We define our material themes as the factors that substantively affect our ability to create value for stakeholders over time. The Group Executive Committee (Exco), the Audit Committee and the Board approved management's materiality determination process and the material themes.
We consider internal and external factors, relying on established processes to identify and confirm our material themes. This process is set out alongside, with cross-references to, additional information.
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Inputconsiderations 
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Reviewed the external operating |
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Considered our stakeholders |
We reviewed their material interests, needs and expectations, and key concerns. These included:
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Reviewed strategic risks most significant |
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Reviewed Board and subcommittee |
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| Prioritisation process |
Based on materiality and the impact assessment we performed | |
The result of
the process 
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Our material themes are |
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Our material themes represented a prioritised view of our material matters. We considered these themes in compiling this report. Our FY2023 performance reflects the current impact of these matters, as discussed on GCFO's report: FY2023 performance and in the GCEO's report.
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1
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Regulatory environment |
Telkom operates in a highly regulated environment affected by policy uncertainty and inconsistency and continuously evolving regulations and legislation. We are also affected by international regulatory trends, irrespective of the different operating contexts, the South African political environment, and the resources required to implement new or changing regulations. |
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2
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Intense competitive landscape |
The competitive landscape includes over-the-top (OTT) players and other non-traditional entrants disrupting the market, and the convergence of telecommunications, technology, media and consumer electronics. This provides us with collaboration opportunities with OTT players and requires Telkom to remain focused on capital allocation, cost optimisation, business growth, innovative products and services, and customer satisfaction. |
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3
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Customer expectations and experiences |
Our customers expect a differentiated value proposition where they receive value for money. Price, available products and services, service speed and reliability, data security and IT system stability influence their experience. In Telkom's competitive landscape, customer experience affects our reputation and customer attraction and retention. Therefore, Telkom must appropriately invest in products and services, systems and employees to meet customer expectations. |
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4
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Cyberthreats |
Cyberattacks and data breaches can potentially impact Telkom's service levels, leading to customer dissatisfaction, reputational damage, business disruption and loss of revenue. This requires continuous focus on information security and business continuity plans. Cyberthreats also allow the Group to develop new customer solutions (information security). |
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5
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Economic climate |
Local and international economies influence Telkom's ability to grow the business, the cost of doing business and customers' spending power. This is affected by muted South African economic performance, the political environment and geopolitical pressures, investor and business confidence, financial risks related to liquidity and foreign exchange and interest rate exposure, the effectiveness of cost optimisation efforts, and socio-economic factors such as the high youth unemployment rate. |
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6
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People skills and expertise |
Telkom requires skilled employees in ICT, digital and other areas to develop products and solutions that will generate future revenue and provide customers with the expected level of service. We compete locally and internationally for scarce, specialised technical skills with traditional and non-traditional players. Gender and race diversity, the premium paid for skills and experience, and the anticipated future skills pipeline (fourth industrial revolution) impact our attraction and retention of talent. Telkom focuses on skills development and empowers and enables employees to work from home. |
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7
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Evolving technology and ICT market trends |
Telkom needs to remain abreast of advances in ICT and disruptive technology. We must ensure long-term viability by developing innovative products and services and enhancing the Group's networks and infrastructure. This requires appropriate infrastructure, network investment and skilled employees to support product development and delivery. Focus areas include our ongoing investments in fibre and mobile infrastructure while optimising the return on invested capital (ROIC). |
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8
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Climate change |
Telkom must mitigate and adapt to climate change impacts (specifically extreme weather conditions) and responsibly use our resources to protect our business and the environment. These impacts can directly affect our operations (operational impacts) or result from poor customer service stemming from acute and chronic weather conditions (reputational and strategic impacts). A more comprehensive climate risk assessment will be conducted during FY2024. |
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