Telecom Italia''s Sustainability reporting is entirely integrated in its 2003 Annual Report (pp. 124-196) and it amounts to half of the whole Report on Operations. This approach is followed by the main companies Telecom Italia controls (Telecom Italia Mobile and Telecom Italia Media). Furthermore, Telecom Italia publishes a Sustainability Report.
The Sustainability section of our Annual Report is divided according to stakeholders: Customers, Suppliers, Competitors, the State and Institutions, the Environment, the Community, Human Resources and Shareholders.

In 2003, the Group completed a number of measures intended to introduce the model of
Sustainability into the main corporate processes:
- implementation of an organizational management model for Sustainability
- integration of Sustainability reporting with the rest of the company?s economical and financial reporting processes
- selection of some Sustainability Key Performance Indicators to be introduced into the Group tableau de bord;
- implementation of a system for planning, monitoring and evaluating Sustainability
- incorporation of the Strategic Plan for Sustainability within the Corporate Business Plan for 2004-2006, establishing guidelines for the Group and individual Business Units.

In particular, more than 300 projects in the Group have been identified as relevant to Sustainability, among these, projects regarding our environmental management systems, the improvement of waste management, the continuous monitoring of electromagnetic emissions, the reduction of direct and indirect emission of CO2, improvement of employees'' quality of life, humanitarian projects - many of them in Latin America..

The beginning of 2003 saw the launch of the Control & Risk Self Assessment project. The aim of the project is to identify, evaluate and manage operational risks, and also to adapt its performance to national and international best practices in the field of Corporate Governance. A joint period of active testing has been organized with the Bocconi University in Milan to assess the Group''s non-financial performance (intangible assets). The aim is to assess the creation of value generated by pursuing the aims of Sustainability.

This year will also see the start of a systematic campaign to emphasize the commitment made by the Telecom Italia Group in developing the governance processes in terms of Sustainability, with the aim of maximizing its benefits in terms of reputation.

Apart from the above general actions, which involved all the company?s Business Units, many specific actions were taken on particular issues: their description is to be found in the Sustainability Section of 2003 Annual Report.

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Telecom Italia''s Sustainable behavior achieved a number of accomplishments. As for the achievement of internal goals relative to specific projects, improvement of our reputation and of relations with stakeholders, they are described in the Sustainability Section of 2003 Annual Report.

The following is a list of awards and acknowledgements we received.

- The "Trust Us - Survey of Corporate Sustainability Reporting" survey, conducted at the end of 2002 by UNEP (UN) included Telecom Italia, the only Italian company to be represented, among the 100 best companies in the world in terms of the quality of its reporting on Sustainability.

- In 2003, the two main companies of the Group listed on the Stock Exchange, Telecom Italia and TIM, were admitted to the main FTSE4Good Indexes (Global 100 and Europe 50), the Global Ethibel Sustainability Index (ESI) and the ethical indexes of E.Capital Partners. Both were declared eligible and were classified as runners up in the Dow Jones Sustainability Indexes. In other words, they will automatically be able to fill the place in the index should any one of the companies in that specific sector ?leave? during the course of 2004.

- In November 2003, Telecom Italia received the Operational Excellence Award, awarded by the Tele Management Forum (an international, non-profit organization for promoting the ICT services industry), for the development of its new broadband platform.

- In the 2003 edition of "Best 100, the best companies to work for" organized by Skillpass (a company specialized in training and selecting personnel, in which Sviluppo Italia and leading Italian banks hold investments), Telecom Italia was rated as the most desirable company to work for in Italy. Telecom Italia was "the company which won the highest number of votes from the Italian public, who thus rewarded two years of innovative management and the dynamic performance of the Group, bestowing a prestigious honor on the corporate brand of Telecom and the values which it succeeds in conveying through its activities."

- In the sphere of the "Pubblicità per bene" award, Telecom Italia received a special mention as a company which has distinguished itself in making an economic contribution for social purposes for the "numerous initiatives geared to promoting, raising awareness of and supporting social and cultural ends" achieved through Progetto Italia.