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technologyfor goodEricsson Sustainability and Corporate Responsibility Report 2014

about ericssonEricsson is a driving force behind the Networked Society – a world leader in communications technology andservices. The Company’s long-term relationships with every major telecom operator in the world allow people,businesses and societies to fulfill their potential and create a more sustainable future. Ericsson’s services, softwareand infrastructure – especially in mobility, broadband and the cloud – are enabling the telecom industry andother sectors to do better business, increase efficiency, improve the user experience and capture new opportunities.With more than 115,000 professionals and customers in more than 180 countries, Ericsson combines globalscale with tech nology and services leadership. Investments in research and development ensure that Ericsson’ssolutions – and its customers – stay in the forefront. The Company provides support for networks with more than2.5 billion subscribers. Approx imately 40% of the world’s mobile traffic is carried through networks delivered byEricsson. Founded in 1876, Ericsson has its headquarters in Stockholm, Sweden. The Ericsson share is listed onNasdaq Stockholm and NASDAQ New York.Cover photo: Myanmar, a country undergoing democratic and social reform, has one of world’s lowest levels of mobile broadbandpenetration. ICT can play a huge role in boosting socio-economic development. In 2014, Ericsson began serving customers in Myanmar,and also joined the UK Department for International Development to support girls’ education in the country.about this reportThis report, together with additional information availableonline, summarizes our 2014 sustainability andcorporate responsibility (CR) performance.Sustainability and CR are central to Ericsson’s core business andour commitment to the triple bottom line of responsible financialand environmental performance and socio-economic development.Our aim is to create positive impacts for our stakeholdersand our business while managing environmental, social and ethicalrisks. Conducting business responsibly is a top priority, andwe take a full value chain perspective.We believe this approach delivers new business opportunities,greater efficiency, less risk, greater brand value, market leadershipemployer attractiveness, and boosts long-term competitiveness.UN Global Compact AdvancedEricsson is reporting for the third year in a row according to the UNGlobal Compact (UNGC) Advanced Level criteria.UN Guiding Principles Reporting FrameworkWith this report, Ericsson is the first in the ICT sector to reportaccording to the new UN Guiding Principles (UNGP) on Business andHuman Rights Reporting Framework launched in February 2015.Report BoundariesUnless otherwise stated, all information and data pertains to activitiesundertaken from January 1, 2014, to December 31, 2014. Thereport covers the Ericsson Group, i.e. Telefonaktiebolaget LMEricsson and its subsidiaries. The Ericsson Annual Report 2014provides information on Ericsson’s structure, nature of ownershipand legal form, subsidiaries, as well as changes regarding size,structure and financial performance.Global Reporting Initiative (GRI) Index 3.0A GRI index for our performance in 2014 is on p. 54.Technology for GoodBy 2020, 90% of the world’s population will be covered by mobilebroadband networks. This scale brings unprecedented opportunityto address global sustainable development challenges. Inthe Networked Society, Ericsson is the leading advocate of Technologyfor Good. It is a concept we work with every day, and isthe overarching theme of this report.External Assurance and GRI Application Level A+This Report has been assured by PricewaterhouseCoopers, see AssuranceStatement on p. 56. The scope of the assurance by external auditor PwCincludes an audit on Ericsson’s own CO 2 emissions. The GRI G3 guidelineshave been used in compiling this Report and a complete GRI compilationappears online.Ericsson’s Sustainability and Corporate Responsibility Report 2014 hasachieved an A+ application level, which means the Report has been externallyassured, and that the application level has been checked by a thirdparty, PricewaterhouseCoopers.000-150For reporting of suspected violations of laws or the Ericsson Codeof Business Ethics, please email: reporting.violations@ericsson.comTo help us improve reporting and ensure transparency, we welcomeyour feedback and questions on our report and performance, pleaseemail: corporate.responsibility@ericsson.comiEricsson | Sustainability and Corporate Responsibility Report 2014

contentsAbout Ericsson ............................................................. iLetter from the CEO ..................................................... 2Letter from the VP of Sustainability and CR ...................... 32014 at a glance .......................................................... 4Strategy to drive positive change and reduce risk .............. 6Engaging with stakeholders .......................................... 7Advocating for change ................................................. 7Our most important sustainability impacts . . . . . . . . . . . . . . . . . . . . . . . . 8Our key objectives and achievementsare on pages 52–53. We also reportprogress on earlier objectives throughoutthe report, noted on various pageswith the following icon.CONDUCTING BUSINESS RESPONSIBLYBuilding trust through responsibility ............................... 11Managing human rights challenges ............................... 12Due diligence in the sales process ................................ 15Anti-corruption a top priority ........................................ 16Proactive engagement on responsible sourcing. .............. 17Raising transparency on conflict minerals ....................... 19A strengthened approach to health and safety ................ 2010PeopleOur people anchored by core values .......................... 21Building skills for the Networked Society . . . . . . . . . . . . . . . . . . . . . 22Committed to diversity and inclusion .......................... 23Facts and figures. .................................................... 25ENERGY, ENVIRONMENT AND CLIMATE CHANGEOn energy and climate, ICT enables transformation ......... 27Assessing ICT sector carbon footprint ........................... 29Rethinking energy performance .................................... 30Handling e-waste responsibly. ...................................... 33Improving performance of our own operations ................ 34Facts and figures ....................................................... 3526Enabling a low-carbon economyEnabling a low-carbon economy ................................ 36Intelligence in the grid .............................................. 38Transport shifts gears. .............................................. 39COMMUNICATION FOR ALLConnecting the unconnected ....................................... 41Mobile money meets needs of unbanked ....................... 42Bringing 4G to Peruvian Amazon .................................. 43Connecting community kiosks in Africa .......................... 43Extending the reach of Connect To Learn ....................... 44Ericsson Response. .................................................... 46Reconnecting families . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47Transforming young lives on path to peace ..................... 48Breaking down barriers ............................................... 4940In recognition . ........................................................... 51Objectives and achievements ...................................... 52GRI Index . ................................................................ 54Auditors’ Combined Assurance Report ......................... 56Engage with us . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57Ericsson | Sustainability and Corporate Responsibility Report 20141

Letter from the CEOAny future vision ofsustainable developmentmust be linked to technologytransformation.”be misused. We are working to ensuregreater privacy and security in our networks,and are active in multi-stakeholderdialogue to address concerns.Hans VestbergPresident and CEOWelcome to our 2014 report.Never in human history have we beenmore connected. In a few years, 90% ofthe world’s population will have access tomobile communications. That’s a staggeringdevelopment, changing every aspectof our lives.In the Networked Society, everyone andeverything will be connected in real time.As a leading ICT company, our role is todrive this transformation, opening up newways to innovate, to collaborate and toempower people, business and society. Wewant to ensure that connectivity paves theway for environmentally sustainable andequitable social and economic development.Driving positive changeOur ambition at Ericsson is to be a responsibleand relevant driver of positive changein the Networked Society. From climatechange and poverty reduction to urbanization,the major challenges confrontingour world require transformative, not inc remental,solutions. Small steps forwardwon’t deliver the necessary scale to findeffective solutions to pressing global issues.The global community is charged with carryingon the work of the Millennium DevelopmentGoals beyond 2015. Any futurevision of sustainable development must belinked to technology transformation.As chair of the Working Group for SustainableDevelopment and the Post-2015Development Agenda of the BroadbandCommission for Digital Development,during 2014 I led the work on a new report“Means of Transformation.” Our aim is tospur the international community to actswiftly to capture the unrealized potentialof ICT and broadband to enable the post-2015 development agenda and help builda more inclusive, sustainable society. Mycontribution to the Leadership Council ofthe UN Sustainable Development SolutionsNetwork is to help ensure that viable solutionsare part of this framework.A transformative technologyMobility, broadband and the cloud aretransforming industries. Utilities aredeploying smart metering to save electricitycosts and reduce carbon emissionswhile connected cars enhance safety andenable electric vehicle charging. Smartgrids and more efficient public transportease the challenges of urbanization.Technology is also transforming howwe meet basic needs. In Connect to Learn,now in 21 countries, we partner in a publicprivateinitiative using cloud-based ICTsolutions to deliver high-quality secondaryeducation worldwide while highlightingthe need to improve access to educationfor girls. With 2.5 billion unbanked peopleglobally, our mobile money platform isaddressing the challenge of financial inclusion.Community health workers equippedwith mobile phones in the devastatingEbola fight are better able to save lives.These are the kind of impacts that illustratethe power of Technology for Good, andin 2015 our initiatives aim to impact morethan 5 million people.Sustainability at the coreAt Ericsson, sustainability and corporateresponsibility are integrated in our corporatestrategy. Our aim is to continuouslyimprove our sustainability performance –in areas such as good governance,responsible sourcing, and health andsafety – to minimize risks to our, and ourcustomers’, brands and earn the trust ofour stakeholders.Ericsson continues to support the tenprinciples of the United Nations GlobalCompact and the UN Guiding Principlesfor Business and Human Rights (UNGP),and we were first in our sector to use thenew UNGP Reporting Framework. Wethink this is important because whilehuman rights such as freedom of expressionand the right to privacy are enabled byICT, there is also a risk the technology canSteady progressAs described throughout this report, in2014 Ericsson made considerable progresswith sustainability and CR, althoughthere is much left to do. Our targets aredesigned to indicate our priorities, both interms of reducing risks, and increasingpositive impacts, and we continue todeliver real performance. As Ericsson’smost significant environmental impact isthe energy used by our products in operation,we put heavy emphasis on helpingcustomers optimize their networks. Ournew Ericsson Radio System provides a50% improvement in energy efficiency.We also seek to reduce the carbonfootprint of our own performance. We areon track towards our objective to maintainabsolute CO 2e emissions from businesstravel, product transport and facilities at2011 levels up to 2017. This equates to areduction of 30% CO 2e per employee, andthis year, we reduced emissions by 10%CO 2e per employee.To accelerate action towards a low-carboneconomy, we also set a new goal thisyear to help other sectors of the economyreduce societal carbon emissions by a factorof 2 relative to Ericsson’s own carbonemissions in 2014. We will do this by implementingICT-enabled solutions such assmart meters and smart transport solutions.Scaling positive impactThis is only the very start. ICT-enabledsolutions can and should be a powerfultool for sustainable development. Byenabling every area of society to usemobility, broadband and the cloud toaddress global challenges, we can ensureour sector’s legacy is a positive one.Hans VestbergPresident and CEO2 Ericsson | Sustainability and Corporate Responsibility Report 2014

Letter from the VPof Sustainability and CRWe strive to be positivechange-makers in theNetworked Society.”and other stakeholders about the complexissues surrounding privacy, surveillance,cybersecurity and freedom of expressionin the ICT sector, and in 2014 we significantlyincreased our stakeholder engagementand outreach on these topics.Elaine Weidman-GrunewaldVice President, Sustainabilityand Corporate ResponsibilityDear stakeholders,Two decades of strong commitment tosustainability and corporate responsibility(CR) has launched Ericsson on a businessmission to positively impact the worldaround us. Each year brings new challengesand opportunities, but over time,sustainability and CR have become an integralpart of our mindset and identity, andthe impact we want to have on the world.Establishing strong foundationsOur vision to be a responsible and relevantdriver of positive change in the NetworkedSociety starts with conducting businessresponsibly. If we don’t get this right, it willbe difficult to succeed in an increasinglytransparent Networked Society.This is of growing importance to ourstakeholders, and Ericsson aims to raisethe performance bar each year in areaslike human rights, responsible sourcingand anti-corruption. Equally important isour focus on energy, the environment andclimate change – and ensuring the benefitsof mobility reach everyone. We have targetsin all areas that help guide our workand measure performance.Embedding sustainability and CROne of our key aims is to embed sustainabilityand CR in everything we do. It isintegrated into our business strategy andour portfolio as a key business factor, and2014 saw many exciting portfolio developments.Financial and social inclusion forthe 2.5 billion unbanked is a central focusof our mobile commerce business. Our TVAnywhere solution can be brought to eventhe remotest corners of the world overmobile broadband. To help shape thelow-carbon society of the future, ourIndustry & Society portfolio offers viablesolutions for the utility and transport sectorslike smart grids and our ConnectedVehicle Cloud.Technology for GoodProviding affordable and accessiblemobile broadband can help break thecycle of poverty for millions of peoplearound the world. Despite rapid growth ofthe ICT industry, today, more than 4 billionpeople do not have access to the internet.In the 48 Least Developed Countries, 90%of the population is unconnected. Marketforces alone cannot address the mainbarriers to progress: infrastructure, affordabilityand usage. Greater joint efforts areneeded by industry, governments andothers to close this gap.As the leading advocate for Technologyfor Good in the Networked Society, weuse our technology and solutions to addressglobal sustainable development challenges.In 2014, we scaled up our education solutionConnect to Learn, and secured ourfirst large-scale engagement with a nationaldevelopment agency (DFID in the UK) toexpand secondary education to thousandsof marginalized girls in Myanmar.Tackling the challengesDespite great progress in our sustainabilityand CR aims, we also met new challenges,in areas like privacy and freedom ofexpression, reducing health and safetyincidents in the supply chain, and settingmore realistic levels for the volumes ofe-waste collected. We also need morewomen in the ICT sector, an industry challengethat we work with others to tackle.But addressing these challenges canalso result in new opportunities to buildtrust among our stakeholders. Our abilityto meet expectations is increasinglyimportant in handling emerging risks andchallenges. For example, telecom is apowerful enabler of human rights, butcertain functionality can also be misused.We acknowledge mounting concernamong investors, customers, civil societyAn untapped potentialICT and broadband are increasingly integratedinto every aspect of the globaleconomy as a vital part of modern infrastructure.As a technology advocate, Iknow what a huge impact ICT can have oneach one of the 17 proposed UN SustainableDevelopment Goals. It seems obviousto me, and many others in our industry,that ICT should be a central element in anyframework for addressing sustainabledevelopment. But technology is rapidlyevolving and not everyone has understoodits full potential.The UN and other organizations havean enormous opportunity to make this link– between existing technologies like ICTwhere industry and governments haveinvested billions, if not trillions, and nationaland global sustainable development plans.There are some quick wins to be gained,for example, in climate change, by engagingmore with the ICT sector and its solutions-basedapproach.In closing, whether it is stakeholderconsultation, customer engagement, orpublic-private partnerships, more multisectorengagement is crucial for providingleverage, impact and scale to many of theareas presented in this report. By workingwith others, we develop a true understandingof the trade-offs and impacts our businesshas in the world. With this insight andour commitment, we strive to be positivechange-makers in the Networked Society.Elaine Weidman-GrunewaldVice President,Sustainability and Corporate ResponsibilityEricsson | Sustainability and Corporate Responsibility Report 20143

2014 at a glanceConductingBusinessResponsiblyICT company to reportaccording to the UNGuiding Principles onBusiness and Human RightsReporting Frameworkof Ericsson employees71%feel that the Company’sefforts on sustainabilityand corporaterespons ibility haveincreased their overall job satisfaction(15% above external benchmark)Energy,Environment,Climate CHANGE– 10%Over10,000tonnes e-waste collectedCO 2 e reductionper employee98%recycling of materials throughproduct take-backCommunicationfor AllConnect To Learnnow in21countriesOver350,000registered inRefugees Uniteddatabaseto find separated families4 Ericsson | Sustainability and Corporate Responsibility Report 2014

strategy to drive positivechange and reduce riskAn important part of Ericsson’sambition is to be a responsible andrelevant driver of positive societalchange.Ericsson’s ambitionGrow faster than the market with best-in-class marginsOur commitment to sustainability and CRis essential to achieving this ambition, andto create value for our employees, customers,shareholders and society.As a leader in the ICT industry, our aimis to provide significant and measurablecontributions to a sustainable NetworkedSociety.The Networked SocietyThe Networked Society goes beyond morethan 50 billion connected devices. It is theresult of people starting to use those connectionsto make their lives, businessesand society better and more efficient. Wefacilitate this development through ourideas and solutions, our products andservices, and our partnerships.In our vision of a Networked Society,every person and every industry isempowered to reach their full potential. Webelieve a better, more sustainable worldwill take shape when 21st century infrastructureis used to deliver services moreeffectively and promote social inclusion.Integrated across the businessSustainability and CR is integrated inEricsson’s business strategy, target-CustomerLeading ICTtransformation partnerEmployeesAttract, develop andretain best talentsetting and risk management processwhich involves Regions, Business Unitsand Group Functions.GovernanceSustainability and CR policies are part ofour governance system and applied globallyacross the business. These includethe Sustainability Policy, Code of Conduct,Code of Business Ethics and OccupationalHealth and Safety Policy. The Code of BusinessEthics is periodically acknowledgedby all employees.The Ericsson Sustainability and CRSteering Group is comprised of seniorexecutives who approve the strategy andShareholderShareholdervalue creatorSocietyResponsible andrelevant driver ofpositive changetargets that support our commitments. Formore information on governance, see p.11.Measuring progressTo track our performance, we report on arange of objectives, risks, and achievementsassociated with our most materialissues and aim for continuous improvementsover time.Focused strategyOur Sustainability and CR strategy(see below) remains constant, focusedon reducing risks and increasing positiveimpacts in society.Our sustainability and CR strategyOur Sustainability and CR strategy is focused on driving positive change in three main areas: Responsible Business Practice, Energy, Environmentand Climate Change, and Communication for All. Each area includes specific goals upon which we measure progress year on year.Undisputed leader inenergy and environmentTrusted partner by conductingbusiness responsiblyImprove performanceof our own operationsTechnology for GoodImpact and ScaleDemonstrate ICT andlow-carbon benefitsResponsible Business PracticeEnergy, Environmentand Climate ChangeCommunication for All6 Ericsson | Sustainability and Corporate Responsibility Report 2014

engaging with stakeholdersListening to, and learning from,stake holders helps address sharedchallenges, and find commonsolutions.Engaging with stakeholders is an inclusiveand continuous process that allows us tobuild relationships and create mutual understanding.Our stakeholders include employees,investors, customers, suppliers, governments,civil society, non-governmentalorganizations (NGOs), industry partners,media, academia, and consumers.Woven into daily businessInteractions with stakeholders are part ofthe day-to-day operations of our business.We reach out to stakeholders througha variety of means such as employeedialogues, joint projects and initiatives;customer meetings; investor meetings;surveys, membership in industry groupsand representation on decision-makingbodies or academic research. Other interactionsinclude in-person meetings, onlinedialogues, consultation with affectedstakeholders, and formal public reports.We engage with customers on many issues,including supply chain management, energyefficiency and our Technology for Goodprograms. We leverage our social mediato extend the conversation.Strengthening approachIn 2014 we developed a more detailed processfor stakeholder engagement, in orderto ensure that we are transparently communicatingand reporting about theseissues in a relevant, meaningful and transparentway. One of the focus areas wasthe management of CR risks, includinghuman rights.Focus areasStakeholder engagement also contributesto better management of CR risks, andone particular focus area for Ericsson inthis regard is human rights (p.12). OtherCR risks areas we address through stakeholderengagement include responsiblesourcing, corruption, health and safety,conflict minerals, and handling of e-waste.Engaging with stakeholdersIn our approach to stakeholder engagement,we carefully consider each step of the processin order to achieve the greatest impact.A. With Whomcompanies needto engageB. About Whatissues companiesneed to engageC. Howengagementshould takeplaceD. Whenengagementshould takeplaceE. Corporate/Policy LevelengagementF. InternalengagementG. EngagingNeutralswhennecessaryAdvocating for changeEricsson takes an active role in advocatingfor ICT’s transformational role in sustainabledevelopment. This includes connectingthe unconnected as well as scaling upaccess to education, reducing carbonemissions, and contributing to sustainableurbanization, women’s empowerment,peacebuilding and human itarian response.Focus areas include:Highlighting broadband’s role insustainable development: The WorkingGroup on Sustainable Development of theBroadband Commission for Digital Development,chaired by Ericsson CEO, publisheda new report in 2014 “Means of Trans formation,”highlighting ICT’s role in proposednew Sustainable Development Goals.Conducting business responsibly:Human rights, anti-corruption, andresponsible sourcing are among our focusareas. In 2014, for example, we participatedin a case study by the Institute forHuman Rights and Business (p.13) tofurther multi-stakeholder dialogue onhuman rights challenges in the ICT sector.Supporting UN initiatives: Ericssonis involved with advocacy and solutions inmany UN initiatives, including the LeadershipCouncil of the UN Sustainable DevelopmentSolutions Network, which gathersacademia, civil society and the privatesector to mobilize action on sustainabledevelopment (p. 44) and Together for SaferRoads, a coalition launched in 2014 (p. 39).Expanding humanitarian response: Wesee huge potential for ICT to help addresscrises from health to refugees and disasterresponse. We are a member of the UNEmergency Telecom Cluster and in 2014,we launched a partnership with the InternationalRescue Committee (p. 46).World Economic Forum: As a partnerof the World Economic Forum, we joinother leading global companies to supporta commitment to improve the state of theworld. Sustainable development is one ofour key focus areas.Many other advocacy initiatives aredescribed throughout this report.Ericsson | Sustainability and Corporate Responsibility Report 20147

Our most importantsustainability impactsA materiality assessment is a vital element in our sustainability and CR strategy, reporting, and targetandrisk-setting process. We look at the economic, environmental and social impacts most significant toour business, and those that substantively influence the assessments and decisions of stakeholders.HIGHAssess and engageActively address and engageInterest to stakeholders174025582291629244136353412187619414133239 15 373832010332627 2303123128 1121AssessAddressEngage when appropriateLOWImportance to EricssonHIGHConducting business responsibly*1 Anti-corruption2 Unintended use of ICT3 Radio waves and public health4 Respect Human Rights5 Child labor6 Information security(including cybersecurity)7 Right to privacy8 Forced labor9 Freedom of association10 Policy engagement and advocacy11 Responsible sourcing12 Tracing of conflict minerals13 Diversity and inclusion14 Occupational health and safety15 Employee engagement16 Responsible land use17 Product information and labeling18 Responsible tax19 Freedom of expressionEnergy, environment andclimate change*20 E-waste management21 Biodiversity22 Emissions (effluents, air emissionsother than GHG)23 Environmental legal compliance24 Waste management(office and production)25 Water consumption26 Ericsson carbon footprint27 Climate change28 Product energy performance29 Use of renewable energy30 Hazardous substances avoidance31 Efficient use of materials(excluding hazardous)32 ICT contribution to low-carboneconomy33 Energy consumption(Ericsson own activities)34 Smart citiesCommunication for all*35 Disaster response36 Access to education37 Digital inclusion38 ICT socio-economic impact39 Access to communication40 Access to healthcare41 Peace building and conflictresolution* Numbering for reference in the graph,not in order of importance.8 Ericsson | Sustainability and Corporate Responsibility Report 2014

Ericsson regularly reviews issues to ensureour materiality assessment captures theaspects most vital to our sustainabilityimpacts. Prioritizing helps us make betterdecisions and guides our strategicchoices.Gathering insightThis year we took into account the Globale-Sustainability initiative’s (GeSI) updatedmateriality assessment for the ICT industry,to which Ericsson contributed. Notableissues highlighted in the assessmentinclude additional privacy, human rightsand waste concerns, as well as recognitionthat the Internet of Things – the interconnectionof various objects, devicesand applications through wireless communications– is in fact becoming a reality.Ericsson identifies stakeholders andtheir significance to the business andincorporate stakeholder perspectives inour work.Prioritizing issuesWe use previous materiality assessmentsas the starting point to rank issues in orderof importance and then include updatesbased on developments during the year.We take into account upstream and downstreammaterial issues across the valuechain. Life-cycle assessment helps toidentify and measure opportunities todecrease negative environmental impacts.Human Rights Impact Assessments helpidentify salient human rights issues.We actively address issues deemedmost material to Ericsson. We manageefforts to tackle the issue, and investigate,steer and/or implement new governanceprocedures to ensure business sustainabilityand accountability. We also engageon this set of issues with stakeholders,through dialogue and advocacy, todemonstrate the positive socio-economicand environmental effects of mobility,broadband and the cloud. Issues in whichwe assess and engage are those rising inimportance for Ericsson and stakeholders.We assess by reviewing and monitoringthe evolution of an issue and we report onour performance in these areas. For someissues, we address and engage whenappropriate.Issues which we assess are importantand we have procedures in place to ensurethat we are working according to ourstakeholders’ expectations on theseissues. Stakeholders generally require lessdisclosure about performance in theseareas as they are aware of our standardsand express confidence in our ability toadequately address them.Right to privacy rising on agendaThe ICT sector is facing new challengesarising from the use of technology – notablythe convergence of previously separateindustries such as telecoms, data managementand media. “Big data” providesopportunities for improving efficienciesand gaining business insights. It can alsopose societal risks if misused.We have identified the right to privacyas one of Ericsson’s salient human rightsissues, and recognize that it is important tostakeholders as well. Privacy and securityissues affect businesses as well as individuals,particularly as commerce becomesincreasingly digitized. We are committedto good governance and responsiblebusiness practices in this area, as well asto multi-stakeholder dialogue. See furtherdiscussion on our approach to humanrights (p.12).New technologies and capabilitiesacross the ICT sector mean that moreaspects of our lives are becomingconnected, and with that arises newchallenges. The trend towards a digitizedsociety is increasingly placing empasison the right to privacy. Ericsson has introduceda Privacy by Design Framework,which ensures privacy is considered fromthe beginning of any product release andmade an integral part of the product developmentprocess.56%of smartphoneownersThe technological and legal implicationsof the right to privacy must be understoodand addressed by all sectors involved inthe debate. We will continue to beengaged in that dialogue.would likecommunication to beEπC \’PT3dSource: Ericsson ConsumerLab report, 10 hot consumer trends 2015.Ericsson | Sustainability and Corporate Responsibility Report 20149

conductingbusinessresponsibly10 Ericsson | Sustainability and Corporate Responsibility Report 2014

Building trustthrough responsibilityOur solid commitment combined with our culture and core values support ourresponsible business approach to deliver long-term business benefits.Conducting business responsibly is the foundation of our commitmentto sustainability and corporate responsibility. Integrity,transparency and responsibility characterize the way we conductbusiness. It is critical to maintaining trust and credibility withcustomers, partners, employees, shareholders and otherstakeholders.Governance frameworkEricsson has Group policies, processes and directives withinresponsible sourcing, occupational health and safety (OHS),environmental management, anti-corruption and human rights,and other areas. The Ericsson Group Management Systemincludes the Code of Business Ethics, Code of Conduct, OHSpolicy, and Sustainability Policy. We are committed to uphold theUN Global Compact Principles and to implement the UN GuidingPrinciples on Business and Human Rights throughout our businessoperations. Under our Global Assessment Program, anexternal assurance provider audits the implementation of thesepolicies and directives, management of risks and achievementof objectives. Policies are regularly reviewed; several werestrengthened in 2014.Code of Business EthicsOur Code of Business Ethics sets the tone for how we conductbusiness globally. It is acknowledged by all employees at the timeof employment and repeatedly throughout the term of employment.We have zero tolerance for corruption and bribery, and haveset high standards within the areas of responsible sourcing, theenvironment, occupational health and safety, human rights andlabor across our operations.Strengthened focus on human rightsEricsson respects all internationally proclaimed human rights andstrives to ensure that we are not complicit in human rights abuses.In 2014, we embedded a stronger human rights focus in our Codeof Business Ethics and Code of Conduct (p.12).The Code of Conduct was strengthened with stronger laborstandard protection in accordance with UN and customer requirements,including reference to the process for reporting violations,and requirements on suppliers to report breaches of the Codeof Conduct.All employees are offered online training on sustainability,anti-corruption and other CR issues. About 90,000 employeeshave taken the anti-corruption training to date, which covers policiesand requirements and explores challenges and dilemmas.In addition, specific training on human rights issues are providedfor certain functions where human rights issues are especiallyrelevant, for example, Sourcing, Security and Legal Affairs.Top-level commitmentThe CEO and senior management actively support the commitmentto responsible business and are regularly informed of progress.Sustainability and CR objectives are part of the EricssonGroup 2014 balanced scorecard. A cross-functional Sustainabilityand CR Steering Group provides guidance for strategic and operationalissues.The Board of Directors of the Parent Company is briefed twicea year on sustainability and CR matters; more often if needed. In2014, briefings covered sustainability and CR strategies and risks,performance, internal operations, OHS, environment, humanrights challenges, and sales compliance processes and results.Ericsson | Sustainability and Corporate Responsibility Report 201411

Managing humanrights challengesMany fundamental human rights –such as the right to health, education,freedom of assembly andfreedom of expression – areenabled through ICT. At the sametime, the Networked Society canalso give rise to specific humanrights challenges. Recognizingboth the opportunities and thechallenges, Ericsson is workingactively to address human rights.Spotlight on most salient issuesThe new UN Guiding Principles (UNGP)on Business and Human Rights ReportingFramework states that a company’s salienthuman rights issues are those humanrights that are at risk of the most negativeimpact through the company’s activitiesor business relationships. Ericsson hasdefined our salient human rights issues.These are the right of freedom of expression,the right to privacy, and labor rights.These are highlighted in the Code of BusinessEthics and Code of Conduct. Weidentify these issues from various input:our own assessment of impacts, externalstakeholder views resulting from HumanRights Impact Assessments in higher-riskenvironments (p.14), broader stakeholderconsultations and industry initiatives. Wemay identify other human rights issues tobe salient over time.Growing stakeholder concerns point tothe need for more transparency, constructivediscussion and clear guidance ongood corporate conduct and due diligenceon human rights and appropriate limits ofgovernment control over communicationservices. More clarity is needed on expectationsand responsibility of companies,and what constitutes effective oversight oflaws governing interception and surveillanceof data to preserve public safety andnational security interests (referred to aslawful interception). We held and engagedin several stakeholder consultations during2014 to address these issues (p.14).Rising societal concernsTechnology is used by governments tofight crime and to assist in life-savingWe engage in stakeholder dialogue in Myanmar, a country undergoing rapid change.emergencies. Despite the benefits, insome cases it can also be misused torestrict human rights, and can infringeon an individual’s right to privacy.Concern around surveillance, mining ofpersonal data and cyber-attacks is rising.It is essential that the right to privacy isprotected so that users and their dataare secure and rights are protected.Ericsson works to ensure appropriate levelsof security in our products, and a rangeof tools are deployed to ensure securitysolutions and safeguarding of networkoperations. This is outlined in the Ericssonwhite paper, “Guiding Principles for Securityin a Networked Society.”12 Ericsson | Sustainability and Corporate Responsibility Report 2014

Reporting violationsWe recognize the importance of havingprocesses in place to provide or enableremedy in the case of negative humanrights impacts related to business activitiesor relationships. Possible violations of theEricsson Code of Business Ethics, includinghuman rights issues, can be reportedthrough our whistleblower procedures publiclyavailable on our website. A transitionto a third party-managed whistle blowerprocess is planned for 2015 (p.16).Embedding a Human Rights frameworkSince 2011, we have been working to integratethe United Nations Guiding Principleson Business and Human Rights intoour governance framework. Since 2012we have been active with the BusinessLearning Program of the non-profit centerfor business and human rights, Shift, toembed a human rights framework acrossthe company. Our human rights due diligencecovers areas such as Sales, Sourcingand Legal Affairs. In 2014, we reviewedand further strengthened the human rightsaspects of our due diligence regardingmergers and acquisitions.UNGP’s new reporting frameworkEricsson is using the opportunity in thisreport to start applying the UNGP’sReporting Framework, launched in February2015 as the first comprehensive guidancefor companies to report on humanrights issues in line with the Guiding Principles.The Framework was developed byShift and international accountancy firmMazars. We are the first ICT company toapply the framework and also among thefirst companies to do so overall. We will bebuilding on this year’s experience in ourfuture reporting.Digital DangersEricsson was the focus of a 2014 casestudy on human rights by the Institute ofHuman Rights and Business (IHRB) in their“Digital Dangers” series. The study exploredchallenges facing network vendors, andhow they can reduce the risk of misuse oftelecommunications systems, and in particularlawful interception systems. Theanalysis of Ericsson’s salescompliance process (p.15)highlighted a number of bestpractices, including escalationof issues, and requiringend user statements as partof all sales that describeapproved uses of the productor service to help track productsand performance. Theauthors also called for governmentsto clarify rules forcompanies providing technologieswhich can be used inways that undermine respectfor human rights and to bearin mind their own duty to protectagainst human rightsabuses involving non-state actors such ascom panies. The report also highlighted theimportance of multi-stakeholder dialogue,an area in which we are deeply engaged.Case Study Number 2NOVEMBER 2014ViewpointHuman Rights Challenges forTelecommunications Vendors:Addressing the Possible Misuse ofTelecommunications SystemsCase Study: Ericsson“Ericsson’s due diligence process…pointsto processes companies can embed intooperations to give proper consideration tohuman rights risks,” the study stated.The impact of ICT on human rights is generally positive, but its increasinguse by governments and business to acquire data creates a complex interrelationship.Awareness of the risks associated with information and communicationstechnologies has grown in recent years. The indeterminate period forwhich data is stored online raises a whole set of issues, particularly for the right toprivacy. The implications of these developments are not fully or widely under stood.The ICT sector needs to do more to find a unified response to such challenges,and ideally this should be done in consultation with stakeholders includ ing civilsociety and other experts. Those dialogues are happening,and we are involved in some of them. Ericsson, and othercompanies in the ICT sector, are well served by havingdilemmas around human rights publicly discussed. Companiescannot effectively deal with these issues if they arekept secret or confidential. Ultimately, while companies caninstitute best practices and due diligence, judicial oversightis crucial. This requires the right regulatory framework withhuman rights protection at its core.”John Morrison is the Executive Directorof the Institute for Human Rights and Business.Ericsson | Sustainability and Corporate Responsibility Report 201413

Assessing our HUMAN RIGHTS impactEricsson has customers in more than 180countries, with different cultures, legal systemsand other factors impacting societyand the business environment. Group policiesand directives regarding human rightsgovernance apply to our global operations.Identifying the issuesWe conduct Human Rights ImpactAssessments (HRIA) in accordance withthe UNGP as part of our human rights duediligence and to help identify salient humanrights issues. The HRIA covers adversehuman rights impacts that Ericsson maycause or contribute to, through our ownactivities, or which may be directly linkedto our operations, products or services byour business relationships. The aim is toensure that we respect human rightswithin the scope of our business operationsand describe the social, operationaland human rights context for doingbusiness in the country.Continued focus on MyanmarThe work with the recommendations fromthe HRIA in Myanmar has continued during2014. At the stakeholder consultation conductedin Myanmar during the summer of2014 one issue raised was labor conditionsand safety, particularly in the supplychain. Focus on these issues has beenhighlighted during 2014, for example,when conducting audits. Several internalprocesses within Ericsson regarding theright to privacy have also been strengthenedduring 2014 as one result of the workwith the HRIA for Myanmar.HRIA initiated in IranIn Iran, where Ericsson has had customersfor over 100 years, a HRIA was initiated in2014. In light of international developments,we are engaging with existing customers,and exploring opportunities withnew customers in Iran, while evaluating thehuman rights situation and continuing tomonitor international developments.Prioritized areas for action identified inthe HRIA include:> > occupational health and safety> > sourcing and supply chainmanagement> > security> > trade and sales com pliance> > discriminationWe will implement the recommendationsfrom the HRIA into our processes andmanagement systems to ensure continuingattention to addressing and trackinghuman rights challenges.Ericsson has served customers in Iran for over 100 years.consulting stakeholdersWe support discussions on finding ways to manage emerging dilemmas throughgreater transparency, collective action and a clear regulatory framework.The initial results of our HRIA in Myanmar were shared in stakeholder consultationsin both Stockholm and Yangon. Stakeholders included investors, thegovernment, customers and local civil society participants. In 2015 stakeholderconsultation on the HRIA for Iran took place. The outcome of these stakeholderconsultations are an important contribution to the final list of identified mitigationmeasures. The HRIA process is a learning experience for the company that wewill continue to build upon, in Iran, Myanmar, and potentially other markets.Right to privacy focus at Wilton ParkWe played a leading role in convening a multi-stakeholder roundtable on privacy,security and surveillance with the Institute for Human Rights and Business (IHRB)held at strategic forum Wilton Park in the UK. Participants addressed growingchallenges and dilemmas around right to privacy, freedom of expression, securityand lawful intercept, and finding the appropriate balance between privacy rights,freedom of expression and security. The input from the round table discussionprovided vital insight for Ericsson’s continued work with human rights. Part of ourlong-standing collaboration with IHRB was our participation in a 2014 case studyon managing human rights dilemmas, ( p.13).GeSI working group on human rightsEricsson is also a member of the Global e-Sustainability Initative (GeSI) workinggroup developing an action plan to provide leadership in addressing human rightsin the ICT sector. The group is focused on prioritizing action on human rightsimpacts; applying a human rights lens to emerging technologies and their application;the future of responsible sourcing in the ICT sector, and building capacity inemerging markets.14 Ericsson | Sustainability and Corporate Responsibility Report 2014

Due diligence inthe sales processHuman rights considerations are an integrated part of Ericsson’s sales process.Human rights risk management is embeddedinto our operations through our salescompliance process. This is particularlyrelevant for the continuing assessmentand prevention and mitigation of potentialimpacts related to freedom of expressionand privacy. A Sales Compliance Board,supported by a Sales Compliance CoreTeam, governs the process.The cross- functional, senior-level SalesCompliance Board represents LegalAffairs, Trade Compliance, Governmentand Industry Relations, Sales, Marketingand Communications, Business Units, andSustainability and Corporate Responsibility.It meets bi-monthly to review cases, inparticular those with potentially negativehuman rights impacts. The Sales ComplianceBoard may approve with conditionsor reject cases, or in specific cases, recommendthat human rights impacts assessmentsfor specific countries be conducted.Gathering broad inputThe Sales Compliance Core Team meets biweeklyto review cases, using expertise fromseveral functions and departments to discusspotential impacts and review policies.The team looks at sales requests, andwhen necessary, determines what mitigationactions should be undertaken, forexample, that implementing staff at theoperator must have the right product or servicetraining before a contract is concluded.Involving different departments helpsensure that any decision considers multipleangles, in order to reduce the risk thatEricsson’s technology directly or indirectlyimpacts negatively on human rights.Criteria for evaluationSales that trigger one or more of the followingcriteria are evaluated in the salescompliance process for human rights risks:> > Portfolio: This concerns products andservices that Ericsson provides thatcould potentially be used for unintendedpurposes.> > Purpose: This concerns understandingthe purpose and context in which theproduct, service or know-how will likelybe used.SALES COMPLIANCErisk methodology> > Customer: This focuses on enhancingour understanding about to whom wesell/deliver.> > Country: This provides insight aboutthe country to which we deliver, basedon the risk indices of a global riskanalytics firm in areas such as humanrights risks; corruption; democraticgovernance; freedom of opinion andexpression. Countries requiring extraattention are those under sanctions aswell as other countries ranked as a highrisk based on a external risk indices. Werecognize this is an ongoing processand continuously monitor internationaldevelopments.Sales Compliance Board Review of Cases219CountryResultsIn 2014, more than 300 cases werereviewed (see graph). The review andapproval process was enhanced, so thatwhile the total number of cases increasedin 2014, more cases were approved withconditions. We have procedures for followingup on mitigation measures and thedecisions that are taken within the salescompliance process.2013 2014183 Cases approved 21424 Cases approvedwith conditionsPortfolioTotal riskevaluationCustomer3198512 Cases rejected 20Source: EricssonPurposeEricsson | Sustainability and Corporate Responsibility Report 201415

Anti-corruptiona top priorityAccording to the World EconomicForum, the cost of corruptionequals more than 5% of global GDP(USD 2.6 trillion). With over USD1 trillion being paid in bribes eachyear (World Bank), transnationalcorruption is a major barrier toconducting business. Ericssontakes a zero tolerance approachto bribery and corruption.Corruption hampers investment, undermineslegal and democratic systems andincreases the costs of doing business.In response, around the world anticorruptionlegislation is becoming stricter,enforcement is increasing, and stakeholderexpectations for high standardsof business integrity are growing. Faircompetition and a level playing field areessential to free markets and businessmust play its part to actively reinforcethis throughout the value chain.With our global operations spanning180 countries – many with a high risk ofcorruption according to TransparencyInternational’s anti-corruption index – stayingfocused on anti-corruption is importantto Ericsson. This is achieved through acombination of risk assessment, a stronganti-corruption program, internal auditsand through regularly updated employeeand supplier training.Prevention and accountabilityEricsson continuously assesses corruptionrisks as part of Group Risk Assessment, inline with strategy and target-setting processes.Headed by the Group’s ChiefCompliance Officer, the anti-corruptioncompliance program targets both preventionand accountability. The effectivenessand appropriateness of the program is alsoreviewed and evaluated annually by theAudit Committee of the Board of Directors.Ericsson has an established process forthe selection of suppliers and in generaldoes not use agents, unless required bylaw or in very restricted circumstances.Reporting violationsBoth employees and third parties mayreport suspected violations of law or theGroup’s Code of Business Ethics, which isavailable publicly on the Ericsson website.Reported violations of law or the Codeof Business Ethics are handled centrally bya Group Compliance Forum, supported bya Regional Compliance Forum in eachregion. We also initiated the transition to athird party-managed whistleblower process,i.e. Ericsson will appoint a third partyto whom employees and third parties canreport violations. The process is plannedto be implemented in 2015.Towards a culture of integrityTo foster individual accountability, Ericssonemployees periodically acknowledge theCode of Business Ethics and undergo ananti-corruption e-learning course to raiseawareness of risks, dilemmas and appropriatecourses of action.By year-end 2014, more than 90,000 ofcurrent employees had completed thetraining.Additional specialized training is providedto key personnel in Sourcing, Salesand other relevant functions, such asregional leadership teams. With regardto suppliers, focus on anti-corruption inself-assessment questionnaires was tightenedand a new anti-corruption e-learningfor suppliers was launched. At year-end,more than 1,100 employees of suppliershad concluded the training.Industry commitmentSince 2012, Ericsson has been a memberof the World Economic Forum Partnershipagainst Corruption Initiative (PACI), aimedat raising business standards and contributingto greater transparency andaccountability. Members commit to a setof principles, which includes zero tolerancetowards bribery and corruption, the cornerstoneof Ericsson’s anti-corruption program.16 Ericsson | Sustainability and Corporate Responsibility Report 2014

Proactive engagementon responsible sourcingResponsible sourcing is a top priorityfor Ericsson. We work towardscontinuous improvement to ensureour suppliers meet high social, ethical,human rights and environmentalstandards.Through transparency and engagement, wework to build trust across the value chainfrom suppliers to customers. Our “beyondmonitoring” approach develops our relationshipwith suppliers across three phases:“require,” “assess” and “improve.”> > First, we provide suppliers clarityaround our sustainability and CRrequirements.> > Second, we evaluate suppliers’ sustainabilityperformance through monitoringand audits. This includes identifyingand auditing high-risk suppliers.> > Third, to ensure continuous improvement,we engage with suppliersthrough audit follow-up, Code of Conductseminars and training sessions,and web-based learning.Setting expectationsSuppliers must comply with the requirementsof the Ericsson Code of Conductwhich are included in supplier contracts.The Code of Conduct was updated in2014 to include stronger human rights languagein accordance with the UN GuidingPrinciples on Business and Human Rightsas well as international labor standards.Specifically, maximum working hoursare more clearly set out. Another new provisionprohibits deduction from wages as adisciplinary measure.In 2014 we carried out over 30 supplierseminars to raise awareness on our Codeof Conduct, Occupational Health and Safetyand environmental requirements, and toemphasize the importance of compliance.Assessing riskEricsson uses a risk-based approach toidentify relevant suppliers for Code ofConduct audits. Prioritized risk areasinclude working at heights, road and vehiclesafety, anti-corruption, working hours,labor rights, environmental management,and communication of requirementsfurther down the supply chain.Monitoring performanceIn 2014, 595 supplier Code of Conductaudits and on-site assessments wereperformed by Ericsson’s 197 SupplierCode of Conduct auditors. We view eachof our audits as an improvement activityand expect suppliers to address identifiedfindings. Auditors follow up the actions toensure there is continual improvement inthe supply chain.Year on year, analyses of our auditresults demonstrate significant improvementsin areas such as better workingconditions, fire prevention, training andenvironmental management. Critical findingsamong 32 selected high-risk suppliersaudited in both 2013–2014 declined60% (from 18% to 7%). (See graph p.18).We prefer to use leadership and transparencywith suppliers to encouragecontinuous improvements over time.However, suppliers who repeatedly failto comply with our Code of Conduct riskbeing disqualified for further business.Ericsson | Sustainability and Corporate Responsibility Report 201417

Capacity buildingAs an important element of our approach,we provide free, online Code of Conducttraining to suppliers, offered in 13 languages.In 2014, Ericsson also launched aweb-based anti-corruption training forsuppliers to reinforce our zero toleranceview on corruption and bribery.Meeting customer expectationsOur own performance as a supplier is acritical part of our proactive engagementin responsible sourcing. We participate inthe yearly Joint Audit Cooperation (JAC)Forum made up of ten of our largest customers,telecom operators. JAC membersconduct Corporate Responsibility audits oftheir suppliers, including Ericsson factoriesand suppliers, and share results. SeveralEricsson and supplier sites have beenaudited by JAC auditors during the pastfew years with satisfactory results.collaborating withsupplier a win-winWhen a supplier is closely aligned with our strong commitment to findsustainable solutions, collaboration can lead to significant improvements.That is the case with global logistics provider DB Schenker,which worked jointly with local Ericsson teams to address the challengeof transporting products from Ericsson in China to our facilitiesin Brazil – all while reducing lead time, costs and carbon impact.By jointly tackling the problem, Ericsson and DB Schenker arrivedat a sustainable multi-modal solution combining rail with air freightwhich reduced CO 2 emissions by 47% per 45ft container and cut leadtime from 45–50 days by sea freight to 23–25 days with the rail-aircombi nation. In addition, intermodal air-rail transports developed byDB Schenker together with Ericsson for our inbound flows to andfrom Europe and China has led to a 56% reduction in CO 2 per 45 ftcontainer.Close and ongoing dialogue with the supplier – central to ourResponsible Sourcing approach – was key to ensuring they understoodour requirements and could develop the right solution. In 2014,Ericsson presented an award to DB Schenker for sustainability excellence,an example of how working together with a supplier canachieve positive outcomes with long-term benefits for Ericsson.Photo: DB SchenkerPerformance of selected suppliers – globally2013 201417.9% Critical 7.1%28.1% Warning 27.6%54.0% Conformity 65.3%Type and number of critical and warning findings of selected suppliers– globallyEmployee contractLocal legislationBenefit and compensationForced and bonded laborOccupational Health and SafetyPhysical working environmentHandling of chemicalsPersonal Protective EquipmentRecords on incidentsSupply chainEnvironmental Management System0 5 10 15 20 25Source: EricssonCriticalWarningSource: Ericsson18 Ericsson | Sustainability and Corporate Responsibility Report 2014

aising transparencyon conflict mineralsDuring 2014 we have taken further steps together withour suppliers to increase transparency regarding conflictminerals in our supply chain, working with our supplierstowards the aim of conflict-free sourcing.Some of the mineral mines in the eastern part of the DemocraticRepublic of the Congo (DRC) have been exploited for many yearsby warlords using illegal trade to finance their activities. The mineralsare exported to smelters around the world and after refinementthey end up in products in different parts of the world.Electronic products contain various metals, including tantalum,tin, tungsten and gold (“conflict minerals”), which can be found inthe eastern part of the DRC. There are several tiers of suppliersbetween Ericsson and the actual mines which is why collaborationwith our suppliers is necessary to achieve our aim to increasetransparency in our supply chain.Industry cooperationBroad industry cooperation is needed to improve the situation andto achieve the objective of increased supply chain transparencyenabling legitimate trade of raw materials that can create a positiveimpact on the local community. We work actively with oursuppliers and through industry initiatives such as the Conflict-FreeSourcing Initiative (CFSI), driven by the Global e-SustainabilityInitiative (GeSI), and the Electronic Industry Citizenship Coalition(EICC). We are also active in the dialogue with policymakers in theEU and other industry sectors aiming to increase awareness andunderstanding of conflict minerals.Our approachOur approach to conflict minerals is based on four principles.> > We have made an active choice not to ban minerals from theDRC. The reason is negative consequences that could resultfrom an embargo of the region.> > We have worked to incorporate the “OECD Due DiligenceGuidance for Responsible Supply Chains of Minerals fromConflict- Affected and High-Risk Areas” in our existing sourcingpractices. Some examples are our public Statement on ConflictMinerals, contractual clauses in supplier agreements, and theannual conflict minerals reporting. We filed our first ConflictMinerals Report with the US Securities and Exchange Commissionin 2014.> > We have a goal to trace metals back to the smelters. This isdone using the joint industry tool, the Conflict Minerals ReportingTemplate. The collected information is used as an input tosupplier assessments.> > We are members of the Conflict Free Smelter Initiative whichincludes the Conflict-Free Smelter Program. This programmakes it possible for smelters to become certified by an independentthird party audit if the smelter does not source rawmaterials that contribute to conflict in the DRC. The certificationalso enables their customers to source metals from smeltersand refiners that are certified as conflict free.Continuous improvementsDuring 2014, we have taken further steps to increase the transparencyregarding conflict minerals in our supply chain. Ourfocus has been to improve the quality of supplier data. An ongoingchallenge is to obtain sufficiently high-quality supplier datato enable us to gain reasonable knowledge of the origin of theused minerals, given an extremely complex supply chain.During 2014 we have taken further steps to increase the transparency regarding conflict minerals in our supply chain.Ericsson | Sustainability and Corporate Responsibility Report 201419

A strengthened approachto health and safetyProviding a safe andhealthy workplace isof fundamental importanceto Ericsson. Ourambition is zero incidentsand we focuson con tinuous improvementsto reduce thenumber and severity ofOccupational Health andSafety (OHS) incidents.The OHS system helps to protect our employees and othersengaged in company business. The Ericsson Group ManagementSystem is certified to the OHSAS 18001 standard. Ericsson’soperations undergo internal audits as well as regular third-partyassurance audits.A comprehensive approachWe provide requirements and controls, guidance and trainingin a comprehensive approach to strengthen OHS performance.Competence and awareness is key to reducing major incidentsand must be based on trust and transparency, to encouragereporting of incidents. Unlike many companies, our approachextends beyond our own operations and includes our supplychain, where we see the greatest risks occurring.We also significantly strengthened and prioritized the OHSarea by integrating it into the Sustainability & CR organization,with higher management visibility, and appointed a new Headof Environment, Health and Safety.In 2014, 22 workplace fatalities were reported. Of these,one was an Ericsson employee, one was a member of the public(an accident involving a caretaker in a work zone), and 20 weresupply-chain related. These fatalities were reported in threecategories: 12 driving and vehicle safety; 9 involved climbingand working at heights; and one related to manual handling.FatalitiesYear to year reporting2520151050111201116201201520131212014Ericsson employeesSuppliers, employees, publicObs! Gjord med columnA challenge for the industry is a lack ofcommondesign.definitionPrata medand varying legislationEva/Catta/Sanna globally on how to om classify ev andreport frågor. fatalities in different areas, such asdriving vehicles. Ericsson intends to workGör så här: Färglägg inte fråntowards a more standardized frameworkpaletten. Markera staplar med vitafor pilen. reporting Välj Object–Graph–Column.but currently takes a morecomprehensive Där väljer man färg approach. och ev tint. This meansthat Kolla in the särskilt future att “Sliding” we may är exclude valt på someincidents “Column from type”. numbers currentlyreported as workplace related.Type–Options:1 stapel: 76% 70%2 staplar: 80% 80%As a leader in our industry, we support full transparency andaccountability in the area of health and safety, and report on andinvestigate all incidents that we are made aware of, includingthose relating to supplier operations.Towards zero incidentsAny workplace fatality is unacceptable and we are taking concretesteps to address this. A program “Zero Incidents in High-RiskEnvironments” was established in early 2014 to reduce severeincidents in high-risk operations in both Ericsson’s own activitiesand in the supply chain.The Zero Incidents program will increase OHS training andawareness of project managers, field service personnel andsub-contractors. It will reinforce governance and global tools,including instructions, check lists, training materials and escalationprocedures. If persistent violations occur, the supplier contractmay be ended. The Zero Incident program pilot waslaunched in early 2015 in the Netherlands, India and Egypt, andglobal rollout will follow later in 2015 and the first half of 2016.Radio waves andhealthEricsson employs rigid product testing and installationprocedures with the goal of ensuring that radio waveexposure levels from products and network solutionsare below established safety limits. The Company alsoprovides public information on radio waves and health,and supports independent research to further increaseknowledge in this area. Since 1996, Ericsson has cosponsoredover 100 studies related to electromagneticfields and health, primarily through the Mobile ManufacturersForum.To ensure scientific independence, firewalls were inplace between the industrial sponsors and the researchersconducting these studies. Independent expertgroups and public health authorities, including the WorldHealth Organization, have reviewed the total amountof research and have consistently concluded that thebalance of evidence does not demonstrate any healtheffects associated with radio wave exposure from eithermobile phones or radio base stations.In 2014, a new web-based general course on radiowaves and health was launched and is available to allEricsson employees. A second part of the course, withspecific information for employees working in environmentswhere general public limits on electromagneticexposure may be exceeded, will be launched in thefirst half of 2015.Source: Ericsson20 Ericsson | Sustainability and Corporate Responsibility Report 2014

Our people – anchoredby core valuesThe commitment of our people isessential to conducting businessresponsibly and meeting our sustainabilityand corporate responsibilitygoals.Ericsson’s core valuesOur values are the foundation of our culture.They guide us in our daily work, in how we relateto each other and the world around us and inthe way we do business.ProfessionalismRespectPerseveranceOur People Strategy starts with the businessdirection: to attract and retain thebest talent needed to maintain anddevelop our business. With an engaged,high-performing, and diverse workforce,we are better positioned to meet futurechallenges.Building on our strengthsOur core values underline who we are,how we do business, and how we behavetowards each other, within our teams andwith our customers. A key competitiveadvantage is being able to learn faster thanour competitors, which requires a highimpactlearning culture. We have a collaborativeand constructive environment,where innovation is encouraged, and peoplehave the freedom and support to turnideas into achievement. We also believethat a diverse and inclusive workplacesparks innovation and creativity, whichmakes our offerings to our customersmore competitive.People make the differenceOur global scale, technology and servicesleadership and strong sustainability andcorporate responsibility performancedepends on our people. Employees aremotivated by what Ericsson stands for andthey want to work for a company thatstrives to make a positive impact in theworld.Employees are highly engaged inEricsson’s success, demonstrated by theresults of our annual employee survey witha 93% participation rate. Our engagementindex is at 78%, and 89% of employeesstate they are “proud to work for Ericsson.”In 2014, as part of the Global EmployeeReferral Program, we increased thenumber of referrals by 21%.Ericsson | Sustainability and Corporate Responsibility Report 201421

Building skills forthe Networked SocietyIn the competitive ICT market, ourskills are our major advantage andan investment in our future. As wemove into the Networked Society,the rules of business are changingand so are the ways we learn anddevelop our competencies.Ericsson aims to be a best-in-class learningorganization that enables employeesto excel in their careers and contributes toEricsson’s market leadership and financialgoals. Learning in the Networked Societymeans driving a learning culture atEricsson. This includes both formaland informal learning, collaboration andknowledge sharing.Strategic approachIn order to stay relevant and remain apioneer and a thought leader in theNetworked Society, we need to keep continuousfocus on competence. We havea strategic approach to learning, usinga two-tier framework.Top-down, we have a process to identifygaps for strategic competences in relationto a specific position or geography.We close these targeted gaps throughdevelopment and deployment of globallearning programs. We have structuredformal and on-the-job training programs toA learning organization – 2014 facts and figuresShare ofemployeesthat tookformal trainingAveragelearninghours peractiveemployee78%26.7HOURSbuild competence in emerging technologyareas as well as focus on our sales, servicesand product development teams.The bottom-up approach is centeredon the individual performance discussionevery employee has annually. Employeesdiscuss with their manager how to closecompetence gaps, and identify learningand competence goals.Identifying competence gapsIn our 2013 report we identified a goal toincrease employee technical certifications30% over levels achieved in 2014. We subsequentlydetermined that this goal is notthe best measurement of our investmentsin building competence. Instead we decidedto track key measures such as closure ofcritical competence gaps, identified througha rigorous annual process working withthe business, including both technicaland non-technical employee skill gaps. In2014 we closed over 99% of the identifiedTotallearninghours: 2.7 millionNo. ofdifferentcourses: 13,000targeted employee critical competencegaps through training.Everyday learning modelOur “Everyday Learning” model consists ofon-the-job learning, collaboration forums,and formal training. This approach supportsvarious learning styles, which makesdevelopment easier for employees. As inall companies, our employees are busywith day-to-day activities and setting asidetime for learning is always a challenge.Hence, at Ericsson we aim to mix learninginto our daily work by offering activitiessuch as stretch assign ments, peer coaching,and providing several online learningand sharing tools.Taking learning virtualWe take full advantage of advancementsin the Networked Society to develop ouremployees’ competence. Learning ischanging. People learn on the go, andwant it at their fingertips. It has movedbeyond the traditional classroom towardsblended learning, including crowd sourcing,discussion forums, video sharing. Werecognize the importance of collaborationand knowledge management and havefocused on driving adoption acrossEricsson.In 2014, Ericsson Play, a corporatevideo- sharing platform, was launched. OurLearn Channel has 30 dedicated channelsfeaturing over 800 videos. Employees canaccess Learn@Ericsson Play at any time ontheir mobile device. The newly launchedEricsson Virtual Campus also enables ourbusiness and technology experts as wellas inspirational speakers to share theirknowledge and insights live with a largeemployee base worldwide, via the web, tosave time, energy and travel costs. Thesenew delivery channels are complements toour online Learning Portal.22 Ericsson | Sustainability and Corporate Responsibility Report 2014

Committed to DIVERSITYAND INCLUSIONA diverse and inclusive workforceis critical to Ericsson’s future success.Diversity not only drives ahigh-performing team and strongbusinessresults, it also enhancesemployee motivation, and helpsattract and retain top talent.In an increasingly global market, diversityhelps us better respond to the needs ofour customers and tap into greater innovation.Diversity and inclusion are also ofgreat concern to our stakeholders and tosociety at large – a trend we expect to continue.We engage in a wide variety of initiativesrelated to gender diversity, bothwithin the company, and to contribute tothe global debate on these issues.The diversity of our employees is one ofour major strengths as a business. It is thiscollective mixture of individuals, culturesand organizational experiences that drivescreativity, makes us stand out from thecompetition and delivers great results forour customers.Diversity spurs innovationDiversity has been high on Ericsson’sagenda for many years and we believediverse teams are the best teams. Theyare high-performing and innovative, with avariety of perspectives, experiences andreferences, which spurs creativity.We believe that achieving success in anincreasingly multi-faceted, global andcompetitive market requires tapping into abroad talent pool in which diversity is acentral component. Our definition of diversityextends beyond gender, race, religion,ethnicity, age and other establishedparameters to focus on diversity of thoughtwhich is a driver of innovation. We arecommitted to increasing diversity andinclusion at Ericsson, and have madeprogress, but when it comes to genderdiversity, we are not where we want to be.Gender diversity in focusGender diversity is a key focus of ourapproach. In order to accelerate progresstowards better gender balance, we haveset a goal that by 2020 women will makeup 30 percent of our employee population.In 2014, 22% of Ericsson employees werefemale. See gender-related data, p. 25.Our diversity strategy and supportiveframework are geared at putting the rightprocesses in place, raising awareness andencouraging open dialogue amongemployees. We measure progress througha diversity dashboard, in which a widerange of diversity statistics are gathered.Key figures are shared externally on theericsson.com Diversity and Inclusionweb page.Progress in embedding diversityA Global Diversity and Inclusion Councilmade up of senior business leaders drivesthe strategy. In addition, we are workinghard to embed diversity into humanresource processes such as talent acquisitionand talent management.Mentoring is used to promote genderdiversity: all members of the ExecutiveLeadership Team mentor a high-potentialfemale in the organization. We have alsocreated mentoring circles in some of ourregional operations.Women in Leadership is an Ericssonemployee network spanning Ericssonoperations in several countries and regionsworldwide. It helps participants achievetheir career goals with the help of mentoring,networking and engagement. Membersdrive internal events, collaborate withlocal organizations and universities andpromote relevant external events.signing the UN pledgeAs part of our commitment to diversity and inclusion, including genderequality, male employees are being encouraged to sign the UnitedNation’s HeForShe pledge. The HeForShe campaign, organized by UNWomen – the UN organization dedicated to gender equality and theempowerment of women – focuses on what men can do to address theinequalities and discrimination faced by women.Since its launch in September 2014, thousands of men around the worldhave supported the campaign including US President Barack Obama andUN Secretary-General Ban Ki-moon. At Ericsson, male employees areasked to sign a simple pledge that they are committed to gender equality.Ericsson President and CEO Hans Vestberg has signed the pledge, and allof Ericsson’s male staff members are urged to do the same.The campaign states: “When women are empowered, the whole ofhumanity benefits. Gender equality liberates not only women but also men,from prescribed social roles and gender stereotypes.”Right: Valter D’Avino, Head of Ericsson Region Western and Central Europe, and Head ofEricsson’s Diversity and Inclusion Council, supports the HeforShe campaign.Ericsson | Sustainability and Corporate Responsibility Report 201423

168nationalities are representedin Ericsson’s workforce.Celebrating differencesIn 2014, we celebrated our first DiversityAwareness Month, addressing issues fromsexual orientation to physical ability, culturalissues and gender. Ericsson celebratedInternational Women’s Day at theglobal level for the first time in 2014. Weheld over 25 activities across the worldand we produced more than 30 video portraitshighlighting “Ericsson’s outstandingwomen.” We also hosted our first GlobalGender Conference, attended by men andwomen. Attendees were empowered tobring the gender discussion to their ownlocations to raise awareness and theycreated activities at the local level.Recognizing unconscious biasesResearch confirms that we all harborunconscious biases that are a result of lifeexperiences, culture, background, andexposure. Biases influence decisionmaking and can affect perceptions andbehavior towards others. One of the waysin which we are furthering a constructivedialogue on inclusion is by raising awarenessof unconscious bias. Our aim is toreach the entire employee population inthe next three years. Face-to-face training isslated for business leaders and e-learningfor the workforce, with a target to reach30% of each group during 2015.The objective of the course for leaders:> > Raise awareness about diversity andinclusion> > Initiate a culture of constructive dialoguearound diversity and inclusion> > Learn about unconscious bias andimpact on decision making> > Increase awareness of techniques whichcan help overcome unconscious bias> > Identify one opportunity for drivingchangeSupporting women in technologyEricsson participates in various externaldiversity initiatives. A central focus isencouraging more women to join themale-dominated technology industry.We support TechWomen, whichempowers and connects next-generationwomen leaders from Africa and the MiddleEast in science, technology, engineering,and mathematics (STEM) by providingaccess and opportunities for careeradvancement.We are a founding partner of WomenUp,a leadership development program forhigh-potential women under the umbrellaof Hillary Clinton’s International Councilon Women’s Business Leadership.We also participate in Introduce a Girl toEngineering. The fifth annual “Girls in ICTDay” at Ericsson in 2014 included seminars,workshops, campus visits and aspeech by former US First Lady LauraBush. The aim is to encourage girls andyoung women to consider careers in ICT.Global outreachEricsson collaborates with the BroadbandCommission for Digital DevelopmentWorking Group on Gender and Broadbandin a mission to promote women in ICT.The Ericsson global education initiativeConnect To Learn (p. 44) promotes accessto secondary school education for girlsaround the world.Employees by age and gender 2014Female representation, %40,00035,00030,00025,00020,00015,00010,0005,000Obs! 30Gjord med columndesign. Prata medEva/Catta/Sanna 25om evfrågor.20Gör så här: Färglägg inte från15paletten. Markera staplar med vitapilen. Välj Object–Graph–Column.Där väljer10man färg och ev tint.Kolla särskilt att “Sliding” är valt på“Column5type”.29222019Obs! GdesignEva/Cafrågor.Gör så häpaletten.pilen. VälDär väljeKolla särs“Column0Under 25MaleFemale26–3536–4546–55Over 55Source: EricssonType–Options: 0201020112012201320141 stapel: 76% 70%2 staplar: 80%Overall80%workforce Line managers Executive (Top 250 positions)3 staplar: 70% 70%Executive Leadership TeamSource: EricssonType–Op1 stapel:2 staplar:3 staplar:24 Ericsson | Sustainability and Corporate Responsibility Report 2014

facts and figuresEmployeesNo. 2014 2013 2012 2011 2010Year end 118,055 114,340 110,255 104,525 90,261Average 117,156 116,630 112,758 103,130 91,825Temporary employees 776 493 766 901 978Employees who haveleft Ericsson 15,536 13,025 12,280 10,571 10,066Employees who havejoined Ericsson 19,251 17,110 18,010 24,835 17,834Satisfaction% 2014 2013 2012 2011 2010Engagement index 78 77 77 77 –Proud to say that I workfor Ericsson 89 89 88 89 –Extremely satisfied withEricsson as a place to work 81 80 80 80 –Recommend Ericssonas a great place to work 78 77 77 78 –Response rate 93 93 94 90 –Diversity – Background% 2014 2013 2012 2011 2010Executives with a backgroundother than Swedish(Top 250 positions) 54 48 55 50 50Executives with a backgroundother than Swedish(Executive Leadership Team) 29 29 29 29 36Diversity – Female representation% 2014 2013 2012 2011 2010Overall workforce 22 21 22 22 22Line manager 19 18 18 18 18Executive(Top 250 positions) 20 19 18 15 14Executive Leadership Team 29 29 29 29 14Diversity – Age and gender 2014No. Under 25 25–35 36–45 46–55 Over 55Female 2,680 9,557 7,777 4,410 1,399Male 2,683 36,316 30,062 18,072 5,099Responsible sourcingAudits and assessments2014 2013 2012 2011 2010Auditors 197 195 179 170 150Audits 444 479 494 392 550Assessments 151 144 152 270 218Occupational health and safetyFatalities (Ericsson employees)2014 2013 2012 2011Total 1 0 1 1North America 0 0 0 0Latin America 0 0 0 1Northern Europe & Central Asia 0 0 0 0Western & Central Europe 0 0 0 0Mediterranean 0 0 0 0Middle East 0 0 0 0Sub-Saharan Africa 0 0 0 0India 1 0 1 0China & North East Asia 0 0 0 0South East Asia & Oceania 0 0 0 0Major incidents (Ericsson employees)2014 2013 2012 2011Total 25 29 20 20 a)North America 0 0 0 0Latin America 12 16 19 19 a)Northern Europe & Central Asia 2 4 0 0Western & Central Europe 8 2 0 0Mediterranean 0 0 0 0Middle East 2 0 0 0Sub-Saharan Africa 1 0 0 0India 0 5 1 0China & North East Asia 0 0 0 1 a)South East Asia & Oceania 0 2 0 0Fatalities (Supply chain and others)2014 2013 2012 2011Total 21 15 b) 6 11 a)North America 2 2 0 0Latin America 5 0 1 8 a)Northern Europe & Central Asia 0 1 0 0Western & Central Europe 0 2 1 0Mediterranean 1 1 1 0Middle East 5 7 b) 2 2Sub-Saharan Africa 1 0 1 0India 6 0 0 1China & North East Asia 0 1 0 0South East Asia & Oceania 1 1 0 0a) Data revised in 2014.b) Fatalities reported in 2014.Major incidents (Supply chain and others)2014 2013 2012 2011Total 44 35 78 11North America 4 2 1 0Latin America 13 11 40 7Northern Europe & Central Asia 1 2 10 1Western & Central Europe 0 2 5 1Mediterranean 1 1 2 0Middle East 7 9 5 1Sub-Saharan Africa 1 1 7 0India 16 2 2 0China & North East Asia 0 4 4 1South East Asia & Oceania 1 1 2 0a) Data revised in 2014.Ericsson | Sustainability and Corporate Responsibility Report 201425

Energy,environmentand climateCHange26Ericsson | Sustainability and Corporate Responsibility Report 2014

ON ENERGY AND CLIMATE, ICTENABLES TRANSFORMATIONOur strategy is to maximize the energy performance of our products andsolutions, reduce the carbon footprint of our own activities, and drive thetransformation that enables a low-carbon economy.Ericsson takes a life-cycle approach toenvironmental management that includesraw material extraction, manufacturing,transport, use, disassembly and end-oflifemanagement. We focus on the followingthree areas:> > Reducing our own environmentalimpacts,> > Reducing environmental impacts fromour products and solutions in operation,> > Advocating and enabling ICT solutionsfor a low-carbon economy.Our life-cycle assessments consistentlyconfirm that Ericsson’s most significantenvironmental impact is the energy usedby our products in operation. O ur mainaim is to maximize the energy performanceof our products, services and solutionsto help customers optimize their networks(p. 30). We also seek to reduce the carbonfootprint of our own activities (p. 34).The ICT sector footprintThe ICT sector is responsible for about1.3% of total global greenhouse gas (GHG)emissions, according to the EricssonEnergy and Carbon Report (2014), whichlooks at the ICT sector’s own environmentalimpact in terms of electricity use andGHG emissions. It also includes an updateof our 2020 forecast for the sector’s GHGemissions.Even with the expected dramaticgrowth in mobile subscriptions, the totalICT impact is expected to account for nomore than 2% of the total GHG emissionsin 2020. This is largely due to advances intechnology, and industry-wide efforts toreduce energy consumption.However, in absolute terms the emissionlevels from ICT are still considerableand must be addressed. We prioritizeenergy performance throughout the networkto identify opportunities to reduceenergy consumption and GHG emissionsof mobile networks.The ICT enablement effectWhile the continued growth of the ICT sectorbrings with it a range of environmentalchallenges, we see huge potential for theICT sector to provide solutions that reduceglobal GHG emissions in other sectors. Infact, our research shows that the use ofICT has the potential to reduce global GHGemissions by approximately one sixth.ICT solutions help other sectors of societyto reduce GHG through dematerializationof physical products and systems, forexample, substituting travel with collaborativetools or substituting the need to producephysical products by deliveringe-products and services. Energy can begenerated, distributed and consumedmore efficiently through smart grids andsmart meters. ICT can also unlock efficiencygains in buildings, transportation,and logistics.Ericsson carbon footprint 2014Mtonnes CO 2e35302520151050–5˜ 3Measuring the impactIn 2014, we strengthened our focus onproviding solutions to help other sectors ofthe economy, primarily utilities and transport,to offset carbon emissions. In linewith this focus area, we set a target for2015: to reduce societal carbon emissionsby a factor of 2 in relation to carbon emissionsfrom Ericsson’s own activities in2014, by implementing ICT-enabled solutions,such as smart meters and smarttransport solutions.˜ 35 Supply chainActivities in 2014Own activities˜ 5˜ –0.3Future (lifetime) operationof products delivered in 2014Operator activitiesProducts in operationEnd-of-life treatmentApproximately˜Source: EricssonEnergy and Carbon ReportERICSSONENERGY ANDCARBONREPORTINCLUDING RESULTS FROM THE FIRST-EVER NATIONAL ASSESSMENT OFTHE ENVIRONMENTAL IMPACT OF ICTNovember 2014The Ericsson Energy and Carbon Report 2014focuses on the ICT sector’s own environmentalimpact in terms of electricity use and GHG emissions.It also includes an update of our 2020 forecast forGHG emissions of ICT; the first-ever national assessmentof the total GHG emissions attributable to theICT sector, and a detailed study of the life-cycleimpact of a smartphone. The research is a collaborationbetween Ericsson, telecom operator TeliaSonera,the KTH Royal Institute of Technology in Stockholmand Sony.Ericsson | Sustainability and Corporate Responsibility Report 201427

Smart street lightingEricsson Zero Site portfolio are smart encapsulated street furniture solutions.The lamp post solution is developed in co-operation with Philips to offer cityofficials an innovative way to support energy efficient LED lighting to meetsustainability goals, and enables network operators to offer improved city-widemobile broadband and app coverage. This street site solution is designed tobe deployed in just a few hours in a city environment.28 Ericsson | Sustainability and Corporate Responsibility Report 2014

Assessing ICT sectorcarbon footprintAccommodating growth in the ICTsector while enabling a low-carboneconomy was the focus of newresearch by Ericsson in 2014,including the first-ever nationalassessment of the life-cycleenvironmental impact of ICT.By 2020, global mobile subscriptions willreach 9.5 billion, according to the November2014 Ericsson Mobility Report. Mobiledata traffic is expected to increase annuallyabout 40% and will grow eight-fold by2020, driven by mobile broadband, cloudservices and new devices. This placeshuge capacity demands on tomorrow’snetworks.approximately 1.5 Mtonnes CO 2e in 2010.This corresponds to 1.2% of total SwedishGHG emissions.The main electricity-consuming categorieswere user PCs, data centers (servers)and other user equipment. These areasalso offer the larg est potential for reducingelectricity consumption.When applying a global average electricitymix to the ICT model for Sweden,the relationship between the manufacturingand use stage changes considerably forall parts, (see graph). The electricity mix isused for calculating CO 2 impact based ondistribution of energy sources used toproduce the electricity in an area.In our study, annual GHG emissions foran average Swedish subscription, recalculatedwith global electricity mix, rangesfrom 34 kg CO 2e for 2G mobile communicationsup to about 560 kg CO 2e for afixed (xDSL) broadband subscription or aworkplace (LAN) PC. The relatively largeimpact for fixed subscription is linked tothe average subscriber having a greaternumber of user equipment connected tothe fixed network. These devices are onaverage physically larger compared tomobile user equipment. Fixed ICT networkscarry the majority of the transmitted data,with a larger share of GHG emissionsbeing allocated from data centers.Data growth marginal impactOn a global basis the global GHG per subscriberfor ICT are estimated to decreasefrom ~110 in 2007 to ~72 in 2020, asshown in the graph. It is also expected thatindividual users will have more subscriptionsand devices in the future.Interestingly, the rapid increase in datacapacity is not having a significant impacton the overall carbon footprint of the ICTsector. Estimates indicate GHG emissionsper amount of fixed data transmitted willdecrease from nearly 6 kg CO 2e/GB in2007 to about 0.25 kg CO 2e/GB in 2020.For mobile data, the estimateddecrease is even greater, from about 100kg CO 2e/GB to about 0.5 kg CO 2e/GBduring the same period. In mobile networks,there was roughly 8 times moredata than voice traffic during 2014, andby 2020 there will be in the magnitudeof 30 times more data than voice traffic.Graph 1: GHG emissions per subscribers outlookkg CO 2e/subscriber2502001501005002007Graph 2: Annual GHG emissions for different average ICT subscriptions in Sweden 2010– global electricity mix in the use stagekg CO 2e2008200920102011201220132014201520162017201820192020Source: EricssonObs! Gjord med columndesign. Prata medEva/Catta/Sanna om evfrågor.Gör så här: Färglägg inte frånpaletten. Markera staplar med vitapilen. Välj Object–Graph–Column.Där väljer man färg och ev tint.Kolla särskilt att “Sliding” är valt påFixed“ColumnICT subtype”.Average ICT subMobileType–Options:ICT sub1 stapel: 76% 70%2 staplar: 80% 80%3 staplar: 70% 70%First-ever nationalassessment of ICT footprintIn 2014, the first-ever national-level studyof the life-cycle environmental impact of ICTwas published together with TeliaSoneraand KTH Royal Institute of Technology inStockholm. This unique study for Swedenis based on available statistical datafrom 2010.The total GHG emissions due tothe ICT sector in Sweden amounted to2G mobile communicationsBroadband telephony3G mobile broadbandClassic telephonyIPTV (high scenario)Fixed DSL broadbandOffice LAN0 100 200 300 400 500 600Source: EricssonUse (electricity consumption)Use (other energy)Manufacturing (embodied)Ericsson | Sustainability and Corporate Responsibility Report 201429

RETHINKINGenergy performanceWith our strategy to lead our sectorin network energy performance,Ericsson has taken a systematicapproach for energy performancethat will reduce energy consumptionwhile increasing app coverage.Energy efficiency has become a keypriority for the telecom industry as mobilenetwork operators are increasinglychallenged by the need to build energyefficientnetworks as well as deliver highperformance. Reducing energy consumptionmakes good business sense, satisfiesregulatory needs and contributes to reducingenvironmental impact.Generation shift brings efficiencyThe new Ericsson Radio System is a modularapproach to build and expand mobilenetworks. It represents a generationalshift. The energy-efficient Ericsson RadioSystem is designed to handle the mobiledata traffic increases expected by 2020.The system is half the size and weight anddelivers twice the capacity. It enablesoperators to capitalize on growing mobilebroadband demand from consumers,businesses and the Internet of Things tobuild their business as they evolve to 5thgeneration mobile systems.A holistic approachIn a mobile network, the radio accessnetwork (RAN) is the largest consumerof energy, and is therefore where mostenergy -efficiency improvements arefocused. However, addressing the totalcost of energy of a network covers morethan reducing energy consumption ofradio base stations. It requires a holisticapproach to address all aspects, fromnodes to sites to network.Address the installed baseImproving radio network energy performanceinvolves more than replacing oldequipment with new, more energy-efficienthardware. Much can be gained, for example,by deploying energy-saving softwarefeatures to the installed base. Whenevernew radio technology is added, existinggenerations remain. Solutions must thereforeaddress all generations of technology;> > From always on to always available,there are many RAN-specific energysavingfeatures for 2G, 3G, 4G, givingoperator the potential to reduce energyconsumption in existing radio equipmentup to 25%. For example BCCHPower Saving (GSM), see Turkcell case;Traffic Aware Power Saving (WCDMA)and Micro Sleep Tx (LTE).> > Prolong capacity life-cycle. An energy -efficient network can deliver neededcapacity for a long time based on flexiblecapacity growth rather than hardwareupgrades. Network capacity canbe increased by staying current with thelatest software release, without addingnew hardware.> > New hardware platforms that supportmulti-standard, multi-band are moreenergy efficient and future proof. Theradio unit from Ericsson Radio Systemprovides a 50% improvement in energyefficiency. Ericsson Radio System waslaunched during 2015.Build with precisionFrom our global installed base Ericssonoffers insights into traffic and network reality,enabling operators to understand howtraffic is distributed. Over-dimensioningdoes not always result in performancegains. Instead, it more often leads toincreased OPEX, higher energy consumption,and inflated capital expenditures –all of which impact the total cost of ownership.In one trial, energy consumption of adeployment with traditional, large-capacityradio base stations was compared withthat of a more precisely matched mix ofsolutions. Results showed that with thisapproach, it is possible to reduce energyconsumption by 40%.The different site capacity demandsneed to be matched with different variants ofbaseband and radio products, optimizedfor each of the desired traffic segments.Ericsson’s unique Psi Coverage is onesolution that has enabled acceleratedefficiency gain for TurkcellTurkcell, the leading mobile operator in Turkey, required a more efficient way to operate itsnetwork and to build in more capacity for increased mobile traffic while keeping energycosts under control. By deploying Ericsson’s energy-efficiency software feature BCCH(Broadcast Control Channel) Power Saving, Turkcell managed to reduce energy consumptionin GSM networks and improve network performance. The solution, designed to savepower in GSM networks, regulates the power level of time slots in the BCCH carrier whilemaintaining network quality. The feature aims to save energy by down-regulating the timeslots (except for TS0) at BCCH TRX (transceiver). Turkcell has deployed this feature for theentire network. It has not only reduced power consumption but improved network performance.The monthly average energy consumption per site decreased by 86.8 kWh, whichresulted in a 6% reduction of total energy consumption yearly for Turkcell.30 Ericsson | Sustainability and Corporate Responsibility Report 2014

deployment of 3G coverage and improveduser experience, while providing significantenergy and cost savings compared totraditional solutions. Successfully deployedin supporting 3G coverage globally, the PsiCoverage solution will during 2015 also belaunched for 4G networks. (See Croatiacase below.)Optimize on siteOne way in which we help operators solvechallenges on-site is through Remote SiteManagement. This assists operators tocontrol site expansion by adding intelligencethat manages energy consumptionwithin limits. It provides continuous informationof energy source which helps controland compare energy consumption at allsites. The remote Hybrid Control Managementensures an optimized usage of dieselgenerators, batteries, solar power, windturbine, fuel cells, etc. The battery life isalso prolonged through battery managementwhich helps avoide unnecessaryreplacements.Reduced energy despite demandBy implementing a systematic approach toenergy performance, it is possible for networkoperators to cover the forecastedeight-fold growth in mobile traffic between2014 and 2020 with reduced energy consumption.Leveraging small cells deploymentIn some environments – such as certainstadiums, busy streets and multi-storyoffice blocks, small cells provide a complementto macro cells in meeting userdemands. Indoor environments pose specialchallenges for service providers. Whensmall cells are implemented correctly, it hasthe potential to both improve performanceand to reduce energy consumption.Small-cell designs can enhance userperformance while reducing total networkenergy consumption compared with apure macro network. When small-cellnodes are added to a highly loaded macronetwork, energy consumption typicallyincreases, as more equipment is addedto the network, but capacity alsoincreases. If placed correctly, small nodescan provide users with better performancethan the macro node. This means thathigher data rates are possible with lesstrans mission energy.Global services reachWe work with our customers to determinethe optimal approach to maximize energyperformance and support future trafficgrowth. This includes an assessmentphase: to understand current energy consumption,set tailored KPIs, predict futurefor remote areas,exploring new approachesIn a project funded by the European Union (EU), Ericsson and partners are exploringhow fuel cell tech nology can power off-grid telecom stations. With growingpenetration of mobile services, the number of remotely located radio base stations(RBS) is on the rise. Unable to connect to the electricity grid, they rely instead onbatteries and diesel generators that can generate substantial carbon emissions.FCpoweredRBS, led by Ericsson, is a large-scale demonstration activity in collaborationwith the EU Joint Research Centre, and includes mobile operator TelecomItalia and 3 Italia. The project looks at the viability of fuel cells and other types ofalternative energy supply as an alternative to standard power sources. A fuel cell isa device that generates electricity by a chemical reaction.Integrated solutionIn ongoing field trials, the power supply of several radio base stations is replacedwith a new energy supply based on a solution that integrates different components(fuel cells, photovoltaics and batteries). The goal is increased energy efficiencyand improved total cost of ownership. Results show that the amount ofunattended hours can be increased, thanks to efficient use of the alternativeenergy sources and the storage potential of hydrogen. This means lower operationalcosts and positive impact on the environment for the operator.Alternative energy sources are selected based on local conditions such asweather conditions, time of day, battery load, and hydrogen. Electrolyzers contributeto generating hydrogen locally, with the aim of making the radio site energyindependentin the longer term.Final project results are expected during 2015.Psi coverage solutiondeployed on Croatia’s coastMobile operator Vipnet partnered with Ericsson to expand 3G coverage onCroatia’s coastline. Vipnet required a low-power solution for their solar-poweredsites. Tested on 20 sites, it was confirmed that the Psi Coverage solution offersup to 50% lower power consumption compared to alternatives, without compromisingnetwork coverage and performance. During 2014 the Psi Coverage solutionwas deployed in 16 networks across 14 countries and included customerssuch as Robi-Bangladesh, Millicom Ghana, Turkcell Turkey and Telin East Timor.Ericsson | Sustainability and Corporate Responsibility Report 201431

trends and propose realistic actions toreduce network energy consumption.To further optimize performance,together with the operator, we look at differentways to deploy, expand, restructure,upgrade, or migrate communicationsnetworks. We also explore implementingenergy-savings software and other features.Such solutions apply to building anew network, or expanding an existing one.We also offer the option to operate networkand energy-related infrastructureon behalf of operators. Our aim is to helpoperators reduce energy consumption,maximize efficiency, and improve networkavailability.Currently, about 240 million subscribersare served by networks for which Ericssonprovides Energy Management, as part ofManaged Services contracts. The serviceincludes around-the-clock, real-time monitoringof infrastructure and remote andon-site problem resolution for all, whetheror not they are connected to utility grids,along with ongoing energy- related optimizationto ensure energy is consumedin the most efficient manner.Partnering for greater reachAs a complement to Ericsson’s end-toendservice portfolio Ericsson has partneredwith the GSMA, the mobile industryassociation, on its Mobile Energy EfficiencyOptimization Service. The serviceundertakes site audits and equipmenttrials, analyses the costs and benefits ofspecific actions to reduce energy andemissions, and then works to implementthe most attractive solutions. This follows onfrom the GSMA Mobile Energy EfficiencyBenchmarking Service in which morethan 40 mobile network operators haveparticipated, accounting for more than200 networks and over half of globalmobile subscribers.Virtualized data centerData centers are important assets todeliver IT services, both for internal and forexternal use for most enterprises, includingoperators. They are often used to realizea cloud environment where many applicationsand users can share resources interms of computing, storage and network.Sharing resources between a number ofapplications and users enables a betterutilization, resulting in less overall need ofenergy-consuming hardware. For example,some applications are used moreduring the day; others more often at night.Cloud technology is therefore positive forenergy efficiency. An example from thetelecom world with a European mobileoperator shows that 60% energy reductionwas achieved when six locations for supportsolutions were consolidated into two,while still delivering the same capabilities.Ericsson’s data center offering has anumber of capabilities contributing tomore energy-efficient solutions. By usingthe latest generation of processors, it ispossible to increase system capacity by 20to 80% without any increase in power consumption.One example of an Ericssonsolution enabling virtualization and clouddeployments is the Ericsson Blade ServerPlatform (BSP) 8000, a family of bladeservers (electronic circuit boards containingmicroprocessors and memory) usedin telecom nodes. By introducing BladeServer Platform 8100 the power consumptionwill improve, compared to earlier hardwareconfigurations, as 20 to 200% moresubscribers can be handled with the samepower consumption.5G energy performanceEricsson is playing a leading role in developmentof next-generation 5G mobilecommunication systems, where keyrequirements and early concept developmentare now underway. A new generationof mobile communications technology is aunique possibility to introduce newrequirements and related capabilities.Energy performance, aiming at reducednetwork energy consumption, is one of thenew key requirements for 5G.First-round 5G research projects includethe EU-funded METIS 1) and 5GrEEn 2) .Standardization-related activities areexpected to start in 3GPP 3) during 2016.Energy performance in previous generationssuch as 2G, 3G, and 4G is focusedon moving from “always-on” to “alwaysavailable”network operation. 5G offers thepotential to take the next step to “alwaysoptimized.”Networks today, and in thefuture, will have to cope not only with hightraffic loads and coverage demands butalso with large traffic variations and lowaverage load. This calls for sufficient sleepmode possibilities to optimize energyperformance. Key means to achieve thisare advanced antenna techniques andultra-lean transmission 4) .RETHINK ENERGY PERFORMANCEApp coverageWhat is 5G?Among other things, 5G includes:> > 1000x higher mobile data volume> > 10 to 100x more connected devices> > 10 to 100x higher use data ratesSource: METISNodesSitesNetworksEnergy1) METIS - Mobile and wireless communications Enablers forthe Twenty-twenty Information Society. EU-funded researchproject 2012–2015.2) 5GrEEn – Towards Green 5G Mobile Networks. EIT ICT Labsfunded research project 2013–2014.3) The 3rd Generation Partnership Project (3GPP) unites seventelecommunications standard development organizations.4) 5G Energy Performance – Key Technologies and DesignPrinciples.32 Ericsson | Sustainability and Corporate Responsibility Report 2014

Handling e-wasteresponsiblyThe key material streams Ericssondeals with are ferrous metals, preciousmetals and plastics. The majority of thesematerials eventually re-enter the commoditiesmarket where they are sold to industryas raw materials.Operators Airtel and MTN have partnered with Ericsson to help withthe disposal and recycling of electronic waste in Africa.We provide product take-backservices to our customers globallyas part of our Extended ProducerResponsibility.According to UN StEP (Solving the globalE-Waste Problem), by 2017 global e-wastewill reach 65.4 million tonnes, one-thirdhigher than in 2012.The European Union (EU) Waste fromElectrical and Electronic Equipment(WEEE) Directive has been in force since2005. However, we apply our proactiveapproach globally to address the risksassociated with WEEE. These risks includeimproper handling and treatment, transport,emissions, and human health risks.We conduct product take-back with recyclingpartners that meet our requirements,and are certified according to internationallyrecognized environmental and recyclingstandards.World-wide free of chargeOur program is available free of charge toour customers globally, not only in marketsrequired by law. For example, in 2014, customersAirtel Ghana and MTN Africa bothtook advantage of the program. Ghanahas one of the largest e- waste dump sitesin the world. Airtel has partnered withEricsson to help with the dis posal andrecycling of electronic waste in Ghana,including telecom equipment from theirnetworks at end of product life.We continue working closely with ourcustomers to ensure their e-waste is handledand treated in an environmentallysound manner. Ericsson’s ecology managementprogram has, since its start in2005, taken back e-waste from morethan 107 countries.Increased take-backWhen we take back our products, werecycle more than 98% of the materials.We continue to expand our ecology managementprogram involving more countriesand increasing take-back volumes forour customers. Product take-back andrecycling levels have increased significantly,from 9,800 tonnes in 2013 to15,900 tonnes in 2014.Revised targetCollection levels were below the 2014 targetcommitment level of 17% take-back,especially in non-legislated (i.e. non-EU)markets. We believe that this target wasoverly optimistic and have thereforereduced the target for 2015 to a globalcommitment average of 9%. We are also inthe process of revising our requirementsconcerning our ways of working and ourinternal processes in this area. Company-widetraining is also being prepared.We believe these changes will have a positiveimpact on achieving the 2015 targetand enable us to substantially increase thetarget from 2016 and onwards.Further, in order to address these challenges,we have initiated a campaign toraise awareness and engagement amongour sales staff, as well as customers. Forexample, Ericsson is working jointly withcustomer MTN Benin in an e-waste projectto take back telecom e-waste as well asmobile phones, personal computers andother household e-waste.Take back process – treated%10080604020020102011RecycledReuse20122013EnergyLandfill2014Source: EricssonObs! Gjord med columnPrata med Eva/Catta/Saev frågor.Gör så här: Markera skiktade devita pilen. Välj Object–Graph–CDär väljer man färg som ska varöversta rundade delen. Kolla sä“Sliding” är valt på “Column typalla delar med rundad topp – inDe nedre markeras då med vitaColumn väljer man “none” och fsom vanligt från paletten swatcEricsson | Sustainability and Corporate Responsibility Report 201433

Improving performanceof our own operationsOur aim is to reduce our carbon footprint from directoperations while improving productivity and achievinga cost-benefit balance.Improving the sustainability performance of our own operationscomprises four focus areas:> > reducing energy use in facilities (offices, production sites,data centers and test labs) and prioritizing purchase ofgreen certified energy;> > shifting to low-carbon product transport, from air freightto surface shipping;> > reducing business travel by increasing use of videoconferencingand other collaborative work tools; and> > reducing fuel used in fleet vehicles.In 2012 Ericsson set an objective to maintain absolute CO 2e emissionsfrom business travel, product transport and facilities at 2011levels up to 2017. This equates to a reduction of 30% CO 2e peremployee. For 2014, the reduction was 10% CO 2e per employee.Facility energy useTo reduce our facilities’ energy use, we work to improve the efficiencyusage of our buildings by enhancing workplace functionality;shift to more energy-efficient buildings and implement Leadershipin Energy and Environmental Design (LEED) green buildingrequirements, level Gold, or the equivalent in other green buildingstandards.During 2014 the green building-rated area was maintained ataround 10%; however, the green electric power increased in 2014to 39% compared to 35% at year-end 2013. With an improvedreporting process in 2014, close to 80% of our real estate portfoliois now covered in an energy assessment. More flexible ways ofworking, including “free seating,” teamwork work-spaces andgreater use of video-conferencing contributed to a smaller carbonfootprint. In 2014, facilities’ energy usage was around 230Ktonnes CO 2e. In Sweden, we have had 100% green-certifiedelectricity since 2008.Ericsson own activities Carbon footprint intensity targetTonnes CO 2e/Employee1086420201120122013Mtonnes0.635.4320141.00.80.60.40.20.0Carbon footprint intensityTonnes CO 2e/EmployeeCarbon footprint absoluteemission, MtonnesSource: EricssonProduct transportationIn 2014, we continued our work of shifting from air to surfacetransport to reduce CO 2 emissions. Product volumes transportedwere comparable to 2013 which shows that we have reduced thetransport distances, mainly within air transport. We have achieveda reduction of 25 kTonnes CO 2e in absolute terms.Business travelIn 2014, business travel emissions were up around 8% peremployee. However, emissions from business travel declined by10% per employee, compared to the 2011 baseline. Video conferencingtools such as Ericsson Visual Communication arepromoted as a substitute to travel.Fleet vehiclesGrowth in Managed Services puts focus on our vehicle fleet. Weare targeting to reduce CO 2e/km in our vehicle fleet by purchasingmore efficient vehicles, implementing telematics, and trialing alternativerenewable fuels. A telematics pilot rolled out to more than1,500 vehicles allowed Ericsson to monitor attributes of vehicleoperations, performance, location and velocity. This has resultedin over 5% increased fuel economy.Global ICT Centerssave energyIn 2014, Ericson opened its first Global ICT Center, located inLinköping, Sweden. This is the first of three high-tech, GlobalICT Centers, which will house the company’s complete portfolio.Using the latest cloud technology, the center enables Ericsson’s25,000 R&D engineers to collaborate beyond bordersmore easily and efficiently, bringing innovation faster to market.Two will be located in Sweden; one in Quebec, Canada.Currently, Ericsson has test labs and data centers located invarious countries around the world. The strategy is to consolidatemost of these within the new Global ICT Centers, whichare placed in areas with access to renewable energy and a reliablepower grid. The centers will also significantly reduce ourcarbon footprint by using green certified power according tothe Swedish Green Energy system “Good EnvironmentalChoice.”The three ICT Centers combined will be up to 120,000square meters – approximately the size of 14 football fields.They will feature leading-edge design, with modular, scalableand efficient use of resources and space adaptable to businessneeds. Ericsson estimates that the combined architecture,design and location solution will reduce energy consumptionup to 40% – another step towards Ericsson’s vision of a moresustainable future.34 Ericsson | Sustainability and Corporate Responsibility Report 2014

facts and figuresConsumptionEnergy consumption (facilities energy use) (GWh)2014 2013 2012 2011 2010Electricity 761 845 808 830 650District heating 36 47 56 60 93Other energy 89 96 121 130 100Business travel (Mpkm)2014 2013 2012 2011 2010Air travel 1,392 1,320 1,200 1,400 1,250Road travel 113 77 74 129 90Fleet vehicles 411 390 339 – –Commuting 438 430 415 375 300Product transportation (Mtonnekm)2014 2013 2012 2011 2010Air transport 274 294 452 481 346Road transport 280 264 372 360 257Sea transport 276 309 338 99 58Rail transport 6 5 53 53 –Production and office waste (Tonne)2014 2013 2012 2011 2010Total 18,100 16,100 29,512 31,045 23,863Recycling 8,180 6,025 13,500 16,300 11,100Energy 5,080 5,215 9,900 8,400 6,600Landfill 4,580 4,510 5,400 5,400 5,100Hazardous 49 150 712 945 1,063Product Take-Back (T-B) and End-of-Life treatment (Tonne)2014 2013 2012 2011 2010e-Waste treated 15,862 9,872 7,748 a) 5,567 5,672Reuse 0 0 1 5 2Recycling 96 95 93 88 91Energy 2 2 4 5 6Landfill 2 2 2 2 1a) Data revised in 2014.Ericsson follows ISO 14040 and ISO 14044 standards when performingLife-cycle Assessments.GWh: Gigawatt hours = one billion (1,000,000,000) watt hoursMpkm: Million personal kilometer = Million distance traveledMtonnekm: Million *tonne* kilometerkTonne: Thousand tonneMtonne: Million tonneGHG: Greenhouse GasSource: EricssonEmissions (CO 2 e)Ericsson own activities (direct and indirect) (kTonne)2014 2013 2012 2011 2010Total 766 829 909 881 647Direct (kTonne)2014 2013 2012 2011 2010Total 298 357 355 260 204Facilities energy use (S1) 20 20 30 32 30Fleet vehicles (S1) 68 66 62 – –Facilities energy use (S2) 210 270 263 228 174Indirect (kTonne)2014 2013 2012 2011 2010Total 470 472 554 621 443Business travel (S3) 193 172 159 189 164Producttransportation (S3) 204 229 326 370 229Commuting (S3) 73 71 69 62 50Other indirect (Mtonne)2014 2013 2012 2011 2010Total 35 28 26 24 18Products in operation (S3)– future (life time) 35 28 26 24 18S1, S2 and S3 stand for Scope 1, Scope 2 and Scope 3 according toGHG protocol.Source: EricssonEmissions factors used in the consolidation (kTonne)Aspect Emission factor SourceElectricity Country specific International Energy AgencyElectricity, SwedenGreen electricityDistrict heating,Other regionsDistrict heating,SwedenFuelsAir travelCar travelAir transportsRoad transportsSea transportsRail transports0.0007 kgCO 2/kWh0.0010 kgCO 2/kWh0.22 kgCO 2/kWh0.10 kg CO 2/kWhGHG protocol(for each typical fuel)0.12 kgCO 2/pkm0.16 kgCO 2/pkm0.65 kgCO 2/tonnekm0.08 kgCO 2/tonnekm0.017 kgCO 2/tonnekm0.03 kgCO 2/tonnekmSites in Sweden uses “Good environmentalchoice” from Telge Kraft.Chalmers Industrial TechnologyAverage. Site specific whenavailable.Chalmers Industrial Technology/“Boverket” (Swedish BuildingAdm.)GHG protocol (average for long/medium air travel). DEFRA GHGindicators for long haul air travel.“Vägverket” (average car in the EU)(Vägverket = Swedish Road Adm.)Based on an investigation of airtransport by Ericsson.GHG protocol, average Swedishroad transports according toSwedish Road and TransportResearch Institute.Average of Maersk Line andEricsson typical TEU, TEU =Twenty foot container eq. unit.2012 Guidelines to Defra/DECC’sGHG Conversion Factors forCompany ReportingEricsson | Sustainability and Corporate Responsibility Report 201435

enabling a lowcarboneconomyThe Networked Society is creatingnew opportunities for ICT-enabledsolutions to accelerate the pathtowards a low-carbon economyand sustainable cities.In an unprecedented shift for society,Ericsson predicts that by 2018, 3G andLTE/4G will represent over 50% of all activemachine-to-machine subscriptions. And4G device penetration will soar from 3%today to 20% to 30% in 2020.Providing innovative solutionsEricsson solutions contribute to the lowcarboneconomy. For utilities, our solutionsinclude smart metering and smartgrid communications, enabling higherlevels of renew able electricity and reducedhousehold energy consumption.Within transport, connected vehicles,ships or public transport contribute tosafer, more efficient traffic flows, amongother benefits. Real-time data enhancesdisaster and emergency managementand enables quicker response.Cities at epicenterNowhere are these ICT-enabled solutionsmore evident than in the world’s fastgrowingcities. But far more can be doneto capture the opportunities enabled byconnectivity and tap into new levels ofefficiency and innovation in support ofsustainble development.By 2050, 7 out of 10 people will live incities. Already today cities account for over70% of global greenhouse gas emissionsand 60–80% of global energy consumption,according to UN-Habitat.Citizen field engineer conceptIn 2014 Ericsson and UN-Habitat conducteda social impact assessment of anew approach to address water quality,availability and affordability in Nairobi,Kenya. The concept, Citizen Field Engineer,developed by Ericsson, builds onresources and skills in the local communityto enable and improve service delivery andinfrastructure maintenance in informalsettle ments where city authorities oftenhave a weak presence. Under the concept,sensors and connected infrastructureare used to monitor water supply andwater quality and community residentscan become citizen field engineers to performingmaintenance tasks on the physicalinfrastructure and receive mobile paymentfor their work. The water service providercan use sensor data to identify and locatepoint sources of pollution. Looking at howthis theoretical concept would apply inKibera, Nairobi’s largest informal settlement,it was found to have potential toimprove water availability and quality,water governance as well as improvegender equality.Smart parking and lightingIn Águas de São Pedro Digital Cities, Brazil’sfirst digital city, we are working with mobileoperator Telefonica to enable digital servicesand an integrated urban network. Forexample, CO 2 emissions can be reducedvia intelligent sensors and controls thattailor energy consumption more preciselyto demand. Ericsson is providing smartlighting and smart parking solutions andsystem integration for the project.Smarter public transport in ChileTo optimize the public transport system inSantiago, Chile, Ericsson is conducting apilot with mobile operator Entel to providelocation-based services technology thatwill allow Subtrans, Chile’s transportdepartment, to monitor the movement ofEntel users in the Transantiago bus andmetro system. The data will be used bySubtrans to manage the system’sresources more efficiently and quicklydetect areas for improvement. The data isgenerated by the mere use of Entel’s networkwhile moving through the city; in nocircumstances are any subscribers individualized.Measuring ICT’s impactMore research will help identify indicatorsmeasuring ICT’s societal impacts. As amember of the ITU Technical Focus Group,“Smart and Sustainable Cities,” we arehelping to develop a methodology toassess ICT’s environmental impact incities. Standardized frameworks cansupport integration of ICT services insmart cities and measure outcomes.36 Ericsson | Sustainability and Corporate Responsibility Report 2014

Hot consumer trendsSustainability is increasingly top of mind for consumers in use of technology, according to EricssonConsumerLab’s “10 hot consumer trends for 2015.”> > Helpful homes. Consumers show high interest in having home sensors that alert them to water andelectricity issues, or when family members come and go.> > Smart citizens. The idea of smart cities is intriguing – but a lot of that intelligence may actually comeabout as a side effect of the changing everyday behaviors of citizens. As the internet makes us moreinformed, we are in turn making better decisions. Consumers believe traffic volume maps, energyuse comparison apps and real-time water quality checkers will be mainstream by 2020.> > The sharing economy. As the internet enables us to efficiently share information with unprecedentedease, the idea of a sharing economy is potentially huge. Half of all smartphone owners areopen to the idea of renting out their spare rooms, personal household appliances and leisure equipmentas it is convenient and can save money.> > My information. Although sharing information when there is a benefit is fine, smartphone ownerssee no point in making all of their actions open to anyone. Some 47% of smartphone owners wouldlike to be able to pay electronically without an automatic transfer of personal information. Some56% of smartphone owners would like all internet communication to be encrypted.The 2014 NetworkedSociety City IndexThe index ranks 40 cities andmeasures their ICT maturity interms of leverage from ICTinvestments in economic, socialand environmental development:the “triple bottom line” effect.One of the key findings fromthe report is the fact that citieswith a low ICT maturity tend tobe improving their ICT maturityfaster than high-performingcities, indicating a catch-upeffect. Many cities also havethe opportunity to leapfrogothers by avoiding expensiveand increasingly obsolete physicalinfrastructure and insteadmoving straight into innovativeapplications using advancedmobile technology.Smart citizensA 2014 online survey by EricssonConsumer Lab found that using the internetto offer smarter, more informed choicescould alleviate urban concerns aroundhealth, commu nication and traffic. Smartphoneusers aged between 15 and 69were surveyed from Beijing, Delhi, London,New York, Paris, Rome, São Paulo, Stockholmand Tokyo representing 61 millioncitizens. Among the key findings:> > 76% want sensors in public spaces thatlet them know what areas are crowdedand best avoided> > 70% want to compare energy use withneighbors to optimize behavior> > 66% want real-time control of drinkingwater quality> > 74% want interactive street signs andbike/car sharing.CONSUMERLABSmartcitizensHow the internet facilitatessmart choices in city lifeAn Ericsson Consumer Insight Summary ReportNovember 2014NETWORKEDSOCIETYCITY INDEX2014 >70%ENERGYof smartphone owners believe thatUSECOMPARISONAPPSTRAFFICVOLUMEMAPSWATERQUALITYCHECKERSwill be mainstream by 2020.Source: Ericsson ConsumerLab report 10 hot consumer trends 2015Ericsson | Sustainability and Corporate Responsibility Report 201437

Intelligence in the gridFor the utilities industry, connectivityoffers a chance to explore newbusiness models that enable grea t-er use of renewable energy andhelp consumers cut energy use.In a drive for efficiency, the energy industryis increasingly looking to connectivity toaddress challenges and opportunitiesaround sustainable development throughoutits value chain, from extraction ofresources all the way through to consumptionof electricity in homes and buildings.In many countries, utilities are keen tomanage energy load and boost networkefficiency to avoid having to invest in additionalpower generation. They also wantto empower consumers to better manageconsumption.Intelligent gridWith smart grids and smart meters, utilitiescan monitor their assets more intelligently,enable consumers to better manage electricityuse, and greatly reduce the complexityand cost of integrating use ofrenewable energy.Many utilities are making substantialinvestments in ICT – both in terms of technologyand new business models rangingfrom smart grids and metering deploymentsto full-scale IT transformationprojects. It is all part of a wider shifttowards distributed, intermittent renewableenergy generation, greater systemenergy efficiency, consumer involvement,peak demand reduction and developmentof electrical vehicles.Ericsson has been a solutions providerfor the utilities industry for several years.What is a smart grid?To date, Ericsson has provided smartmetering and smart communicationssystems for utility customers in eight countriesacross Europe (France, Italy, Estonia,Sweden, Spain, Ireland, Finland and theUK), Canada and Australia. Significantutility contract announcements in 2014include Landis & Gyr and Con Edison, withearlier announced contracts ongoing withE.ON, Elektrilevi, Acea and Hydro Quebec.The business represents a mix of managedservices, smart metering as a service andsmart meter deployment projects.Smart grids use ICT to gather and act on information about the behavior of suppliers andconsumers using the grid. This information can improve the efficiency, reliability and sustainabilityof electricity production and consumption. Utilities are rapidly introducingremote control and automation technologies that transform delivery systems into smartgrids and customers’ meters into smart meters. This requires communication networksolutions, as well as operational and business management support solutions.Bringing smartmeters to EstoniaTwo years into an eight-year contract with Estonian electricity supplier Elektrilevi, morethan half of the 630,000 total smart meters planned for Estonia have been installed.The project includes installation of a central automatic meter reading system (AMR)for data gathering and integration into Elektrilevi systems, as well as AMR managedservices during the rollout period.Customers receive smart meters that can be read remotely, allowing them to saveenergy and money by adjusting energy purchases and consumption based on dailyelectricity prices. Smart meter customers also get more accurate and timely bills. Infuture, smart meters may help the utility find and eliminate power outages more quickly.Elektrilevi is using the smart meters to suit customers’ individual needs, sinceElektrilevi receives data from every connection point. Other benefits to Elektrileviinclude lower costs and risk, improved network operation and maintenance andregulatory compliance in both the EU and Estonia.Ericsson integrated the meter and data management operations support systemsand will operate the smart metering network on Elektrilevi’s behalf. After 2016, Ericssonwill provide maintenance for three years and Elektrilevi has the option of extending themaintenance contract until 2025.38 Ericsson | Sustainability and Corporate Responsibility Report 2014

Transport shifts gearsWith continued global growthprojected for transportation andmobility, tackling associated environmentalchallenges and drivingefficiency gains, reduced emissionsand improved safety is vital.Environmental and climate change concernscombined with pressures on reliableenergy supply are causing the transportsector to shift gears towards more sustainablemobility solutions.Mobility at seaimproves efficiencyWe offer a number of solutions to contributeto this new direction. For the automotiveindustry, this includes enhanceddriving safety supported by new telematicsand data analytics, along with infrastructurefor electric vehicle charging.Exchanging information, traffic androad data can help drivers make betterchoices and avoid dangerous situations.Cooperative driving provides real-timeinformation about driver intentions so theycan avoid risks when changing lanes.Additionally, our solutions enable activeMaersk Line, the world’s largest ocean carrier, was looking for a system that couldmonitor the reefer containers onboard. Ericsson provided a GSM communicationnetwork on Maersk’s vessels as well as internet for its fleet. The solution combinesmobile and satellite technology with global reach in professional managed services.For Maersk, benefits of the solution include:> > The ability to see the position, speed and direction of the vessels> > Transfer of data from refrigerated containers to a back-end system.support in critical situations – automatedsystems can help avoid imminent collisions.Shared hazard information and intelligenttraffic management help authoritiesimprove safety.Partnering with automakersWe are working with a number of companiesin the automotive and ICT sectors,including Volvo Cars, to realize thesepossibilities.Connected bike helmetIn a ground-breaking collaboration,Ericsson, Volvo, and protective gravitysports gear manufacturer POC presentedproof of concept in 2014 for an innovativesafety technology connecting drivers andcyclists for the first time. The cloud-basedtechnology connects cyclists through aconnected helmet with car drivers. By sharingand comparing each other’s positionsthe two road users can get alerts of closeencounters to avoid possible collisions.Together for safer roadsAccording to the World Health Organisation,road traffic crashes are the 8th leadingcause of death worldwide. We are oneof ten founding members of Together forSafer Roads, launched at the UN in 2014to improve road safety, reduce road trafficcollisions and help the UN fulfil its goal ofhalving road deaths during the Decadeof Action for Road Safety. A primary goalof the coalition is to foster cross-sectorcollaboration to identify and scale bestpractices.Smarter shippingIn the shipping industry, our solutions givecompanies new ways to cut fuel costs andrevolutionize cargo management with lesswaste of perishable goods.The intelligence enabled by ICT providesthe insight and solutions for fleetoperators and shipping companies to reapsubstantial operational efficiency gains.Speed and position monitoring of plannedroutes are done efficiently, leading topotential fuel savings.Ericsson | Sustainability and Corporate Responsibility Report 201439

communicationfor all40 Ericsson | Sustainability and Corporate Responsibility Report 2014

Connecting theunconnectedICT is increasingly recognized as an essential means of boosting social andeconomic development. We need to scale for impact in order to make the full rangeof possibilities in the Networked Society affordable and accessible to all.From boosting livelihoods and promotingfinancial inclusion and gender equality toimproved access to health, education,government services and more, ICT is anessential part of every aspect of our lives.It also helps advance equality, democracy,governance and freedom of expression.Today those benefits are available tomore people than ever before with therapid growth of mobile communications.Smartphones are becoming increasinglyaffordable. This means people inregions with low levels of internet penetration,such as sub-Saharan Africa, will beable to take advantage of full connectivityfor the first time via their smartphones.Connecting the unconnectedDespite these positive trends, an estimated2.5 billion people remain unconnected tomobile devices, and 4.4 billion of the worldpopulation still do not have access to internet.In a business as usual scenario, 1.7billion will still be unconnected to mobiledevices in 2020. This digital divide is moreprevalent in rural areas and affects theleast-developed countries and marginalizedpopulations disproportionately.In connecting the unconnected, thereare huge opportunities for business, andsociety, but this transformation will nothappen on its own. Through use of ourtechnology, we combine mobility, broadbandand cloud services to improveaccess to healthcare, education andlivelihoods around the world. If affordableand fully accessible, the internet extendsopportunities to all, allowing everyone tobenefit from the digital age on more equalterms, which leads to positive impacts forbusiness, people and society.Greater efforts are needed by industryand governments to close this gap as marketforces are not sufficient in the nearterm in order to address the three mainbarriers to progress: infrastructure, affordabilityand usage.While strong economic growth in thedeveloping world has helped lift millionsout of poverty, global population growth,modern lifestyles and consumption arenow stretching the limits of the planet’sresources. ICT has radically transformedcommunication and daily life, opening upnew possibilities for helping to put theworld on a more sustainable path.Making a differenceWe apply our innovation and technology todevelop solutions in response to globalchallenges; the use of M-Commerce as aninnovative business platform to addressfinancial inclusion is just one example.In our belief that technology is a forcefor good, we are also committed to makinga contribution, in partnership with others,to address the many humanitarian crisesthe world faces, from refugees to healthand education to disaster relief.85% of the growthin 3G and 4G connectivitywill be in Asia Pacific, theMiddle East and Africa.”Source: Ericsson Mobility Report(November 2014)Measuring our impactIn 2013, Ericsson set an objective to positively impact 2.5 millionpeople directly through our Technology for Good initiatives by2016. In 2014, we exceeded that goal, positively impacting over4 million people. This has inspired us to revise our objective to5.5 million people positively impacted by 2016.While often difficult to establish exact causality betweenICT and a specific outcome, we have a number of ongoing monitoringand evaluation activities. For the time being, we havedetermined that the most reliable indicator to track our progressis to measure the number of people positively impacted by ourTechnology for Good programs, the additional people coveredby Ericsson-enabled mobile broadband networks in low-andmedium-HDI (Human Development Index) countries, as definedby the UN Development Programme, and the number of peoplewith increased access to financial services resulting fromdeployment of Ericsson technology and solutions.Ericsson | Sustainability and Corporate Responsibility Report 201441

Mobile moneymeets needs of unbankedMobile commerce is creating a newfinancial ecosystem to address theneeds of the world’s unbankedpopulation, creating unprecedentedopportunities for inclusion.The World Bank reports that some 2.5billion people are unbanked, the majorityin emerging markets and developing countries.And yet 70% of the world has accessto a mobile phone.Studies show that broader participationin the financial system can reduce incomeinequality, boost job creation and directlyhelp people better manage risks andabsorb financial shocks.Mobile financial services can alsoempower marginalized groups such asrural women by providing the confidentialityand convenience they require. In developingcountries 37% of women have accessto a bank account compared to 46% of men.Ericsson is driving the next generationof mobile commerce development by connectingbanks, operators, money transferorganizations, and payment and loan providers.This industry-leading work is creatinga more flexible, transparent and openfinancial ecosystem that helps key stakeholdersspeed the launch of mobile financialservices to drive financial inclusion.One m-wallet, multiple usesPeople will be able to use their m-walletsfor banking, payments and remittancesbetween banks, shops, employers, governmentinstitutions and customers, allcarried out on a single, secure platform.Available in indigenous languages as wellas Spanish, the service aims for universalinclusion and appeal. The solution isexpected to be implemented in phasesand available in the Peruvian market in2015.Ericsson’s M-Commerce solutions arealready deployed with mobile operatorMTN in Uganda, Rwanda, Nigeria,Swaziland and Zambia. Ericsson is workingwith operator Millicom’s Tigo platformin Senegal.Overcoming challengesFor m-commerce to gain traction inregions with low financial inclusion, a numberof factors must be addressed. Theseinclude regulation linking mobile operatorsand financial institutions, supportive governmentpolicy, consumer education andlocal system capacity.Partnering with Peru’s ASBANCIn 2014, ASBANC, Peru’s National BankAssociation, selected Ericsson to designand implement its Mobile Money project,the country’s largest private initiative forfinancial inclusion. ASBANC estimates that2.1 million Peruvians will own and benefitfrom a mobile wallet by 2019.The initiative with ASBANC is significant.In addition to the 13 major banks of Peru,bank agents and mobile operators plan toget connected to the Mobile Wallet Platformto create an m-commerce eco-system inPeru to address the financial needs of theunbanked population.The platform will feature easy-to-useand secure next-generation mobile financialservices, capable of hosting all servicesfrom different financial and commercialinstitutions to secure interoperability.The Ericsson M-Commerce solutionincludes the development of the mobilemoney platform, systems integration, learningservices, managed services and support.Mobile financial services enable small-scale entrepreneurs to accept convenient mobile payments.42 Ericsson | Sustainability and Corporate Responsibility Report 2014

Bringing 4G tothe Peruvian AmazonIn 2014, Ericsson implemented thefirst rural connectivity project inLatin America to provide internet toAmazon communities with 4G/LTEtechnology, together with mobileoperator Telefonica Peru. The aimis to further social inclusion, fostereconomic growth, and contributeto a better quality of life for thousandsof people.This is the first project in LatinAmerica to use 4G technology asfixed wireless internet access inremote rural areas with difficultgeography, such as that of theAmazonian jungle – going a longway in bridging the digital divide forpeople living in these communities.Many socio-economic benefitsGovernment entities in the PeruvianAmazon, such as schools andhealthcare centers, will gain internetaccess via 4G/LTE during2015. With over 500,000 squarekilometers, the Peruvian Amazonhas some of the greatest biodiversityand largest amount of oldgrowthforest in the world.Providing internet access willnot only help with reducing thedigital gap and fostering economicgrowth, but also provide peoplein these isolated areas the advantagesconnectivity can offer interms of education, job creationand a better quality of life.For the first time, these remoteand inaccessible areas will beconnected not only with the restof Peru, but also with the wholeworld.Remote rural areas in the Amazon will now benefit from internetaccess through mobile connectivity.Connecting communitykiosks in AfricaEricsson, The Coca-Cola Company andGerman start-up Solarkiosk are piloting aproject to leverage the role of ICT in improvingsocio-economic development for ruralvillagers in Africa, with a focus on empoweringwomen. Ericsson will provide mobilebroadband solutions for Coca-Cola’sEKOCENTER, a modular communitymarket that is run by local woman entrepreneursand also provides safe water,solar power and internet access.The kiosk will serve as a hub where freeand fee-based services can be offered,ranging from education, healthcare,finance, information and entertainment.Many of these services cannot be deliveredwithout connectivity. The ultimategoal of the pilot is to empower the localcommunity and find commercially viablesolutions that can scale.Using solar powerEricsson will deploy its solar-poweredManaged Rural Coverage solution toprovide telecom services in the rural areaswhere the kiosks are located. The communitywill enjoy 3G services that will be runusing solar energy, generated through thekiosks designed and built by Solarkiosk.Ericsson’s TV Anywhere service will providenews, information and entertainmentand health and education capabilities.Together, the solutions make the kioska connected hub for the community.Pilot in RwandaThe first connected EKOCENTER willbe piloted in Rwanda in 2015 with Tigo.Based on the results, there are plans tolaunch connected kiosks in several sitesin Rwanda and other African countries.Ericsson will provide mobile solutions for Coca-Cola’sEKOCENTER.Ericsson | Sustainability and Corporate Responsibility Report 201443

Extending the reachof Connect to LearnOne of the world’s most pressingglobal challenges is ensuring accessto education, which is a fundamentalhuman right. Despite majorprogress over the past decade,many young people, particularlygirls in developing countries, lackaccess to secondary education.Society loses out, too. Countries witheducated populations have better health,educational, social and economic outcomes.Connect To Learn was conceived toaddress some of the challenges relating tosecondary education access and quality.It is a global education initiative launchedin 2010 by the Earth Institute of ColumbiaUniversity, Millennium Promise andEricsson to scale up access to quality secondaryeducation, in particular for girls, byproviding scholarships and bringing ICT toschools in remote, resource-poor parts ofthe world, over mobile broadband. To datethe initiative is launched in 21 countriesand benefiting some 50,000 students.In support of the SDGsInitiatives such as Connect To Learn canplay a key role in helping achieve futureSustainable Development Goals (SDGs).Proposed SDG 4 (4.1) sets out that “by2030, ensure that all girls and boys completefree, equitable and quality primaryand secondary education leading to relevantand effective learning outcomes.”Ericsson is taking an active role promotingaccess to ICT and broadband in the SDGConnect To LearnNumber of students60,00050,00040,00030,00020,00010,000020112012201343,0502014Estimated2015Source: Connect To Learnprocess, as a member of the UN SustainableDevelopment Solutions Network andthe Broadband Commission on DigitalDevelopment.Scaling up girls’ education in MyanmarEricsson and the UK Department for InternationalDevelopment (DFID) and partnershave joined forces as part of DFID’s Girls’Education Challenge to support girls’ educationin Myanmar (also known as Burma).It aims to improve access to the internet,delivering teacher training and enablingstudents to experience a 21st centuryeducation. The collaboration with the UKgovernment and DFID is Ericsson’s firstpublic-private partnership with a government.Through the unique constellation ofpartners, we believe it is one meaningfulway to bring scale and impact to ConnectTo Learn.In Myanmar, only 54% of secondaryschool-aged children are enrolled in secondaryschool, according to the WorldBank. As the population of Myanmarbegins to enjoy the benefits of mobilecommunications, the intention is thatstudents will not be left behind.Obs! Gjord med columndesign. Prata medEva/Catta/Sanna Connecting om ev more than 30 schoolsfrågor. Leveraging Connect To Learn, the initiativeGör så här: Färglägg will inte allow från more than 30 secondary schoolspaletten. Markera staplar to be med connected vita to the internet throughpilen. Välj Object–Graph–Column.Där väljer man färg mobile och ev tint. broadband, with deployment to theKolla särskilt att “Sliding” schools är valt på set for 2015. Professional developmentprograms for teachers, educa-“Column type”.Type–Options: tional content for students, and childfriendlycomputing solutions to1 stapel: 76% 70%improve2 staplar: 80% 80%Grade nine students in Bhutan, part of a pilot e-learning project “iSchool.”literacy and numeracy among females areamong the aims.Ericsson is working with UNESCO, theEarth Institute at Columbia University, FinjaFive, Qualcomm Incorporated, through itsQualcomm© Wireless Reach initiative,and the external evaluator EduEval todeliver the program.Up to 600 scholarships will also beprovided to marginalized girls. The deploymentsare supported by mobile operatorMyanmar Posts and Telecommunicationsand will benefit 11,000 students in the firsttwo years.Reaching remotest BhutanWe partnered in 2014 with the Governmentof Bhutan, the Ministry of Education andBhutan Telecom to roll out a pilot e-learningproject “iSchool.”Based on Connect To Learn, the projectaims to provide access to qualityeducation to 250 grade nine students atsix schools in remote areas of Bhutan.Ericsson is deploying videoconferenceand commu nications technology; BhutanTelecom will provide high-speed mobilebroadband. If successful, the initiative isplanned to extend to some 200 schools.Extending outreach in Sri LankaIn Sri Lanka, a partnership betweenEricsson, Mobitel and Open Universityof Sri Lanka brings ICT and computer literacyeducation to teenage girls in farmingcommunities in Sri Lanka.44 Ericsson | Sustainability and Corporate Responsibility Report 2014

Launch in Northern GhanaIn Ghana, Connect To Learn is beinglaunched in the Millennium Village in theNorthern Ghana SADA region with mobileoperator Tigo, which will benefit over 7,000students, in four secondary schools. Thiswill build upon Connect To Learn’s girls’scholarship program, which was launchedin SADA in 2013. The launch of Connect ToLearn follows Ericsson’s deployment of a3G network to eight sites in the SADAregion, in cooperation with Tigo.Today over 500,000 people in 12 countriesin sub-Saharan Africa are benefitingfrom connectivity in engagement with theMillennium Villages Project (MVP). Thisconnectivity has made it possible to introduceConnect To Learn as well as otherservices that benefit villagers, for examplewithin health and small businesses development,which is improving livelihoods.Girls in Ghana take advantage of cloud-managed education through Connect To Learn.Current Connect to Learn deploymentsTUNISIAMEXICOCAPEVERDEBHUTANCHINASENEGALINDIABRAZILSRI LANKAMYANMARCHILEBURKINAFASODJIBOUTIUGANDA RWANDA MALAWIThis map covers deployments of Ericsson’s cloud-managedICT solution for education (ongoing and scheduled for firsthalf of 2015) in conjunction with the Connect To Learn andWPDI Initiatives.GHANAETHIOPIASOUTHSUDANKENYATANZANIAEricsson | Sustainability and Corporate Responsibility Report 201445

ericsson responseOur employee volunteer program Ericsson Response has responded to natural disasters and humanitariancrises since 2000; in 2014, an important mission was bringing critical communications supportto West Africa during the Ebola crisis to aid humanitarian workers on the ground.Ericsson Response is a global initiative ofaround 140 specially trained employee volunteerswhich provides communicationsexpertise, equipment and resources toEricsson Response has been supporting communityhealth workers on the frontline of the Ebola crisis.assist humanitarian relief organizations inresponding faster and more effectivelywhen disaster strikes. Since its formation,employee volunteers have been deployedin over 40 relief efforts in 30 countries.Ericsson Response supports UN andhumanitarian workers with emergencytelecoms support as a leading partner ofEmergency Telecom Cluster (ETC). During2014, Ericsson Response volunteers continuedto assist humanitarian workers inmissions including: the aftermath of thedevastating typhoon in the Philippines;assisting aid workers in Internally DisplacedPersons (IDP) settlements in bothSouth Sudan and Iraq; as well as engagingin the Ebola response.Emergency telecoms in west AfricaTo support Ebola relief efforts in westAfrica, Ericsson Resp onse has beenrequested to support the ETC and theirrole in the UN Mission in Ghana andSenegal, as well as supporting connectivityin common oper ational areas in SierraLeone, Ghana and Guinea.The deployment of some 15–20 of ourWIDER (Wireless LAN in Disaster andEmergency Response) solutions aresupporting up to 65 sites in West Africa,including emergency treatment units andconnecting thousands of humanitarianworkers to the internet.Transforming humanitarian responseThe spread of Ebola, the Syrian refugee crisisand the less high-profile crisis in SouthSudan all present different challenges tothose working with humanitarian response.The challenge is knowing what technologyto leverage, and how to best make use ofdata and partners. Just as many industriesare experiencing data, mobility and cloudtransformations, modern technology isincreasingly seen as a way to improve theeffectiveness and efficiency of humanitarianresponse. Ericsson has worked withhumanitarian response and Technologyfor Good for more than 15 years, helpingorganizations to address humanitarian andsustainability challenges.ViewpointRight now we are facing an unprecedentednumber of humanitarian crises around the world. It’smore important than ever that we look for new solutionsto take on these challenges. We’re looking at refugee displacementin Syria, a major crisis in South Sudan, and inWest Africa we’re fighting the Ebola outbreak. Ericsson’scommitment in responding to the great many humanitariancrises around the world will be a tremendous benefitto our joint ability to create new partnershipsand respond more effectively to people onthe ground. We believe our two organizationscan be extraordinarily powerful inbringing new solutions to the field and to thefrontline where we most need them.”Allan Freedman, Advisor, PublicPrivate Partnerships & InnovationInternational Rescue CommitteeNew partnershipIn 2014, Ericsson and the International Rescue Committeeentered a partnership aimed at connecting and providingsupport for those impacted by health crises, natural disasterand conflict-driven humanitarian crises.The partnership initially will focus on the use of mobilephones and applications designed to support Ebolainfection-prevention efforts at primary healthcare facilitiesin Liberia and Sierra Leone. Specifically, the technologywill enable IRC teams to more accurately and efficientlycapture and monitor data related to the facilities’ Ebolapreparedness and response.The partnership also will provide technology andservices that enable displaced families to reconnect withone another. It will start in South Sudan, together withEricsson’s long-term partner Refugees United. The organizationswill collaborate on common projects, advocacyand knowledge sharing over the longer term. The publicprivatepartnership will capitalize on respective strengthsand help create real impact on the ground.46 Ericsson | Sustainability and Corporate Responsibility Report 2014

Responding to the Ebola crisisMobile phones can empower health workerswho are fighting the current outbreakof Ebola in West Africa. We are contributingto Ebola infection-prevention efforts ina number of ways, primarily by supportingcommunity health workers.As part of the initatives led by the EarthInstitute and the International RescueCommittee (IRC), Ericsson is helping toempower community health workers inWest Africa.Helping health workers on the frontlineEricsson supplied more than 1,600 mobilephones pre-loaded with m-health apps tohealth workers in communities affected byEbola, for use by the IRC and the UN PopulationFund. A survey management tooland a patient record-tracking tool wereamong the apps.Ericsson employees volunteered toset up the phones with health apps beforethey were shipped to West Africa, removingcomplexity in the field, as part of a new employeevolunteer pilot in Sweden (which alsoinvolves mentoring of high school students).Multi-stakeholder effortThe effort in West Africa contributes tothe 1 Million Community Health Workers(CHW) Campaign hosted by the UN SustainableDevelopment Solutions Network,in which Ericsson is represented. The goalis to use ICT to help community healthworkers, often on the frontline duringdisease outbreaks, to do their job moreeffectively and link the rural poor to thebroader healthcare system.reconnecting familiesBy bringing on board a number of mobilenetwork operators in countries of concernit has been possible to reach more familiesin refugee environments, on a scale thatREFUNITE would not have been able toaccomplish on its own.An online family reconnection platform, easily accessed by mobilephone, is helping refugees locating loved ones.According to the UN Refugee Agency(UNHCR), for the first time since World WarII, there are more than 50 million forciblydisplaced people in the world. From Syriato South Sudan, a historic and dauntingrefugee crisis is unfolding. Technology canplay an important role in addressing theneeds of the world’s growing number ofrefugees.Reconnecting loved onesSince 2010, Ericsson has been the leadtechnology partner to Refugees United(REFUNITE), a non-profit organizationfounded in 2008 to help displaced personslocate missing family and loved ones.Ericsson has supported the developmentof an online family reconnection platform,providing technical expertise, andengaging with mobile network operatorsand employees for on-the-ground support.The mobile phone platform combines asimple, low-tech user interface, like textmessage services such as SMS andUSSD, with high-tech back-end searchalgorithms and analytics. For the user, it iscost-free, and works over low bandwidthconnections on the most basic devices sothat refugees can register themselves andaccess the service.Aiming to reach 1 millionSince its formation, REFUNITE hasassisted thousands of forcibly displacedfamilies, with hundreds of family reconnectionsas a result. By end of 2014, the databasehad approximately 350,000 registeredusers – an increase from approximately250,000 in 2013, largely thanks todigital registrations. The goal is to register1 million people separated from family byend of 2015.Assisting Syrian refugeesSince 2010, a coalition of mobile operatorsin Africa and the Middle East has supportedthe project, including Safaricom inKenya, Vodacom DRC in DemocraticRepublic of the Congo, MTN in Uganda,Zain Group in Jordan and South Sudan,Asiacell in Iraq and AVEA in Turkey.In February 2014, the reconnectionplatform was launched to help reachSyrian refugees living in Jordan, Turkeyand Iraq.The REFUNITE platform is available tofamilies via a mobile application with tollfreelines and SMS awareness campaignsand at www.refunite.org.Refugees UnitedNumber of refugees registered400,000300,000200,000100,0000201120122013354,8179.02014Source: Refugees UnitedEricsson | Sustainability and Corporate Responsibility Report 201447

Transforming younglives on path to peaceAccess to mobile technologycan provide fresh perspectives andnew, life-changing skills for youthin conflict-affected countries.Ericsson together with the WhitakerPeace and Development Initiative(WPDI) seeks to break cycles ofviolence and conflict through youtheducation aimed at peace building.Drug trafficking and gangs in Mexico, andconflicts like the civil wars in South Sudanand Uganda can have devastating effectson youth. In such conflict-prone areas,60% or more of the population affected arechildren and youth. By working together,WPDI and Ericsson, as technology partner,help to equip young people with thetools and skills they need in order to affectreal change via peaceful means in theirhome communities.WPDI was founded in 2012 by actorForest Whitaker, UNESCO Special Envoyfor Peace and Reconciliation and UNAdvocate for Children Affected by War. Ithas already made strides in communityempowerment of violence-affected youthin its programs in the United States, LatinAmerica, and in Africa. WPDI’s trainingfocuses on conflict transformation; ICTtraining, which Ericsson provides, to helpyouth get connected with a larger worldand and build needed ICT skills for futurejobs; life skills such as meditation andyoga, and community project developmentassistance.A lifeline in South SudanThe YPN was established in South Sudanin late 2012 and the tragic outbreak of civilwar in December 2013 put the project onhold. The youth participants were, however,able to create some early warningsystems based on friendship, inclusionand a commitment to peace, regardless ofethnicity or racial lines. Thanks to computersand phones provided as part of theprogram, they informed each other on thewhereabouts of violent outbursts as theywere happening; they shared informationabout rumored attacks, and reports aboutthe safety levels of roads. Through theirnetwork, the youths could advise eachother on which routes to travel, and howto get to safety.The project restarted in 2014 in EasternEquatoria state, a more stable region andprogress included the launch of computercenters and vocational training.Harmonizer in MexicoWPDI launched the three-year HarmonizerProgram in Tijuana, Mexico in 2014.Harmonizer is aimed at conflict transformationin urban settings where violence hashad an impact. The program concluded itsfirst stage with the graduation of 34 youthin leadership, ICT usage, and skill developmentin conflict resolution and well-being.Harmonizer is slated to expand to the stateof Chiapas in Mexico in 2015. Some 35Ericsson volunteers in Mexico are supportingthe youths by teaching ICT and socialmedia skills to help promote the program.Hands-on training in UgandaAs part of the Harmonizer program,throughout 2014 Ericsson has workedwith the Hope North school to providehands-on ICT training for youth affected byUganda’s civil war and to help build vocationalskills. The training covered use of theinternet, social networks and staying safeonline, as well as communication andentreprenurial skills.Youth PeacemakersThe Youth Peacemaker Network (YPN) is akey part of WPDI. YPN’s goal is to fosteryoung leaders in conflict regions such as inSouth Sudan, or in post-conflict situationsas in northern Uganda. YPN agents contributeto positive change by fostering reconciliationand conflict prevention in thelocal communities of their county. ICThelps the youths from all the sites connectto each other and share experiences.Actor Forest Whitaker, founder of WPDI and UNESCO Special Envoy for Peace andReconciliation, shares one of many moments of connection with youth in Mexico.48 Ericsson | Sustainability and Corporate Responsibility Report 2014

Breaking down barriersEricsson has teamed withFacebook and other partners withthe goal to make internet accessavailable to the two-thirds of theworld who are not yet connected.There are still many regions in the worldwhere connectivity is not taken for grantedand where slow networks with insufficientcapacity are a common issue.The goal of Internet.org, a partnershipbetween Ericsson, Facebook andother technology companies, includingSamsung and Qualcomm, is that everyonein the world should benefit from theopportunities of connectivity. Together,the companies brainstorm initiatives thatwill support the furthering of connectivityworldwide, and pool their resources toimplement these initiatives.Hackathons spark ideasTo bridge the connectivity gap, apps needto be able to run even with very limited networkparameters. While 4G network technologyis common in many countries,much of the world still operates on 2G and3G standards. Ericsson sponsored hackathonsin 2014 to provide developers withsimulated network environments runningnetworks of various capabilities, so thatthey could test their work on these othernetworks. With the insights gained, developerswere able to make changes to theirapps for better performance the same day.Optimization with XL AxiataAlso in 2014, Ericsson and Facebookreleased data on a long-term project thatfocused on the development of a modelEricsson has joined Facebook and other companiesto address barriers to internet access in Internet.org.for improving networking performance.Through joint testing of Indonesian operatorXL Axiata’s network with Facebookstarting in December 2013, Ericssonidentified network issues affecting performanceand made alterations to theradio network, DNS servers and contentdelivery network that resulted in up to70% improvement in app coverage.The model developed in this projecthas been leveraged into Ericsson’sApp Experience Optimization service,expanding the offering worldwide.Innovation LabEricsson and Facebook have partnered onthe Internet.org Innovation Lab, whichopened on Facebook’s Menlo Park campusin February 2015. It provides the testenvironments and expertise for optimizingapplications, networks, devices and servicesfor the next five billion internet users.Much like Ericsson’s smartphone labs,this location is open to developers toexperiment with their app’s performanceon a global scale, without the cost andcomplications of traveling worldwide. Appscan be tested in a real-world envi ronmentand under conditions which are typical forgrowth markets. It also gives developers away to ensure their apps will run in veryremote areas and to optimize the apps forcustomers who are commonly exposed tonetwork capacity and accessibility issues.Ericsson provides access to simulatednetwork environments, analysis of networkperformance, and control of networks toimplement optimization efforts.Ericsson | Sustainability and Corporate Responsibility Report 201449

50Ericsson | Sustainability and Corporate Responsibility Report 2014

IN RECOGNITIONGlobal 100 Most SustainableCorporations in the WorldEricsson is on the 2014 Global100 listannounced at the World Economic Forumin Davos in January 2014. The Global 100is an annual project initiated by CorporateKnights, the company for clean capitalism.FTSE4GoodFTSE Group confirms that Ericsson hasbeen independently assessed accordingto the FTSE4Good criteria, and has satisfiedthe requirements to become a constituentof the FTSE4Good Index Series, anequity index series designed to facilitateinvestment in companies that meet globallyrecognized corporate responsibilitystandards.Member of the Ethibel excellenceEricsson has been reconfirmed for inclusionin the Ethibel EXCELLENCE InvestmentRegister since 25/04/2014. Thisselection by Forum ETHIBEL indicates thatthe company performs better than averagein its sector in terms of CorporateSocial Responsibility (CSR).Newsweek Global Green rankingIn partnership with Corporate KnightsCapital and leading sustainability mindsfrom nongovernmental organizations andthe academic and accounting communities,Newsweek has ranked the world’slargest companies on corporate sustainabilityand environmental impact.Ericsson is ranked 40 on Newsweek’sglobal green ranking list in 2014.CDPWith inclusion in The A List: The CDPClimate Performance Leadership Index2014, Ericsson is recognized as one of theworld’s leading companies in tackling climatechange. The index has been createdat the request of more than 750 investors,representing more than a third of theworld’s invested capital, to assess companies’efforts to mitigate climate change.Companies on the A List have receivedtop marks for their performance in anindependent assessment according tomethodology developed by the CDP.The 2014–15 CDP supply chain programinvolved 66 corporations with $1.3 trillion inprocurement spend. They requested thattheir suppliers disclose information on howthey are approaching climate and waterrisks and opportunities, generating thelargest ever set of such data, from 3,396companies worldwide, up from 2,868 in2013. Ericsson scored A.Telecoms.com 2014 Industry AwardsIn February 2014, Ericsson received thetelecoms.com 2014 Industry Awards“Connecting the Unconnected,” in recognitionfor providing connectivity to addressbasic human needs through the MillenniumVillages Project and Connect ToLearn initiative.VerizonIn 2014, Ericsson was awarded Verizon’sTop Performance Award for CSR out of200 suppliers, acknowledged for havingrobust CSR programs, comprehensivepolicies, actions and results.EcoVadisAccording to EcoVadis, a collaborativeplatform used in procurement by 18 of ourcustomers, Ericsson is in the top 2% ofsuppliers in all categories with a score of79/100, the EcoVadis Gold level. The platformenables companies to benchmarksustainability performance of suppliers.ASBANCEricsson received the 2014 Mobile Money& Digital Global Payments Award for DisruptiveDigital Payments for the company’sleading work with ASBANC, Peru’sNational Bank Association, to improvefinancial inclusion in Peru. The awards programrecognizes exceptional achievementand advancement within the mobilemoney sector, highlighting organizationsthat have changed the game for digitalpayments in 2014 and that are disruptingthe global payments marketplace.Ericsson | Sustainability and Corporate Responsibility Report 201451

Objectives and AchievementsIn line with our ambition to be a relevant and responsible drive of positive change, we have restructured our objectivesand achievements to reflect our efforts to reduce risks and create positive impacts. We have also con sidered stakeholderfeedback in streamlining our performance reporting. In addition to reporting on 2014 objectives, we have merged earlierlong-term objectives (2013–2016) into a 2014–2016 time frame. We also report progress on some of the earlier objectiveson various pages in this report; the relevant paragraphs are noted with the following icon: See also bottom of p.53.Risk reduction objectivesStatus2014Long Term Objectives (LTO)(2014–2016) * Objectives 2014 Achievements 2014 Objective 2015Identify and mitigate supplierrisks related to ResponsibleSourcing.Complete South East Asia EnvironmentalAudit Program and enhance integration ofenvironmental aspects into Respons ibleSourcing Program.Achieve 95% completion rate of training“Anti-corruption for Suppliers” by StrategicSourcing personnel.Broaden Supplier Code of Conduct toa Responsible Sourcing Program withenhanced risk assessment, tracking andimprovement activities.Reduce the number of critical findingsamong selected high risk suppliers auditedin 2013 and 2014 by 70%.Establish and launch Zero Incident Programwith the target to reduce severe incidentsinternally and in the supply chain.The South East Asia Audit program hasbeen completed and the environmentalaspects have been more deeply integratedinto the Responsible Sourcing Program.We achieved over 90% completion rateof training.We have broadened the Supplier Codeof Conduct to a Responsible SourcingProgram with enhanced risk assessment,tracking and improvement activities.The number of critical findings amongselected high-risk suppliers audited inboth 2013 and 2014 decreased 60%.We established and launched the Zeroincident Program (See OHS below).Close 60% of audit findings.Increase completion rate ofanti-corruption e-learning foremployees and suppliers.Approx 90,000 employees completed theanti-corruption e-learning for employees.Over 1,100 supplier representatives completedthe e-learning Anti-Corruption forSuppliers in 2014.Continue to deploy anticorruptiontraining targetingall employees, and selectedsuppliers, in line with our zerotolerance policy.Secure independent thirdparty to manage whistleblower process.Achieve 13% of e-waste takebackvs. equipment Put on Market(POM) while continuing toensure less than 5% of e-wasteis disposed of in landfill.Note: The long-term target hasbeen revised downward toreflect market reality (see p.33).Achieve 17% of e-waste take-back vs.Equipment Put on Market while continuingto ensure less than 5% of e-waste isdisposed of in landfill.We achieved approximately 6% of e-wastetake-back vs. put on market, and less than2% of e-waste was disposed of in landfill.Achieve 9% of e-waste takebackvs. Equipment Put onMarket while continuing toensure less than 5% of e-wasteis disposed of in landfill.Reduce major OccupationalHealth and Safety (OHS) incidentsand track mitigation of riskfor major incidents, workingtoward our long-term goal forzero fatalities.Establish and launch Zero Incident Programwith the target to reduce severe incidentsinternally and in the supply chain.Launch a new campaign to continue tofocus on raising awareness internally ofthe importance of OHS in each region.At the end of 2014 at least 95% of theincident investigators will be trained in theinvestigation methodology. Particular focuswill be put on incidents related to workingat heights and safe driving.The Zero Incident Program was launchedfocusing on on high-risk operations includingdriving and working at heights.This included the development of tools,training, global governance model andescalation procedures for field service workby internal staff as well as within supplychain.At the end of 2014, 97% of the incidentinvestigators that conducted investigationswere trained.Increase reported volume ofincidents with 50% in countrieswith low reporting and trainpersonnel for key roles.Secure regional and BusinessUnit adherence to the SalesCompliance process.Manage Corporate Responsibilityrisks including humanrights risks.Complete the second year of the BusinessLearning Program on business and humanrights with Shift.Complete a Human Rights Impact Assessmentin one additional high-risk country.Second year of the Business LearningProgram on business and human rightswith Shift was completed.The Sales Compliance Process is fullyoperational.Human Rights Impact Assessments inMyanmar and Iran were conducted inaccordance with the UN Guiding Principleson Business and Human Rights.Extend a third year of theBusiness Learning Programon business and human rightswith Shift.Secure regional and BusinessUnit adherence to the SalesCompliance policy and directiveand manage CorporateResponsi bility risks.Reduce human rights risks bycompleting identified mitigationplans in human rights impactassessments for Iran andMyanmar, and initiate HRIA forone additional country.52 Ericsson | Sustainability and Corporate Responsibility Report 2014

Positive impact objectivesStatus2014Long Term Objectives (LTO)(2014–2016) * Objectives 2014 Achievements 2014 Objective 2015Demonstrate energy performanceimprovements in linewith the strategy to be theundisputed leader in energyperformance.By 2016 research and evaluate algorithmsor technologies that would enable adecrease of total accumulated mobile networkenergy consumption with 30% in a2020 scenario, in addition to the conceptsprovided by the EARTH project (EnergyAware Radio and neTwork tecHnologies –EU research project).In 2014, algorithms and technologies havebeen developed that enable a total mobilenetwork energy consumption reduction ofabout 5% in a 2020 scenario, in addition tothe concepts provided by the EARTHproject (Energy Aware Radio and neTworktecHnologies – EU research project).Significant progress was made in the newradio platform, Ericsson Radio System, inimproving energy efficiency by 50%.By 2016 research and evaluatealgorithms or technologies thatwould enable a decrease oftotal accumulated mobilenetwork energy consumptionwith 30% in a 2020 scenario,in addition to the conceptsprovided by the EARTH project.Demonstrate energy performanceimprovements in customernetworks.Maintain absolute CO 2e emissionsfrom Ericsson own activitiesfor business travel, producttransportation and facilitiesenergy use in 2017 at the samelevel as 2011. Reduce CO 2eemissions per employee by 30%over five years.Reduce CO 2e emissions per employee by7% over five years.Achieved a 10% reduction of CO 2eemissions per employee.Reduce 6% CO 2e emissions peremployee.Impact positively 5.5 millionpeople through Technology forGood initiatives by 2016.Positively impact 2.5 million people withTechnology for Good initiatives.In 2014 we achieved over 4 million peoplepositively impacted by Technology forGood initiatives.Impact positively 4.8 millionpeople through Technologyfor Good initiatives.Ericsson’s solutions will reducesocietal emissions from selectedIndustry & Society offerings with2 times Ericsson’s own emissions.Develop 3–5 cases that show the ICTenablementpotential for the low-carboneconomy.We have estimated 1.4 Mtonne CO 2 carbonreductions in 2014 from selected Ericssonofferings; this represent a ratio of 1.8.Ericsson’s solutions will reducesocietal emissions from selectedIndustry & Society offerings with2 times Ericsson’s ownemissions.Reach 30% female employeesby 2020.In 2014, 22% of Ericsson employeeswere female.* Unless otherwise stated.Target achieved Partly achieved On trackStatus2014 Objectives not found above in 2014–2016 LTOs are reported on the following pages. PageIncrease by 30% the number of technical certifications passed. 22Launch Ericsson Technology for Good employee volunteer program. 47Increase awareness of Diversity and Inclusion, by strengthening and increasing the number of employee networks, participatingin targeted development programs, and building for the future by encouraging girls to consider careers in ICT.23Launch Ericsson Play and Virtual Campus to facilitate new ways employees can learn and share. 22Increase number of Global Employee Referrals by 20%. 21Publish first results from partnership with UN-Habitat on sustainable urbanization. 36Deployed ICT in education projects to an additional 10,000 students. 44Achieve 650,000 registrations in the Refugees United database. 47Continue the establishment of a Monitoring and Evaluation framework for evaluating the connection between technology,development and peace with ICT tools and training.41Establish a globally agreed industry position around the potential of ICT for low carbon economy with key stakeholders. 7Advocacy and support for Broadband Commission for Digital Development’s 2015 targets and post-2015 development agenda. 7Document connection between technology, development and peace with ICT tools and training by 2015. 48Be one of the key drivers to increase financial inclusion in an open financial ecosystem, and make it significantly simpler and moreaffordable to make a financial transaction over a mobile device, whomever or wherever you are.42Ericsson | Sustainability and Corporate Responsibility Report 201453

GRI IndexFull reporting onlineGRI Reporting element ReferencePROFILE1. STRATEGY AND ANALYSIS1.1CEO statement about the relevance of sustainability tothe organization1.2 Description of key impacts, risks, and opportunities2. ORGANIZATIONAL PROFILEAR p.04S&CR p.02AR p.149S&CR p.502.1 Name of the organization GRI2.2 Primary brands, products, and/or services AR p.082.3 Operational structure of the organization AR p.082.4 Location of organization’s headquarters AR p.1772.5 Countries where the organization operates AR p.472.6 Nature of ownership and legal form AR p.1342.7 Markets served AR p.472.8 Scale of the reporting organization AR p.552.9 Significant changes during the reporting period AR p.082.10 Awards received in the reporting period GRI3. REPORT PARAMETERS3.1 Reporting period GRI3.2 Date of most recent previous report GRI3.3 Reporting cycle (annual, biennial, etc.). GRI3.4 Contact for questions regarding the report GRI3.5 Process for defining report content S&CR p.083.6 Boundary of the report S&CR p.i3.73.83.93.103.113.123.13State any specific limitations on the scope or boundaryof the reportGRIBasis for reporting on subsidiaries, leased facilities,outsourced operations, etc. AR p.63Data measurement techniques and the basesof calculationsExplanation of the effect of any re-statements ofinformation provided in earlier reportsSignificant changes from previous reporting periods inthe scope, boundary, or measurement methodsAR p.174GRIGRIGRITable identifying the location of the StandardDisclosures in the report S&CR p.54Policy and current practice with regard to seekingexternal assurance for the report S&CR p.564. GOVERNANCE, COMMITMENTS AND ENGAGEMENTS4.1 Governance structure of the organization AR p.1324.2Indicate whether the Chair of the Board is alsoan executive officer4.3 Independent and/or non-executive Board members AR p.1444.44.5Mechanisms for shareholders and employees toprovide recommendations to the BoardCompensation for Board members, senior managers,and executivesGRIAR p.136GRIAR p.96AR p.1424.6 Processes for avoiding conflicts of interest in the Board AR p.1324.7Process for determining the competence of the Boardmembers AR p.1324.8 Mission, values, codes of conduct, and principles relevant GRI4.9Procedures for the Board assessment of organization´ssustainability performance.4.10 Processes for evaluating the Board´s own performance GRI4.11Explanation of precautionary approach application bythe organization4.12 Subscription to external sustainability principles GRI4.13 Memberships in advocacy organizations GRI4.14 List of stakeholder groups engaged S&CR p.074.15GRIGRIBasis for identification/selection of stakeholderswith whom to engage S&CR p.074.16 Approaches to stakeholder engagement S&CR p.074.17Key topics and concerns that have been raised throughstakeholder engagement S&CR p.07GRI Reporting element ReferenceECONOMIC PERFORMANCE INDICATORSEC 01 Direct economic value generated and distributed AR p.108EC 02 Risks and opportunities due to climate change AR p.50EC 03EC 04EC 05EC 06Coverage of the organization’s defined benefit planobligations AR p.83Significant financial assistance received fromgovernmentsRange of ratios of standard entry level wage comparedto local minimum wage *Policy, practices, and proportion of spending onlocally-based suppliersGRIAR p.96GRIEC 07 Procedures for local hiring GRIEC 08EC 09Infrastructure investments and services providedprimarily for public benefitGRIGRISignificant indirect economic impacts, including theextent of impacts S&CR p.42ENVIRONMENTAL PERFORMANCE INDICATORSEN 01 Materials used GRIEN 02Percentage of materials used that are recycled inputmaterialsEN 03 Direct energy consumption S&CR p.35EN 04 Indirect energy consumption S&CR p.35EN 05EN 06GRIEnergy saved due to conservation and efficiencyimprovements * S&CR p.35Initiatives to provide energy-efficient or renewableenergy based products * S&CR p.26EN 07 Initiatives to reduce indirect energy consumption* S&CR p.26EN 08 Total water withdrawal by source GRI NMEN 09EN 10EN 11EN 12Water sources significantly affected by withdrawal ofwater * GRI NMPercentage and total volume of water recycled andreused * GRI NMLand owned, leased, managed in, or adjacent to areasof high biodiversity value GRI NMDescription of significant impacts of activities andproducts on biodiversity GRI NMEN 13 Habitats protected or restored * GRI NMEN 14EN 15Strategies, current actions, and future plans formanaging impacts on biodiversity * GRI NMNumber of IUCN Red List species and nationalconservation list species with habitats in areasaffected by operations * GRI NMEN 16 Total direct and indirect GHG gas emissions S&CR p.35EN 17 Other relevant indirect GHG gas emissions S&CR p.35EN 18 Initiatives to reduce GHG emissions * S&CR p.26EN 19 Emissions of ozone-depleting substances GRIEN 20 NO, SO, and other significant air emissions GRIEN 21 Total water discharge GRIEN 22 Total weight of waste S&CR p.35EN 23 Number and volume of significant spills GRIEN 24EN 25EN 26EN 27EN 28EN 29EN 30Weight of transported or treated waste deemedhazardous *Water bodies and related habitats significantly affectedby the reporting organization’s discharges of water *GRIGRIInitiatives to mitigate environmental impacts of productsand services S&CR p.26Percentage of products sold and their packagingmaterials that are reclaimed by category S&CR p.35Monetary value of significant fines for non-compliancewith environmental lawsSignificant environmental impacts of transportingproductsTotal environmental protection expenditures and investmentsby typeGRIS&CR p.35GRIGRI54 Ericsson | Sustainability and Corporate Responsibility Report 2014

GRI IndexGRI Reporting element ReferenceSOCIAL PERFORMANCE INDICATORSHuman rights Performance IndicatorsHR 01HR 02HR 03Percentage and number of significant investmentagreements that include human rights clauses or thathave undergone human rights screeningPercentage of significant suppliers and contractors thathave undergone screening on human rights andactions takenHours of employee training on policies and proceduresconcerning aspects of human rights *HR 04 Number of incidents of discrimination and actions taken GRIHR 05HR 06HR 07HR 08HR 09Operations identified in which the right to exercisefreedom of association and collective bargaining maybe at significant risk, and actions taken to supportthese rightsOperations identified as having significant risk for incidentsof child labor, and measures taken to contributeto the elimination of child laborOperations identified as having significant risk forincidents of forced or compulsory labor, and measuresto contribute to the elimination of forced or compulsorylaborPercentage of security personnel trained in policies orprocedures concerning aspects of human rightsNumber of incidents of violations involving rights ofindigenous people and actions taken *Labor Performance IndicatorsLA 01LA 02LA 03LA 04LA 05LA 06LA 07LA 08LA 09LA 10LA 11LA 12LA 13LA 14GRIGRIGRIGRIGRIGRIGRIGRIWorkforce by employment type, employment contract,and region AR p.100Number and rate of employee turnover by age group,gender and region AR p.100Benefits provided to full-time employees that are notprovided to temporary or part-time employees,by major operations *Percentage of employees covered by collective bargainingagreementsMinimum notice period(s) regarding operationalchanges, including whether it is specified in collectiveagreementsPercentage of total workforce represented informal joint management worker health and safetycommittees *GRIGRIGRIGRIRates of injury, occupational diseases, lost days,absenteeism, and number of work related fatalitiesby region S&CR p.25Education, training, counseling, prevention, andrisk-control programs to assist workforce members,their families, or community members regarding seriousdiseases *Health and safety topics covered in formal agreementswith trade unions *Average hours of training per year per employee byemployee categoryPrograms for skills management and lifelong learningthat support the employability of employees *Percentage of employees receiving regular performanceand career development reviews *Composition of governance bodies and breakdown ofemployees per categoryRatio of basic salary of men to women by employeecategoryProduct responsibilityPR 01PR 02Life cycle stages in which health and safety impacts ofproducts are assessed for improvementNumber of incidents of non-compliance with regulationsand voluntary codes concerning health and safetyimpacts *GRIGRIGRIGRIGRIAR p.144AR p.152AR p.96GRIGRIGRIGRI Reporting element ReferencePR 03PR 04Type of product information required by proceduresand percentage of significant products and servicessubject to such information requirementsNumber of incidents of non-compliance withregulations and voluntary codes concerning productinformation *PR 05 Practices related to customer satisfaction * GRIPR 06PR 07PR 08PR 09Programs for adherence to laws, standards, andvoluntary codes related to marketing communicationsNumber of incidents of non-compliance with regulationsand voluntary codes concerning marketingcommunications *Number of substantiated complaints regardingbreaches of customer privacy and losses ofcustomer data *Monetary value of significant fines for non-compliancewith laws concerning the provision and use of productsand servicesSociety Performance IndicatorsSO 01SO 02SO 03Programs and practices that assess and manage theimpacts of operations on communitiesPercentage and total number of business unitsanalyzed for corruption risksGRIGRIGRIGRIGRIGRIGRIAR p.49AR p.149Percentage of employees trained in anti-corruptionpolicies/ procedures S&CR p.11SO 04 Actions taken in response to incidents of corruption GRISO 05SO 06SO 07SO 08ReferenceS&CRARGCPublic policy positions and participation in public policydevelopment and lobbyingTotal value of financial and in-kind contributions topolitical parties, politicians, and related institutionsby country *GRIGRITotal number of legal actions for anti-competitivebehavior, anti-trust, and monopoly practices andtheir outcomes AR p.51Monetary value of significant fines and total number ofnon-monetary sanctions for non-compliance with lawsSustainability and Corporate Responsibility ReportAnnual ReportGlobal Compact Report – CriterionGRI GRI disclosure 2014 (online)* Additional indicatorDegree of reportingNRNANMCGRI Disclosure at a glanceFully reportedPartially reportedNot reportedNot applicableNot materialConfidentialFully reportedPartially reportedNot materialSource: EricssonGRIEricsson | Sustainability and Corporate Responsibility Report 201455

Auditor’s Combined Assurance Reporton Ericsson’s Sustainability & Corporate Responsibility ReportTo Telefonaktiebolaget LM Ericsson (publ)IntroductionWe have been engaged by the Executive Leadership Team of TelefonaktiebolagetLM Ericsson (publ) (“Ericsson”) to perform an examination ofthe Ericsson Sustainability & Corporate Responsibility (CR) Report for theyear 2014.Responsibilities of the Board and ManagementThe Board of Directors and Executive Leadership Team are responsiblefor the preparation of the Sustainability & CR Report in accordance withthe applicable criteria, as explained on the inside front cover (page i) of theSustainability & CR Report, and are the parts of the Sustainability ReportingGuidelines (published by The Global Reporting Initiative, GRI) whichare applicable to the Sustainability & CR Report, as well as the accountingand calculation principles that the Company has developed. This responsibilityincludes the internal control relevant to the preparation of a Sustainability& CR Report that is free from material misstatements, whether dueto fraud or error.Responsibilities of the AuditorOur responsibility is to express a conclusion on the Sustainability & CRReport based on the procedures we have performed.We conducted our engagement in accordance with RevR 6 Assuranceof Sustainability Reports issued by FAR, as well as AA1000AS (2008)issued by AccountAbility (type 2 engagement). The engagement includesa limited assurance engagement on the complete Sustainability & CRReport and audit of carbon dioxide emissions data regarding Ericsson’sown activities on page 27 and 35.The objective of an audit is to obtain reasonable assurance that theinformation is free of material misstatements. A reasonable assuranceengagement includes examining, on a test basis, evidence supporting thequantitative and qualitative information in the Sustainability & CR Report.A limited assurance engagement consists of making inquiries, primarily ofpersons responsible for the preparation of the Sustainability & CR Report,and applying analytical and other limited assurance procedures. Hence,the conclusion based on our limited assurance procedures does notcomprise the same level of assurance as the conclusion of our reasonableassurance procedures. Since this assurance engagement is combined,our conclusions regarding the reasonable assurance and the limitedassurance procedures will be presented in separate sections.Our procedures are based on the criteria defined by the Board ofDirectors and the Executive Leadership Team as described above. Weconsider these criteria suitable for the preparation of the Sustainability &CR Report.In accordance with AA1000AS (2008), we confirm that we are independentof Ericsson. Our review has been performed by a multidisciplinaryteam specialized in reviewing economic, environmental and socialissues in Sustainability & CR reports, and with experience from the Informationand Communication Technology sector.We believe that the evidence we have obtained is sufficient and appropriateto provide a basis for our conclusions below.ConclusionsBased on the limited assurance procedures we have performed, nothinghas come to our attention that causes us to believe that the Sustainability& CR Report is not prepared, in all material respects, in accordance withthe criteria defined by the Board of Directors and Executive LeadershipTeam, including adherence to the AA1000APS (2008) principles inclusivity,materiality and responsiveness.In our opinion the information in the Sustainability & CR Report whichhas been subject to our reasonable assurance procedures have, in allmaterial respects, been prepared in accordance with the criteria definedby the Board of Directors and Executive Leadership Team.Other informationThe following is other information that has not affected our conclusionabove. According to AA1000AS (2008), we have included observationsand recommendations for improvements in relation to adherence to theAA1000APS (2008) principles:Regarding inclusivityWe acknowledge that Ericsson has an inclusive approach to managingkey Sustainability & CR risks, and has conducted several stakeholderengagement exercises during the year. We note that Ericsson has documentedthe stakeholder engagement process for the area of Sustainability& CR in a new group level instruction, and has further developed andimplemented stakeholder engagement guidance with particular focus onhuman rights. We have no specific recommendations regarding inclusivity.Regarding materialityWe note that Ericsson in 2014 has continued to update and successfullydeploy the documented process for assessing material sustainability topics,taking into account relevant new input from stakeholders and variousframeworks. While the results of the materiality assessment are clearlypresented in the Sustainability & CR Report, we encourage Ericsson toalso consider publishing further details on how the actual assessment iscarried out, such as a summary of the internal materiality assessmentinstructions.Regarding responsivenessWe recognize that Ericsson has a well-established practice of respondingin a relevant and constructive manner to significant stakeholder concerns.We appreciate that Ericsson has made significant progress in implementingthe UN Guiding Principles on Business and Human Rights, and hasadopted a transparent approach in this work, including pioneering therecently released UNGP Reporting Framework. We have no specificrecommendations regarding responsiveness.Stockholm, March 23 rd 2015PricewaterhouseCoopers ABPeter NyllingeAuthorised Public AccountantFredrik LjungdahlExpert Member of FAR000-15056 Ericsson | Sustainability and Corporate Responsibility Report 2014

Ericsson employee volunteers in Kista, Sweden engaged in the Ebola response.engage with usThis report and additional content can be found atwww.ericsson.com/ sustainability, including morecomprehensive information on Global ReportingInitiative indicators.If you are interested in learning more or continuingthe conversation, we also welcome you to engagewith us via our Technology for Good socialmedia channels and websites below.Ericsson Sustainability andCR reporttwitter@ericssonsustainEricsson Annual ReportBlogTechnology for Good blogTechnology for Good photosLinkedInFacebook/technologyforgoodTechnology for Good videosBelow are a selection of videos highlighting Technology for Good. Additional partner and customer cases can be found online.Connecting the Amazon Facebook + Internet.org Maersk: Mobility at sea Remote schooling in Bhutan Humanitarian responseEricsson | Sustainability and Corporate Responsibility Report 201457

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