by the Hispanic Colombian Chamber of Commerce and the Spanish Embassy in Colombia, which is a space for meeting and dialogue in the areas of sustainable development and human rights between Spanish companies operating in Colombia, and from which lines of work are agreed upon to advance in the development of corporate social responsibility actions and compliance with due diligence in human rights.
The Company joined the ‘Alliance for Human Rights in Business Contexts’ led by the Ombudsman’s Office, which has the primary objective of promoting compliance with the ‘2030 Agenda for Sustainable Development’ and promoting the prevention of negative impacts in the business sphere.
Participation in the Human Rights Board of the Global Compact Local Network Colombia.

Human Rights Training

GRI Contents 404-2, 410-1, 412-2

During 2023, the Company continued with the training process on the Responsible Business Principles, which incorporate, among other things, a chapter related to respect for and promotion of Human Rights and Digital Rights. As of December 31, 2023, this course had been completed by 91% of the workforce.

Likewise, the promotion and training of the Supply Chain continued. Specifically, training aimed at security personnel. The Company’s current Security scheme covers the protection of people, assets and infrastructure and is in charge of the allied companies Seguridad Atlas Ltda., Prosegur S.A. Cía.

Security and Honor Security Services Ltda. —

Prosegur S.A. Cía. de Seguridad:
The company, within its training plan, has established, from the Prosegur University, an online Human Rights course that aims to recognize which behaviors can affect human rights and what are the obligations of the State, companies and individuals in each specific case. As of December 2023, the coverage for personnel assigned to the Telefónica device is 70%.

Seguridad Atlas Ltda.:
The company’s training process is carried out in two modalities and, as of December 2023, the coverage for personnel assigned to the Telefónica device is 84%:

Virtual Modality: Through the UniAtlas Virtual Campus, training is provided in the Induction processes: Code of Ethics, Anti-Bribery Policy and Human Rights; Comprehensive Development Day (Re-induction): Human Rights, Diversity and Inclusion and Virtual Training: Human Rights Course and Diploma in the use of force with an emphasis on international humanitarian law.

Distance Modality: Re-induction Handbook for the provision of Service for Telefónica, which includes the topics of Code of Ethics, Anti-Bribery Policy, Human Rights, Ethics Line, Siplaft.

Honor Servicios de Seguridad Ltda.:
The company has established courses taught virtually on human rights, gender equality, due diligence, among others. As of December 2023, the coverage for personnel assigned to the Telefónica device is 100%.

According to the distribution of personnel from each of the Allied companies, the total percentage of Human Rights training for Security personnel assigned to the protection of people, assets and infrastructure of Telefónica is 85%.

Governance
Management

G – Lead by Example

Customer Management

Movistar works to achieve the best customer experience and satisfaction. In the recertification process of the Quality Management System (SGC), structured under the ISO 9001 standard, it was highlighted, among other things, that the Company has been recognized as a benchmark in business agility, being above the average of the region, as well as the meticulous work that is carried out in the monitoring of risks, which allows obtaining better results in each of the processes.

■
Customer Experience and Care

Technological resources, speed of response in the design and implementation of strategies and the support of allies, have allowed enabling everything required to strengthen call and digital service channels, as well as to develop self-service solutions so that the customer has the ability to carry out their frequent consultations and transactions at a click of distance.

To achieve this continuity and in the face of the imminent displacement of face-to-face services towards virtual or telephone services, the strategic axes are ensured: Strengthening of social network services, self-service and multi-channel Interactive Voice Response (IVR) and self-service digital channels.

To this end, initiatives such as the following were implemented:

#TeContestamosTeSolucionamos: Focus on guaranteeing agile and easy access to the telephone channel, Experience Centers and WhatsApp. To this end, the Company monitors high-impact incidents that affect access to service channels, to ensure their resolution and mitigate the impact. Thanks to this, a 99.4% availability of access to the telephone channel was consolidated, plus a 4 pp increase in the transactional NPS of the VOZ channel and a 1.6 pp reduction in customer recurrence between channels.
Incorporation of artificial intelligence in the IVR Cognitive Agent. Likewise, the processes were adjusted to carry out automatic transfer from the IVR to digital channels, with which it was possible to attend 768 thousand transactions and direct 3.2 million calls in 2023, allowing solving through self-service, reducing friction due to transfers.
Soy Guía Bot Movistar for self-service and first-contact solution processes. Self-service developments through the WhatsApp channel with the Soy Guía Bot Movistar: Balances and payments, Know your Plan, Prepaid Customers, Sales and Offers, Technical Support, etc. In 2023, through B2C Chatbot, a total of 970 thousand unique customers were served on average per month, who carried out 1.1 million sessions, with a containment of 75%.

Improvements in platforms for a better browsing experience. The mobile network speed test measurement was developed in the Mi Movistar App, complying with regulations. At the end of 2023, there were 3.9 million customers who have downloaded the app and who carried out 12.5 million transactions.
Strengthening of Soft Skills in Experience Centers through workshops focused on service sensitization. This is a process of continuous improvement and constant application, which translates into:

A disruptive and high-impact content created in the monthly service workshops, developing soft skills that bring teams together, achieving a close and warm relationship with the customer. In 2023, the kindness target was exceeded by 0.2. It reached 1,300 advisors with an average of 12 hours of training per year in 91 offices.

Service becoming experiences: waiting was managed and customers were provided with appointments for an average of 9,900 scheduled customers per month.

Overachievement of solution and kindness targets with 102% and 104% respectively, as well as 99% compliance in satisfaction.

Implementation of the Initiative:
+Solución +Satisfacción in the face-to-face channel and service, with the aim of leveraging the management of dissatisfied customers and ensuring the customer promise. This resulted in the following improvements in the face-to-face channel:

The ISC target was exceeded in all months of the year, reaching a historic ISC in July (8.94).

The Close the loop methodology was implemented in focus offices.

Customer Satisfaction:
Net Promoter Score (NPS)

The measurement of customer management focuses on the level of recommendation (NPS – Net Promoter Score) based on the ACSI (American Customer Satisfaction Index) model developed at the University of Michigan and used worldwide in companies in different sectors, under a corporate-level defined methodology that allows comparison of the different Telefónica operations in the world.

This methodology applies surveys to randomly selected customers from the active pool, ensuring representativeness of regions and segments, which are processed by an external market research firm, ensuring objectivity and are subsequently subjected to audit and control processes. During 2023, a total of 68,856 surveys were conducted for a monthly average of 5,738 in-depth surveys with customers.

It is a fact that the NPS result for 2023 falls, breaking the upward trend that has been historically carried, an effect that is also observed in competitors and in other countries, affected, among other things, by the country uncertainty that affects customer sentiment. The perception of the service operation was affected by the significant increase in massive damage caused by vandalism by third parties to the network infrastructure, cable theft and public works. Likewise, customer dissatisfaction was generated due to the price increases that have been applied in an inflationary macroeconomic situation.

The decrease in the level of recommendation result mobilized the entire Company to identify processes, policies, and platforms that were degrading the customer experience and a plan was defined with 11 structural initiatives with weekly monitoring by the executive committee of the identified action plans; multidisciplinary work teams were generated to delve into the root cause of problems and ensure solutions, even involving authorities, suppliers, best practices of other companies and support from the Company’s global and regional team.

Having understood the impacts that caused this degradation in NPS levels, the company focused on the execution of the actions defined based on the voices of its customers, in order to accelerate the capture of value in satisfaction that will allow it to grow in recommendation for 2024. All this supported by the actions of the transversal operations teams as follows:

●
Invoicing, Billing and Collection

The time a customer takes to carry out a transaction in the collection machines at the experience centers was reduced by 30%, through the simplification of steps and interaction with the machine, making them more intuitive and easier to use.
Improvement in the payment gateway including new market trends such as Nequi – Daviplata, which has allowed improving the customer experience by reducing payment times by 20%.
Optimization of billing processes, improving billing delivery times by 40%.
Personalization of invoicing notification, billing and collection messages according to their payment preferences, statement and product type, contributing to the increase in digital payments that closed at 67% and in the increase to payment on maturity that closed at 53%.

●
Commercial Support

The attention in the first line of customer requests increased to 99.84% and a referral to the Back Office of 0.16% with automatic levels of 98.89% of these derived requests.
The Company’s sales force digitalization tools were enhanced, allowing to improve the times and processes of sales and after-sales with customers.
Compliance with Law 2300 was ensured, seeking to protect the right to privacy of customers and continuity was given, protecting users with compliance with the Habeas Data law. Decreasing the number of interactions with the customer, being effective in communication through authorized means, ensuring that they continue with their good payment behavior.

●
Logística

The Company increased the effectiveness of final customer delivery from 81% to 85%, contributing directly to the income of the mobile commercial operation and generating greater satisfaction with final customer delivery compliance.
A Focus Group was held with the face-to-face channels to improve the process of managing home delivery orders, which helped to improve customer satisfaction and process clarity.
During 2023, a re-entry indicator below 1% was achieved, reflecting the management and quality of the after-sales service workshop for final customers.
With regard to the technical service management times for final customers, it was possible to maintain an average solution time of six days, generating a better service in quality and overall management.

Processes for Mitigating
Negative Impacts

GRI Content 2-25

While the Company has regulated service channels to handle all Questions, Complaints and Claims (PQRs), actions have been developed to improve the customer experience through digital and self-service channels focused on solving those issues that are most recurring with users.

Comprehensive management of the root cause of claims on billed concepts, closing 2023 with 0.24% at the Company level, achieving a decrease compared to the 2023 results (0.28%).
Implementation of preventive controls was consolidated to identify in advance the need for correction of offers in systems and adjustments, achieving more secured offers, parameterized correctly and with assured billing with respect to the promise offered to the customer. This allowed closing the year with less than 0.5% of findings and needs for offer correction in the face of the sales promise.
To manage the root cause of claims, the inter-area committee (REC Committee) continued, where findings are socialized and the elimination of the root cause is managed with the corresponding areas, with bi-weekly follow-up and evaluation of improvements in indicators, a visible result in the percentage of claims received with respect to the plant (0.24%).
Implementation of a process of massive analysis of claims, where based on the observations, adjusted charges and operations executed in the system, the cause of the claim is confirmed, and the execution of the solution is ensured. A review and identification of 60% of general cases has been achieved, and 80% of the most representative typologies.
Simplification of self-service activation flows through the Mi Movistar App, reducing steps that facilitate customer management, who currently also have the option of easily deactivating through self-service, in line with the Company’s transparency value.
Through CX Labs, spaces with clients and interdisciplinary areas to build or improve the user experience regarding services, and increase loyalty, key business processes were managed during 2023, resolving pain points found in moments of truth with customers.
The sales promise assurance and solution assurance plan contributed to the prevention of cancellations, as 10% of uninsured customers decided to leave the Company, compared to 2.8% of insured customers.

Digital Accessibility and Support
for People with Disabilities

Movistar has a special attention approach for people with hearing and visual disabilities. This is how it implements different tools, improves processes and internal procedures, in order to offer people with disabilities the possibility of accessing prioritized service channels and contribute to reducing the digital gap of Colombians with disabilities.

Among the actions, the launch of the “Movistar Sin Barreras” offer stands out, with a 15% lifelong discount benefit exclusively for people with disabilities to apply to postpaid mobile plans (current commercial offer) and any home internet plan (fiber or copper).

The Company also designed a Special Attention Protocol for People with Visual and Hearing Disabilities. This is implemented and socialized with all the advisors of the Experience Center channel; it comes accompanied by sensitizations and training in inclusive language and awareness, continuous training for collaborators to provide excellent service through reinforcement with tips and guidelines for specialized and adequate attention to people with disabilities in the acquisition and/or advice on products and services, as well as attention to requests or petitions from clients and users with disabilities. The Company had the support of the National Institute for the Blind – INCI and the National Federation of the Deaf of Colombia – Fenascol to structure this protocol.

Additionally, it launched the adaptation of 42 accessible Experience Centers enabled in 31 cities nationwide that have exclusive equipment and personnel for attending to people with hearing disabilities, through Servir, a platform of Fenascol. And since 2022, Movistar has allowed the use of the Ministry of TIC’s Relay Center app without data charges for its Movistar customers so that they can communicate with interpreters.

Portfolio Awards

Telefónica Movistar was recognized by the Portfolio Awards in the Customer Service category, for its approach to attention to people with hearing and visual disabilities. Highlighting actions such as the implementation of differential attention protocols to this population and Movistar Sin Barreras, an offer with a special benefit for people with disabilities.

Corporate Governance

With the aim of preserving the integrity of the administrators and safeguarding the interests of the organization, the Company has a Code of Good Governance (hereinafter “the Code”) which aims to “guarantee its proper administration, public knowledge of its management and the mechanisms for evaluating and controlling such evaluation.”³ This Code governs the Company’s ethical behavior and compiles the administration, conduct, information and control standards to which it is subject. Its general principles include, among others, the sustainable investment model, fair competition, and sustainability.

3. Code of Good Governance Number 1.2..

Governance Structure

GRI Contents 2-9, 2-10, 405-1

■
Board of Directors

GRI Contents 2-12, 2-13, 2-14, 2-17, 2-18

The General Shareholders’ Meeting appoints the members of the Board of Directors subject to the provisions of the Bylaws and, while the company is listed on the stock exchange, to the provisions of Law 964 of 2005 and the regulations that amend it. The Board of Directors is made up of 10 principal members, with their respective personal alternates. While the Company is listed on the Colombian Stock Exchange, the Board members will not have alternates.

The Bylaws, the Code of Corporate Good Governance and its Annex No. 3 – Board of Directors Regulations establish that the members of the Board of Directors will be professionals of high moral and ethical quality, with management competencies of leadership that allow them to contribute to the Company through their special knowledge of the information and communication technology sector, financial and risk aspects, legal issues, commercial matters and crisis management. Likewise, they establish the obligation that 25% of the members be independent, adopting the independence criterion and the requirements established in Law 964 of 2005.

The profiles of the Board of Directors members are published on the website https://www.telefonica.co/accionistas-e-inversionistas/gobierno-corporativo-2/modelo-de-gobierno/junta-directiva-de-colombia-telecomunicaciones-s-a-esp-bic/

●
Composición Junta Directiva

Row	Name	Gender	Non-executive level	Age	Quality	First Appointment
1	Alfonso Gómez Palacio	Male	Executive	55	Capital	19/12/2006
2	Fabián Andrés Hernández Ramírez	Male	Executive	53	Executive	7/10/2011
3	Luis Ángel Prendes Arroyo	Male	Executive	57	Capital	27/11/2019
4	Diego Colchero Paetz	Male	Executive	50	Capital	27/11/2019
5	Martha Elena Ruiz Díaz-Granados	Female	Executive	56	Executive	9/08/2012
6	Pedro Alberto Ramón y Cajal Agüeras	Male	N.A.	70	Independent	5/11/2010
7	Francisco Javier Azqueta Sánchez-Arjona	Male	N.A.	77	Independent	22/02/2007
8	Isabella Barrios Morales	Female	Executive	55	Capital	23/12/2022
9	Juan Carlos Fernández Martínez	Male	Executive	47	Capital	23/12/2022
10	Lina Zuluaga Ocampo(*)	Female	N.A.	47	Independent	23/12/2022

*Dr. Lina Marcela Zuluaga submitted her resignation as a member of the Board of Directors. The appointment of her replacement will be made by the General Shareholders’ Meeting.

Gender Participation

Men

70%

Women

30%

Age Participation

● Between 30 and 50 years 30%

● Over 50 years 80%

In accordance with the Bylaws, the Board of Directors has the function of supervising corporate good governance practices and reviewing the level of compliance with the ethical and conduct standards adopted by the Company, among which are the Code of Corporate Good Governance, the Responsible Business Plan, and the Responsible Business Principles. Therefore, it periodically receives and approves information related to the compliance of these policies and information on the progress and status of business plans and Company management, which includes sustainability issues.

The Board of Directors actively participates in integrating sustainability into the organization, since the activities it carries out include the definition of guidelines for the sustainability strategy, the periodic monitoring of management, risk and result indicators that are presented to it. Likewise, it is responsible for overseeing the Responsible Business Plan and corporate good governance practices, as well as reviewing the level of compliance with the ethical and conduct standards adopted by the Company.

Annually, the Board of Directors reviews the Responsible Management Report –
BIC Management Report, before submitting it for review and approval by the General Shareholders’ Meeting—

During 2023, the Company maintained ISO 37001:2016 certification (Anti-Bribery Management System). In its supervisory role, the Board of Directors has the responsibility of ensuring compliance with the international standard and the Anti-Corruption Policy that helps the Company to prevent, detect and address bribery and corruption. To maintain the certification, the corresponding internal and external audit processes were carried out in the first half of the year and their results were presented to the highest governing body.

Likewise, as part of its responsibilities, the Board of Directors receives periodic reports from the Compliance Department on the performance of the Company’s Compliance Program, including matters related to the management of complaints of possible violations of the regulations on ethics and integrity of the Telefónica Group.

These reports are also submitted to the Audit Committee and the Company’s Management Committee, who are responsible for leading and exercising reasonable supervision regarding the planning, implementation, establishment, and continuous improvement of the Compliance Program and its components.

Aware of the adverse effects generated by Money Laundering (LA), Terrorist Financing (FT), Proliferation of Weapons of Mass Destruction (PADM), bribery, and corruption on the economy and society, the Company has a compliance program through which it seeks to prevent the organization from incurring in or being affected, directly or indirectly, by these behaviors.

●
Chairman of the Board

GRI Content 2-11

The Chairman of the Board is not a senior executive of Colombia Telecomunicaciones SA ESP BIC. The Bylaws establish that the Board of Directors will have a chairman elected from among its members, for a period equal to that of this social body. The Chairman of the Board will be the Executive President of the Company. However, while the Company is listed on the Colombian Stock Exchange, the person who holds the position of Legal Representative of the Company may not serve as Chairman of the Board.

●
Evaluations

Although specific performance evaluations of the Board of Directors in relation to the supervision of the management of the organization’s impacts on the economy, the environment and people are not carried out specifically, in accordance with the provisions of the Code of Corporate Good Governance and its Annex No. 3 – Board of Directors Regulations, it annually carries out an evaluation of its management, through the mechanism that it defines for this purpose.

The self-assessment includes, among other things, the participation and attendance of its members at meetings, the knowledge they have regarding the main aspects of the Company and the follow-up on the decisions made by this social body and their contribution to the definition of the strategies and projection of the Company.

The results of the self-assessment of the members of the Company’s Board of Directors and the management carried out during the year will be included in the 2023 Corporate Good Governance Practices Compliance Report, which is published on the Company’s website.

●
Remuneration

GRI Contents 2-19, 2-20

The members of the Board of Directors are entitled to remuneration or compensation, as provided in the bylaws, the code of corporate good governance and its annex 3. Fees are set by the General Shareholders’ Meeting, taking into account the responsibility of the position, the size of the Company and market guidelines.
The Company does not have variable compensation systems, hiring bonuses, hiring incentives, retirement pensions or compensation systems that incorporate stock options for board members.

On the other hand, it is reported that no fees are recognized or paid to members designated by the Telefónica Group that are labor-related to it.
Finally, it is specified that the remuneration policy for Board members and Senior Executives is not linked to their performance in the management of the organization’s impacts on the economy, the environment and people.
The Annual Report on Compliance with Corporate Good Governance Practices will annually report the remuneration received by the members of the Board of Directors in each fiscal year. This information can be accessed through the website https://www.telefonica.co/accionistas-e-inversionistas/gobierno-corporativo-2/informe-de-cumplimiento-de-practicas-de-buen-gobierno-corporativo/.

■
Audit Committee

The Audit Committee is composed of five members of the Board of Directors, and its integration takes into account the quality of independence and must have knowledge of accounting, finance and other subjects.

The profiles of the members of the Audit Committee are published on the website

https://www.telefonica.co/accionistas-e-inversionistas/gobierno-corporativo-2/modelo-de-gobierno/comite-de-auditoria/.

The Audit Committee analyzes the reports of the Responsible Business Plan and the Company’s management and, among its functions, it is generally responsible for overseeing the compliance of the internal audit program, which must take into account the business risks and comprehensively evaluate all the Company’s areas.

●
Audit Committee Composition

No.	Name	Gender	Non-executive level	Age	Quality	First Appointment
1	Alfonso Gómez Palacio	Male	Executive	55	Capital	19/12/2006
2	Pedro Alberto Ramón y Cajal Agüeras	Male	N.A.	70	Independent	5/11/2010
3	Francisco Javier Azqueta Sánchez-Arjona	Male	N.A.	77	Independent	22/02/2007
4	Isabella Barrios Morales	Female	Executive	55	Capital	23/12/2022
5	Lina Zuluaga Ocampo(*)	Female	N.A.	47	Independent	23/12/2022

*Dr. Lina Marcela Zuluaga submitted her resignation as a member of the Board of Directors. The appointment of her replacement will be made by the General Shareholders’ Meeting.

Gender Participation

Men

60%

Women

40%

Age Participation

● Between 30 and 50 years 30%

● Over 50 years 80%

Conflict of Interest Management

GRI Content 2-15

Colombia Telecomunicaciones S.A. E.S.P. BIC has a Code of Corporate Good Governance (hereinafter “the Code”) which aims to “guarantee its proper administration, public knowledge of its management and the mechanisms for evaluating and controlling such evaluation,” which preserves the integrity of the administrators and safeguards the interests of the organization.

Among other provisions, number 3.7 of the Code states that “in accordance with the law, administrators must abstain from participating, either directly or indirectly, in their own interest or that of third parties, in acts with respect to which there is a conflict of interest.”

In the case of the Board of Directors, its members must declare their conflicts of interest to the other members of the governing body, who must decide on the possibility of the declarant participating in the matter with respect to which the alleged conflict of interest or impediment occurs.

However, those administrators who are employees of the Company must comply with the provisions of the Corporate Conflict-of-Interest Regulations.LTDA.—

In this case, administrators must declare their conflicts of interest on two (2) occasions:

During the selection process through the completion of the “Acceptance of the Conflict-of-Interest Regulations and the Telefónica Group’s Relationship Regulations with Public Entities” form, distributed prior to its incorporation as an employee.

At any time that a possible conflict of interest arises, through the Telefónica Group’s corporate conflict of interest declaration tool available on the corporate intranet, accessible anytime and anywhere and managed locally by the Compliance Department.

In both events, the Compliance Department is responsible for carrying out the corresponding analysis, issuing the conclusion regarding the existence of a conflict and, if applicable, issuing the recommendations that are necessary to mitigate the risk derived from its existence.

The Company has adopted the provisions of the law in matters related to the declaration of conflicts of interest by its Board members. Its members must disclose any activity that involves competition with the company and, in general, any act with respect to which there is a conflict of interest, including those related to their participation on other boards or their cross-shareholding with suppliers or other stakeholders.

In this regard, with respect to the Company’s high level, the Telefónica Group has a Corporate Policy regarding the participation of Directors and Managers on Boards/Administrative Bodies of External Companies, according to which Directors and Managers are allowed to participate in these entities, as long as the non-existence of conflicts of interest is guaranteed and authorizations are obtained from the relevant bodies in this case, prior reporting and subsequent validation and approval by the Compliance Department.

On the other hand, administrators who are employees must declare any situation in which a direct or indirect personal interest influences, could influence or apparently influence their professional decisions.

According to the Conflict-of-Interest Regulations, this includes those situations arising from “family ties, participation in companies, either in their capital or in their management and/or administration bodies, or for any other reason that the Affected Subject considers that limits or conditions their ability to make objective decisions in the performance of their duties”.

Without prejudice to the foregoing, in the declaration of conflicts of interest made by potential employees during the selection process, they are expressly required to provide information related to family ties and contractual and/or legal ties with contractors, suppliers or competitors of Telefónica, as well as current contractual ties with any other company, regardless of the sector and/or market, a requirement that extends to previous contractual ties with public entities, regardless of the model and type of contract existing between the parties.

■
Audit Committee

GRI Contents 2-14, 2-16

Because the governing body must demonstrate its commitment and leadership to ethical and responsible management within the Company, as well as exercise reasonable supervision over it, the Board of Directors receives periodic information on the management of reports received through the complaint channels from the Inspection Department, which may involve critical aspects or with significant importance for the Company.

Additionally, the Compliance Department provides periodic reports to the Board of Directors on the performance of the Company’s Compliance Program. This space is also a way to convey any concern, critical or non-critical, related to the Telefónica Group’s ethical and integrity regulations.

During 2023, no critical concerns were raised regarding the Company’s ethical and responsible management that, by its nature and scope, warranted communication to the Board of Directors.

Culture based on ethics
and Responsible
Business Principles

GRI Contents 2-23, 2-24, 205-2

With the aim of ensuring ethical and responsible management, the Company has a robust regulatory framework, through which the main commitments made by the organization for this purpose are established, developed, and regulated.

The main commitments made by the Telefónica Group to guarantee responsible business conduct in all its activities and commercial relationships are reflected in its Code of Ethics, also known as the Responsible Business Principles (PNR), through which it seeks to promote transparent, integral and long-term management, which encourages more ethical, fair and sustainable social and environmental development.

In order to ensure that these principles are incorporated into organizational strategies and, in particular, into policies and operational procedures, Telefónica has adopted a Policy for the Development and Organization of the Regulatory Framework, which establishes the bases, instruments, and mechanisms necessary for adequate and efficient coordination between Telefónica S.A. – Head Office and the other companies of the Group regarding the development of their internal regulations. This function is currently coordinated by the Compliance Department in Colombia. This standard recognizes that

“(…) the Responsible Business Principles as the Telefónica Group’s code of ethics, which inspire and define how the Group and all employees act in the development of their professional activity, constitute the fundamental standard under which all other internal standards of the Group are framed.”

The foregoing implies that, being the highest standard within the organization, in the context of the design and establishment of its policies and regulations, the Company must respect the content and scope of the PNR and its governing elements from the moment of its creation until its eventual repeal.

To this end, at the local level, the Compliance Department has a function assigned to review local policies and procedures within the organization. This review is carried out before the publication and dissemination of these, in order to safeguard compliance with the PNR and the obligations applicable to the Company in accordance with the Preventive Model of Regulatory Compliance (MPCN) defined at the Group level for the most relevant subjects. Upon the repeal of any policy or procedure, it must be ensured that its elimination from the regulatory framework is not affecting compliance with the PNR and the obligations of the MPCN.

Additionally, with the purpose of adapting the organizations of the Telefónica group to new regulatory standards, the Compliance function assumed from the second half of the year the activities carried out by the Inspection and Intervention (Payment Control) areas, which were part of the Audit Department, in order to reinforce the independence of that department when auditing those functions that were structurally in this area.

The Company’s regulatory framework is made up of a series of corporate and local policies and regulations that develop the Responsible Business Principles:

Digital Security and Trust

Global Security Policy
Global Security Regulations
Global Privacy Policy
Global Supply Chain Security Regulations
International Supply Chain Security Regulations
Local Instruction on Data Security in BI Governance
Local Instruction on Access Controls for Applications and Platforms
Local Operational Risk Manual

Ethics and Integrity

Anti-Corruption Policy
Self-Control Policy and Risk Management of Money Laundering and Terrorist Financing
Regulation on Sanctions
Policy on Competition Law
Regulation of Relations with Public Entities
Conflict of Interest Regulations
Regulation of Certifications of Executives in Anti-Corruption Matters
Internal Code of Conduct

General Aspects of Responsible Business

Global Human Rights Policy
Diversity and Inclusion Policy
Equality Policy
Regulation on Gender Equality
Diversity and Selection of Counselors Policy
Regulation of the Management of the Responsible Business Principles Channel
Quality Policy
Regulation on Disability

Environmental Management and Climate Change

Environmental Policy
Regulation of Environmental Management
Energy Management Policy

Sustainable Supply Chain Management

Sustainability Policy in the Supply Chain
Regulation of Sustainability in the Supply Chain
Instruction on Low-Carbon Purchases

Occupational Safety and Health

Regulation of Occupational Safety, Health and Well-being
Manual on the Protocol for Acting in Situations of Labor or Moral Harassment, Sexual Harassment, and Discrimination

Responsible Communication

Regulation of Responsible Communication
Social Media Regulations
Local Internal Communication Regulations

Note: Publicly available policies are accessible at https://www.telefonica.com/es/sostenibilidad-innovacion/como-trabajamos/principios-negocio-responsable/

The main commitments made by the Telefónica Group to guarantee responsible business conduct in all its activities and commercial relationships are reflected in its Code of Ethics, also known as the Responsible Business Principles (PNR), through which it seeks to promote transparent, integral and long-term management, which promotes more ethical, fair and sustainable social and environmental development.

In that sense, with the aim of ensuring that employees and other counterparts with whom the organization interacts effectively adhere to compliance with these regulations and the commitments to which they refer, the Company has contractual clauses that are incorporated into agreements or contractual agreements, and that, in most cases, oblige counterparts to comply and establish consequences in the event of their eventual violation.

Considering the above, during 2023, 100% of the members of the Board of Directors and directors of Levels I and II signed the Telefónica Group’s Anti-Corruption Certificate, through which they reaffirmed their commitment to complying with the policies, practices and standards established in the Responsible Business Principles and the Anti-Corruption Policy. During the second half of the year, the Management Committee received training on Anti-Corruption.

On the other hand, the Company has a Code of Corporate Good Governance, which aims to ensure respect for the rights of shareholders, creditors, investors, as well as those of the Company’s other stakeholders. This document governs the ethical behavior of the Company and compiles the rules of administration, conduct and information to guarantee its proper administration.

The Code of Corporate Good Governance has as its general principles, among others, the sustainable investment model, fair competition and social responsibility, so sustainability strategies are guided according to the parameters established by the main responsible investment index (Dow Jones Sustainability Index – DJSI), managing effectively the risks inherent to economic, environmental and social development.

Likewise, the Company collaborates with public civic, community and non-profit organizations oriented to provide solutions to the development challenges of the country.

By reflecting the commitments made by the organization to achieve ethical and responsible management, compliance with the Responsible Business Principles (PNR) is a duty for employees and other counterparts of Telefónica, which must be evidenced in each of the actions and decisions, before, during and after their relationship with the Company.

With the aim of making these commitments tangible, the organization has established a series of application mechanisms that could be summarized as follows:

Due Diligence exercise on counterparts, in order to identify potential corruption risks with the potential to affect the ethical and responsible management of the organization.

Adherence of counterparts to compliance with the Responsible Business Principles through the signing of the Anti-Corruption Certificate and the contractual clauses established by Telefónica.

Availability of the corporate tool for reporting conflicts of interest and mechanisms for receiving or delivering invitations and gifts in the private and public spheres.

Reporting of possible conflicts of interest by potential employees as part of their entry process into the Telefónica Group.

Establishment of consultation and/or complaint channels for employees, suppliers, allies, and any third party or stakeholder.

Contractual and/or disciplinary mechanisms that allow for the application of consequences in the event of a violation of commitments and/or internal and external regulations.

Communication and Formation

GRI Contents 2-17, 205-2, 404-2

During 2023, the Company continued with the training process on the Responsible Business Principles, Competition Law and FCPA (Foreign Corrupt Practices Act) in Telefónica through the updating of online courses on these topics. As of December 31, 2023, these courses had been completed by key employees in 91%, 90% and 97% respectively.

Additionally, the Compliance Department provided 30 internal and external training sessions on Telefónica’s Compliance Program, which primarily addressed issues related to compliance with the Responsible Business Principles, the Anti-Corruption Policy, the Conflict-of-Interest Regulations and the Relationship with Public Entities. 75% of the sensitive positions identified in the Company were trained in relation to the prevention, detection, and response to the risk of bribery and corruption.

With regard to external training, this was primarily directed to Optecom S.A.S., a company controlled by Colombia Telecomunicaciones S.A. E.S.P. BIC, and also to civil society in different academic and training spaces on the good practices of the Telefónica Group.

100% of new employees (568) who joined the Company during 2023 received a copy of the Responsible Business Principles and the Anti-Corruption Policy from the Compliance Department, as well as being invited to the quarterly training processes carried out by this Department.

Likewise, focused training was carried out in areas of the Company that, given the nature of their functions and the risks to which they are exposed, require training in specific regulations or policies, such as the B2C, B2B and Internal Audit Departments.

In the context of the relationship with its different business partners or with external parties with whom it is intended to have some type of relationship, the organization is committed to establishing mechanisms that allow them to effectively manage their own integrity risks. In addition, in different processes, allies/suppliers/partners are required to comply, observe, and adhere to the Telefónica Group’s policies and procedures in terms of anti-corruption and the fight against LA/FT/PADM.

In addition to the foregoing, commitments are established in the agreements, contracts or formalization documents of Temporary Unions. To this end, in 2023, 5 external training sessions were carried out within the framework of the collective anti-corruption initiatives to which the Company belongs, 3 training days on private corruption directed to the public and 2 sessions within the framework of academic activities and Compliance conferences. These sessions sought to publicize and share the good practices adopted by the Company in terms of Compliance. On the other hand, in the second half of the year, different key suppliers were invited to the Integrity Culture training process in the Supply Chain.

Mechanisms, ethics and
consultation channels

GRI Content 2-26

The Company has established mechanisms through which any person, internal or external to the Company, can safely communicate any doubts or concerns related to the Telefónica Group’s ethical and integrity regulations.

■
Complaint channel

The Company has a complaint mechanism managed by the Compliance Area and its Inspection Department that offers the possibility to report, anonymously or personally, any alleged unethical or corrupt conduct, in the name or on behalf of the Company, that constitutes a violation of any of the regulations, including those related to ethics and integrity or those external parties who commit these violations and who have some link with the Company. The complaint channel is governed by the Telefónica Group’s Internal Information System, as well as the Internal Information System Management Procedure.

Among the behaviors that can be reported through this channel are those related to bribery, favoritism, conflicts of interest or those involving crimes against public administration, as well as any unethical or illegal conduct.

●
Employees

The mechanisms that employees have at their disposal to access the complaint channel are:

Intranet: intranet.telefonica.com/principios-negocio-responsable/es/#REPORTA_DENUNCIA

E-mail: canal.denuncias.co@telefonica.com

Toll-free line from anywhere in the country: 018009345712

Through this channel, a total of 64 complaints were received in 2023, which, together with 7 that remained under analysis at the end of 2022, generated a total of 71 complaints, of which:

● Valid: 21 30%

● Invalid: 29 40%

● Under analysis: 21 30%

As a result of the investigations conducted during this exercise, 21 complaints were found to be valid. Of the investigations closed, it can be concluded that there were 11 for internal fraud, 6 for external fraud, 2 for inappropriate/improper conduct, 1 for conflict of interest, and 1 case of harassment.

It is important to note that, for the valid complaints, the Company took the respective disciplinary and corrective measures in each process. Among the measures adopted as a consequence of the valid complaints, there were 7 terminations of the employment contract, two employees submitted their resignations prior to the notification of termination of the contract with just cause, 17 suspensions, 2 reminders of obligations, a warning, a cancellation of the commercial agency contract, and a warning to a supplier.

In accordance with the policy of zero tolerance towards corruption, bribery, and discrimination,
Telefónica has specific controls for the detection and remediation of possible cases. —
This is materialized in the adoption of disciplinary measures and/or contract terminations.

■
Compliance Mailbox

The Company currently has two permanent and available consultation mailboxes:

The email address of the Compliance Manager, who is locally responsible for the Compliance function, registered with the local regulators of the subject matter.

The generic mailbox corresponding to the email address of the Compliance Department: ofc.cumplimiento.co@telefonica.com.

This last consultation channel is governed by the principles of confidentiality, availability and accessibility and can be used by any person internal or external to the organization, including senior management, in order to request information or advice related to:

Ethical dilemmas.

The content and application of the Telefónica Group’s ethical and integrity regulations, as well as the communication of facts or acts contrary to the Telefónica Group’s Compliance Program or Corporate Ethics. This corporate consultation mailbox is governed by the “Specific Procedure of the Compliance Office Mailbox Manual”.

In this regard, it is pertinent to clarify that an ethical dilemma is understood as those assumptions in which a Telefónica executive or employee has doubts about how they should behave or act in a specific event, because they are not sure whether their behavior:

Is ethical.
Complies with the ethical and integrity regulations of the Telefónica Group.
Whether it could generate adverse consequences for him or for the organization.

■
Responsible Business Channel

Additionally, the Company has the Responsible Business Channel, a specialized medium for attending any query and/or claim related to the Responsible Business Principles. This channel is managed by the Sustainability area and is responsible for transferring communication to the competent area. In 2023, 11 cases were received through this channel: 2 from business partners/suppliers, 7 from customers and 2 from employees.

During 2023, the information related to the consultation channel and the Telefónica Group’s complaint channel was updated on the website www.telefonica.co and on the Company’s new intranet, with the objective of socializing them with employees and any person external to the Company.

Risks Associated
with Corruption

GRI Content 2-26

In the exercise of its functions and with the objective of actively contributing to the management of the risks to which the Company is exposed, the Compliance Department directly intervenes in the identification and evaluation of corruption risks and LA/FT/PADM associated with the operations carried out by the Company.

The following table shows the total number of operations evaluated by the Compliance Department, according to the type of operation:

Operation evaluated	Evaluation objective	Number of evaluations during 2023
Temporary Unions	Identify and manage corruption and/or LA/FT/ PADM risks arising from the formation of temporary unions for the development of projects with the public sector, through (i) due diligence of business partners and (ii) the review and incorporation of anti-corruption clauses.	13
Conditional Suppliers	Identify and manage corruption and/or LA/FT/PADM risks associated with the hiring of suppliers directly within the framework of the execution of projects with public sector clients.	122
Sponsorships	Identify and manage corruption and/or LA/FT/PADM risks associated with the delivery or granting of sponsorships to third parties.	45
Real Estate Sales Projects	Identify and manage corruption and/or LA/FT/PADM risks arising from the sale of the Company’s real estate to third parties.	55
Due diligence on counterparts	Identify and manage corruption and/or LA/FT/ PADM risks arising from the relationship with the Company’s counterparts and certain Telefónica Group companies in Colombia.	19.311
Linkage with PEP	Identify and manage corruption and/or LA/FT/PADM risks arising from the relationship with counterparts considered Politically Exposed Persons (PEP).	49

During 2023, the Company obtained the ISO 37001:2016 ((Anti-Bribery Management System) certification, for which the corresponding internal and external audit processes were carried out in the first half of the year. For this session, the Compliance Department Colombia identified in its Bribery Risk Matrix a total of “65” risks, none of which is valued as “Critical”.

The results of the external audit processes carried out within the framework of maintaining the ISO 37001:2016 certification highlighted the involvement of personnel, the commitment of senior management in the maintenance and continuous improvement of the Anti-Bribery Management System, as well as the level of detail applied to the Due Diligence of suppliers and external allies that relate to the organization.

Additionally, by virtue of the commitment to promoting ethics and integrity, during 2023, the Company carried out activities aimed at ensuring that the companies in which it has a majority stake implemented their own anti-corruption controls and effectively implemented the Telefónica Group’s ethical and integrity regulations. In this sense, the Company guided Operaciones Tecnológicas y Comerciales S.A.S. – Optecom S.A.S. in the process of identifying its integrity risks and LA/FT/PADM, in order to contribute both to the management of the risks to which Optecom S.A.S. is exposed and those that may directly or indirectly impact the Company.

Corruption Cases
and Measures Taken

GRI Content 205-3

The Telefónica Group has mechanisms that allow it to identify, investigate and apply consequences in the event of the occurrence of irregularities or violations associated with acts of corruption or misconduct against ethics and integrity.

Within the framework of the activation of these mechanisms, during 2023, no cases of corruption were confirmed within the Company that have resulted in the termination of contracts with business partners or in the reputational damage of the Company.

During 2023, eight (8) disciplinary sanctions were imposed for disciplinary offenses subcategorized as conflicts of interest and acts contrary to integrity in the private sphere, within the framework of the nine (9) Disciplinary Action Committees held.

Good practices

The Company continued to position itself as a benchmark for good practices in terms of ethics, integrity and anti-corruption in the business sector during 2023. —

As proof of this, within the framework of the “Responsible Business Conduct (CER)” publication, the Bogotá Chamber of Commerce recognized as a success story its “Conflict of Interest Management”, which seeks to combat corruption through the prevention of cases in which private interests may conflict with the interests of the Company. This practice, with an impact on SDG 16 (United Nations Sustainable Development Goals), has achieved significant results in the Company:

Facilitating the management of corruption risks derived from the existence of conflicts of interest.

Generating an ethical and transparent business environment.

Promoting the impartial and integral exercise of employees.

Contributing to the positioning of Telefónica as an ethical, responsible and transparent Company.

In 2023, the creation of the Comprehensive Business Transparency and Ethics Program (PTEE-I) of the Telefónica Colombia Foundation was carried out in compliance with the Legal Regulations issued by the Mayor’s Office of Bogotá D.C. The construction of the PTTE-I of the Telefónica Foundation involved the lifting of the Integrity Risk Matrix and the integration of the different protocols required by the standard, such as the delivery and/or offering of gifts, hospitality to third parties, and due diligence mechanisms carried out by the Foundation, among others.

Regarding the promotion of Transparency, Ethics and Integrity among stakeholders and civil society, during 2023, the Compliance Department carried out five (5) external training sessions within the
framework of individual and collective anti-corruption, anti-fraud, and anti-Money Laundering and Terrorist Financing initiatives, through which it seeks to share the good practices that the Company carries out on these matters to become a benchmark for corporate social responsibility. Some of these participations in which the Company is the protagonist of training correspond to the program called “Training of Companies for Companies – DEPE organized by Alliance For Integrity and the Global Compact Colombia chapter and additionally participation in the “Annual Ethics and Compliance Summit of the Latin American Compliance Network”, where the Company’s vision on Artificial Intelligence and Compliance was presented.

Measurements and Certifications

In terms of certifications, during 2023 the Company maintained for the second year the ISO 37001:2016 (Anti-Bribery Management System) certification awarded by the Spanish Agency for Standardization and Certification (AENOR). The foregoing maintains the Company as the first Colombian company belonging to the TELCO sector in obtaining this certification. On the other hand, the organization obtained the “Cisco Partner Compliance Assessment (CPCA)” from Cisco Systems. The scope of this certification involved the verification of the implementation of standards, procedures, and internal policies against bribery and the fight against corruption.

Finally, the third recognition consisted of the approval by Oracle of the extension of the “Public Sector Addendum – PSA” agreements between Colombia Telecomunicaciones and Oracle, which allows and authorizes the resale of products, goods and services in the Public Sector in accordance with the compliance standards required in the FCPA (Foreign Corrupt Practices Act).

From the Business and Private Sector Initiatives Line and with the aim of advancing in strengthening the co-responsibility of the business sector in the fight against corruption through the incorporation of effective measures that can adequately prevent corruption risks and events, Colombia Telecomunicaciones S.A. ESP BIC participated in the 2023 Business Corruption Risk Management Measurement (MGERC), with the objective of identifying opportunities for improvement in mechanisms to manage corruption risks. As a result of the evaluation, the Company obtained a Satisfactory performance and highlighted an optimal exercise in the chapters of Corporate Good Governance, Management Control, Management of Suppliers and Contractors, as well as in the Systems for Reporting and Denunciation of Corruption Events.

Digital Trust:
Ensuring Customer Data and Privacy

GRI Content 418-1-c

The Company, as a service provider, firmly believes that the adequate access and treatment of this important amount of data represents a great opportunity to enrich the lives of citizens and contribute to the development of societies.

Telefónica Movistar respects the fundamental rights and freedoms of individuals, including the fundamental right to the protection of personal data. The Responsible Business Principles contemplate the need to preserve this fundamental right and, in this area, establish common behavioral guidelines for all companies that are part of it. The Company develops the general principles and guidelines of the Global Security Policy, which has a comprehensive scope, not only physical and operational security (of people and property) but also digital security, business continuity, fraud prevention, supply chain security, as well as any other relevant area or function whose objective is corporate protection against potential damage, whatever it may be, or possible losses. In turn, the concept of digital security integrates aspects related to information security and cybersecurity. These aspects are applied to the physical media, systems and technologies and elements that make up the Network, and the services that support them, based on the following principles: legality, efficiency, shared responsibility, cooperation and coordination.

Integrated security is supported by the following regulatory framework:

●
Global security policy:

It constitutes the declaration of principles and commitment of the Telefónica Group to security, based on international standards and best digital security practices.

●
General security regulations:

Develops the general principles and guidelines of security.

●
Local regulations:

Aligned with global guidelines, best practices and Colombian regulations.

●
Global security regulations:

Where the guidelines that establish the necessary controls and measures to guarantee security in information classification, security incidents, business continuity, change management, security risks, supply chain, access control, IT infrastructure, people, physical, networks and communications, assets, development lifecycle, cybersecurity, fraud management, and security governance in infrastructure are described in more detail.

In 2023, the Company achieved a significant milestone in digital security management by obtaining the ISO 27001 information security quality certification for the billing area. This achievement was the result of an external audit that successfully evaluated the digital security processes.

Security culture has been strengthened thanks to employee participation in awareness and training programs. In 2023, over 87% of direct employees participated in at least one of the security courses available in Success Factors – SSFF and attended digital security talks.

The deployment and use of Office 365 components for information protection has been a key factor in improving workplace security. Over 80% of employees have demonstrated their commitment to information security by correctly tagging and classifying their information according to its criticality.

In addition, a risk analysis was conducted on 70 critical processes identified by the business continuity area and 35 critical company applications. The Company is working to ensure development controls, close security flaws in the code, and timely identify projects and applications that require security review before being released to production.

Work was done to improve the operational and efficiency of digital security processes through the development and implementation of digital tools such as the SHIMO application and the ITGCS matrix, which keeps SOX security controls updated.

Likewise, more than 95% of agile train initiatives were monitored, ensuring compliance with security controls in architecture, integration, and access. Adjustments were implemented in 90% of access controls to improve Active Directory protection, thus reducing the risk of attacks, information leaks, and unauthorized access. This has generated security alerts and identified bad practices, benefiting over 33,000 users and employees.

Additionally, all information corresponding to contracts and managers was updated, with a focus on over 13,000 third-party users

in the authoritative source T-Technicians tool. This has helped reduce exposure to unauthorized access and ensure quality in the recertification process.

Vulnerability analysis and penetration tests were carried out on 98% of the Company’s critical applications and 100% of exposed assets. Thus, over 4,700 assets from the internal technological and network infrastructure were integrated into the continuous vulnerability monitoring, and over 15,000 into the security event monitoring procedure.

Finally, 100% of the incidents reported were managed in a timely manner, supporting the investigation, mitigation, implementation of controls and recovery of the affected assets. The foregoing without any impact on the personal data of customers, suppliers or employees. Additionally, new intelligence sources were integrated that allow the Company to anticipate threats that could trigger potential security incidents.

In 2023, the Company did not identify claims from users or authorities.—
for violations of customer privacy or for the loss of their personal data.

Partners Trained
in Cybersecurity

At the end of 2023, 63.81% of partner and third-party employees were trained in security, equivalent to 16,814 people trained.

This result is thanks to the joint work with the training area and channel leaders to properly promote the course with partners and third parties, sending communications and ensuring spaces for people to take the course without affecting their operation.

The activities carried out that allowed these results were:

Definition of a user baseline.
Definition of course deployment planning with call center, loop, agent and Experience Center channels.
Course launch by the training area.
Download and weekly report of course progress.
Consolidation of monthly indicator reports.
Course mobilization with contract managers
and channel managers.
Monthly report to the sustainability area for approval.

Protection of Children
in Digital Environments

Movistar is committed to the responsible use of technology. Therefore, it promotes and participates in initiatives to foster a safe environment on the Internet and help society and, especially, children, minors, and adolescents to adequately manage their digital identity and to make the most of connected devices.

The Company has a strong commitment to the protection of Children’s Rights and establishes mechanisms to promote the responsible use of technology by fostering a safe environment on the Internet and helping society in general, and especially children, minors, and adolescents to make the most of connected devices.

●
The following lines of work materialize this commitment:

Stakeholder partnerships: Ensuring a safer Network is a task that cannot be done individually. That’s why Movistar works jointly with sectoral and civil society partners (National Police, MinTIC, NGOs, entities, and experts) to raise awareness about the risks to be managed.
As a founding partner of Te Protejo, the Company participates in Viguías, the first Safe Internet Center (CIS), an initiative that aims to help, protect and guide minors on the Internet, as well as prevent digital risks. Viguías has four components for the prevention and management of dangerous situations in online environments. These components are: Te Protejo (reporting line), Tú Lideras (youth initiatives), Te Guío (help line) and Knowledge Center, with the support and experience of Te Protejo, Red PaPaz, INHOPE, and other partners. (https://viguias.org/)

Content blocking: in the proactive fight against content and material of abuse and sexual exploitation of minors on the Network, Movistar proceeds to block this material following the guidelines and lists provided by the competent entities and which are published on the specialized content portal “MASI” (Child Sexual Abuse Material). Additionally, it receives notifications, official letters, and legal management messages to take action on specific content that needs to be intervened. See more about this management at: https://descubre.movistar.co/atencion-cliente/politicas-de-privacidad/bloqueo-contenido.html
Products and services: nothing can replace the mediating and educational role of an adult in the responsible use of technology, however, when this is not possible, one can always count on the support of technology. To this end, the Company is committed to promoting and developing products and services (parental controls and other security solutions) that raise awareness about the responsible and safe use of the Network and connected devices and help families successfully address the challenge of the digital world.
Joint work with suppliers: assesses with suppliers the implementation of basic child protection parameters, especially in the area of security, from terminal design to operating systems.
Education and awareness initiatives: committed to developing training and awareness initiatives for all audiences through the Dialogando portal (https://dialogando.com.mx/). A channel with content created by different experts that helps to reflect on the use of technology in everyday life and provides the keys to successfully manage digital life.

Commitment
to Suppliers

GRI Content 204-1

The Company is aware of the importance of its supply chain, both due to its international presence and the impact and volume it represents in its turnover. For this reason, it promotes, establishes and maintains high levels of responsibility requirements with respect to its suppliers, promoting among them compliance with not only product and/or service quality standards, but also with legislation and ethical, social, environmental and privacy standards in everything related to Telefónica’s supply chain.

●
Los Principios de Negocio Responsable incluyen como principio la Gestión responsable en la cadena de suministro:

Sustainability in the supply chain is a key issue in the telecommunications sector, where Companies increasingly share services and value chain activities with our suppliers and contractors.

We promote sustainability to extend the positive impact on society and the planet, of the products and services we offer to our clients, as they are the result of a mutually beneficial relationship with our business partners and suppliers. Our relationships are balanced and trusting, and generate a joint commitment to quality, innovation and final customer satisfaction.

We are committed to acting with rigor, objectivity, transparency and professionalism in our relationship with our business partners and suppliers.

In order to comply with our commitment to responsibility throughout our value chain, we require our business partners and suppliers to comply with the Telefónica Group’s minimum responsible business criteria.

It is important that those employees who make purchases or acquisitions for our Company assume their individual responsibility in working with responsible suppliers and partners, and that they carry out the established controls to ensure, beyond the quality of the service provided or product delivered, that they act responsibly at all times with respect to their stakeholders.

The Company has a Regulation and a Sustainability Policy in the Supply Chain that originates in the Responsible Business Principles, which constitute the framework of reference in the Company’s relationship with its different stakeholders, and more specifically in Telefónica’s commitment to Sustainable Supply Chain Management. These have been developed in accordance with international standards such as, for example, the UN Guiding Principles on Business and Human Rights, the International Labor Organization conventions, the UN Convention on the Rights of the Child, the OECD (Organization for Economic Cooperation and Development) guidelines and ISO criteria (International Standards Organization). The Policy, in turn, highlights Telefónica’s commitment to the Global Compact in terms of corporate social responsibility, the Sustainable Development Goals and the defense of Human Rights promulgated by the United Nations.

Of the 578 suppliers (awardees) that the Company had in 2023, 70% (404) are companies established in Colombia (local suppliers), which were awarded 89% of the total value, divided into the following product lines:

Infrastructure and Networks:

34%

Services and Works:

16%

B2B/B2C Solutions:

12%

Information Systems:

Advertising and Marketing:

Mobility:

21%

The Company had the support of 41 Partners and 48 Agents in 2023, who generated the following indirect employment:

●

Partner Company: Supplier that provides a service to Telefónica and, for the development of the service, directly or indirectly impacts the final customer and/or the internal customer. Additionally, this type of company allocates resources (human, physical, financial, among others) for the provision of the service with exclusive dedication to Telefónica.

●

Commercial Agents: Organization that undertakes to independently and stably assume the task of promoting the commercialization of Telefónica’s products and services.

On the other hand, in 2023,
the Company entered into 345 new contracts with 278 organizations and 82 modifications with 70 organizations —
outside the scope of the Telefónica Purchasing Model (MCT).

Sustainability Performance
Evaluation for Suppliers

GRI Contents 308-1, 414-1

In accordance with the guideline of the Sustainability Regulation in the Supply Chain, the Company relied on Achilles to assess the level of compliance with Telefónica’s minimum Responsible Business criteria for suppliers.

This company has a supplier rating system, which uses an evaluation methodology that covers ethical, social, environmental and supply chain management criteria, in such a way that it assigns each assessed supplier a total score (0%-100%) obtained in Sustainability. With these results, the supplier can have a diagnosis that allows them to define an action plan and carry out their own assessments of environmental, social, ethical, corporate governance, and their own supply chain management. The percentage of new suppliers evaluated with environmental and social criteria was 19%, however, it is not currently considered a criterion for awarding.

■
Supplier Audits

In 2023, the Partner Model in Colombia was further strengthened with the following focus areas:

Conducting comprehensive audits of 12 contracting companies, which included in the evaluated topics those corresponding to Human Resources, occupational safety and health, the environment, Responsible Business Principles, Security and Data Protection.
17 on-site audits were conducted, achieving a 33% coverage of partners at the end of the year, based on which action plans were identified and designed, verifying the analysis and elimination of root causes of deviations.
Contractor administrative audits: 501 audits were conducted to ensure timely compliance with the labor obligations of partners.
Administrative audits of contract closure: Audits are carried out at the time of contract closure as a closing process to ensure compliance with labor obligations.

Additionally, as a local best practice to ensure compliance with social, labor, safety and health standards in the supply chain, the following activities were developed:

Technical boards Implementation of SST standards with partners who carry out high-risk tasks with the following approaches:
Technical Board – Update of Serious and Fatal AT Instruction..

Action	No. Sessions	No. Partners
Technical Board – Partners (Critical Activities)	2	19

TOTAL PARTICIPANTS

Promoting compliance with Telefónica’s ethical, labor, safety and health, and environmental requirements among suppliers (thus being aligned with the Responsible Business Principles and the Responsibility Policy in the Supply Chain through the induction/reinduction of Partners).
It is carried out with new partners at the time of starting operations and every two years reinduction is provided to companies that are part of the partner model, in order to ensure that companies have updated information. In 2023, 11 induction and reinduction sessions for partners were held.

The main practices for communicating, establishing dialogue and fostering supplier satisfaction are:

Partner mail, where communication with partner companies is focused on topics related to Human Resources and Occupational Safety and Health processes.
Partner Newsletters. This is the means to inform the Company’s network of partners (and contract administrators) about topics of interest to all. It is published quarterly and three editions were sent during 2023.

Action	No. Sessions	No. Partners
Partner Induction / Reinduction	11	58

TOTAL PARTICIPANTS

169

Legal
Management

Company Investments
in Other Companies

The Company has direct investments in the capital of Operaciones Tecnológicas y Comerciales S.A.S. – Optecom S.A.S., Comunicación Celular S.A – Comcel S.A. and Álamo Holdco S.L. The details are as follows:

The Company owns 3,330 common shares, equivalent to 100% of the share capital of Optecom S.A.S., a Colombian company.

Colombia Telecomunicaciones is the holder and owner of 3 shares of Comcel S.A., a Colombian company.
The Company has a stake corresponding to 40% of the share capital of Alamo Holdco S.L., a Spanish company, which owns 100% of the share capital of Onnet Fibra Colombia S.A.S., a Colombian company.

Operations with Shareholders
and Administrators

The Company did not enter into transactions with shareholders or administrators.

Intellectual Property and
Copyright Standards

The Company complied with the intellectual property and copyright standards in the different installed systems. There is no knowledge of violations or possible non-compliance with laws, regulations and standards on intellectual property and copyright, whose effects must be considered to be disclosed in the financial statements or as a basis for the recording of a contingent loss.

Free Circulation
of Invoices

The free circulation of invoices was allowed in accordance with the provisions of Article 87 of Law 1676 of 2013.

Report on the Implementation of
Corporate Practices - Country Code

The Company timely made and submitted to the Colombian Financial Superintendence the report on the implementation of best corporate practices corresponding to the year 2023, which is published on the Company’s website.

Compliance with
legislation and regulations

GRI Contents 2-27, 307-1

The Company paid the following amounts (in Colombian Pesos) in significant fines imposed by the Superintendence of Industry and Commerce: $61,000,000, $924,000,000, $760,000,000, $772,962,561, $1,430,000,000, $708,000,000, $571,000,000, $525,000,000, and $40,000,000, for a total of $ 5,791,962,561 during 2023.

Five investigations were also initiated by the Superintendence of Industry and Commerce for alleged violations of the Communications User Protection Regime. As of December 31, contingencies were reported that involve the recognition of provisions for 1.97 billion pesos.

In 2023, 19 investigations by the Ministry of ICT were managed for alleged violations of the general telecommunications regime, including the CRC regulation (reports, cell phone theft, network quality). Contingencies were reported for 768.7 million pesos.

Marketing Communications
Non-Compliance Incidents

GRI Content 2-27 y 417-3

In 2023, the Company reported four cases of non-compliance related to marketing communications:

The Superintendence of Industry and Commerce (SIC), through Resolution 71799 of 2022, imposed a fine of 1.43 billion pesos on the Company. This fine was confirmed and paid in November 2023. The sanction is due to a case of advertising, where the SIC considered that the Company violated the users’ right to information, as well as the prohibition of disseminating misleading advertising, through the advertising campaign “Fibra Movistar, the Best Internet in Colombia”, where it also claimed to have the “1st Place in Customer Satisfaction”. According to the SIC, the advertising pieces of this campaign could mislead consumers, as no evidence was found to establish that its context and conclusions were truthful, verifiable, sufficient, provable and suitable, since such assertions had no basis whatsoever.

The Superintendence of Industry and Commerce (SIC), through Resolution 60437 of 2022, imposed a fine of 708 million pesos on the Company. This fine was confirmed and paid in September 2023. According to the SIC, the sanction was for a transgression of the users’ right to receive truthful and complete information, by announcing in some pieces published on social networks that “only Movistar gives you IlimiDatos”, when there were other operators on the market that also offered unlimited data.
The Superintendence of Industry and Commerce (SIC), through Resolution 23019 of 2022, imposed a fine of 525 million pesos on the Company. This fine was confirmed and paid in May 2023. The sanction was for an advertising campaign for the prepaid product, because according to the SIC, the company provided information that does not correspond to reality, having informed in the advertising pieces of the promotions or offers “Unlimited Social Networks in Prepaid All in One and Combos” and “Prepaid All in One Ultra”, which included the benefit of unlimited social networks, when in reality in the general terms and conditions, the use of some of its functionalities is restricted.
Through Resolution 55597 of August 19, 2022, the SIC fined the Company 1.51 billion pesos for alleged misleading advertising related to the IlimiDatos advertising, because the Company did not clearly, truthfully, sufficiently and verifiably inform the conditions and restrictions of the service. The Company filed legal appeals against the resolution and the SIC modified the fine through Resolution 32525 of 2023 and reduced it to 571 million pesos.

Complaints related to privacy
and customer data

GRI Content 418-1

In 2023, the Company did not identify any claims from users or authorities, for violations of customer privacy or for the loss of their personal data.

Regulatory
Management

Spectrum

According to the procedures of the Ministry of Information and Communication Technologies (MinTIC), Telefónica Movistar Colombia requested the renewal of 30 MHz in the AWS band in June 2023, as well as 25 MHz in the 850 band and 15 MHz of spectrum in the 1900 MHz band in September 2023. The national regulation allows that while the definitive conditions of these renewals are closed, the spectrum is used normally.

MinTIC Resolutions 3947, 4138 and 4185 of 2023 established the requirements and procedure for carrying out the objective selection process through the auction mechanism, to grant spectrum use permits nationwide, in the 700 MHz, 1,900 MHz, extended AWS, 2,500 MHz and 3,500 MHz bands. The available spectrum was 10 MHz of 700 MHz and 1,900 MHz, 30 MHz in the 2,500 MHz band and extended AWS, and 320 MHz in the 3,500 MHz band.

MinTIC held the auction on December 20, 2023, and Telefónica participated and acquired, in a Temporary Union with Tigo (Colombia Móvil S.A. ESP), a block of 80 MHz in the 3.5 GHz band for the reserve value of 318 billion pesos, which includes the amount to be recognized for obligations to do.

The block has coverage obligations on primary and secondary highways, and to connect educational institutions via fiber optic, which must be executed within a maximum period of 18 months, extendable to 24 months in some cases. The maximum value that the Ministry will recognize for executing these obligations is 69 billion pesos. The other three blocks were assigned to Claro, WOM, and Telecall, a new operator, also with obligations to do.

●
Memorandum of Understanding and
Authorization of the Superintendence of
Industry and Commerce to operate the
Single Mobile Access Network - NetCo

Telefónica Movistar announced the signing, together with Tigo, of an agreement to develop a shared mobile access network in Colombia. The companies evaluated the creation of a new mobile access infrastructure company to make the management of current networks more efficient and to serve as a vehicle for deploying new mobile technologies such as 5G.

The consolidated network aims to improve the quality of mobile services in more than 700 municipalities and for approximately 35 million users. The companies will continue to operate separately functionally and legally, they will continue to compete in the provision of telecommunications services and will maintain their independence and business, strategic, and commercial autonomy.

The Superintendence of Industry and Commerce authorized the operation under Resolution 61548 of October 6, so that the Companies can share their network infrastructure and spectrum use rights. The entity recognizes that there will be no impact on retail and wholesale telecommunications markets, as Telefónica and Tigo will continue to participate independently, as they will not share network cores (Core) or transmission routes (backbone and backhaul).

The decision highlights that the new network company presented a plan to transfer and return portions of the spectrum to avoid exceeding current limits. The Temporary Union will use 140 MHz (40 in low bands and 100 in medium bands). Today, Tigo has 120 MHz of spectrum compared to Telefónica’s 85. After consolidation, the two firms will release 65 MHz: in the AWS band, Tigo 30 MHz and Telefónica 10 MHz. In the 850 band, Telefónica will return 25 MHz. The Authority established conditions for Telefónica and Tigo for the operation, valid for five years, as follows:

Do not unilaterally, unjustifiably or untimely modify, to the detriment of MVNOs, current or future agreements, and must submit a semi-annual report.
Do not unilaterally, unjustifiably or untimely modify, to the detriment of third-party providers, current or future agreements for National Automatic Roaming, nor increase the price of RAN unjustifiably, and must submit a semi-annual report, and an eventual report upon entering into a new contract or adjusting commercial conditions.
Implement a Governance Manual, and other provisions on the Shareholders’ Meeting, the Board of Directors, the Legal Representative, information management protocols, and coverage and quality.

Main Regulations and
Projects Published by
the CRC

Resolution 7120: Established the conditions for access, use and remuneration of passive infrastructure for the deployment of infrastructure.
Resolution 7151: Incorporates changes on mobile number portability by eliminating arrears as a reason for rejection. According to CRC Resolution 7151 of 2023 issued by the Communications Regulation Commission (CRC), which seeks to facilitate the portability or change of operator process by updating the reasons for rejection and strengthening mechanisms to reduce fraud through identity theft. Among the new measures, the elimination of the obligation to stay current with payments to be able to port stands out. Likewise, once cases of fraud through identity theft are known and concerned about the safety and protection of Colombians, the text of the message that the user will receive when carrying out the procedure with which the personal identification number (NIP) is sent, warning that the code corresponds to the change of operator of their mobile line, so that, if they have not requested the port, they can contact their operator.
Resolution 7156: Included the wholesale carrier market by municipality and included a list of 170 municipalities with competition problems in the residential fixed internet market. In addition, it modified the reporting of information on the transport service between the municipalities of the country to have more information.

CRC Resolution 7265: Modifies the Rate Update Index IAT. The update of the regulated values will be based on the annual variations of the IAT, which in turn has been adjusted to respond to the Construction Cost Index for Civil Works (telecommunications networks), the Consumer Price Index division of Services, added to the Index of the Minimum Monthly Legal Wage in Force and the 12-month moving average of the Representative Market Rate plus the average nominal tariff that were already in the formula.
The CRC published for comments the “Review of Continuous Quality Improvement Tools in 4G” draft, with adjustments in i) a new definition for degradation in the provision of mobile services, ii) the periodicity of dissemination campaigns and publication on company websites of quality measurements with crowdsourcing; iii) the target values for download and upload speed; iv) compliance with the thresholds for 4G mobile data quality indicators.
The Commission has published a draft, after reviewing the retail markets for mobile services. Identifying that OTT calling and SMS applications do not exert competitive pressure on the mobile voice service; that fixed internet does not exert competitive pressure on mobile internet, and also that “Outgoing Mobile Voice” has declined and will continue to decline in the short and medium term, it proposes to eliminate this market from the list of those susceptible to ex ante regulation.

Competition

GRI Content 206-1

The legal actions taken in 2023 regarding unfair competition or violations of legislation on monopolistic practices or free competition were as follows:

For restrictive practices of competition in the Superintendence of Industry and Commerce (SIC): Against Claro Colombia, there are three ongoing processes, for excessive unjustified rejections in mobile number portability; diversion of subsidies for new accesses in the fixed internet plan in strata 1 and 2; and unjustified rejections for the new regulatory causes. Filed against Telefónica Movistar, by Claro, there is a complaint regarding the loyalty bonus and “better together” programs.
For jurisdictional lawsuits for unfair competition in the SIC: Against Claro Colombia, there is a process for acts of unfair competition for customer diversion by offering active customers plans for strata 1 and 2 with resources from the ICT Fund. Filed against Telefónica Movistar, there are three processes, by Claro, Tigo and WOM, for the loyalty bonus and “better together” programs.

Economic and Financial Management

Direct economic value generated and distributed

Sources and uses

Sustainable Financing

Environmental Management

● E – Building a greener future

Environmental Program Management

● Eco Rating

● Papiros Project

Climate Change

Risks and Opportunities of Climate Change

Energy

● Energy Intensity

Emissions

● This is the evolution of annual scopes 1 and 2 emissions:

Water

Water Consumption (M3)

Waste Management

Promotion of the Circular Economy

Sustainable Mobility

Green Digitalization: Eco Smart Seal

Environmental Assessment of Suppliers

Environmental Audits and Trainings

Precautionary Principle

Regulatory Compliance

Social Management

S – Help society prosper

Connectivity for Digital Growth

Movistar Fiber

● Mujeres en Red

Network Management and Mobile Services

Prepaid

Digital Solutions for Companies

IoT

Cloud

Advertising

Big Data

Ciberseguridad

● Major milestones in the business segment

Increased Anti-DDoS Mitigation Capacity:

Launch of the Security Edge Service:

Innovation

Agility and Digital Transformation

Human Talent Management

● Employees per contract type and gender

● Employees per contract type and region

Hiring and rotation

Diversity, Equity & Inclusion

Empleados(as) por categoría laboral

● Key Performance Indicators

● Organizational Diagnosis

● Inclusive Culture

● Diverse Employer Brand

GENDER EQUALITY

GENERATIONAL

LGBTQI+2 COMMUNITY

PEOPLE WITH DISABILITIES

MULTICULTURALITY

● Freedom of Association

Salary Remuneration

■ Salary Structure

■ Compensation Ratio

■ Employee Benefits

Well-being, Remote Work, and Work-Life Balance

■ UNO Benefits

■ Movistar Moments

■ E-work/Work from Home

■ Flexible Work Hours

Flexible Schedules

Unplugged Friday

■ Parental Leave

Employee Development and Performance

Occupational Health and Safety of Employees

Management

Store (CE)

Commercial/Management

Operational/Administrative

Operational/Heights

Commercial/100% fieldwork

Management
2023

Economic and
Financial Management

Direct economic value
generated and distributed

Environmental
Management

●
E – Building a greener future

Environmental
Program Management

●
Eco Rating

●
Papiros Project

Risks and Opportunities
of Climate Change

●
Energy Intensity

●
This is the evolution of annual scopes 1 and 2 emissions:

Green Digitalization:
Eco Smart Seal

Environmental
Assessment of Suppliers

Environmental
Audits and Trainings

Connectivity for
Digital Growth

●
Mujeres en Red

Network Management
and Mobile Services

Digital Solutions
for Companies

●
Major milestones in the business segment

Increased Anti-DDoS
Mitigation Capacity:

●
Employees per contract type and gender

●
Employees per contract type and region

Diversity, Equity
& Inclusion

●
Key Performance Indicators

●
Organizational Diagnosis

●
Inclusive Culture

●
Diverse Employer Brand

LGBTQI+² COMMUNITY

●
Freedom of Association

■
Salary Structure

■
Compensation Ratio

■
Employee Benefits

Well-being,
Remote Work, and
Work-Life Balance

■
UNO Benefits

■
Movistar Moments

■
E-work/Work from Home

■
Flexible Work Hours

■
Parental Leave

Occupational Health
and Safety of Employees

■
Occupational and Preventive Medicine

■
Employee Participation and Consultations on SST

■
Worker training on
occupational health and safety

■
Promotion of health, prevention
and mitigation of impacts on SST

■
Work accident injuries

■
Occupational illnesses
and diseases

Risk Management and
Remediation Measures
for Human Rights Impacts

Human Rights Commitments
and Working Boards

Colombia Guidelines
on Human Rights

●
Guías Colombia Human
Rights Self-Assessment

% Progress Movistar Implementation
of the community engagement guide

■
Other HR Participation Spaces

Governance
Management

■
Customer Experience and Care

Customer Satisfaction:
Net Promoter Score (NPS)

●
Invoicing, Billing and Collection

●
Commercial Support

●
Logística

Processes for Mitigating
Negative Impacts

Digital Accessibility and Support
for People with Disabilities

■
Board of Directors

●
Composición Junta Directiva

●
Chairman of the Board

●
Evaluations

●
Remuneration

■
Audit Committee

●
Audit Committee Composition

■
Audit Committee

Culture based on ethics
and Responsible
Business Principles

Mechanisms, ethics and
consultation channels

■
Complaint channel

●
Employees

■
Compliance Mailbox

■
Responsible Business Channel

Risks Associated
with Corruption

Corruption Cases
and Measures Taken

Digital Trust:
Ensuring Customer Data and Privacy

●
Global security policy:

●
General security regulations:

●
Local regulations:

●
Global security regulations: