Zain sustainabilityreportenglish


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Zain sustainabilityreportenglish

  1. 1. Zain Saudi Arabia Sustainability Report 2010 Zain Saudi Arabia Sustainability Report 2010Zain Saudi Arabia Corporate OfficeKing Fahad Highway, PO Box 295814, Riyadh 11351Kingdom of Saudi Arabia Interact with us on:Tel: +966 59 0000 A Wonderful World
  2. 2. Contents2 CEO Message 46 Appendix A : Scope of the Report4 Zain Saudi Arabia Corporate Profile 47 Appendix B : Acronyms6 Our Stakeholders Appendix C : Glossary8 Our Sustainability Framework 48 Appendix D : GRI Index10 Our 2010 Sustainability Performance 49 Appendix E : RI Statement and G12 Delighting Customers GRI Application Level Check18 Pioneering Networks22 Creating a Dynamic Team28 Building Partnerships32 Developing Communities36 Improving the Environment40 Adopting Best Practice44 Our 2011 Sustainability CommitmentsZain Saudi Arabia Corporate OfficeKing Fahad Highway, PO Box 295814, Riyadh 11351Kingdom of Saudi Arabia Interact with us on:Tel: +966 59 0000
  3. 3. At Zain Saudi Arabia we have made the commitment to implement sustainabilitymanagement and transparent reporting. With this baseline Sustainability Reportfor 2010, we aim to open a constructive and engaging dialogue with all ourstakeholders on the subject of our sustainability ambitions, performance, and theoverall sustainable development of the Kingdom of Saudi Arabia.This report sets out what sustainability means to us and presents our frameworkand baseline performance since establishment, from an environmental, socialand economic perspective. Comparable data is provided for 2008, 2009 and2010 as available.This report has been prepared using the most internationally recognized andcomprehensive sustainability reporting guidelines – the Global ReportingInitiative (GRI) G3.We have self-declared this report to have achieved a GRILevel B, demonstrating the level of disclosure achieved. The GRI has checkedand approved our declaration level.As one of our valued stakeholders, we hope that you will join our dialogue byproviding your comments on our sustainability webpage, or by contacting oursustainability team at the Zain Saudi Arabia corporate office in Riyadh.
  4. 4. CEO MessageIntegrity, Trust, InnovationWe believe that mobile communications is one of the most This baseline report is the first step to reaching a new level of managementtransformative and enabling technologies of our lifetime. It holds vast excellence by embedding sustainability management into our corepotential to support, and in some cases accelerate, economic, social business operations. As a summary of our performance to date, thisand environmental development through the provision of unique report will provide a platform for annual reporting to you, our stakeholders,solutions across all sectors of society. on the development and successful implementation of our sustainability strategy and action plan.With the world facing a new and shifting reality, the concept ofsustainable development is rapidly being identified as a new model I offer sincere gratitude to the Custodian of the Two Holy Mosques,for long-term prosperity and growth. King Abdullah Bin Abdulaziz Al-Saud, HRH Prince Sultan Bin Abdulaziz Al-Saud, HRH Prince Naif Bin Abdulaziz Al-Saud, and all GovernmentZain has a unique opportunity in its early development as the third Ministers. Their enlightened leadership has made an invaluableentrant to the Saudi market to help contribute to the sustainable contribution to the economic and social development of the Kingdomdevelopment of the nation, in line with King Abdullah’s vision. of Saudi Arabia.By driving market innovation, we hope to enable more people and Finally, I take this opportunity to praise the good work of all ourorganizations to harness and benefit from the power of mobile employees and partners for the achievements of 2010. We hope youtelecommunications. With the ongoing fulfillment of our stakeholders’ enjoy this report and we look forward to engaging with you on itsexpectations, and through continuous open communication, we aim to content and delivery of our commitments.demonstrate the highest levels of integrity and build a new level of trustin the delivery of a better future.For this reason, we view sustainability as synonymous with our brandpromise ‘A Wonderful World’. As we come to better understand theneeds of all our stakeholders, we will be able to deliver greater valueto them and build further value for our shareholders. Dr. Saad Al Barrak2 | Zain Saudi Arabia
  5. 5. 3 | Sustainability Report 2010
  6. 6. Corporate profileSaudi Arabia’s Newest Operator Saudi Arabia’s Telecommunications Market Mobile Telecommunications Company Saudi Arabia Saudi Arabia is the largest telecommunications market (Zain Saudi Arabia) launched its commercial operations in the Gulf Cooperation Council (GCC) region, with SR 52.5 billion total revenues in 2009, out of which on August 26, 2008, a year after it was awarded its license up to 74% was attributable to mobile services. as the Kingdom’s third mobile voice and data operator. SIM penetration as reported by the Communication and Information Technology Commission (CITC) The company has been one of the most successful new stood at 167% on 31st December 2010, with mobile subscriptions increasing approximately 23% to 45.3 entrants in the global telecommunications market and million in 2010. has developed a strong customer base against the Mobile Service Market Growth backdrop of a highly penetrated market. (Subscriptions 2001-2010) In 2010, Zain Saudi Arabia’s share capital consisted of 2010 2009 6.3 45.3 51.6 186 1.4 billion shares distributed amongst 10 organizations 6.1 38.7 44.8 2008 5.5 30.5 36.0 167 and a public shareholding of 630 million shares. Further 138 2007 4.8 23.6 28.4 113 details are available in the Zain Saudi Arabia Annual 2006 Financial Report on the website 2005 2004 2003 2002 2001 12 Pre-paid subscriptions Post-paid subscriptions Total subscriptions Mobile penetration (%) Source: Figures reported by mobile service providers4 | Zain Saudi Arabia
  7. 7. 2007 2008 2008 2009 2010 2010 January August October December January December Mobile Zain Over Over Commences Over licence Saudi Arabia 1 million 5 million Largest LTE 8 million awarded launches subscribers subscribers trail in the subscribers regionMission Zain Saudi Arabia in 2010To become the telecommunications operator of choice in Saudi Arabia with an approach Market Voice SMS Broadband Multimedia SMS shortbased on market segmentation and innovation. share Customers traffic messages subscribers downloads code requests 18% 8.3 million 9 billion 632 million 250,000 1.3 million 3.6 millionVisionA Wonderful World. Our Economic ImpactValues Zain Saudi Arabia has achieved sustainable positive growth as evidence in the financial andRadiance: leading the way with imagination and vision, bringing joy, color, and richness to our commercial indicators of 2010. However, the breakeven point is yet to be accomplished andbusiness environment. is expected to be achieved in the year 2014, demonstrating the long-term commitment and continued investment in the Kingdom by the company’s shareholders.Heart: living our lives with courage and resolve, engaging our spirit and touching emotions. 2009 2010Belonging: leveraging the fellowship and community spirit that knows no territorial boundaries. Revenue (USD) 801,080,533 1,582,498,667Principles Benefits to employees (USD) 25,832,000 26,853,067Zain Saudi Arabia has a clear set of ten principles upon which the business operates: Trust, Contribution to Governmental fee (USD) 54,493,600 157,015,200Openness, Fairness, Quality, Speed, Devolution, Innovation, Tolerance, Leadership Nurturing Distribution to the community (USD) 1,951,629 5,083,461and Teamwork. Cost of revenue (USD) 567,206,933 907,712,533ServicesZain Saudi Arabia offers a number of core telecommunications services to individuals, Association and Membershipsbusiness and government. These include: Zain Saudi Arabia is a member of the Arab Sustainability Leadership Group (ASLG) – the region’s foremost network of sustainability management and reporting leaders.Voice, SMS and MMS – The foundation of mobile communications that can be accessedthrough a mobile handset. Zain as a group has also joined and shown support for the:Broadband – High-speed mobile broadband that can be accessed on a mobile handset, • GSMA Mobile Alliance Against Child Sexual Abuse Contentcomputer or any other internet enabled technology, through a USB dongle or Wi-Fi device. • GSMA Mobile Privacy PrinciplesValue Added Services – Such as mobile downloads (Islamic content, news, sports, musicand videos), mobile TV, ring-back tones and SMS short codes.5 | Sustainability Report 2010
  8. 8. OurStakeholdersHow We Approach SustainabilityMapping out Zain Saudi Arabia’s stakeholders andtheir expectations has informed our approach tosustainability and development of a longer-termsustainability strategy.6 | Zain Saudi Arabia
  9. 9. Stakeholders How we engage Stakeholders’ expectations Customers • Call centre operators • Affordable prices and tariffs that also demonstrate Zain values • 24/7 interactive Voice Response (IVR) • Nationwide coverage • In-person shop assistants available during opening hours • Availability and high quality of network service • Alternative communication channels including the website, social media, • Continued development and innovation in services including high speed internet email, fax and SMS • Ease and clarity of billing • Our online customer self service portal available 24/7 to all customers • Information security and data protection • Fast and efficient complaint resolution and high quality customer care Employees • ASK HR function and employee call center available during office hours • Stable and secure employment • Employee self service section and intranet available 24/7 • Living the Zain values • E-mail • Competitive remuneration package • SMS • Ongoing training and development • Post and Fax • Clear career progression • Dynamic, safe and inclusive working environment Business Partners • Contracts and agreements • Long-term, secure and financially rewarding contracts and relationships • HR Business Partners (HR BP) program • Prompt payment upon delivery • Quarterly engagement surveys Community • Daily direct marketing • Digital inclusion, additional choice and innovation in the mobile marketplace • Zain Saudi Arabia website: • Increased competitiveness of the telecommunications sector • Ongoing community investment programs (including Mashroee Zain • Integrity, trustworthiness and a growing economic contribution and Shabab Tahmouh) • The health and safety of mobile technology, especially electromagnetic fields • Sponsorship of sports and events • Little or no noise and visual pollution from mobile masts and base stations • Investment in the local community The Environment • Building and maintaining the network • Ongoing reductions of GHG emissions • Energy, material, and resource consumption • Minimum use of finite resources • Protection of ecological systems Investors • Quarterly investor reports • Strong economic performance and return on investment • Annual Financial Reports • Strong corporate governance and compliance with all rules and regulations • Ongoing investor meetings and road shows • Ongoing demonstration of business and management excellence Government and • Mandatory quarterly reporting • Ongoing sector development and innovation, advancing services to society Regulatory Bodies • Ongoing sector meetings • An open, fair and competitive telecommunications sector • Daily interaction with CITC and other government /regulatory representatives • Compliance with national laws7 | Sustainability Report 2010
  10. 10. Our SustainabilityFrameworkOur commitment to sustainability is based on three central outcomes: The three central outcomes are surrounded by seven sustainability focus areas, which create the framework for reporting, as well as our internal sustainability strategy.Integrity Delighting CustomersHolding true to our values and ethics as a company, Provide the most advanced platform, together with next generation mobile technology to enable individual, business and government customers to live, conduct business, and provideconducting business as a fair competitor that brings services in a secure and supportive environment, within Saudi Arabia and overseas.choice, innovation, improved pricing and great quality Pioneering Networksto the market. Maintain and constantly develop our network, offering the most advanced technology to customers across Saudi Arabia in a responsible and sustainable manner.Trust Creating a Dynamic TeamBuilding mutually beneficial relationships and confidence Be recognized as an employer of choice in Saudi Arabia through the creation of a dynamic, vibrant, safe and engaging work environment that is aligned to the ten principles of Zain,based on safe, responsible, reliable and on-time reflecting our corporate values.operational performance, earning a high level of Building Partnershipstrust from all our stakeholders. Create long-term business relationships that deliver mutual growth and prosperity based on the Zain values.Innovation Developing CommunitiesLeading the deployment of innovative products and Harness the power of our products and services to create both direct and indirect positive impacts on the communities we that add significant value to individuals,businesses and government alike. Improving the Environment Reduce our own environmental impact, while providing advanced solutions to help reduce our suppliers’ and customers’ impact, and the impact of the ICT sector as a whole, by pioneering solutions for a low carbon society. Adopting Best Practice Conduct business in a responsible and transparent manner, holding ourselves accountable to our investors and the wider group of stakeholders as a way of improving performance.8 | Zain Saudi Arabia
  11. 11. Customers Delighting Ad op Be tin g s st g rin k Pr o ne e wor ac Pi t tic Ne e Integrity Trust Crea g the ting ment Innovation ovin a Dy Impr Team nami on c Envir s Bu tie Par ildi uni ng ing tne mm op vel rsh De Co i ps9 | Sustainability Report 2010
  12. 12. Our 2010 SustainabilityPerformanceSustainability ManagementThe creation of this baseline report and development of an internal sustainability strategy has been driven by theCorporate Social Responsibility (CSR) department within Zain Saudi Arabia. This will evolve in 2011 as we work toembed sustainability management across the organization and further engage with stakeholders on the subject ofcreating a more sustainable Saudi Arabia.In 2011, Zain Saudi Arabia commits to the creation of a sustainability function that will work to implement thesustainability strategy across all areas of the organization.Delighting Customers (Key Perfomance Indicators) 2008 2009 2010Number of customers 2,000,000 5,232,000 8,393,000Number of mobile broadband customers – 91,000 250,000Maximum speed of broadband (Mbps) – 7.2 14.4Number of innovative M2M connections – – New IndicatorMobile TV accessed – 328,330 337,005Ring-back tones downloads – 1,045,876 1,288,503Ring-back tones subscriptions – 1,100,345 2,234,639Short code requests – 2,903,186 3,634,315First call resolution (%) – 97% 98%Pioneering Networks (Key Perfomance Indicators) 2008 2009 2010Number of sites 1,590 2,480 3,367Number of LTE enabled sites – – 300CITC 3G population coverage obligation (%) 50.95% 61.07% 65.00%3G population coverage (%) 59.30% 69.04% 71.45%Number of sites shared 144 396 483Number of reduced noise generators 500 900 130010 | Zain Saudi Arabia
  13. 13. Creating a Dynamic Team (Key Perfomance Indicators) 2008 2009 2010Number of employees 375 420 626Employee engagement index (out of 5) – – 3.87Employee turnover rate (%) 6.9% 12.6% 7.2%Saudization rate (%) 56.6% 56.0% 61.3%Average hours of training per employee 20 48 49Female employment rate (%) – – New IndicatorBuilding Partnerships (Key Perfomance Indicators) 2008 2009 2010Number of strategic business partners 10 11 12Combined number of employees within strategic business partners 180 986 918Strategic business partner employees somewhat engaged (%) (*Q4 of 2009, **Q2 of 2010) – 59%* 64%**Developing Communities (Key Perfomance Indicators) 2008 2009 2010Community investment expenditure (SAR) – 1,951,629 5,083,461Number of CSR initiatives aligned to core services – – 2Number of women involved in Mashroee Zain 10 33 40Number of youth involved in Shabab Tamouh – – 36Improving the Environment (Key Perfomance Indicators) 2008 2009 2010Total electricity usage (KwH) – 70,647 87,891Electricity per employee (KwH) – 172 140Total water usage (liters) – 5,571,000 13,619,000Water per employee (liters) – 13,588 21,756Emissions from electricity usage (kg) – 57,648 71,719Emissions per employee (kg) – 140 114Mobile recharges through electronic methods (%) – 5% 22%Customers using e–billing – – New IndicatorAdopting Best Practice (Key Perfomance Indicators) 2008 2009 2010GRI level of sustainability report – – BSustainability report commitments achieved (%) – – New IndicatorNumber of formal stakeholder sustainability engagements – – New Indicator11 | Sustainability Report 2010
  14. 14. DelightingCustomers Our Ambition: Provide the most advanced platform, together with next generation mobile technology to enable individual, business and government customers to live, conduct business, and provide services in a secure and supportive environment, within Saudi Arabia and overseas. Customers Delighting Ad op Be tin st g Pr ing ks ac ne er or tic Pio tw e Ne Integrity Trust Impro ving the nmen t Innovation Creatin Team g a Dy namic Enviro ies Bu Par ildin unit Co loping g tne mm rsh ve De ips12 | Zain Saudi Arabia
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  16. 16. Delighting Rapid Expansion (customer numbers)Customers 2011 target 10 million 2010 8.3 million 2009 5.2 million 2008 2 million Connecting People Launch Package (1+1) Weekend Package One month paid by the customer, Offers 2 Riyals for every Riyal The most powerful way to enable customers is through facilitating connections between the next month paid by Zain. consumed over the weekend. individuals, families, friends and businesses in a tailored and cost-effective manner within the Kingdom and internationally. Greater Choice and Innovation for Consumers Zain Time Package 10/10 Package As the third entrant to Saudi Arabia’s mobile voice and data market, Zain has adopted a strategy 35% discount during your favorite 10 Riyal day-long bonus credit to offer innovative and value-for-money packages that target previously underserved segments time: morning, evening or night. if customer consumes 10 Riyals and to offer greater choice and value. that day. Leveraging extensive regional experience and significant brand value from its Saudi launch in 2008, Zain has offered many innovative packages for the first time in the Kingdom. The focus Mazaya Package International Package on service innovation has helped the company to rapidly establish a solid base of customers A post paid plan with Up to 50% permanent discount that continues to expand and achieve the corporate targets set for the next five years. tailored benefits on two international numbers and additional services. In 2011, Zain Saudi Arabia commits to launching five new innovative packages that increase access to mobile telecommunications and enable more connections. These will include: Zain Super – the only package offering customers their choice of discount on local and international calling. Toon Package – the only package introduced specifically for children ensuring use of mobile telecommunications services in a safe and secure manner, with a full range of parental control. It is the only line in the Kingdom to provide free Spacetoon content including videos, sounds, ring tones and edutainment. Roaming Zain Saudi Arabia’s aim is to ensure customers are not only enabled within the Kingdom, but overseas, allowing them to connect with family, friends, and do business while traveling. The company has rapidly established international partnerships with over 440 operators world-wide that ensure customers may use their mobile phones while traveling overseas to over 160 countries. Zain also provides customers with a large range of in-air roaming options covering 11 airlines, and counting, allowing them to remain in contact while flying.14 | Zain Saudi Arabia
  17. 17. Zain Add-ons This service allows businesses The range of add-ons currently includes: to start with Zain’s competitive basic package, Business Private Network – for communicating between employees customize it by selecting only the relevant Business to Business Private Network – for employees and five add-ons and features according to their selected companies business needs, adapted to their employees’ Global Advantage – 30% discount on international calls use. This provides greater choice and helps Business Best – monthly commitment, no fees and free Global Advantage companies to eliminate unnecessary costs. On-Net SMS – 350 texts for a low monthly feeThe ONE Network – World’s First Borderless Network New Smart Office Products in Association with GoogleLaunched in 2008, the ONE Network is the world’s first borderless mobile service, offering In 2011, Zain Saudi Arabia commits to launching a new smart office product for businessexcellent rates without high roaming charges while traveling in any ONE Network country. customers offering a unique bundle of Google applications, voice, SMS, and mobile broadband.Benefits include the facility to receive calls with the most attractive rates, make calls at local With this ‘office in a box’, business customers will gain all the functionality of Google Apps,rates, recharge with local recharge cards, and call their home country’s Customer Care center together with the best prices from Zain increase productivity, collaboration, communicationfree of charge. This excellent product is another way in which Zain enables customers to and effectiveness, while reducing IT and telecommunications costs. A regional first, thisconnect across borders. Countries included are Jordan, Bahrain, Iraq, Sudan, Nigeria, Uganda, product is another illustration of Zain’s commitment to providing greater choice and innovationBurkina Faso, the Republic of Congo, the Democratic Republic of Congo, Gabon, Chad, to the Saudi market.Tanzania, Kenya, and Malawi. M2M Innovation Machine-to-Machine (M2M) data transfer services are growing rapidly in application and usageEnabling Business and Government as more and more hardware devices and software applications are developed worldwide. AtZain Saudi Arabia provides solutions that enable businesses and government to perform and present, Zain Saudi Arabia offers data SIM Card Solutions for businesses to manage their fleetinnovate within their sectors. or team, track logistics and stock, conduct security surveillance, and conduct on-site data collection.Greater Choice and Innovation for BusinessesIn line with its vision and values, the company provides a set of standard packages for business M2M data transfer has the potential to transform whole sectors – in particular the utilitiescustomers, and aims to build innovative, tailored and customizable solutions that suit the sector – with the emergence of smart grids, as well as the security, healthcare, governmentneeds of enterprises, of all sizes and in all sectors. and retail sectors.Zain Saudi Arabia brought greater choice to the market by allowing business owners to benefit The emergence of M2M highlights the need for stakeholder collaboration for large-scalefrom a range of features that include: sector-based innovations. In 2011, Zain Saudi Arabia commits to conduct a series of pilot programs with organizations and government entities to develop new solutions for the way• Dedicated customer care – business call center, service specialist and self-service portal. we work, deliver education and healthcare, conduct commerce, and tackle climate change.• The ONE Network – connection to the world’s first borderless network.• BlackBerry – voice and data offers for BlackBerry users to help create a mobile office solution. The Power of Mobile Broadband• Private numbering and short codes – private company numbering plans and short code The rapid development and deployment of wireless broadband technology is allowing more dialing systems. people across the world to gain access to the internet, enabling them to connect, interact,• Hybrid lines – post-paid and prepaid hybrid SIM cards. collaborate, engage, transact, be informed and inform in new and innovative ways through• Cost control – spending limits, calling rates, split calls and ‘on your time features’. their mobile phones or other mobile internet devices.Zain GateAn innovative solution that helps businesses save up to 40% on their fixed-to-mobile calls.Customers’ fixed-to-fixed calls are still carried by their fixed service provider, while fixed-to-mobilecalls are ‘converted’ into Zain mobile-to-mobile calls at a lower tariff. Zain Gate is helpingbusinesses reduce costs, while allowing Zain to access a proportion of the fixed market.15 | Sustainability Report 2010
  18. 18. Mobile Broadband Content and Entertainment 2009 2010 2011 Target 1,000,000 Entertainment downloads 158,116 41,392 53,1702011 Target 75 Mobile TV accessed 328,330 337,005 457,978 Ring-back tone downloads 1,045,876 1,288,503 2,670,704 250,0002010 Ring-back tone subscriptions 1,100,345 2,234,639 2,508,174 14.4 Information channel subscriptions 77,378 158,288 155,319 91,000 Mobile broadband customers Short code requests 2,903,186 3,634,315 5,459,5562009 7.2 Maximum speed of broadband (Mbps)The Kingdom’s Broadband Potential Zain DelightBroadband penetration in Saudi Arabia stood at around 16% of the population in 2010, with In 2011, Zain Saudi Arabia commits to launching Zain Delight, the world’s first mobilebroadband house penetration at 41.6%. Overall internet penetration is expected to reach 41% broadband prepaid internet service. Consumers will gain access to high-speed mobileof the population by the end of 2010. (Source: CITC ICT Indicators in KSA 2010. broadband with no package expiry, no renewal charge, no monthly bills and no long-termsa.) Wireless broadband has seen the greatest growth as the easiest, fastest and cheapest commitment – just internet charged per MB. This unique service will help bring mobiletechnology to deploy, used on mobile phones, computers and through mobile broadband broadband to everyone, providing customers with unbeatable prices per MB, together withdevices such as USB dongles or 3G routers. freedom and control over their internet expenses.It is predicted that the Kingdom will become a regional leader in the provision of mobile Pioneering Long Term Evolution (LTE)broadband services, as mobile phone penetration exceeded 180% in 2010, and as operators Zain Saudi Arabia is conducting the largest LTE network trail in the world, with the aim ofcompete to provide the fastest, widest reaching coverage in the Arab World’s largest country, creating one of the largest wireless broadband internet networks in the region with speedsin terms of geographical size, with the largest population in the GCC region. of up to 100 Mbps. This initiative will help to rapidly increase internet penetration, while providing more customers access to faster and more reliable wireless internet service. FurtherZain Saudi Arabia Mobile Broadband information regarding our LTE ambitions is available in the ‘Pioneering Networks’ section onZain recognizes the power that mobile broadband has to enable customers, be they page 22.individuals, organizations or government. Mobile broadband will help revolutionize multiplesectors such as entertainment, education, health and energy, while acting as a foundationfor rapidly growing business norms such as cloud computing and teleconferencing. More Content and Entertainmentinformation regarding the company’s commitment to innovation is available in the ‘Enabling Zain offers a range of online content and entertainment that can be received or subscribedBusiness and Government’ section on page 15. to by text message, downloaded online or downloaded directly through handsets.For the individual, the company offers a range of value-for-money mobile broadband Content and entertainment is grouped into themes such as sport, children, religion, world, andpackages, as well as innovative mobile broadband devices such as USB dongles and Zain-Fi, lifestyle. It currently includes downloads (music, games, themes, wallpaper, greetings tonesenabling customers to access high speed internet on their mobile phones and computers and screen savers), mobile TV (news, series and movies), ring-back tones (download andanywhere, without the need for an ADSL fixed line. subscription available), information channel subscriptions (news, events and information directly to your handset), and short codes (text 2 TV, Facebook, Twitter, etc).Zain-Fi – A Personal Wireless Broadband NetworkZain Saudi Arabia is the first operator to introduce the concept of pocket-sized devices that The company will continue to offer a wide range of unique and value-added content andallow individuals to create a wireless broadband internet network anytime and anywhere, at entertainment. Also, in 2011, Zain Saudi Arabia commits to research the feasibility andthe cost of only one mobile subscription. A minimum of five people are able connect to the demand for ‘green’ content, raising environmental awareness and empowering people to takeinternet simultaneously through the device, with speeds of up to 7.2 mega bits per second action on the environment.(Mbps), providing easy access to broadband on the move.As a major area of focus, Zain Saudi Arabia has made significant investments in its mobilebroadband network and services. This investment has yielded rapid growth in the number ofbroadband subscribers in 2010, with forecasts for significant growth in 2011, helping to tacklethe Kingdom’s low internet penetration.16 | Zain Saudi Arabia
  19. 19. Call Center in Numbers 2008 2009 2010 2011 Target Number of call center calls 19,055,851 77,821,434 86,163,039 – Average speed of answer (sec) 106.00 52.25 50.42 30 First call resolution – 97% 98% 98%Customer Care Information SecurityWithin a short period of time, the company built a reputation for high standards of customer Information security is one of the most important factors in building trust and demonstratingcare and a dedication to ensuring a positive Zain experience for every customer. integrity. To ensure the protection of data and information, the company has created an Information Security Policy and ensures its enforcement on a day-to-day basis across theZain Saudi Arabia interacts with customers through traditional channels such as call centers organization.and shops. In 2010, the company also launched a range of alternative channels that provedpopular with customers. These include web (self-care portal, Facebook, YouTube, Twitter), SMS Information Security Policy(balance enquiry, enquiry about complaints, increasing limit, etc), IVR (detailed bill, roaming Zain Saudi Arabia is committed to serve as a leading provider of telecommunications servicesprices, increasing limit etc), and email. to its stakeholders inside and outside the Kingdom. The company approved its policy statement to set a clear corporate direction and commitment to information securityIn addition to these features, Zain’s Network Department has a customer care function that throughout the organization, ensuring business continuity and customer satisfaction.directly receives network-related complaints on coverage, quality and reliability. It also dealswith credit control and collection. Adding a human feel to this function ensures a seamless Zain is committed to continually ensuring that:customer interface. • confidentiality, integrity, and availability of information is secured and maintainedCall Center • regulatory and legislative requirements are metThe number of calls to Zain Saudi Arabia’s call center continues to rise, although at a decreasing • Business Continuity Plans are produced, tested, and maintainedrate to the growth in customers. To ensure good customer service we continue to reducethe time it takes for a call to be answered, hitting 50.42 seconds in 2010 with a target of • information security awareness is delivered to all staff30 seconds in 2011. The percentage of questions and concerns raised by customers that are • any cases of information security breach is reported and investigateddirectly resolved in the first call hit 98% in 2010. The company will continually strive to review and improve the Information Security Policy on aWeb Selfcare Portal periodic basis. The policy is the responsibility of every member of the organization, includingThis was launched in November 2009, enabling customers to manage their subscriptions contractors, suppliers, and service providers.through the website. A study conducted at the beginning of 2009 showed that competitors’web portals had too many features, without a proper focus on the user experience. Zain Saudi ISO CertificationArabia decided to launch a portal with priority given to the most important services for Demonstrating the company’s commitment to the highest standards in internal and externalcustomers, focusing on a pleasant user experience. Feedback has been extremely positive and information system management and security, Zain Saudi Arabia has two ISO certifications:we continue to develop the Selfcare portal, accommodating all the feedback and suggestions • ISO 27001 – Information Security Management Systemreceived from customers. • ISO 20000 – IT Service Management SystemIn 2011, Zain Saudi Arabia commits to gather and publish customer satisfaction results and These international recognitions of our IT and information security management systems helpsuggestions, together with our response and systematic management of customer feedback. to ensure that customer data is kept safe and protected at all times.17 | Sustainability Report 2010
  20. 20. PioneeringNetworks Our Ambition: Maintain and constantly develop our network, offering the most advanced technology to customers across Saudi Arabia in a responsible and sustainable manner. Customers Delighting ing ks or Ad Be op er ne tw tin st g Pio Ne Pr ac tic e Integrity Trust Impro ving the nmen t Innovation Team Creatin g a Dy namic Enviro ies Bu Par ildin unit g g tne pin mm velo rsh De Co ips18 | Zain Saudi Arabia
  21. 21. 19 | Sustainability Report 2010
  22. 22. PioneeringNetworksOur Physical Network 2008 2009 2010 Physical NetworkTotal number of sites 1,590 2,480 3,367 During the first three years of operation, Zain Saudi Arabia’s focus has been the rapidNumber of 2G sites 1,590 2,480 3,367 deployment of a wide reaching and high quality network, covering the Arab region’s largestNumber of 3G sites 1,067 1,579 2,000 country. This challenge was compounded by an obligation to the regulator (CITC) onNumber of LTE sites New sites New sites 300 trials population coverage, a condition for receiving the Kingdom’s third mobile operator license.Coverage 2008 2009 2010 This challenge was overcome in two ways: through the development of a comprehensive and modern physical 2G, 3G and HSPA network that is easily scalable and upgradable, allowing forCITC 2G population coverage obligation 63.89% 70.95% 80.30% significant growth in the number of subscribers and ongoing evolution in mobile technology;2G population coverage (%) 70.15% 83.10% 88.26% and by pioneering the concept of site and infrastructure sharing in the Kingdom.CITC 3G population coverage obligation (%) 50.95% 61.07% 65.00%3G population coverage (%) 59.3% 69.04% 71.45% In 2010, Zain Saudi Arabia launched the world’s largest trial of Long Term Evolution (LTE) technology capable of revolutionizing mobile broadband to deliver speeds of up to 150 MbpsReliability 2008 2009 2010 to handsets. With 300 LTE sites, commercial testing is due to begin as soon as the companyRadio availability (%) 98.4% 98.88% 99.21% receives approval from the regulator and the technology becomes widely available for use onDrop call rate (%) 0.76% 0.63% 0.58% handsets and other mobile devices.Site Sharing In Numbers 2008 2009 2010 In 2011, Zain Saudi Arabia commits to enhance our mobile broadband services with the introduction of 3G voice and HSPA of up to 42 Mbps covering 11 cities. The company will also start workingTotal number of shared sites 144 396 483 on a fiber optic network that will provide even faster and more reliable services in the future.Shared sites – Zain on other operators 144 396 479Shared sites – other operators on Zain 0 0 4 Coverage and ReliabilityNoise and Visual Pollution 2008 2009 2010 In 2008 the company recognized that wide reaching coverage and a high quality network wereNumber of sites with reduced noise generators 500 900 1300 integral to the successful launch of its services. Significant investments and innovative infrastructureNumber of ‘palm tree’ sites New sites 5 15 sharing partnerships were made to rapidly cover a large proportion of the population with high quality mobile voice and broadband services. Coverage The virtual network covered more than 400 cities and 50 highways in 2010, exceeding all population coverage obligations set by the CITC on both 2G and 3G services. This has been a consistent achievement since launch, demonstrating the speed and commitment the company has to develop its network. Universal Coverage – Reaching Remote Areas In 2010, Zain Saudi Arabia was awarded a contract from the CITC’s Universal Service Fund for the provision of voice and internet services to remote areas in the Kingdom. This will involve the roll out of over 500 new sites to bring coverage to remote areas not currently served by any of the Kingdom’s three operators.20 | Zain Saudi Arabia
  23. 23. What is Infrastructure Sharing? Benefits include: Infrastructure sharing can take a number of • reducing operators’ investment requirements by sharing network development costs forms including site, network and spectrum • offering new sources of revenue for incumbent operators sharing, national roaming and tower • shifting operators’ focus towards service innovation, instead of network deployment companies. This is sometimes adopted by • increasing access by expanding to less dense areas and meeting Universal Service Obligations and targets regulators to encourage competition and • reducing negative environmental impacts as a result of less network build-up boost the performance of operators. • optimizing the use of scarce resources, particularly the right of wayReliability Network ImpactTo ensure the provision of a high quality service to all customers, the network features several As the network continues to develop and grow, Zain Saudi Arabia is constantly looking at wayslevels of protection to ensure continuous and consistently high quality network service through to reduce its impact on the local community, striving to reduce visual and noise pollution whilea wide variety of conditions. maintaining high health and safety standards. For details regarding the environmental impactContinuing investment in modern technology ensures an ever improving radio availability rate of our network, refer to the ‘Improving the Environment’ section on page 39.and decreasing drop call rate, ensuring Zain Saudi Arabia comfortably outperforms the CITCstandards of 2% drop call rate. Electromagnetic Fields Zain Saudi Arabia has encountered a handful of concerns from stakeholders regarding the health and safety effects of its network with regards to Electromagnetic Fields (EMF). When theInfrastructure Sharing company receives a concern, it sends experts to conduct a dialogue, presenting reports andIn order to ensure the rapid deployment of a far-reaching network, the company adopted an findings from CITC and other international sources on the health and safety implications ofinfrastructure sharing strategy with the two incumbent operators. This helped Zain to cover a mobile masts.large proportion of the population as quickly as possible, at minimal cost, and minimized thesocial and environmental impacts because the number of masts and base stations required to The company fully adheres to CITC standards relating to radiofrequency, which are compliantserve the population was reduced. with the ICNIRP, 1998 standards on non-ionizing radiation, and with IEEE standards. For more information regarding EMF issues visit – a websiteSite Sharing created by the GSM Association of Mobile Manufacturers Forum and the Australian MobileZain Saudi Arabia pioneered the adoption of site sharing in 2008 and was the first in the Telecommunications Authority.Kingdom to sign site-sharing agreements with the other two operators. After demonstratingthe benefits of site sharing, businesses, government and other large institutions requiring Health and Safetymobile coverage requested that all three operators adopt a site-sharing policy for new The deployment and maintenance of our network is handled by a strategic business partner.developments, ensuring just one base station mast is built instead of three. (Refer to the ‘Building Partnerships’ section on page 30 for further details.) Zain Saudi Arabia has experienced zero fatalities or injuries related to the deployment and maintenance of the network.(Source: Telecom Infrastructure Sharing, Regulatory Enablers and Economic Benefits. BoozAllen Hamilton 2007. Zain Saudi Arabia recognizes its responsibility for the safe development and operation of its network. In 2011, Zain Saudi Arabia commits to track the health and safety performance ofNational Roaming business partners, providing guidance and tools that help to ensure zero fatalities.Zain Saudi Arabia also signed numerous short-term national roaming agreements with otheroperators. National Roaming, a form of infrastructure sharing, allows the company to use Reducing Visual and Noise Pollutionother operators’ networks for a fee, providing instant coverage and reducing upfront network Zain Saudi Arabia continues to minimize the visual and noise pollution from the sitting anddeployment investment. operation of base stations and masts. To reduce noise pollution, the company has equipped a growing number of base stations with reduced noise generators and continues to do so at new base station sites. To reduce visual pollution, the company has begun converting towers into ‘palm tree’ sites, which will continue in the future.21 | Sustainability Report 2010
  24. 24. Creating a DynamicTeam Our Ambition: Be recognized as an employer of choice in Saudi Arabia through the creation of a dynamic, vibrant, safe and engaging work environment that is aligned to the ten principles of Zain, reflecting our corporate values. Customers Delighting Ad op Be tin st g Pr ing ks ac ne er or tic Pio tw e Ne Integrity Trust Impro ving the nmen t Innovation Creat ing a Dynam Enviro Team ic ies Bu Par ildin unit g g tne pin mm velo rsh De Co ips22 | Zain Saudi Arabia
  25. 25. 23 | Sustainability Report 2010
  26. 26. Creating aDynamic Team Full-time Employees by Level 2008 2009 2010 2011 Target Senior management positions 15 15 32 37 Middle management positions 55 73 97 114 Team members 305 332 497 579 Total 375 420 626 730Employee Turnover 2008 2009 2010 Living our ValuesTotal employee turnover 26 53 45 The Zain vision, values and culture are a major contributor to the attraction and retention ofTotal employee turnover (%) 6.9% 12.6% 7.2% high quality talent. Zain is well known regionally for living its core brand values, which areTurnover by level radiance, heart and belonging. These powerful brand values have helped to create demandSenior management 3 6 3 to join Zain Saudi Arabia – in 2008, queues formed outside the corporate office in Riyadh upon launch. Since then, the company has worked hard to live up to this brand promise bySenior management (%) 20% 40% 9% embedding the values, principles and culture of Zain across the organization.Middle management 6 14 7Middle management (%) 11% 19% 7% The Human Resources (HR) team of 27 employees handles a variety of functions aimed atTeam member turnover 17 33 35 effectively managing the company’s human capital, improving the effectiveness of individuals and teams, and fostering a healthy and productive professional environment. Zain aims toTeam member turnover (%) 6% 10% 7% establish optimum working conditions that provide all employees with the opportunity forTurnover by gender personal and professional development and fair compensation, while working in an ethical,Female turnover – – New indicator equitable, and dynamic environment.Female turnover (%) – – New indicator Zain Saudi Arabia’s HR work is governed by a range of clear manuals that detail HR policy andMale turnover 26 53 45 procedures, all of which are aligned to the laws and regulations of Saudi Labor Law, and furtherMale turnover (%) 6.9% 12.6% 7.2% developed based on the Zain values and principles. As a result, we have set ambitious targetsTurnover by age group in all areas, especially with regard to the employment of Saudi nationals. To aid this, Zain has18-30 12 20 22 developed the HR Pioneer Program to build the capacity of nationals. This program is being18-30 (%) 6% 11% 7% rolled out across the organization.31-40 7 23 18 In addition, the HR Department oversees outsourcing activities and acts as an HR consultant31-40 (%) 5% 12% 7% for other departments within Zain to support them in their strategy regarding contractors and41-50 6 7 4 business partners. For further details, refer to the ‘Building Partnerships’ section on page 31.41-50 (%) 20% 21% 8% The HR Department also handles governmental relations regarding labor laws and regulations, registering expatriates, and deals with the travel requirements of Zain employees.51-60 1 3 151-60 (%) 9% 27% 7%24 | Zain Saudi Arabia
  27. 27. Employee Engagement Survey Results (out of 5)Employee engagement index 3.87 5Job design 3.95 5 HR Innovation ASK HR is a function within the HR DepartmentOrganizational health 3.42 5 responsible for responding to employee enquiries. It ensures employees receive timely and accurate responses, providing liveManagerial excellence 3.59 5 responses, guidance and support. As a unique innovation theExtrinsic rewards 3.19 5 ASK HR function also works to provide support to the employeesWorkplace readiness 3.62 5 of our strategic business partners, as discussed on page 31.Other drivers 3.63 5Employee Profile Employee TurnoverIn 2010, the workforce consisted of 626 full-time permanent contract employees, continuing Employee turnover is often a clear indicator of overall work environment and employeeits year-on-year growth since launch. Zain Saudi Arabia has no part-time temporary contract satisfaction. In 2010, our turnover rate stood at 7.2%, a reduction from 12.6% in 2009, makingemployees or casual labor. However the company relies on a large amount of contracted labor us one of the top private sector performers in Saudi Arabia. Zain aims to continue reducing thisdue to its outsourcing model. For further details regarding outsourced labor, refer to the figure to below 5%, while continuing to expand.‘Building Partnerships’ section on page 31. Remuneration and Benefits Zain Saudi Arabia offers all employees highly competitive packages that reflect their levelEmployee Engagement and Retention of qualification and skill, and set well above the local minimum wage. Competitiveness isAs a way of ensuring employee engagement and satisfaction, the HR Department has put in maintained using ongoing market-based pay studies to ensure the company remains anplace a comprehensive range of two-way communications channels, measurement and tracking employer of and a clear open door policy between employees at all levels. The Human ResourcesContact Center (HR CC), part of the HR Shared Services organization, is designed to respond Benefits provided to full-time employees include:to enquiries regarding HR policy and procedure. • airline tickets for expatriatesHR CC interacts with Zain employees via e-mail, the HR portal, web requests through the • holidays (including marriage, compassionate, exam, maternity and paternity)intranet self service section, live chat, phone, SMS, fax and post. • handset allowancesTracking Employee Engagement • mobile lines (data and voice) for employees and their familiesZain Saudi Arabia conducts an annual employee engagement survey that covers multiple • education allowanceselements of engagement and satisfaction including job design, organizational health, • connect devicesmanagerial excellence, extrinsic rewards, workplace readiness and areas for improvement. • medical insurance for employees and their familiesIn 2010, the results of the survey highlighted a number of areas for improvement, as well as • subsidized gym membershipsome successful employee engagement points. The Sales Department has a consistentlyhigh engagement rating across multiple functions and drivers. Directors and managers also • all benefit plans as per the General Organization for Social Insurance (GOSI) and Labor lawsscore highly on engagement. Areas that require the most attention include the Finance and • severance packagesNetworks departments.Results of these annual surveys are presented to senior management, as well as relevantdepartmental managers, to ensure they take action to improve levels of employeeengagement and satisfaction.25 | Sustainability Report 2010
  28. 28. Creating aDynamic Team 2008 2009 2010 2011 target Government mandated Saudization rate for communications sector of 500-2,999 employees 56.6% 56.0% 61.3% 68.2% Red 0-9% Yellow 10-29% Green 30-74% Saudi nationals Expatriates Excellent 75%Training 2008 2009 2010 SaudizationTotal number of training (hours) 7,362 19,957 30,924 Zain Saudi Arabia recognizes the importance of the national policy to encourage the employment of Saudi nationals. Saudization benefits the local and national economy, while bringing directAverage hours of training per employee 20 48 49 value to Zain by harnessing local talent that understands the culture and market of the Kingdom.Total cost of training as a % of OPEX 0.03% 0.08% 0.26%Average cost of training per employee (SAR) 2,500 3,000 4,180 Demonstrating this priority, as part of the bid for the third mobile telecommunications license,Average hours of training per employee by employee category Zain committed to achieve a Saudization rate of 81% by the year 2012, putting the company into the ‘Excellent’ category as defined by the Ministry of Labor.Senior managers 6 9 13Middle management 3 5 6 In 2010, the company’s Saudization rate increased from 56% to 61.3%, demonstrating theTeam members 3 4 13 tangible results of a number of initiatives. However, it is recognized that more will need to be done in order to accelerate the recruitment of nationals in order to reach the 81% target by 2012.Diversity 2010 2011 Target As the company enters its third year and the employee base settles, Zain hopes to targetFemale N/A 9 fresh Saudi graduates as a major source of future employees, while promoting from within asFemale employment rate (%) N/A 1.23 experienced positions become available. As a result, all vacancies are advertised internally asMale N/A 721 a first step. If a vacancy is not filled internally, then the position is advertised externally withFemale participation in management positions priority given to qualified Saudi applicants.Females in middle management positions N/A 1Females in senior management positions N/A 0 Development and Leadership Ongoing training and development is the foundation of creating a dynamic, innovative and loyalAge Diversification 2008 2009 2010 2011 Target workforce. Zain Saudi Arabia invests heavily in the development of employees, ensuring thatTotal workforce by age group (%) training programs contribute to employees’ personal and professional development. The overall18-30 (%) 52 43.8 47.1 50.3 aim of the company’s training programs is to enhance capacity by providing the most advanced31-40 (%) 37.07 45.5 42.7 41.1 leadership training, while investing in developing the next generation of Saudi leadership.41-50 (%) 8 8.1 7.8 6.3 Development Needs Identification51-60 (%) 2.93 2.6 2.4 2.3 Development needs are identified by line managers in collaboration with the HR Department, with 100% of employees receiving regular performance and career development reviews asHealth and Safety 2008 2009 2010 2011 Target of November 2010. The company’s target is to maintain this level as it continues to grow at aEmployee injuries 0 1 0 0 rapid pace.Employee fatalities 0 0 0 026 | Zain Saudi Arabia