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Independent assurance from Ernst & Young

Independent Assurance Statement to Vodafone Management
The Vodafone Group Sustainability Report 2011 (the Report)1 has been prepared by the management of Vodafone, which is responsible for the collection and presentation of the information it contains. Our responsibility, in accordance with management’s instructions, is to carry out the following assurance activities:

Assurance scope Level of assurance2 Reporting and assurance criteria
1. Vodafone’s application of the AA1000 principles, as described in the Sustainability section of the Vodafone website
 Reasonable assurance The criteria set out in AA1000AS for the principles of Inclusiveness, Materiality and Responsiveness
2. Progress against Objectives Limited assurance Objectives set in 2009/10 sustainability report
3. Reliability of selected performance data for 2010/ 2011 marked with (*) symbol Limited assurance Completeness and accuracy of selected reported performance data
4. Vodafone self-declared Global Reporting application level Limited assurance G3 Sustainability Reporting Guidelines and application level requirements

Our responsibility in performing our assurance activities is to the management of Vodafone Group only and in accordance with the terms of reference agreed with them. We do not accept or assume any responsibility for any other purpose or to any other person or organisation.

What we did to form our conclusions
Our assurance engagement has been planned and performed in accordance with ISAE30003 and to meet the requirements of a Type 2 assurance engagement as defined by AA1000AS (2008). The AA1000AS (2008)4 assurance principles of Inclusivity, Materiality and Responsiveness have been used as criteria against which to evaluate the Report.

In order to form our conclusions we undertook the steps outlined below:

  1. Interviewed more than 25 executives and senior managers including the CEO to understand the current status of social, ethical, environmental and health and safety activities, and progress made during the reporting period.
  2. Reviewed Vodafone’s processes for determining material issues to be included in the Report.
  3. Conducted media analysis, reviewed selected relevant internal documents and the outputs of stakeholder engagement activities to enable us to test the coverage of topics within the Report.
  4. Reviewed information or explanations supporting Vodafone’s reporting of progress against objectives, we also reviewed drafts of the report for statements or assertions for consistency with the findings from our work.
  5. Undertook visits to Vodafone businesses in South Africa (Vodacom SA), India (Vodafone Essar Ltd), Turkey and Germany. We reviewed the processes and controls supporting environmental and safety performance data, conducted interviews with senior executives and managers in the businesses and reviewed stakeholder engagement processes.
  6. Reviewed selected environmental and safety data collection, consolidation and reporting processes at Group level to assess accuracy of reporting.

The limitations of our review
Our review was limited to the information contained in the printed report and the description of AA1000 and the GRI application level reported in the online data hub.

Our conclusions
Based on the scope of our review our conclusions are outlined below:

Assurance scope 1 – Application of AA1000 Principles

  • Vodafone’s description of the application of the AA1000 principles on the website in managing and reporting sustainability matters is fairly stated.

Assurance scope 2 – Progress against Objectives

  • Nothing has come to our attention to suggest that the reported progress against objectives is not fairly stated.

Assurance scope 3 – Completeness and accuracy of selected environmental, health and safety performance data marked with the symbol (*)

  • We are not aware of any reporting units that have been excluded from the data relating to the topics above.
  • Nothing has come to our attention that causes us to believe that the data relating to the above topics has not been collated and presented properly at Group level.
  • We are not aware of any errors that would materially affect the data as presented in the Report.

Assurance scope 4 – Self declared GRI application level

  • Nothing has come to our attention to suggest that Vodafone’s self-declaration of GRI application level B+ is not fairly stated.

Observations from our work
Our observations and areas for improvement will be raised in a report to Vodafonemanagement. These observations do not affect our conclusions on the Report set out above.

Stakeholder Engagement
We saw that Vodafone engages with government, consumers and NGO stakeholders at both Group and local levels. There are processes in place across the organisation to engage and learn from stakeholder feedback. During the year significant and ongoing disruption occurred in a number of markets notably in the Middle East. Vodafone will need to review whether its approach to stakeholder engagement and responsiveness is sufficient to balance stakeholder needs and define appropriate responses in these rapidly changing markets.

Environmental data
Vodafone Group’s guidelines for reporting environmental data have been disseminated to all the markets. However, during our local market visits we noted that the internal review of sustainability data in certain markets could be improved to help build confidence in the data sets used to manage these issues.

Progress against objectives
Vodafone consistently report against its objectives many of which are qualitative in nature and are set on a short term basis. We saw evidence of a number of strategic initiatives which could shape Vodafone’s sustainability direction over a number of years. Vodafone could consider including a roadmap of its sustainability journey over the next few years to enable stakeholders to assess progress over a longer period of time.

Health & safety
The local markets visited had programmes in place to drive improvements in managing and reporting safety performance across their operations. At Group level a number of initiatives have been developed by Vodafone to support the reduction of reported driving related incidents, including fatality prevention plans and detailed root cause analysis. However, despite these efforts, over 50% of fatalities result from road traffic accidents. Vodafone need to continue supporting the adoption of good practices and embedding a safety culture and standards on driving safety at both Group and local market level.

Our independence
This is the first year that Ernst & Young LLP has provided independent assurance services in relation to Vodafone Group Sustainability Report. We have provided no other services relating to Vodafone Group’s approach to sustainability reporting.

Our assurance team
Our assurance team has been drawn from our global environment and sustainability network, which undertakes engagements similar to this with a number of significant UK and international businesses. The work has been led and reviewed by Lead Sustainability Assurance Practitioners.

Ernst & Young LLP

London
May 2011

1 This includes the printed reports and the data included in the online data hub.
2 The extent of evidence gathering procedures for a ‘limited level’ of assurance is less than that of a ‘reasonable’ assurance engagement (such as a financial audit) and therefore a lower level of assurance is provided for assurance scope 2 – 4 than for assurance scope 1.
3 ISAE 3000 - International Federation of the Accountants’ International Standard for Assurance Engagements Other Than Audits or Reviews of Historical Financial Information.
4 AA1000AS (2008) – The second edition of the AA1000 assurance standard from the Institute of Social and Ethical Accountability.