A Moment of

Your Time, Please...

May we take a few moment of your time to show what
the TM Group of Companies has been up to this past year.
We’ve realigned our businesses and our brands in addition
to the way we work, so we can better focus on enabling our
stakeholders to enjoy even better moments in life.

Please take a look, and you will see how we have refined,
and redefined, our own TM moments to add value to those
whose lives we touch.
 Our Strategy & INTEGRATED ANNUAL REPORT 2017

Sustainability

Strategy
at a Glance

Our Vision
To Make Life and Business Easier
for a Better Malaysia

Life Made Easier is more than just a tagline; it is our belief, focus and promise in delivering a
connected and seamless digital experience to our customers.

Linking our Strategies

We have identified a new purpose in how we intend to deliver Life Made Easier, and that is by being there for all our
customers’ and stakeholders’ Share of Moments. Guided by our pivotal strategic thrusts Accelerate Convergence
and Empower Digital, we have introduced a new execution model called PERFEXE 10 to achieve our purpose.

10
_

Our Purpose Strategic Thrusts Execution Model

Redefining our business purpose to be there Staying focused on our strategic thrusts to Realigning our priorities by establishing
for our customers’ and stakeholders’ Accelerate Convergence and clear plans to achieve our aspirations
Share of Moments Empower Digital in a timely manner

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 TELEKOM MALAYSIA BERHAD

OUR PURPOSE

Share of Moments

Life is full of moments and in TM, we celebrate all the meaningful moments in our daily lives. Moments can be anything; from celebrating achievements,
conversations with loved ones, or making new discoveries, we are compelled to share those moments with everyone who matter.

In today’s era of convergence, moments are shared in real-time, as it happens across multiple digital platforms. Because we understand that each moment
is important and meaningful, we have found our purpose to connect everyone to share all of their moments in the digital world through us, the one and
only partner they can trust.

Daily, we share moments at home, at work or while we are on-the-go. Throughout 24 hours of the day as each moment is experienced, our customers are
able to share their moments anytime, anywhere on any device with our range of services for individuals and businesses. Always, we are with them either via
unifi, TM ONE or TM GLOBAL.

Each time our customers share their moments through us, it is translated into our share of wallet and in turn creates more value for all our stakeholders.
Our share of wallet refers to the amount of our customers’ total spend in a household on TM. Today, connectivity to the digital world has become an
important part of a household in making lives easier. Through this, we are able to increase our share of wallet by capturing more of customers’ share of
moments, beyond homes, at any given part of the day.

Moments at Home Moments at Work Moments while On-the-Go

Being there for our Translates to Creating

CUSTOMERS’ OUR SHARE OF VALUE FOR
SHARE OF MOMENTS WALLET STAKEHOLDERS

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 Our Strategy & INTEGRATED ANNUAL REPORT 2017

Sustainability

Strategy at a Glance

STRATEGIC THRUSTS

Our Overall Strategic Focus Key Focus Area 2018 - 2020

Life Made Easier TM Life Made Easier TM

To Make Life and Business Easier, for a Better Malaysia

EASY TRUSTED INNOVATIVE STRATEGIC

THRUSTS ACCELERATE EMPOWER
CONVERGENCE DIGITAL
CONVERGENCE CHAMPION

Smarter Smarter Smarter Smarter Smarter

Living Businesses Cities Communities Nation

Beyond Products
& Services

Education
Group Group
Digital
Centre
UNDERLYING
PRINCIPLES

Corporate
Responsibility
REPRIORITISING EMBEDDING
PRODUCTIVITY INNOVATION

KRISTAL VALUES
Total Commitment Uncompromising
Respect & Care
to Customers Integrity

Our overall strategic framework has evolved over time (please refer to TM Integrated Annual Report 2016 for further reference). We continue to deliver
convergence across the 5 (five) pillars of Smarter Living, Smarter Business, Smarter Cities, Smarter Communities and Smarter Nation. These pillars
represent our contribution as Convergence Champion to our customers and the nation, in line with our TRUSTED brand value and vision. However we have
united and consolidated our business clusters and brands into unifi, TM ONE and TM GLOBAL to better serve our customers. These business clusters are
supported by digital enablement via our newly established Group Digital Centre as well as beyond products and services namely our Education Group and
Corporate Social Responsibilities. The foundation of the framework is enabled by our people who remain guided by our KRISTAL values.

Our overall strategy remains intact where we have defined our key focus areas for the next three years. We remain focused on our two strategic thrusts of
Accelerate Convergence and Empower Digital.

Accelerate Convergence refers to our continuous effort to bring superfast broadband with reliable seamless digital experience, delivered to our customers
in an enjoyable way. This goes in parallel with our Empower Digital strategy in our daily operations by getting rid of obsolete processes and implementing
digital innovations for enhanced customer experience.

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10
_
EXECUTION MODEL

Execution Model 2018 - 2020

01 _ 02_

Trust as Key Unifying

Defining Value unifi

10
_
03 _

Sweat the Transforming

Assets the unifi
Business

04
_

09_ TM ONE
as the
Liberating Verticals
WiFi Digital
Enabler

08_ 05
_

Expedite Accelerating
Network Growth with
Rollout TM GLOBAL
07
_ 06 _
Improving
Employee Empowering
Happiness Digital

Introducing PERFEXE 10, a lean and aggressive execution model. Through PERFEXE 10, we have identified and prioritised 10 comprehensive high priority
plans to Accelerate Convergence and Empower Digital. PERFEXE 10 is designed to proactively motivate ourselves and bring TM to the next level by
anchoring on 3 key principles:

Aspiration Acceleration Execution

Each market cluster - unifi, TM ONE and Keeping abreast with rapid technology changes Among the reasons of our existence is to execute
TM GLOBAL - is pushing boundaries beyond KPI and disruptive market trends, we are accelerating Convergence and Digital lifestyle to everyone,
with long term Aspirational Targets. PERFEXE 10 the way we do business for speedier results. everywhere, on any device. To achieve this, it
will see TM Group, inclusive of Central Functions Our initiatives leverage on innovations in begins with the fundamentals of maximising our
and Support Businesses setting new aspirations communication to achieve faster deployment connectivity coverage, both fixed and wireless.
in an effort to motivate employees to greater and reachability to customers before losing We are constantly improving and expanding our
heights. opportunities to others. This acceleration also network, whilst executing initiatives to establish a
applies to speed of execution. digital landscape for everyone to participate and
collaborate.

PERFEXE 10 is further deliberated under the Management Discussion & Analysis section.

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 Our Strategy & INTEGRATED ANNUAL REPORT 2017

Sustainability

Sustainability
Statement

Sustainability is embedded
in our culture at TM, infusing
our every thought and
guiding our every action
– from the creation of
the latest digital offerings
for customers right down
to our daily operations,
thus ensuring the nation’s
broadband connectivity is
“always on”.
Committed to sustainable practices,
we are able to successfully balance our
business opportunities and risks in the
economic, environmental and social
realms.
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 TELEKOM MALAYSIA BERHAD

As Malaysia’s Convergence Champion, we aim to operate

responsibly to ensure we promote sustainability in everything
we do, from keeping our Warga Keluarga TM happy, to bridging
socio-economic gaps, and protecting our environment. We
adhere to the highest standards of governance in our quest
to be a model corporate citizen, conducting our operations in
a manner that meets our business goals while fulfilling social
needs and protecting the environment.

Sustainability at TM is led by our Board of Directors, which

oversees our commercial and regulatory compliance while
maintaining the Company’s goals to become a responsible
and sustainable organisation. Our Management Leaders
ensure sustainability is integrated in all operations throughout
the Company. Sustainability is also discussed at Board Risk
Committee meetings as efforts to manage stakeholder concerns
are key to managing emerging and potential risks.

In 2017, we conducted our fourth materiality assessment to gain

greater clarity on issues that are material to our stakeholders.
Results of this materiality survey will help us to craft our
sustainability programmes for the coming years, providing a
useful compass in our sustainability journey.

Sustainability at TM is led by
our Board of Directors, which
oversees our commercial and
regulatory compliance while
maintaining the Company’s goals
to become a responsible and
sustainable organisation.

Readers should read this Statement together with our

Sustainability Report, themed Caring Moments, which provides
comprehensive disclosure on our approach to sustainability
and how we manage our material issues. In our report, we
have categorised our initiatives according to their Economic,
Environmental and Social impacts.

We have described initiatives taken to manage our material

issues under these three categories and also mapped their
relevance to the United Nations’ Sustainable Development Goals
(UN SDGs).

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 Our Strategy & INTEGRATED ANNUAL REPORT 2017

Sustainability

Sustainability Statement

ECONOMIC IMPACT ENVIRONMENTAL IMPACT

Boosting Economic Impact Minimising Environmental Impact
Echoing our Business Strategy of We recognise the urgent need for all corporations to play their part in mitigating issues
Accelerating Convergence & Go Digital, such as climate change; as well as for Malaysians companies to protect and preserve
we are leading the way in transitioning the country’s rich biodiversity. Carbon reduction and environmental conservation are
the country into a digital economy. two main focus areas of our environemtal initiatives.
All our products and services – from
broadband to mobile and WiFi, and IoT to To reduce our emissions, we continue to enhance various energy saving initiatives in
Data Centres – enable a digital work- and our networks and buildings. Detailed benchmarking and reporting of our emissions can
lifestyle. We remain at the leading edge be found in our Sustainability Report 2017.
of enabling the country’s digital economy
via our broadband deployment for the In terms of environmental conservation, we continued with our TM Earth Camp project,
nation and in bridging the digital divide. focusing our energies on preserving the marine environment. We also continued
We support the Government’s objective with our marine conservation project on corals at Pulau Tinggi and Pulau Bidong. We
towards improving the affordability, reach have become proactive in preserving Mother Earth, trailblazing our way into better
and quality of broadband services. In environmental stewardship and leading others down the same path.
our unique role as protector of national
interest, we now have a converged
nationwide coverage of unifi which
includes broadband, mobility and WiFi.
We have refreshed our business clusters TM 3Ducation programme reached out
to further serve our customers, with unifi
representing lifestyle offerings for homes,
to 85 schools, involving a total of 2,907
individuals and Small Medium Enterprises students and 140 teachers in real-time
(SMEs); TM ONE offering end-to-end
converged solutions to business verticals coding and 3D printing.
in the enterprise and public sector space;
and TM GLOBAL positioned to accelerate
the digital opportunities of domestic and
international telecommunications for the
economy.

We also enhance the economy by

supporting the Bumiputra Vendor
Development Programme (BVDP). We
have to date promoted 15 Bumiputera
vendors through training as well as
more than RM6 billion in business
opportunities. Eight of these vendors
have progressed to become strategic
partners under the BVDP Strategic
Partnership Programme. We are now
focused on developing some of our
more successful Bumiputera vendors to
become ‘regional champions’ through
export capabilities enhancement and
exposure to the regional marketplace.

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 TELEKOM MALAYSIA BERHAD

SOCIAL IMPACT will receive intense coaching for a period

of 90 days to help boost their businesses.
Creating Positive Social Values Our Group Digital Centre (GDC) meanwhile,
We strive to provide a stimulating work environment that engages our employees in a manner that partnered the Malaysian Communication and
brings out their best, inspiring them to work together as dynamic teams with a common vision of Multimedia Commission (MCMC) to introduce
attaining our corporate goals. While providing ample training and development opportunities as well as 43 entrepreneurs in Kemaman to digital
rewarding high performance, we care for our employees and take a genuine interest in their well-being technologies that have helped them in product
because, to us, they are not just employees; they are truly part of the TM family. branding and packaging as well as in marketing
their products online. Initiatives such as these
This year, we reinforced our position as a caring employer by expanding the range of benefits offered. not only benefit the participants but, through
Among others, we discourage the setting of meetings after 4pm*; allow employees to work half-day spinoff effects, also their local economies.
on the last Friday of each month*; enable mothers with young children and those who are expecting
to finish work at 4pm; and have also introduced flexi work arrangements for expecting mothers. In Helping Those in Need
addition, we have enhanced our medical benefits and increased the availablitliy of financial aid for In conjunction with our #keajaibanunifi and
education. #keajaibanramadan celebrations, we organised
a special reaching out project to 115 NGOs
*Applicable to certain categories of employees, mainly non-shift workers. nationwide, surprising them with monetary
contributions totalling RM1 million to mark unifi
Better Education for All surpassing 1 million customers. The gesture
We have been contributing towards the development of a knowledge society through Multimedia truly added to the magic of the holy month of
University (MMU), which was the first private university to be set up in the country, and which continues Ramadan.
to be a pioneer in innovative teaching and learning. Focused on engineering and ICT, the university
has to date produced 52,705 industry-ready graduates with a keen entrepreneurial sense. At the same Meanwhile, we continued to help those in need
time, we provide the financial means to enable outstanding Malaysian students to study at the best via numerous voluntary programmes organised
foreign and local universities through our foundation, Yayasan TM (YTM), which has to date disbursed a by our internal divisions as well as TM Clubs
total of RM505.0 million to support 15,216 scholars through secondary and tertiary education. & Societies. As the leader of the GLC Disaster
Response Network (GDRN), TM also rose to
We are also continuing with the TM School Adoption Programme, which has completed its 14th year, the challenge of coordinating disaster relief
solidifying our commitment to the Malaysian education landscape. Today, we are providing full support missions during the floods, distributing essential
to two schools adopted in 2016 – SMK Arau in Perlis and SMK Medamit in Sarawak – while extending items and extending physical help as well as
our support to SKPK Tuaran in Sabah, a school for visually impaired children, by enabling them to caring support to the affected communities.
participate in a special edition of our 3D-printing TM 3Ducation programme. In 2017, TM 3Ducation
programme reached out to 85 schools, involving a total of 2,907 students and 140 teachers in real-
time coding and 3D printing. Through the project, students learn to code their own programmes to
create 3D objects.

Empowering Entrepreneurs
A key way in which we are able to uplift the lives of the under-served is through sharing our business
knowledge, networks and digital expertise. During the year, we did this with a group of fledgling women
entrepreneurs as well as rural entrepreneurs in Kemaman, Terengganu.

Under TM Scale-Up, a new programme launched, we have identified 20 women who we believe would
benefit from a high-impact programme to boost their entrepreneurial skills. In 2018, these women

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 Our Strategy & INTEGRATED ANNUAL REPORT 2017

Sustainability

Managing Our
Material Issues
We seek to understand our stakeholders’ expectations of TM, and the issues regarding our
operations that are important to them, as these have an impact on our onward journey. Our entire
sustainability framework rests on managing issues that are material to TM.

By material, we mean issues that are important to both our stakeholders as interviews with key management to review and help further prioritise the
well as to TM ourselves which, if not managed, could negatively impact our material issues, according to how important our management believed the
performance in the long term. To determine these issues, we undertake a issues are to our stakeholders, as well as to TM.
materiality assessment every year.
In this manner, this year we identified 15 material issues – 14 that had been
We are also improving our process from last year by conducting workshops identified in 2016 plus one new issue, ie Online Safety. The 15 material
among stakeholder-facing employees and other employees to obtain: a) issues were presented to our Group CEO, who validated the list.
issues that have substantial influence on our stakeholders – eg customers,
suppliers, investors, analysts, shareholders, regulators and the community; The results of our materiality assessment help us to formulate our
and b) TMʼs significant EES impacts. With our employees, we discussed sustainability programmes. We also use our findings to identify emerging
material issues that had been identified in the previous year, as well as trends and issues that have the potential to become more significant in the
issues raised from our risk register, those that have been identified by peers medium term. These issues are monitored and, where required, managed
as being material, and also any other national or industry issue that relates within TM to enable us to respond proactively.
to our business. This provided a preliminary prioritisation of our material
issues. For details on our current material issues and how we are managing them,
please refer to our 2017 Sustainability Report, themed Caring Moments.
In 2017, we engaged with more than 3,000 community and industry
stakeholders, including our Warga Keluarga TM, to get their views of our
most material issues. With this primary list, we conducted one-on-one

Our Material Issues

Boosting Minimising Creating Positive

Economic Impact Environmental Impact Social Values

M1 Product Quality M5 Climate Change and M7 Talent Retention and

Energy Management Attraction
M2 Innovation M6 Resource Use and M8 Human Rights
Waste
M3 Supply Chain M9 Employee Health &
Management Safety
M4 Regulatory M10 Customer Satisfaction
Compliance
M11 Consumer Health &
Safety
M12 Consumer Data &
Privacy
M13 Online Safety
M14 Supporting
Communities
M15 Inclusivity

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MANAGING OUR MATERIAL ISSUES

For relevance, we focus the contents of our Sustainability Report on material issues that have been identified for a particular year. In
this report, therefore we focus on the 15 issues as presented below:

Economic Environmental Social

Most Influential
Influence on Stakeholder Assessment and Decision

M1

M7

M8

M9

M10

M12 M11 M2

M4

M3

M5 M13

M6
M15

M14
Influential

Significant Most Significant

Significance of Economic, Environmental and Social Impacts

M1 Product Quality M7 Talent Retention and Attraction

M2 Innovation M8 Human Rights
M3 Supply Chain Management M9 Employee Health & Safety
M4 Regulatory Compliance M10 Customer Satisfaction
M11 Consumer Health & Safety
M12 Consumer Data & Privacy
M13 Online Safety
M14 Supporting Community
M15 Inclusivity
M5 Climate Change and Energy Management
M6 Resource Use and Waste

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