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e2ecac1c6a354f03abf5f01ce37b2399.indd 1
08.02.2022 08:53:48
3a0f22ec57fb46959c7dca336ce71541.indd 1
07.02.2022 17:23:17
The Annual Report, Sustainability Report and ‘2021 at a glance’ together make up Swisscom’s reporting
on 2021. The three publications are available online at: swisscom.ch/report2021
‘Ready for tomorrow’ concept
As part of its ‘ready for tomorrow’ concept, Swisscom is committed to preparing itself and its customers
for the digital future and harnessing the corresponding opportunities. The images in the Annual Report
show Swisscom services that simplify the everyday life of SMEs and improve their competitiveness.
The cover pages of the Annual Report and ‘2021 at a glance’ show Swisscom SME consultant Kathrin Kölbl
with Fabian Mauerhofer, manager of the Ziegelhüsi hotel and restaurant in Deisswil. The company
procures services from Swisscom.
The remaining images are mostly from the various Swisscom campaigns run throughout the 2021
reporting year.
Sustainability Report 2021 ready for tomorrow71092c7abd1147d2b9a8400b3527cb29.indd 102.02.2022 12:07:34
Table of contents
Introduction
Management Commentary
1 – 11
12 – 63
Corporate Governance and Remuneration Report
64 – 105
Consolidated Financial Statements
Further Information
106 – 175
176 – 184
1
2021 in review
Net revenue
billion CHF
EBITDA
billion CHF
Capital expenditure
billion CHF
11.2
0.7%
4.5
2.2%
2.3
2.6%
Net income
billion CHF
Net debt to EBITDA
after leases ratio
Equity ratio
%
1.8
20.0%
1.4
0.1
43.6
4.5 PP
Employees
(full-time equivalent)
Dividend per share
CHF
18,905
0.8%
22
Total shareholder
return Swisscom share
%
12.9
15.9 PP
Ambitious
for the climate
Swisscom has set itself the target
of net zero emissions by
2025
Very good
Swisscom wins
connect service shop test
with best ever rating.
Top
rating
‘My Swisscom’ rated
best customer app –
in Switzerland and compared
with neighbouring
German- speaking countries.
World champion
Out of 4,400
entries, Swisscom wins
Global IoT Award
from Microsoft.
On
course
Fastweb 2021
once again achieved
more sales, more
customers and
more profit in Italy.
Fastest
Swisscom has
fastest 10 Gbit/s
fibre optic connection.
Best
Swisscom again winner of all
mobile tests in Switzerland.
In the connect test, it even
received an ‘outstanding’
rating and the highest score
ever awarded in Switzerland.
KPIs
In CHF million, except where indicated
Net revenue and results 1
Net revenue
Operating income before depreciation and amortisation (EBITDA)
EBITDA as % of net revenue
EBITDA after lease expense (EBITDA AL)
Operating income (EBIT)
Net income
Earnings per share
Balance sheet and cash flows 1
Equity
Equity ratio
Operating free cash flow proxy
Capital expenditure
Net debt
Operational data
Fixed telephony access lines in Switzerland
Broadband access lines retail in Switzerland
TV access lines in Switzerland
Mobile access lines in Switzerland
Revenue generating units (RGU) in Switzerland
Broadband access lines wholesale in Switzerland
Broadband access lines in Italy
Mobile access lines in Italy
Swisscom share
Number of issued shares
Market capitalisation
Closing price at end of period
Closing price highest
Closing price lowest
Dividend per share
Employees
Full-time equivalent employees
Average number of full-time equivalent employees
2021
2020
Change
11,183
11,100
4,478
40.0
4,177
2,066
1,833
35.37
10,813
43.6
1,891
2,286
5,689
1,424
2,037
1,592
6,177
4,382
39.5
4,082
1,947
1,528
29.54
9,491
39.1
1,853
2,229
6,218
1,523
2,043
1,588
6,224
11,230
11,378
596
2,750
2,472
51,802
26,657
514.60
562.40
456.30
22.00
2
18,905
19,099
555
2,747
1,961
51,802
24,715
477.10
577.80
446.70
22.00
19,062
19,095
%
CHF
%
in thousand
in thousand
in thousand
in thousand
in thousand
in thousand
in thousand
in thousand
in thousand
CHF
CHF
CHF
CHF
number
number
0.7%
2.2%
2.3%
6.1%
20.0%
19.7%
13.9%
2.1%
2.6%
–8.5%
–6.5%
–0.3%
0.3%
–0.8%
–1.3%
7.4%
0.1%
26.1%
–
7.9%
7.9%
–
–0.8%
0.0%
1 Swisscom uses various alternative performance measures. The definition and
reconciliation of values in accordance with IFRS are set out in the chapter on
financial review.
2 In accordance with the proposal of the Board of Directors to the Annual
General Meeting.
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Business overview
Other Operating
Segments
With subsidiaries in the area of
network construction and main-
tenance (cablex Ltd) and broad-
cast services (Swisscom Broadcast
Ltd), Swisscom is supplementing
the core business in related areas.
The Digital Business division is fo-
cused on growth areas in the field
of Internet services and digital
business models, and also includes
business with online directories
and telephone books (localsearch).
Swisscom
Switzerland
Fastweb
Fastweb provides broadband and
mobile phone services to resi-
dential, business and wholesale
customers in Italy. The offering
includes telephony, broadband
and mobile services. Fastweb
also offers comprehensive ICT
solutions for business customers.
Residential Customers
The Residential Customers division
provides mobile and fixed-line
services in Switzerland, such as
fixed-line telephony, broadband,
TV and mobile communications.
Business Customers
Business Customers offers tele-
com services and overall commu-
nications solutions for large cor-
porations and SME customers in
Switzerland. The offering in the
area of business ICT infrastructure
covers the entire range from
individual products to complete
solutions.
Wholesale
The Wholesale segment enables
other telecommunications pro-
viders to use the Swisscom fixed
and mobile network.
Infrastructure & Support Functions
The Infrastructure & Support Func-
tions area plans, operates and
maintains the network and IT
infra structure in Switzerland.
Revenues
Revenues
Revenues
CHF 8.2 bn
EUR 2.4 bn
CHF 1.0 bn
EBITDA
EBITDA
EBITDA
CHF 3.5 bn
EUR 0.8 bn
CHF 0.2 bn
5
Shareholders’ letter
Healthy financial results –
ready for tomorrow
From left: Michael Rechsteiner, Chairman of the Board of Directors Swisscom Ltd and Urs Schaeppi, CEO Swisscom Ltd.
Dear Shareholders
The future needs digitisation. Our ambition is to make the digital future possible for our customers in
Switzerland and Italy. Some 19,000 Swisscom and Fastweb employees have been committed to this
objective for years. By investing around CHF 2.3 billion annually in network expansion, we are creating the
conditions for successful digitisation. We develop advanced products and services for and with our
customers – ensuring that our customers are also ready for what tomorrow may bring. We also seize the
possibilities of digitisation to make climate-friendly changes: for example, we are seeking to become
climate-neutral along the entire value chain in Switzerland by 2025. As a market and technology leader,
we are spurred on by curiosity to anticipate future developments at an early stage: for example, we work
closely with universities, invest in innovative start-ups and host an annual StartUp Challenge, with the
theme for 2021 being cyber security.
Solid finances – the foundation for lasting success
Our markets remain saturated, and promotional and price pressure is high. Swisscom successfully held its
own in this environment in 2021: with net revenue of CHF 11,183 million (+0.7%) and operating income
before depreciation and amortisation (EBITDA) of CHF 4,478 million (+2.2%), the results were above the
previous year. We achieved these good results thanks to networks that once again received top ratings in
the year under review, our multi-award-winning customer service, and innovative products and services.
In addition to these outward-facing aspects, we are consistently improving our own internal efficiency by
expanding process automation, strengthening our online channels and simplifying our IT and networks.
These measures enabled us to reduce our cost base by around CHF 120 million in 2021, further boosting
our competitiveness.
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Fastweb records more customers, revenue and EBITDA
Fastweb made an important contribution to Swisscom’s success again in 2021. With a market share of
around 16% among residential customers, 34% among businesses and 46% in the public sector, Fastweb
is the clear number two in Europe’s fourth-largest broadband market. It grew its customer base in all
segments, with rises of 0.1% for broadband customers and 26.1% in mobile communications. As a result,
Fastweb boosted its revenue by 3.8% to EUR 2,392 million and its operating income before depreciation
and amortisation (EBITDA) by 5.4% to EUR 826 million. This was a tremendous result!
Much invested, much gained
At the end of 2021, Swisscom reached the expansion target that it promised six years ago: it is delivering
speeds of at least 80 Mbps to 90% of all homes and offices in every Swiss municipality. To achieve this,
Swisscom invested around CHF 1.6 billion per year in the expansion and maintenance of its IT and network
infrastructure in Switzerland. This forward-thinking approach to infrastructure expansion is continued in
its Network Strategy 2025: Swisscom intends to double its fibre-to-the-home (FTTH) coverage and
provide 50–60% of homes and offices with bandwidths of 10 Gbps by 2025.
Swisscom again came top in all Switzerland’s mobile network tests in 2021, and achieved the best rating
ever awarded in Switzerland in the annual test conducted by the trade magazine ‘connect’. Today, the
entire Swiss population has 4G coverage. A basic version of 5G (5G technology on 4G antennas) already
covers 99% of the population. The full benefits of 5G (5G technology on 5G antennas) are so far only
available in 888 locations. In order to create new capacity for modern 5G technology, Swisscom decom-
missioned the obsolete 2G/GSM mobile generation during 2021.
Best network – but more difficult expansion
Switzerland’s mobile and fibre-optic network is one of the best in the world. However, we note with
concern the increasing regulation, which threatens to slow down the urgently needed network expansion.
On top of the already ten times stricter installation limit values in Switzerland, we face an extremely
strict assessment of adaptive 5G antennas and high administrative hurdles for minor operational or
technological adjustments. If data traffic increases by around 20% annually but capacity is only expanded
by 5%, the Swiss mobile communications network is heading for an unnecessary crunch.
In its ruling of 30 September 2021, the Federal Administrative Court confirmed COMCO’s precautionary
measures, meaning that Swisscom may not continue to expand its network infrastructure in accordance
with the standard international point-to-multipoint (P2MP) FTTH standard. Swisscom is in talks with the
COMCO to reach a solution in the interest of our customers as quickly as possible. By engaging in close
dialogue with the authorities and politicians, Swisscom is striving to ensure that the expansion of our
fibre-optic and mobile communications infrastructure is neither made more expensive nor delayed,
because it is only with the highest-performing infrastructure that Switzerland will be able to seize the
opportunities that the digital future will bring.
Target of net zero by 2025 – one small step for the climate,
but one ambitious leap for Swisscom
After being named the world’s most sustainable telecommunications company in 2020, Swisscom is
embarking on the next step: to reduce its CO2 emissions in Switzerland along the entire value chain to net
zero by 2025. In order to be completely climate-neutral four years from now, Swisscom aims to reduce CO2
emissions from its operations and supply chains to a total of 235,000 tonnes, which is in line with a reduc-
tion path to well below 1.5°C. Measures to achieve this include switching to electric models for its
2,400-strong vehicle fleet: Swisscom brought the first 80 electric vehicles into service in 2021 and intends
to electrify the entire fleet by 2030.
We are also promoting innovations that drive climate-friendly changes via the Swisscom IoT Climate
Award and direct investments in start-ups. Examples include our investment in ecoRobotix, whose weeding
robots cut CO2 emissions and herbicide use by 90% through solar cells and 5G.
7
Ready for our residential customers
The residential customers market in Switzerland is saturated and strongly promotion-driven. Despite
that, Swisscom continuously developed its attractive inOne bundled offering during the year under
review. Home networking for controlling lighting, music or alarm systems also grew strongly.
Ready for the new TV experience: Swisscom launched ‘blue Play’, an extensive new media library offering
series, feature films and children’s programming, in 2021. It also introduced a technical innovation for
sports fans: when using the Replay mode, the key moments – such as goalmouth action or yellow and red
cards – are visually indicated so that viewers can always move to the most exciting passages of play.
Swisscom is also committed to the Swiss music scene, which it will be bringing live to blue TV users from
2022, 365 days a year.
Just as important as good-quality products is quality of service – be that online or in store. The trade
magazine ‘connect’ awarded the My Swisscom app the highest score of any service app from a tele-
communications company in Europe. The quality of personal service in our shops also secured the best
score ever achieved in Switzerland: in a nutshell, ‘we are ready’!
We are supporting Switzerland on its journey into a digital future with appropriate media training for
individuals, teachers, school pupils and parents. A total of 72,000 people took part in these training
sessions in 2021. Swisscom also campaigned against hate speech and online bullying with the #mutethehate
campaign.
‘ Swisscom was a pioneer when it
became the world’s first environ
mentally certified telecom
munications company 20 years
ago. Now it wants to lead the
way again with its target
of net zero emissions by 2025. ’
IT: the lifeline for companies
IT infrastructure is increasingly an indispensable lifeline for companies. Unsurprisingly, the market for
IT services recovered last year. Especially those SMEs that only really recognised the importance of digiti-
sation during the pandemic have some catching up to do. That is why Swisscom launched a digital POS
system in 2021 that allows SME managers to manage all major processes, from ordering and inventory
management to invoicing, from their tablets without any specific IT knowledge.
To enable SMEs to provide their services securely, Swisscom offers IT security assessments, cloud solutions
that apply the highest security standards and e-learning for employees.
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8
In 2021, Swisscom’s partnership with Rhomberg Sersa, an SME in the field of track construction, provided
a powerful illustration of what digitisation can achieve: the combination of the Internet of Things, cloud
solutions and 5G have not just improved Rhomberg Sersa’s competitiveness and the safety of its employees
on sites, but have also helped cut its CO2 emissions. Little surprise, then, that this ground-breaking project
was selected from 4,400 applications as the winner of Microsoft’s Global IoT Award.
‘ Swisscom once again offered the
best mobile network in 2021
and also the best service in its
shops throughout Switzerland.
These independent test
results are a joy to behold! ’
Shareholder return and outlook
Swisscom’s share price rose 7.9% to CHF 514.60 in 2021. Swisscom expects net revenue of CHF 11.1 to
11.2 billion, EBITDA of around CHF 4.4 billion and capital expenditure of around CHF 2.3 billion (around
CHF 1.7 billion of which will be in Switzerland) for 2022. Subject to achieving its targets, Swisscom will
propose an unchanged dividend of CHF 22 per share for the 2022 financial year at the 2023 Annual
General Meeting.
Many thanks
‘Being ready for tomorrow’ is both an opportunity and a challenge for all of us. Our employees prove every
day that they are ready for tomorrow and want to support our customers as they move into this digital
future. We are very thankful to them for this.
We would also like to thank you, our valued shareholders, for your trust and confidence. We hope that
you, too, are ready and eager to join us on our journey to a successful tomorrow.
Kind regards
Michael Rechsteiner
Chairman of the Board of Directors
Swisscom Ltd
Urs Schaeppi
CEO Swisscom Ltd
9
‘Ready for everyday
digital business’
More time for your customers thanks to
our modern POS system on your touchscreen.
‘Ready for everyday
digital business’
‘Ready for optimal
data security’
Enhanced IT security for your company
and your customers thanks to our security checks,
cloud solutions and e-learning.
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Strategy and environment _______ Targets and achievement of targets in 2021 . . . . . . . . . . . . 14
General conditions and market environment . . . . . . . . . . 14
Swisscom Group Goals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Strategy for Switzerland . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Strategy in Italy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Sustainability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Infrastructure ________________ Infrastructure in Switzerland . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Infrastructure in Italy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Employees ___________________ Employees in Switzerland . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Employees in Italy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Brands, products and services ____ Swisscom brands . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Products and services in Switzerland . . . . . . . . . . . . . . . . . . 37
Products and services in Italy . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Customer satisfaction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Innovation and development _____ Innovation as a key driver of business performance . . . . 40
Innovation focused on specific topics . . . . . . . . . . . . . . . . . . 41
Financial review _______________ Alternative performance measures . . . . . . . . . . . . . . . . . . . . . 44
Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Segment results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Depreciation and amortisation, non-operating results 51
Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Cash flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Capital expenditure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Net asset position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Financial outlook . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Value-oriented business management . . . . . . . . . . . . . . . . . 58
Statement of added value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
Capital market ________________ Swisscom share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
Dividend policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Credit ratings and financing . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Risks ________________________ Risk situation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Risk factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
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14
Strategy
and environment
Swisscom is Switzerland’s largest telecoms provider . Through its subsidiary Fastweb, it
also has an alternative telecoms service provider in the Italian market . In order to ensure
its long-term success in a dynamic environment, Swisscom has defined five Group
goals . In Switzerland, Swisscom aims to consolidate its market leadership even further .
Swisscom forms Switzerland’s digital backbone and sets itself apart by offering the
best customer experience . In Italy, the subsidiary Fastweb is focusing on the further
expansion of the ultra-broadband network and on convergence offerings . Other key
Group goals are an extremely high level of financial stability, innovative offerings,
resilient networks and sustainability .
Targets and achievement of targets in 2021
Financial targets
Net revenue
Operating income before depreciation
and amortisation (EBITDA)
Capital expenditure
Operational Excellence
Targets 2021
Target achievement 2021
Net revenue for the year 2021
of around CHF 11 .1 billion
EBITDA for the year 2021
of around CHF 4 .3 billion
Capital expenditure for the year 2021
of around CHF 2 .3 billion
Reduction of cost base 2021 in Swiss business
by CHF 100 million
CHF 11,183 million
CHF 4,478 million
CHF 2,286 million
CHF 119 million
Swisscom has set itself various targets that take eco-
nomic, ecological and social factors into consideration.
This annual report contains the targets and achieve-
ment of targets for 2021 from a financial perspective.
Those for sustainability are described in the separate
sustainability report.
N See www.swisscom.ch/cr-report2021
General conditions and
market environment
Swisscom operates in a very dynamic environment. Meg-
atrends such as demographic change, a sharper focus on
health-related topics and the growing importance of sus-
tainability are indelibly shaping and altering Swiss soci-
ety and the economy and have a long-term impact on the
activities of Swisscom as a result. By the same token, the
expansion of ultra-fast broadband, the increasing pene-
tration of cloud computing and the advancements made
in the field of artificial intelligence are short- to medi-
um-term trends that impact Swisscom’s business. Digiti-
sation is being accelerated even further by the global
Covid-19 pandemic as it penetrates more and more into
all spheres of life. Customer behaviour has also under-
gone a lasting change, as indicated by, among other
things, the increased use of online channels for shopping
and making contact as well as the rise of contactless pay-
ment. The pandemic has caused the importance of
high-performance networks to grow and expectations
regarding the stability and availability of the network
infrastructure will continue to rise as a result.
Digitisation is leading to new, rapidly developing business
models. Swisscom’s core business is characterised by fierce
competition with strong price pressure. The overall market
for connectivity services continues to shrink in Switzerland
and Italy. Global Internet companies are using their econo-
mies of scale and forcing themselves into local ICT markets
for both residential and business customers.
Market environment
The three macroeconomic factors of the economy (in
Switzerland and in Italy), interest rates and exchange
rates (EUR and USD) can have a significant influence on
Swisscom’s financial position, results of operations and
cash flows, and therefore on financial reporting.
Change GDP Switzerland
Change GDP Italy
Yield on government bonds (10 years)
Closing rate CHF/EUR
Closing rate CHF/USD
1 Forecast SECO
Economy
Economic developments in 2021 were once again dom-
inated by the measures taken to contain the Covid-19
pandemic. After slumping sharply in the early stages of
the pandemic in 2020, the economy recovered in the
year under review, with GDP in Switzerland up 3.5% in
2021 compared with the previous year. Swisscom’s cus-
tomer segments are affected differently by the eco-
nomic trend. A high share of the revenues generated in
the Residential Customers segment can be attributed
to products with fixed monthly charges, meaning the
impact of economic fluctuations on revenue remains
low in the short term. However, an economic downturn
may reinforce the trend towards switching to cheaper
price plans. Project business with business customers is
more sensitive to cyclical factors. Pandemic-related
travel restrictions led to lower revenues and lower
costs in the roaming business. Furthermore, the pan-
demic resulted in a negative business trend in the cin-
ema business.
Interest rates
The interest rate level has an impact on funding costs
and also affects the valuation of long-term provisions
and pension liabilities in the consolidated financial
statements. In addition, interest rates constitute a key
assumption for the impairment assessment of goodwill
and other items in the financial statements. The yields
on ten-year government bonds remain at a very low
level. Swisscom issued one bond totalling CHF 100 mil-
lion in 2021. The average interest expense on these
financial liabilities (excl. lease liabilities) was 0.9% at the
end of 2021. 88% of these financial liabilities were
charged a fixed interest rate. The average maturity is
6.2 years. This financing structure offers considerable
protection against a potential rise in interest rates.
Unit
in %
in %
in %
in CHF
in CHF
2017
2018
2019
1 .0
1 .5
(0 .07)
1 .17
0 .98
2 .8
0 .1
(0 .24)
1 .13
0 .99
0 .9
0 .2
(0 .46)
1 .09
0 .97
2020
(2 .5)
(9 .6)
(0 .53)
1 .08
0 .88
2021
3 .5
1
6 .3
2
(0 .13)
1 .03
0 .91
2 Forecast Istat
Currencies
Exchange rate fluctuations have very little impact on
Swisscom’s income or financial position. Transaction
risks for operational cash flows exist primarily in the pur-
chase of end devices and technical equipment and ser-
vices from network operators outside of Switzerland
(e.g. for roaming). In the core business in Switzerland,
the amount of money paid out in foreign currencies is
higher than the income in the corresponding currencies.
The largest currency exposure is in USD. The net cash
flows in foreign currency are partly hedged by foreign
currency forward contracts, and hedge accounting is
applied
in the consolidated financial statements.
Swisscom funds itself for the most part in Swiss francs
and to a lesser extent in EUR. The net assets of foreign
subsidiaries, especially of Fastweb in Italy, are also sub-
ject to a currency translation risk in the consolidated
financial statements. The carrying amount of Fastweb’s
net assets totalled EUR 3.4 billion at the end of 2021. The
balance sheet items of the foreign subsidiaries were
translated into Swiss francs at the exchange rate on the
balance sheet date, and differences arising in translation
were recognised directly in equity. A portion of the
financial liabilities in EUR is classified as a currency hedge
of the Fastweb net assets.
Legal environment
Swisscom’s legal framework
Swisscom is a public limited company with special status
under Swiss law. Corporate governance is governed by
company law and, in particular, the Telecommunications
Enterprise Act (TEA). In its capacity as a listed company,
Swisscom also observes capital market law and the
requirements of the Ordinance against Excessive Com-
pensation in Listed Stock Companies (OaEC). The legal
framework for Swisscom’s business activities is primar-
ily derived from the Federal Telecommunications Act
(TCA) and the Federal Cartel Act (CartA).
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Telecommunications Enterprise Act (TEA) and
relationship with the Swiss Confederation
The TEA requires the Swiss Confederation to hold a
majority of the capital and voting rights in Swisscom.
Were the government to dispose of the majority hold-
ing, this would require a change in the corresponding
law, which would be subject to a facultative referen-
dum. Every four years, the Federal Council defines the
goals which the Confederation as principal shareholder
aims to achieve. The current target period covers the
years 2018 to 2021. These goals include strategic, finan-
cial and personnel policy objectives as well as targets
relating to partnerships and investments. The Federal
Council also expects Swisscom to pursue a corporate
strategy that is, to the extent economically possible,
both sustainable and committed to ethical principles. In
November 2021, the Federal Council approved the goals
for the period from 2022 to 2025.
N See www.swisscom.ch/ziele_2018-2021
N See www.swisscom.ch/ziele_2022-2025
Telecommunications Act (TCA)
The Telecommunications Act and the associated legisla-
tion primarily govern network access, basic service pro-
vision and the use of radio frequencies. The new provi-
sions on network neutrality and roaming resulting from
amendments to the law and ordinances entered into
effect in 2021. The regulatory provisions regarding
mobile network hardening are still being drafted. These
provisions are designed to ensure that the population
and the economy can continue to use important tele-
communications services (emergency calls, data ser-
vices, telephony, radio and TV programmes) in the event
of a power shortage.
N See www.admin.ch
Network access
The legislator has confirmed that it intends to continue
to limit network access regulation to copper-based con-
nections (no technology-neutral network access). This
means that Swisscom is required to allow other provid-
ers physical network access only to copper lines at cost-
based prices. Access to fibre-optic lines continues to be
on the basis of commercial agreements.
Basic service provision
The Federal Communications Commission (ComCom) has
awarded the universal service licence for the period 2018
to 2022 to Swisscom. The aim of the basic service is to pro-
vide reliable, affordable basic telecommunications to all
sections of the population in all regions of the country. The
Federal Council periodically determines the scope of ser-
vices as well as the related quality and pricing require-
ments. Swisscom fulfils its mandate and generally offers
fixed network telephony (IP) as well as broadband Internet
with a transmission rate of at least 10 Mbps (downloads)
and 1 Mbps (uploads). In December 2021, the Federal
Council opened a consultation on the revision of the Ordi-
nance on Telecommunications Services (OTS), proposing
to include an additional Internet service with a download
speed of at least 80 Mbps in the universal service licence
from 2024 onward. The amendment to the ordinance pro-
vides for the subsidiarity principle. If the market already
provides an alternative using mobile communications or
satellite technology, for example, no basic service is
required.
Non-ionising radiation
The Ordinance on Non-Ionising Radiation (ONIR) regu-
lates immissions and thus the transmission power of
mobile antennas. The Swiss limit values (installation
limit value) are ten times stricter than the limit values
recommended by the WHO or those in force in neigh-
bouring countries. Additional antennas are required to
cope with increasing volumes of data transmitted over
the network and to guarantee the reliability of mobile
connections. These meet with resistance from the popu-
lation. In April 2020, the Federal Council refused to
adjust the limits, which would have increased the capac-
ity of existing antenna systems.
Federal Cartel Act (CartA)
Competition law (Federal Cartel Act) is highly relevant
to various products and services from Swisscom, pri-
marily due to Swisscom’s prominent market position. It
allows for direct sanctions to be imposed for unlawful
conduct by market-dominant companies. Companies
upon which other companies are dependent (relative
market power) will be subject to the Federal Cartel Act
from 2022 onward. The Swiss competition authority
(Competition Commission, COMCO) has classified
Swisscom as being market-dominant in a wide range of
submarkets. There are currently several proceedings
open within the context of which COMCO has classi-
fied Swisscom as being market-dominant and its con-
duct as being unlawful, and has thus imposed or may
impose direct financial sanctions. The proceedings
relate to the rolling out of the fibre-optic network, the
broadcast of live sporting events on pay TV, broadband
connections of post office locations and the broadband
connections of business customers. The statuses of the
proceedings and the potential financial effects are set
out in the notes to the consolidated financial state-
ments (Note 3.5).
The Federal Copyright Act (CopA)
Swiss copyright law protects the rights of creators of
works while also facilitating the fair use of works subject
to copyright, which may generally be used only with the
copyright holder’s consent and in return for a considera-
tion. An exception to this rule is made for private use
and for copying for private use. The compensation paya-
ble to the copyright holder for certain types of use pro-
tected by copyright law (collective management of
rights) is determined by reference to collectively negoti-
ated copyright tariffs. These apply to distribution of tel-
evision programmes and to the use of time-delayed tel-
evision viewing (Replay TV).
The Federal Radio and Television Act (FRTA)
Switzerland’s Radio and Television Act governs the pro-
duction, presentation, transmission and reception of
radio and television programmes. It is primarily on
account of blue TV that Swisscom is affected by the rules
on the transmission and broadcasting of media offer-
ings. The various privileges (known as the ‘must carry’
provisions) applicable to certain broadcasters are rele-
vant to Swisscom.
Federal Act on Data Protection (FADP)
The Swiss Federal Act on Data Protection regulates
the treatment of personal data. After several years of
preparatory work, Parliament adopted the revised
version of the Federal Act on Data Protection in 2020.
It is not yet known when the revised act will come
into force. Swisscom expects this to happen in the
second half of 2022.
The European Union’s General Data Protection
Regulation (GDPR)
The General Data Protection Regulation has regulated the
processing of personal data since May 2018. The GDPR is
relevant to Swisscom both as regards its service offering to
residential customers in the EU as well as within the Euro-
pean Economic Area (EEA) and its provision of IT services to
business customers directly subject to the GDPR. The
actions required to comply with the GDPR’s requirements,
in so far as it impacts Swisscom’s operations, were taken
by Swisscom within the specified time period.
Legal and regulatory environment in Italy
The legal framework for Fastweb’s business activities is
determined primarily by Italy’s telecommunications leg-
islation and the EU. Following a market analysis, in
August 2019 the national regulatory authority, AGCOM,
issued a decision on Telecom Italia’s wholesale access
services (TIM) for the years 2018 to 2021. Among other
things, it approved a price reduction for virtual unbun-
dled access (VULA) based on FTTS (Fibre to the Street) for
the period from 2019 to 2021. In July 2021, Commission
Delegated Regulation (EU) 2021/654 entered into force,
setting limits on fixed and mobile termination rates for
voice services at EU level.
Data protection
Swisscom attaches great importance to the legally com-
pliant and responsible processing of personal data. Data
protection within Swisscom is controlled and monitored
by a central data governance unit, which works closely
with all the relevant divisions and other staff units.
Swisscom pushed ahead with the implementation of
the new Federal Act on Data Protection (FADP) in the
year under review. It has analysed the new legal require-
ments and examined their impact on its own activities.
It will now implement the corresponding measures in a
cross-departmental programme involving all relevant
functions. In addition, Swisscom issued new directives
and information sheets in 2021 for specific types of data
processing. One important aspect of data protection at
Swisscom is the expansion of technical systems that
support data governance. Swisscom also has clearly
defined processes and responsibilities that apply in the
event of data protection breaches.
In the year under review, Swisscom worked hard to pro-
mote the development of Privacy Icons. These graphical
representations show data subjects quickly and easily
which of his or her data is being processed and how.
They are made available to the public through the Pri-
vacy Icons association and can be used by data proces-
sors at no charge. Swisscom is a member of the associa-
tion and is represented on the board.
At Swisscom, a data ethics framework for the entire
company forms the basis for ethically correct data pro-
cessing. The framework is used by the Data Ethics Board,
which is made up of members from various divisions of
Swisscom, to assess sensitive cases and ensure that they
comply with the principles of corporate ethics. The Data
Ethics Board reviewed several use cases in 2021 to check
for compliance with data ethics principles. The approach
set out in the framework for data ethics has proven suc-
cessful and will be continued.
N See www.swisscom.ch/dataprotection
Swiss market trends in telecoms
and IT services
The Swiss telecommunications market is characterised by
a wide range of voice and data products and services as
well as the continuing advance of digitisation and con-
nectivity. In addition to the established regional and
national telecommunications companies, internationally
active companies are entering the Swiss telecommunica-
tions market, offering both free and paid-for Inter-
net-based services around the world, including telephony,
SMS messaging and streaming services. Overall, this is
generating constant growth in demand for high band-
widths that enable fast, quality access to data and appli-
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cations. The uninterrupted availability of data and ser-
vices as well as the security involved in ensuring this
availability are becoming increasingly important, with
modern, highly effective network infrastructures provid-
ing the foundations. Swisscom is therefore employing the
latest technologies to continuously expand both its fixed
and mobile networks. The 2020 acquisition of Sunrise by
Liberty Global (parent company of UPC Switzerland) and
the subsequent merger of UPC Switzerland and Sunrise
have consolidated the market even further in the year
under review. Competitive pressure in the market remains
high as a result.
The Swiss telecoms market is broken down into the sub-
markets of relevance to Swisscom – mobile communica-
tions and fixed network – and generates total revenue
estimated at CHF 11 billion. Price pressure will remain
high in all markets, and Swisscom therefore expects rev-
enue to decline slightly in the telecommunications mar-
ket in the medium term. Saturation in all markets is
intensifying the existing cut-throat competition. The
individual submarkets are characterised by a high level
of promotional activity on the part of the individual
market participants and corresponding price pressure.
At the heart of the portfolio of offerings are convergence
offerings which can contain one or more mobile lines, in
addition to a fixed broadband connection with Internet,
TV and fixed-line telephony. Swisscom – as well as some
competitors – offers products and services from the core
business using secondary and third-party brands.
Market share Swisscom
Swiss telecommunication market
57%
56%
51% 50%
37%
37%
2020
2021
2020
2021
2020
2021
Mobile
Broadband retail
TV
Mobile communications market
Switzerland has three separate, wide-area mobile net-
works on which the operators of those networks market
their own products and services. Other market players
also offer their own mobile services as MVNOs (mobile
virtual network operators) on these networks. Swisscom
makes its mobile communications network available to
selected third-party providers so that they can offer pro-
prietary products and services to their customers via the
Swisscom network. The Swiss mobile communications
market is saturated due to the high level of market pen-
etration and the number of mobile lines (SIM cards) has
stagnated at around 11 million. Mobile access line pene-
tration in Switzerland remains at around 125%. As in the
previous year, the number of postpaid subscriptions
taken out increased, while the number of prepaid cus-
tomers fell. The proportion of mobile users with post-
paid subscriptions stands at approximately 81% (prior
year: 77%). Swisscom decommissioned the obsolete sec-
ond-generation mobile network (2G/GSM) in the first
half of 2021. Swisscom is using the freed-up capacity for
the newer 4G and 5G generations. Swisscom’s postpaid
market share is 56%. This represents a decrease of one
percentage point compared to the previous year, which
is due to the continuing competitive pressure.
Fixed-line market
Close to 100% of Switzerland is covered by fixed broad-
band networks. Alongside the fixed-line networks of tel-
ecoms companies, there are also networks provided by
cable network operators. Moreover, market players such
as utilities operating in particular cities and municipali-
ties are building and operating fibre-optic networks on
their own initiative at a regional level. For the most part,
their network infrastructures are available to other mar-
ket participants for product offerings and the provision
of services. Swisscom
is building state-of-the-art
fibre-optic networks, partly in cooperation with other
companies, based on the principle of open networks. In
2021, Swisscom entered into a partnership for fibre-op-
tic expansion with its competitor Salt. Within the frame-
work of the partnership, Salt is investing in long-term
usage rights for Swisscom’s fibre-optic connections. This
will enable Salt to offer its own products and services on
a large scale in the future, thereby increasing the diver-
sity of its offerings on the market even further. Fixed
broadband connections lay the basis for a wide-ranging
product offering from both national and global compet-
itors. There is currently a great deal of uncertainty
shrouding the continued rolling out of the fibre-optic
network to homes and businesses (FTTH), which
Swisscom is implementing for the whole of Switzerland.
In 2021, the Federal Administrative Court confirmed the
precautionary measures taken by the Competition Com-
mission in December 2020, which partly call into ques-
tion Swisscom’s network architecture and may there-
fore also have an impact on its partnership with Salt.
Until the situation is clarified, Swisscom is only building
network elements relating to the P2P (point-to-point)
network element (e.g. feeder to the home) or that are
being built under cooperations.
Broadband market
The most widespread access technologies for fixed
broadband connections in Switzerland are infrastruc-
tures based on the networks of telecommunications
providers and cable network operators. The broadband
market grew by around 2% in the 2021 reporting year.
There were 4 million retail broadband access lines in
Switzerland at the end of 2021. Swisscom’s market share
declined by one percentage point year-on-year to 50% as
a result of persistently high competitive pressure.
TV market
In Switzerland, TV signals are transmitted via cable,
broadband, satellite and mobile. The large majority of TV
connections is provided via cable or broadband networks.
The Swiss TV market features a diverse range of offerings
from established national market participants. Offerings
from other national and international companies are also
available on the market, including TV and streaming ser-
vices that can be used over an existing broadband con-
nection, regardless of the Internet provider. The competi-
tive dynamics in the saturated TV market remain high,
driven by the large number of different offerings. At the
end of 2020, Swisscom acquired the broadcasting rights
for all matches in the top Swiss football leagues from
2021 to 2025 in order to further strengthen its strong
position in the TV market. It defended its market share
against the competition in 2021 and remains the market
leader with a market share of 37%.
Fixed-line telephony market
Fixed-line telephony is mainly based on lines running over
the fixed networks of the telecoms service providers and
the cable networks. As the use of fixed-line telephony is
steadily declining it continues to be replaced by mobile
communications. This trend continued in 2021, with the
number of Swisscom fixed-line connections falling by
around 7% to 1.4 million.
IT services market in Switzerland
In 2021, the IT services market (IT services and software)
generated revenue of around CHF 19 billion. The market
recovered in the 2021 reporting year following a slight
decline in the previous year due to the Covid-19 pan-
demic. For the coming years, Swisscom assumes that the
market will grow by 4 to 5% per year due to increasing
digitisation. The areas in which it expects the most
growth are the cloud, workspace & collaboration, secu-
rity, the Internet of Things (IoT) and business applica-
tions. This growth is a result of the increasing number of
business-driven ICT projects as well as the rising demand
for digital business models and new working models.
Swisscom has noticed companies’ growing willingness
to procure more external services in order to cope with
elevated complexity and the accelerating transforma-
tion into a hybrid cloud. Further growth drivers are also
the increasing threats in the area of IT security as well as
system solutions in the area of IoT. Customers generally
expect services customised to their individual sector and
business processes with appropriate advice.
In a difficult market environment, Swisscom increased its
revenue slightly year-on-year and held on to its market
position. This was mainly due to positive trends in the
growth areas of security, cloud and business applications.
Market revenues increased in each of those areas, although
certain revenues shifted to the big global cloud providers
(hyperscalers) and were lost in Switzerland as a result. In
addition, Swisscom strengthened its position in the IT ser-
vices market in the year under review through the acquisi-
tions of the MTF Group (IT services for SMEs), Webtiser AG
(SAP e-commerce) and JLS Digital AG (digital communica-
tions, customer-specific applications and digital signage),
all of which operate in German-speaking Switzerland and
the Principality of Liechtenstein.
Italian market trends in telecoms services
Italian broadband market
Thanks to revenue of around EUR 15 billion including
wholesale, Italy is the fourth largest fixed-line market in
Europe. The volume of the broadband market for homes
and businesses has increased steadily in past years. The
broadband market comprises around 17 million access
lines for four major competitors and other smaller pro-
viders. Fastweb is one of the largest fixed-network
broadband providers with a market share of 16% in the
residential customer segment and 34.5% in the business
customer segment.
Italian mobile communications market
The Italian mobile communications market has a volume
of around 78 million active SIM cards and a total revenue
of around EUR 13 billion. Competition and price pressure
are substantial. Despite the difficult environment, Fast-
web’s customer base in mobile communications grew by
26% year over year to around 2.5 million customers. Fast-
web’s market share in terms of SIM cards is 3%.
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Swisscom Group Goals
In order to ensure its long-term success in a dynamic
environment, Swisscom has defined five Group targets
(‘Swisscom Group Goals 2025’). It has enshrined one
common denominator in these Group targets, which
apply to all Group companies: the new purpose of
‘Empowering the Digital Future’.
Swisscom Group Goals 2025
No. 1
in Switzerland
Leading
Challenger in Italy
Rock-solid
Financials
Committed to
Corporate
Responsibility
Outstanding
in Innovation
& Reliability
Swisscom has set itself the goal of consolidating its posi-
tion even further, both as a market leader in Switzerland
and as a key provider in the market for IT services (‘No. 1
in Switzerland’). It forms Switzerland’s digital backbone
and sets itself apart by offering the best customer expe-
rience.
Swisscom’s Fastweb subsidiary is a leading alternative
provider for residential and business customers in Italy
(‘Leading challenger in Italy’). Fastweb continues to
expand its own convergent ultra-broadband network
through ongoing investments. The best customer experi-
ence is based on impressive quality of service and on
offers that are characterised by transparency, fairness
and simplicity. Fastweb contributes significantly to
Swisscom’s growth and aims to make further gains in
market share.
Swisscom is characterised by enormous stability (‘Rock-
solid financials’). Safeguarding profitability and cash flow
is pivotal to its ability to continue distributing attractive
dividend.
Swisscom is committed to fulfilling its corporate respon-
sibility towards society. This responsibility is becoming
increasingly important in the eyes of shareholders, the
capital market and customers (‘Committed to corporate
responsibility’). As a trustworthy company, Swisscom
focuses on sustainability, which it expresses through net
zero emissions and a positive carbon footprint in the
Swiss business by 2025, among other things. Swisscom
also promotes diversity and inclusion within its own
company. Diversity stands for a balanced mix of genera-
tions, gender equality and variety in terms of language
and origin. Inclusion refers to the targeted integration of
employees with physical or psychological impairments
as well as the integration of refugees.
N See www.swisscom.ch/cr-report2021
As a leading digital company, Swisscom launches innova-
tive products and services based on resilient and secure
networks (‘Outstanding in innovation & reliability’). It
develops growth areas in its Digital Business division,
such as FinTech or Trust Services, in a targeted manner.
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Strategy for Switzerland
Swisscom is a market, technology and innovation leader
in Switzerland with high quality standards, connecting
both residential and corporate customers. It is at the
heart of digitisation and enables its customers to seize
the opportunities presented by the networked world
without difficulty. In everything it does, Swisscom
focuses on people’s needs. Its employees work in con-
cert to provide inspirational experiences. Swisscom is
committed and trustworthy in its actions, consistently
seeks to learn new things and develop and systemati-
cally pursues its goals. What matters most to Swisscom
is its customers’ trust in it. That trust is strengthened by
Swisscom’s reliability and sustainability in everything it
undertakes. To realise its vision of being a market leader
in shaping the future and inspiring people in a net-
worked world, Swisscom has set out three strategic aspi-
rations.
Best infrastructure
Digital leader
Best service
Highly simplified
IT & network
Best
customer
experience
Operational
excellence
Best products
Smart investments
Growth
Maximisation of core business
Focused growth
in new areas of business
Growth in IT market
Strategic aspirations of Swisscom
Best customer experience
Swisscom wants to inspire its customers by providing
them with the best service at all times, regardless of
their location. Since the customer experience is based on
a high-performance infrastructure, Swisscom offers its
customers the latest IT and communications infrastruc-
ture and develops these on an ongoing basis. Customer
requirements for networks are constantly growing. As a
result, Swisscom sets up and operates high-perfor-
mance networks that are top-notch in terms of security,
availability and coverage. In the year under review, the
Swisscom network once again earned top rankings in
numerous tests conducted by leading technical journals.
Swisscom sets itself ambitious goals for the expansion
of its fibre-optic network. By the end of 2025, fibre-optic
coverage in homes and businesses (FTTH – Fibre to the
Home) is expected to increase to between 50 and 60%.
After launching the first 5G network in Europe with
commercial offerings and end devices in spring 2019,
Swisscom is continuing to push ahead with the expan-
sion of 5G. Some portions of the population still have
concerns about and are resistant to the expansion of 5G.
Additionally, Switzerland’s strict legal limits mean that
networks’ full capacity cannot be exploited and that, in
turn, hinders efforts to create urgently needed capacity
on the mobile network.
Cloud services produced in Switzerland form the central
cornerstone of the cloud offering and are supplemented
by global public cloud solutions (including Amazon Web
Services or Microsoft Azure, for example). Swisscom acts
as an independent service provider that offers hybrid
and multicloud solutions to provide customers the sup-
port they need for their digital transformation.
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The relationship with customers is at the heart of
Swisscom’s success. Swisscom’s top priorities are providing
the best service and inspirational experiences across the
board. Swisscom provides customers with expert guidance
and they get flexible, personalised on-site service and
enjoy a simple user experience across all online offerings.
Swisscom is also streamlining its offering and provides rel-
evant, advanced products. At the forefront of its conver-
gence offering is the flexible, modular inOne subscription,
which is being improved on an ongoing basis and remains
very popular among residential customers. In addition to
its main brand, Swisscom offers second- and third-party
brands to address more digitally savvy or price-sensitive
target groups. Swisscom continues to develop its blue TV,
blue News, blue+ and blue Cinema entertainment services
within the ‘Swisscom blue’ product family.
Swisscom provides small and medium-sized enterprises
(SMEs) with in-depth, personal, local support thanks to a
nationwide network of SME specialists and certified part-
ners. Swisscom provides SMEs with complete Smart ICT
solutions for outsourcing IT. Most recently, it added new
security solutions and more to its offering for Swiss SMEs.
As a trusted partner, Swisscom helps SME customers to
defend themselves against the growing threat of cyber
attacks. Both standardised products and customised cus-
tomer solutions are in demand in the business customer
segment. Swisscom offers business customers an inte-
grated customer experience from a single source.
Operational excellence
Due to fierce competition, revenues in the core business
are still under strong pressure. Swisscom wants to offset
these revenue losses as much as possible through
growth in new areas and strict cost management. In its
core business, Swisscom wants to optimise its cost base
further over the coming years in order to secure long-
term profitability. This should allow Swisscom to free up
funds for the exploration of new business opportunities
and make the investments necessary to ensure future
success. As a leading digital company, Swisscom’s inter-
nal digital transformation and accompanying increase in
its own level of digitisation are also crucial. To drive this
transformation, Swisscom is expanding process auto-
mation, strengthening its online channel for sales and
consulting and using artificial intelligence and analytics
capabilities, among other things. Simplifying the com-
pany’s own IT and network is also essential. To this end,
Swisscom is modernising and consolidating its IT plat-
forms, phasing out old technologies, reducing inter-
faces, using agile development methods and standardis-
ing and streamlining its product portfolio. What’s more,
Swisscom is making its investment activities even more
efficient, for example through an intelligent mix of tech-
nologies and value-oriented network expansion.
New growth
The market for telecommunications in Switzerland is
saturated. Swisscom anticipates moderate volume
growth, both as a continuation of the previous trend in
the postpaid segment of mobile communications as
well as in the broadband segment, where it expects the
rising number of homes and businesses in Switzerland,
among other factors, to result in an increase in the num-
ber of subscribers. Price pressure will remain high in all
markets, and Swisscom therefore expects revenue to
decline slightly in the telecommunications market as a
whole. Following the slight dip in the market in 2020 due
to the Covid-19 pandemic, the IT services market recov-
ered in the year under review. Market experts believe
that it will continue to enjoy moderate growth over the
next few years, driven by increasing digitisation and the
related increase in the use of ICT in numerous industries.
Swisscom is targeting growth in the following three
areas in particular: in its core business, in the IT market
and in new business areas. By developing its core busi-
ness further, it intends to exploit growth opportunities,
e.g. in the Internet of Things (for both residential and
business customers), with advanced value-added ser-
vices and in respect of secondary and third-party brands.
In the IT sector, the focus is on security and cloud ser-
vices, vertical IT offerings (e.g. banking) and applications.
It aims to generate growth in new business areas
through its activities in the fintech sector, digital ser-
vices for SMEs provided by localsearch (Swisscom Direc-
tories Ltd) and trust services. It manages growth areas
using clearly defined success criteria. When selecting
growth areas, it is guided by future customer require-
ments, focuses on future-oriented business models
offering strong growth and makes increased use of part-
nerships.
‘Level up’ transformation
In order to achieve the Group goals (‘Swisscom Group
Goals 2025’) in a rapidly changing environment and to
help shape the future, Swisscom must break new
ground. To do so, it focuses on the following three basic
principles of management and employee behaviour:
‘Performing together’, ‘Thinking digital first’, and ‘Acting
lean-agile’. These three basic principles are crucial to
achieving the Group’s goals. With clear targets regarding
‘Performing together’, ‘Thinking digital first’ and ‘Acting
lean-agile’, Swisscom intends to develop its corporate
culture and employees’ skills and take them up to the
next level (‘Level up’). To that end, Swisscom is commit-
ted to Group-wide goals and also relies on the continu-
ous development of all employees and teams who take
on responsibility and deliver a correspondingly impres-
sive performance. Decisions at Swisscom are always
made based on data. In this context, digitisation plays a
central role, which is why Swisscom is systematically
digitising its internal business processes. Likewise, all
employees need digital skills to provide Swisscom cus-
tomers with the best experience and to offer significant
added value through lean, iteratively developed solu-
tions. To that end, Swisscom promotes the continuous
development of its employees.
In order to improve its brand positioning, Fastweb has
additionally enshrined its purpose of ‘Tu sei futuro’ in its
articles of association. In doing so, it intends to expand
its positioning, which had been heavily based on speed
and performance in the past, to include future topics
such as digitisation and sustainability. Swisscom expects
Fastweb to further expand its market position in the
future and to make a rising value contribution.
Strategy in Italy
Fastweb is an infrastructure-based, alternative telecom-
munications provider for residential and business cus-
tomers in Italy. It has its own ultra-broadband infra-
structure and offers mobile communications services in
addition to fixed-network services for residential cus-
tomers and smaller business customers. It positions
itself as a high-quality provider and pursues a strategy
of becoming an infrastructure-based OTT provider. Its
own network infrastructure (mobile communications
and fixed network) offers customers gigabit connectiv-
ity. At the same time, Fastweb is developing new ser-
vices that – much like conventional OTT providers – are
characterised by simplicity, strong customer orientation
and effectiveness. Fastweb continues to expand its own
convergent ultra-broadband network through ongoing
investments. In the broadband market, Fastweb’s good
market position is based on its own optical fibre-based
infrastructure (FTTH and FTTS). Fastweb has held a 4.5%
stake in FibreCop S.p.A, a network company founded in
2020 and majority owned by TIM (58%), since 2021. By
acquiring a stake in FibreCop, Fastweb will benefit from
the planned further FTTH roll-out in Italy. Fastweb addi-
tionally relies on the use of fixed wireless access (FWA).
FWA allows surfing speeds similar to those offered by
fibre to achieve a better customer experience at lower
costs and with less time required for network expan-
sion. The planned roll-out of the nationwide 5G mobile
network will be enabled by the acquisition of Spektrum
and the partnership with WindTre.
In the residential customer segment, Fastweb relies on a
convergent product portfolio that is transparent, fair
and simple. It intends to offer the best customer experi-
ence by providing an impressively high level of service
quality. For business customers, it is making strategic
expansions to its portfolio, primarily by employing hori-
zontal solutions focused on cloud and digital security.
Another focus of Fastweb’s activities is the expansion of
its wholesale offerings – whether in the area of ultra-
fast broadband or with the connection of mobile com-
munications sites to the fibre-optic network.
Sustainability
Sustainability strategy
Swisscom assumes responsibility towards society and
the environment. As Switzerland’s leading ICT company,
it wants to seize the opportunities of the digital trans-
formation for the prosperity of Switzerland, get involved
and help shape the future. Swisscom does this by pro-
moting the digital skills of people, protecting the cli-
mate, supporting fair and climate-friendly supply chains,
and building and maintaining a reliable, high-perfor-
mance ICT infrastructure. These measures are part of its
Sustainability Strategy and are aligned with the UN’s 17
Global Sustainable Development Goals. Swisscom has
formulated three strategic priorities with corresponding
objectives to address these fields of activity: ‘ready for peo-
ple’, ‘ready for the environment’ and ‘ready for Switzerland’.
Further information can be found in the separate Sustaina-
bility Report.
N See www.swisscom.ch/cr-report2021
Ready for people
Swisscom wants to enable people in Switzerland to
make use of the opportunities presented by a networked
world. By no later than 2025, Swisscom will help 2 mil-
lion people annually to improve their skills in the digital
world. New educational opportunities for schools, the
people, SMEs and their employees are bringing it closer
to this goal. Its teams in the call centres and shops are
available to answer its customers’ questions. Swisscom
ensures safe and fair working conditions in the supply
chain. It is also committed to barrier-free access to all its
services.
Ready for the environment
As a pioneer in climate protection, Swisscom makes a
contribution to help limit the global temperature increase
to 1.5 degrees. In its Swiss business, Swisscom will be cli-
mate-neutral across the entire value chain by 2025. It is
also working with its customers to reduce net CO2 emis-
sions by 1 million tonnes per year by 2025. This corre-
sponds to around 2% of Switzerland’s greenhouse gas
emissions. Furthermore, Swisscom wants to reduce its
energy consumption by 20% by 2030 compared to today.
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Ready for Switzerland
Swisscom provides individuals and businesses nation-
wide with reliable ultra-fast broadband. Swisscom uses
the best networks and progressive solutions to create
added value for its customers, employees, shareholders
and suppliers, and for all of Switzerland. By doing this,
Swisscom makes the country more competitive and a
better place to live.
Climate protection and energy efficiency
In a rapidly changing environment, Swisscom is continu-
ing along its path towards greater energy efficiency and
climate protection, strengthening its sustainability tar-
gets and reducing its greenhouse gas emissions. The
transition to a zero-emission company has implications
for Swisscom’s organisation and processes. In return, it
offers new sources of revenue through Swisscom’s port-
folio of sustainable products and services.
The regulatory environment has become more challeng-
ing. In Switzerland, as in Europe, there is a noticeable
trend towards more stringent requirements. Regulatory
efforts are aimed at accelerating the transition to a
zero-emissions economy by 2050 (net zero emissions) or,
in other words, an economy that produces no more CO2
emissions than it is able to offset. This target is in line
with the latest recommendations of the International
Plant Protection Convention (IPPC) to keep the average
temperature increase below 1.5 degrees. Swisscom
revised its CO2 reduction targets in the 2021 reporting
year and plans to meet the goal of net zero emissions in
its Swiss business by 2025.
In order to achieve its goals, Swisscom is working
mainly on efforts to boost its own energy efficiency.
Maximum energy efficiency is essential for an ener-
gy-intensive company like Swisscom. As part of that,
Swisscom aims to increase the efficiency of its network,
real estate and mobility infrastructure while refraining
from using environmentally harmful energy carriers.
Accordingly, it acts and invests in a targeted manner.
The company’s individual activities and impact of
those activities are described in detail in the sustaina-
bility and climate reports.
The goal of net zero emissions not only requires that
emissions be reduced to an enormous degree, but CO2
also needs to be sequestered in carbon sinks in the long
term to remove it from the atmosphere. Swisscom is
examining various options for this, including reforesta-
tion or capturing CO2 directly from the air and storing it
underground.
Swisscom offers a range of services that help custom-
ers reduce their CO2 footprint. These include teleser-
vices such as Microsoft Teams or Zoom, which signifi-
cantly reduce travel and therefore greenhouse gas
emissions, as well. These services have proven very
useful during the Covid-19 pandemic since they were
able to preserve and even increase the economy’s pro-
ductivity and competitiveness. One prerequisite for
using teleservices like these is comprehensive coverage
with high-speed connectivity. By 2025, Swisscom aims
to provide 50 to 60% of Swiss homes and businesses
with network speeds of up to 10 Gbps. An estimate of
the emissions prevented by Swisscom customers
through the use of sustainable services can be found in
Swisscom’s annual climate report.
N See www.swisscom.ch/climatereport2021
A transformation of this magnitude and speed comes
with various risks and opportunities. Swiss and Euro-
pean regulations will strongly shape the field of sustain-
able finance going forward. They will demand a much
higher degree of transparency about investments and
their long-term impacts, as well as a more detailed
materiality analysis. This kind of analysis must look at
the matter from two perspectives: in terms of both the
company’s impact on its environment and the environ-
ment’s impact on the company. From 1 January 2022,
companies with subsidiaries in the EU or whose securi-
ties are traded on financial markets in the EU will have to
report their activities according to the categories of the
European taxonomy to make these more easily compa-
rable. Swisscom has arranged its business activities in
accordance with this classification.
In addition to the transition risks associated with regula-
tory and legal uncertainties, Swisscom must assess the
physical risks arising from climate change. To that end, it
has begun to implement the recommendations of the
Task Force on Climate-related Financial Disclosures
(TCFD).
Swisscom has surveyed the potential impact that arises
through climate change and the transition to a net-zero
emissions company on its reputation, financing and
portfolio. Swisscom was the first listed company in Swit-
zerland to issue a green bond in euros in 2020, the pro-
ceeds of which will be used within the scope of the
Green Bond Framework. A green bond in CHF followed
in 2021 and Swisscom has also had credit facilities with
costs that are linked to environmental social governance
(ESG) objectives since 2021. The portfolio of sustainable
services makes a relevant contribution to sales and is
expected to grow further. Information on this can be
found in the sustainability report.
N See www.swisscom.ch/cr-report2021
Infrastructure
Telecommunications networks form the foundations for digital Switzerland . This
was evident during the pandemic, when the networks seamlessly maintained
economic life and social life . Swisscom continues to invest heavily in infrastructure
to meet the growing broadband needs of the Swiss fixed and mobile network . It
aims to directly connect up to 60% of homes and businesses with optical fibre by
the end of 2025 and Swisscom had already provided 99% of the Swiss population
with basic 5G coverage by the end of 2021 . This is commensurate with its strategy
of building the best networks and laying a solid foundation for the digital transfor-
mation for Switzerland .
Infrastructure in Switzerland
Network infrastructure
The telecommunications networks form the backbone of
the Swiss information society. This makes Swisscom the
largest network operator in Switzerland by far, in both
fixed and mobile networks. It aims to provide Swiss cus-
tomers with the best network for both the fixed and
mobile networks. It relies on a smart combination of dif-
ferent network technologies so that the whole of Swit-
zerland can benefit from the opportunities offered by the
digital world. A network fault occurred in July 2021 that
impacted emergency numbers, among others. The meas-
ures taken in 2020 to implement a dynamic routing sys-
tem for emergency service organisations proved funda-
incident. Swisscom
mentally successful during the
continues to work on reducing disruptions. The number
of residential customers affected by interruptions and
downtime has decreased in recent years. Accordingly,
customer satisfaction is showing a positive trend.
A new age of communication has begun
Swisscom has replaced conventional fixed-line teleph-
ony with the Internet protocol (IP), and thus geared its
network towards the future. All Swiss municipalities
have already switched to IP telephony. Private custom-
ers benefit from significantly improved voice quality,
automatic name display and the ability to block annoy-
ing advertising calls.
Leading international position thanks to constant
expansion
Switzerland boasts one of the best IT and telecoms infra-
structures worldwide, International studies carried out by
the OECD or the data and information service provider
IHS Markit regularly confirm this. Rural regions benefit in
particular from the high level of capital expenditure,
almost two thirds of which is financed by Swisscom.
According to the Broadband Coverage in Europe 2020
study carried out by Omdia/IHS Markit, commissioned by
the EU Commission and published in the year under
review with the support of Glasfasernetz Schweiz, the
availability of broadband in rural regions of Switzerland is
significantly higher than the EU average. At the end of
2021, around 4.8 million or 90% of homes and businesses
were connected with speeds in excess of 80 Mbps. This
has enabled Swisscom to make ultra-fast broadband
available even in remote locations. Meanwhile, more
than 3.9 million (or 72%) of homes and businesses enjoy
connections with speeds of more than 200 Mbps. Cover-
age is at around 33% for speeds of 10 Gbps. In the Broad-
band Network Test Switzerland 2021 conducted by the
trade magazine connect, Swisscom’s fixed network takes
first place in the 10 Gbit/s speed class. At the same time,
Swisscom received a ‘very good’ rating for its fixed net-
work. Swisscom’s mobile network is also one of the best
networks in the world, as confirmed by independent net-
25
work tests such as those conducted by the trade maga-
zine connect, CHIP or network analyst Ookla. Swisscom
now provides over 99% of the population with 3G and 4G
coverage, 99% of the population with basic 5G coverage
and 888 locations with 5G+ coverage.
Network expansion
Bandwidth requirements in the Swiss fixed and mobile
telephone network continue to grow. In order to main-
tain such a high level of service provision, further invest-
ments in the networks are necessary. Swisscom there-
fore invests around CHF 1.6 billion in IT and infrastructure
in Switzerland every year. Compared to 2019, FTTH cov-
erage will nearly double by the end of 2025. This means
that 50 to 60% of all homes and offices will have a band-
width of up to 10 Gbps.
Fibre to the Curb (FTTC)
● Up to 100 Mbps
Fibre to the Street (FTTS)
● Up to 500 Mbps
Fibre to the Building (FTTB)
● Up to 500 Mbps
Fibre to the Home (FTTH)
● Up to 10,000 Mbps
Fibre
Copper
At the same time, Swisscom will continue to modernise
its existing network in the coming years, giving 30 to 40%
of homes and offices access to a bandwidth of 300 to 500
Mbps. Bonding technology is also helping to noticeably
improve broadband provision in certain regions. Bonding
combines the performance of the fixed-line network
with that of the mobile network, thus ensuring a signifi-
cantly better customer experience.
Customer demand for data in the mobile network contin-
ues to rise. According to an independent study conducted
by the Sotomo research institute based on Swisscom net-
work data, mobile data traffic has grown 200-fold since
2010 and there are now three times more devices on the
network than in 2010. In this context, the 5G mobile com-
munication standard not only enables new functions for
current applications, but also brings a much-needed
reduction in the load on the network, increases capacity
and maintains the accustomed quality of the 4G network.
Because of this, and owing to the stringent legal frame-
work conditions that apply, the mobile network has to
be expanded by the addition of new mobile telephony
sites. Progress continues to be made on expanding 4G+
and 5G+. In the year under review and after 28 years of
operation, Swisscom decommissioned the now obsolete
second mobile generation (2G) in the space of just a few
weeks. Swisscom is using the freed-up capacity for the
more efficient successor generations.
N See www.swisscom.ch/networkcoverage
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57 times higher data volume in nine years
in million terabytes
628
556
431
353
267
170
11
25
49
96
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Development of data volume in Swisscom networks in million terabytes
Swisscom has been working together with Ericsson since
2015 on the introduction of 5G in Switzerland. In 2019, it
was the first provider in Europe to put a 5G network into
operation and is constantly expanding it. Swisscom cur-
rently provides 99% of the Swiss population with a basic
version of 5G and has already made the 5G+ version,
which includes all the benefits of 5G, available in 888 loca-
tions. According to the industry association asut, more
than 1 million 5G-enabled devices were already in opera-
tion in Switzerland by mid-2021. The 5G expansion will
gradually provide the additional capacity that residential
and business customers need. Things are proceeding
slowly, however, as health concerns from the populace
often dominate the discussion about network expansion.
On 23 February 2021, an important addendum to the
NISV enforcement recommendations was published that
controls the operation of the new type of adaptive anten-
nas. On 19 August 2021, OFCOM confirmed that mobile
operators meet all technical and operational require-
ments to apply correction factors to adaptive antennas.
This enables operators to use adaptive antennas in
accordance with their technical design – and, in doing so,
to benefit from all the advantages offered by the latest
generation of antennas. These are increased capacity and
range with less exposure to people who are near the
antenna but not using mobile communications.
The Conference of Building, Planning and Environment
Directors (BPUK) has expressed legal concerns about the
aforementioned federal enforcement recommendations
and called for a partial waiver of the application of the
correction factor – based on legal expertise. At the time,
however, a legal opinion from the industry supported the
FOEN’s enforcement recommendation in all key respects.
BPUK, FOEN, OFCOM and delegations from the cantonal
NIS specialists as well as the operators subsequently met
under the chairmanship of DETEC to find a joint solution.
They achieved that goal prior to the end of the year and
found binding solutions at ordinance level to the issues
raised. One question remains unanswered, namely how
adjustments made to antennas that do not have any
impact on immissions can be regulated in a legally bind-
ing manner. To answer that question, the task force men-
tioned above intends to present solutions that take dif-
ferent interests into account by the end of the first
quarter of 2022. Since operational adjustments have to
be made to mobile communications systems approxi-
mately every 18 months, an appropriate regulation is
essential.
Some portions of the population still have reservations
regarding the expansion of the mobile communications
infrastructure and are resistant to the idea. The argu-
ments for opposing expansion vary widely, with the
underlying speculation and assumptions about 5G often
lacking a factual basis. Even today, the controversy sur-
rounding mobile communications has considerably
delayed numerous network expansion projects, which is
also affecting the expansion of the 4G network.
Moreover, since strict regulation is currently preventing
the new 5G technology from exploiting its full potential,
the legal environmental framework will need to be
adjusted if Switzerland is to make full use of the possibil-
ities offered by 5G. In order to improve the level of infor-
mation, Swisscom provides information on its channels
and supports the industry association asut in its infor-
mation campaigns, one of which is the joint information
platform CHANCE5G.
N See www.chance5g.ch
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The Internet of Things (IoT) has long connected a multi-
tude of objects and devices to one another and to users.
The entry of international cloud providers into the IoT
market has given new impetus to the integration and
scaling of IoT. Thanks to strong partnerships with Ama-
zon and Microsoft, Swisscom is well positioned in this
respect. It is already the leading provider of IoT system
solutions required for cloud and analytics implementa-
tions and their operation. ‘Data as a Service’ rounds off
Swisscom’s portfolio and, thanks to plug-and-play,
makes it even easier for many customers to enter the IoT.
In the year under review, for example, Swisscom imple-
mented overarching applications that combine 5G, IoT,
cloud, data-driven business and artificial intelligence in
a project with its business partner Rhomberg Sersa Rail
Group. The joint project has global appeal: Together,
Rhomberg Sersa Rail Group and Swisscom have been
awarded the Microsoft Partner of the Year Award 2021
by Microsoft in the Azure/IoT category.
increasing
is continually
Swisscom
its number of
antenna sites. It coordinates site expansions with other
mobile providers wherever feasible, and now shares
nearly a quarter of its approximately 9,400 antenna sites
with them. At the end of 2021, Swisscom had around
6,400 exterior units and 3,500 mobile communication
antennas in buildings. With around 7,000 hotspots in
Switzerland, it is also the country’s leading provider of
public wireless local area networks (WLAN).
Mobile frequencies
Transmission of mobile signals requires the availability of
suitable frequencies. In Switzerland, such frequencies are
allocated on a technology-neutral basis, i.e. any mobile
communications technology can be transmitted on the
available frequencies. In 2012, the Federal Communica-
tions Commission (ComCom) allocated the frequencies
800 MHz, 900 MHz, 1,800 MHz, 2,100 MHz and 2,600
MHz. Swisscom currently uses these frequencies to offer
its customers services via the 4G and 3G mobile commu-
nications technologies. In February 2019, further mobile
radio frequencies – 700 MHz, 1,400 MHz, 2,600 MHz and
3,500 MHz – were allocated in Switzerland, primarily for
transmission via 5G. Swisscom currently uses these fre-
quencies to offer its customers services via the 5G, 4G
and 3G mobile communication technologies. It always
does this within the legal limits, which in Switzerland are
ten times stricter than those recommended by the World
Health Organization in sensitive areas such as homes,
schools, hospitals and permanent workplaces.
IT infrastructure and platforms
Swisscom operates six major data centres in Switzer-
land. The IT infrastructure comprises over 75,000 virtual
machines and around 4,300 servers. The central tele-
communications functions for the operation of the fixed
and mobile networks converge in four of the six data
centres. In addition, four data centres (two data centres
have a dual function) are used for the operation of IT
applications. These include all business applications in
connection with Swisscom services. The infrastructure is
designed for redundant operation and high availability.
Swisscom attaches the very highest priority to both sta-
bility and resilience, and reviews and improves them on
an ongoing basis. Since the quality and security culture is
a central aspect of Swisscom, the company takes every
possible precaution to continuously minimise the likeli-
hood that major disruptions will occur.
Swisscom positions itself as a reliable IT partner with a
broad range of services. On the basis of an extended cloud
strategy, it is expanding its cloud offering with hybrid ICT
services. These services support Swisscom customers in
setting up hybrid and multi-cloud environments and oper-
ating them efficiently. Swisscom responds quickly and
individually to the numerous needs of its customers using
a flexible service modular system. As part of its strategy, it
is strengthening its partnerships with the major public
cloud providers (such as Amazon Web Services and Micro-
soft Azure). In addition to its extensive public cloud service
offering for business customers, Swisscom will be relying
on Amazon Web Services to operate selected internal IT
applications over the next few years.
In order to accommodate the continuing advance of digi-
tisation as well as the growing requirements imposed on
connectivity services, Swisscom has distributed the virtu-
alisation and containerisation of network functions
across four locations. This enables the transfer of high
data volumes with short response times while also ensur-
ing the most resilient and stable operation possible.
Swisscom consistently uses its cloud platforms to pro-
vide internal and external communication services. It
operates these cloud platforms in its own geographi-
cally redundant data centres, which thus enables effi-
cient, automated use and improves the customer expe-
rience in a targeted manner. Swisscom is expanding its
connectivity offering to include advanced software-de-
fined networking (SDN), managed security and man-
aged LAN, paying special attention to the combination
of modern and established services. During the Covid-19
pandemic and in light of changing needs, the use of
remote access services and cloud connectivity services
has risen dramatically. The constant state of change on
the market backs up Swisscom’s efforts to use the latest
technologies both internally and externally for the ben-
efit of its customers. Instead of developing its own infra-
structure, Swisscom is increasingly making use of the
standardised systems created by its partners. The focus
on the development of market-specific, value-adding
services based on such infrastructure has proven sound.
The industrialisation of IT continues to make headway,
as does the development of modern applications that
benefit from the opportunities offered by the platforms,
cut costs and ensure maximum stability. At the same
time, the consistent dismantling of obsolete fixed-net-
work technology such as TDM (Time Division Multiplex-
ing) and traditional data centre infrastructure is reduc-
ing complexity and creating space for new infrastructure.
Nevertheless, the old and new technologies will con-
tinue to exist and function side-by-side over the coming
years. Here Swisscom is establishing its role in the digital
transformation through specific services such as the
‘Journey to the Cloud’ portfolio. By combining different
generations of technology to meet its needs, Swisscom
is building upon its experience and expertise to provide
the best possible support to its customers as they make
their way into the digital world.
Infrastructure in Italy
Network infrastructure
The market for ultra-fast broadband (UBB) in Italy is
growing steadily. This development is further acceler-
ated by an increasingly extensive use of digital services
and related performance requirements. Fastweb plays a
fundamental role in the sustainable development of
UBB. To that end, it is investing in its own infrastructure
and that of FibreCop, in which it holds a 4.5% stake. Fast-
web’s goal is to provide UBB coverage to 90% of homes
and offices by 2025. The expansion of UBB’s own fixed
network through the use of FTTH/FFTS (Fiber to the
Home/Street) and 5G FWA (Fixed Wireless Access) will
help reach this goal.
Fastweb’s UBB coverage had reached 9 million homes
and offices, or about 30% of the population in Italy, by
the end of 2021. The deployment of 5G FWA, in a strate-
gic partnership with Linkem, will add another 10.5 mil-
lion homes and offices by 2025. Finally, Fastweb reaches
another 7 million homes and offices via FibreCop.
IT infrastructure
Fastweb currently uses four large data centres, three in
the Milan area and one in Rome. One of the data centres
is owned by a technology partner that manages and
develops the data centre and handles all operational
tasks relating to Fastweb’s IT infrastructure. Two other
data centres are mainly used for the corporate business
segment, including housing, the cloud, and other
ICT-managed services. In view of the growth of the cloud
ICT market and the business opportunities in cloud edge,
Fastweb plans to expand its central and local data centre
capabilities. It intends to mainly use additional white-
space solutions for this purpose. The IT infrastructure
comprises around 6,000 virtual servers and physical
servers for its own needs.
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Employees
In an environment that is changing at a rapid pace, Swisscom is getting to grips with
the working models of the future, making targeted investments in professional
training for its employees in order to maintain and improve their employability and
the company’s competitiveness in the long term . At the end of 2021, Swisscom had
18,905 full-time equivalent employees, of whom 15,882 or 84% were employed in
Switzerland . Swisscom is also training around 900 apprentices in Switzerland .
Employees in Switzerland
Digitisation presents many opportunities as well as great
challenges for employees and companies. To take advan-
tage of these opportunities and to overcome the chal-
lenges requires motivated employees who use their indi-
vidual skills and experience to inspire people in the
networked world. Swisscom helps its employees develop
their skills and provides them with five training and devel-
opment days a year for this purpose to ensure that its
employees continue to have the required skills and
resources going forward. The One Swisscom Academy
offers a wide range of training and development opportu-
nities. For the most part, the One Swisscom Academy
relies on digitalised learning methods, thanks to which
employees can build their knowledge irrespective of loca-
tion and time. The offerings are designed to develop skills
that are needed now and in the future, as well as to
strengthen employees’ employability.
Swisscom positions itself on the ICT job market as an
attractive employer, offering its employees the opportu-
nity to assume responsibility, utilise their potential and
further develop their professional skills. Swisscom staff
are employed under private law on the basis of the Code
of Obligations. Swisscom management employees in
Switzerland are subject to general terms and conditions
of employment, while all other employees are subject to
Swisscom’s Collective Employment Agreement (CEA).
The terms and conditions of employment exceed the
minimum standard defined by the Code of Obligations.
In the year under review, 98.6% of the employees in
Switzerland were on open-ended contracts (prior year:
98.1%). Part-time employees made up 21.6% (prior year:
21.4%). The fluctuation rate, representing departing
employees in Switzerland, was 6.2% of the workforce
(prior year: 7.8%). Further information on HR matters
can be found in the Sustainability Report.
N See www.swisscom.ch/cr-report2021
The Covid-19 pandemic presented Swisscom with a
multitude of challenges yet again in the year under
review. However, experience gained in 2020 helped the
company react swiftly and in a targeted manner.
Swisscom’s Covid-19 task force continuously analysed
the situation and – both quickly and transparently –
informed the company internally about any decisions
taken. Swisscom adapted its measures to the current
circumstances as well as the regulations of the Federal
Office of Public Health (FOPH) or the Federal Council on
an ongoing basis.
In the days when working from home was mandatory,
over 80% of employees – even those in the call centres –
worked from home.
Swisscom plays a pioneering role in flexible working
throughout Switzerland. Even before the Covid-19 pan-
demic, working from home, on the road or at different
locations was very popular and widespread among
Swisscom staff. Employees appreciate the flexibility, the
elimination of commuting and a better work-life bal-
ance. Swisscom will continue to promote and expand
flexible working models in the future. However, meeting
regularly in the office and thus maintaining an informal
exchange remains important for Swisscom employees.
Collective Employment Agreement (CEA)
Swisscom is committed to fostering constructive dia-
logue with its social partners (the syndicom union and
the transfair staff association) as well as the employee
associations (employee representatives in the various
divisions). The Collective Employment Agreement (CEA)
and the social plan, with their fair and jointly drafted
provisions, are negotiated by Swisscom Ltd and its social
partners and applicable to Swisscom Ltd’s employees.
Subsidiaries adopt the CEA, either in its original form or
as adapted to specific sectors or lines of business, by
means of an affiliation agreement. The subsidiaries
cablex Ltd and Swisscom Directories Ltd (localsearch)
negotiate their own CEA with the social partners. Under
the Telecommunications Enterprise Act (TEA), Swisscom
is obliged to draw up a collective employment agree-
ment in consultation with the employee associations. In
the event of any controversial issues, an arbitration com-
mission must be convened which will support the social
partners by providing suggestions for solutions. At the
end of December 2021, 80% of the workforce in Switzer-
land were covered by the Swisscom CEA (prior year:
81%). The CEA includes progressive employment condi-
tions and benefits such as five days of further training
per year, 18 weeks of maternity leave, three weeks of
paternity leave and an option to purchase ten days of
additional holiday time. The CEA also accords the social
partners and employee representations rights of co-de-
termination of varying degrees.
Social plan
The objective of the social plan is to formulate socially
acceptable restructuring measures and avoid job cuts. It
sets out the benefits provided to employees covered by
the CEA who are affected by redundancy. The social plan
also makes use of instruments to increase the employa-
bility of employees and provides for retraining measures
in the event of long-term job cuts. Responsibility for
implementing the social plan lies with subsidiary firm
Worklink AG. It provides employees with advice and sup-
port in their search for new employment and arranges
temporary external or internal work placements. The
services it offers include skill assessments, career advice
and coaching. Swisscom also supports progressive work-
ing models such as phased partial retirement. In 2021,
93% of those affected by personnel reduction measures
had found a new job before the social plan programme
ended (prior year: 80%). For employees with manage-
ment contracts, there is also an arrangement in place to
support them in their professional reorientation in the
event of restructuring.
Employee remuneration
Competitive remuneration packages help to attract and
retain highly skilled and motivated specialists and man-
agerial staff. Swisscom’s salary system comprises a basic
salary, a variable performance-related component and
bonuses. The basic salary is determined based on
function, individual performance and the job market.
The variable performance-related salary component
depends on the success of the company. This is meas-
ured by the achievement of overriding objectives such as
financial parameters as well as business transformation
metrics that fall into the areas of operating perfor-
mance, customers, growth and sustainability. Details on
remuneration paid to members of the Group Executive
Board are provided in the Remuneration Report.
In 2021, Swisscom and its social partners signed an
agreement on the pay round for the year under review.
With effect from April 2021, salaries for employees sub-
ject to the CEA were increased by 0.8% of the total pay-
roll: this took the form of a general salary increase, the
level of which varied depending on the employee’s posi-
tion in the salary band. The performance of employees
whose salaries are in the upper range of the respective
salary band was rewarded by a one-off payment. The
payroll for managers increased by 0.6% to allow for indi-
vidual salary adjustments.
Equal pay
Swisscom remunerates its employees fairly and in line
with market conditions and also ensures equal pay
between the sexes. The salary system is structured in
such a way that equal salaries are paid for equivalent
tasks and services. Employees’ salaries are adjusted
within the scope of the annual salary review. Employees
who have put in an above-average performance and
whose wages are at the lower end of their respective sal-
ary bands generally receive an above-average wage
increase. Swisscom also periodically reviews the salary
structure for differences between men’s and women’s
wages using the federal government’s equal pay tool
(Logib). Past reviews have only revealed minor pay dis-
crepancies that are below the tolerance threshold set by
the Federal Office for Gender Equality.
In accordance with the new requirements under the
Gender Equality Act, Swisscom carried out equal pay
analyses for all Swiss Group companies with more than
100 employees. The formal review of the pay equal anal-
yses required by law was carried out by PwC. According
to its report, there are no indications that the analyses
do not comply with the legal requirements in all
respects.
Internal staff development
and external job market
Swisscom’s market environment is constantly changing.
The company invests in targeted professional training
for its employees and managers in order to maintain and
improve their employability and the company’s compet-
itiveness in the long term. Employees have the opportu-
nity to attend internal and external training pro-
grammes. As a pioneer in the field of digitisation in
Switzerland, Swisscom is dedicated to getting to grips
with the working models of the future. By doing this, it
provides employees and management with a learning
environment in which they can develop new skills and
shape their own professional development. In 2021,
Swisscom employees spent an average of 3.5 days per
person on learning, training and development. It is also
Swisscom’s declared goal to fill as many positions as pos-
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sible internally. Where this is not possible, external
recruitment is used. Here Swisscom has to compete with
national and international companies for the best talent –
especially in the IT professions. The shortage of skilled
workers on the Swiss labour market is currently noticea-
bly affecting DevOps engineers primarily. These engi-
neers have a skills profile that is critical to companies’
competitiveness in the ICT market. Their skills help
Swisscom become even more agile and respond quickly
to changing markets. Although the Swiss labour market
remains a priority, Swisscom operates DevOps centres in
Rotterdam and in Riga. It does this primary to provide
access to international talent outside the Swiss labour
market, if needed.
Employee satisfaction
The Pulse survey gives Swisscom employees an opportu-
nity to submit their feedback on a wide variety of issues
relating to their personal work situation. The results and
the comments in which employees give their assess-
ments are available to all employees in real time. They
enable every individual employee and team and the
organisation as a whole to respond quickly to the feed-
back and start making improvements. A survey of this
type fosters a culture of feedback and trust, which pro-
vides the basis for Swisscom and its employees to grow
and develop together. The response rate to the Pulse
survey was 68% in 2021 (previous year: 74%). More than
90% of the employees participating in the survey said
they recommend Swisscom as an employer.
Diversity
Swisscom grows through diversity – as individuals, as a
team, as a company. The different points of view, experi-
ences, ideas and skills that every single employee brings
to bear on their everyday work are what make Swisscom a
successful, innovative company. To promote diversity,
Swisscom focuses in its activities on the factors of gender,
inclusion, generations and language regions. In the gen-
der dimension, for example, Swisscom also endeavours to
make work compatible with family life. Flexible working
models and the option of reducing working hours on an
experimental basis are making part-time working more
acceptable. At the end of 2021, around 24% of Swisscom’s
employees were women (prior year: 25%), and the pro-
portion of women in management was around 14%.
Swisscom is also committed to making jobs available to
people with physical or psychological impairments in
order to (re)integrate them into the workforce (inclusion).
The proportion of such posts increased from 1.06% to
1.11% versus the previous year. Swisscom tries to earmark
at least 1% of jobs for inclusion-related employment solu-
tions. Swisscom also works towards integration where
generation management is concerned, with flexible
working models and many development measures in
place to help older employees keep working for as long as
possible. Swisscom trains around 900 apprentices in Swit-
zerland. Graduates of technical colleges and universities
gain their first practical experience in our company as
part of a step-in internship or as a trainee. Swisscom is
represented in all of Switzerland’s language regions. It
attaches importance to ensuring that the different lan-
guages are adequately represented in all areas and
accordingly offers apprenticeships, internships and talent
programmes for all language regions.
Employees in Italy
Statutory terms and conditions of employment in Italy
are based on the Contratto Collettivo Nazionale di Lavoro
(CCNL), a state collective employment agreement. The
CCNL defines the terms and conditions of employment
between Fastweb and its employees. It also contains pro-
visions governing relations between Fastweb and the
unions. Fastweb engages in dialogue with the unions and
the employee representatives and, in the event of major
operational changes, involves them at an early stage.
The working week for employees covered by the CCNL is
40 hours. Benefits include five weeks’ annual leave, 20
weeks’ maternity leave and one day of paternity leave. In
the event of incapacity for work due to illness or acci-
dent, Fastweb guarantees full payment of salary for 180
days and payment of half the salary for a further 185
days. The company’s terms and conditions of employment
enable employees to achieve a healthy balance between
their work demands and personal life. This is largely due to
the following measures, which were set out in an agree-
ment concluded with the trade unions: flexible office
working hours, smart working and working from home,
and for mothers the choice of shifts or temporary part-
time jobs.
Fastweb offers competitive salary packages aimed at
attracting and retaining highly qualified specialists and
managers. The company’s salary system comprises a
basic salary, a collective variable profit-sharing bonus for
non-managerial staff and a variable performance-re-
lated component for managerial staff which is contin-
gent on meeting individual goals and company targets.
The basic salary is determined according to function,
individual performance and the situation in the labour
market. The variable profit-sharing bonus is based on
the model agreed with the unions. Fastweb complies
with the legal minimum salary defined by the CCNL.
The Covid-19 pandemic also left its mark on Fastweb:
Fastweb and the national trade unions of the telecommu-
nications sector, together with the local representations
and the Rappresentanza Sindacale Unitaria (RSU), have
extended the preliminary agreement on Smart Working
that was signed on 29 September 2020 until 30 June
2022. The goal is to renew the organisational and working
model in a flexible and sustainable way – in order to guar-
antee a high level of quality and the achievement of cor-
porate goals as well as to facilitate the balance between
work and family life.
The agreement on Smart Working had been introduced
on a trial basis on 16 October 2020. It provides full flexibil-
ity and autonomy in the choice of working model for all
employees of the company, including customer advisors.
It gives Fastweb employees the option of using the smart
working model on all business days or deciding each day,
in consultation with their supervisor, whether to do their
work in the office or remotely. This guarantees perfor-
mance-based management that does not view success as
being contingent upon employees’ on-site work.
33
‘Ready for tomorrow’s
competition’
More competitive thanks to our innovative solutions that leverage
artificial intelligence, the Internet of Things, the cloud and 5G.
‘Ready for tomorrow’s
competition’
‘Ready for the digital
working environment’
More efficient collaboration thanks to the web training
we provide for your company’s employees.
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Brands, products
and services
The Swisscom brand builds a bridge between the familiar and the new . It brings
together all products and services from the core business under a single roof .
Swisscom constantly adapts the range of services and products it offers to its
customers’ needs . The ‘Swisscom blue’ product family, which combines all of
Swisscom’s entertainment offerings in a single world of experience, became
extremely well established on the market in the year under review .
Swisscom brands
The Swisscom brand is managed strategically as an
intangible asset and an important element of the
Group’s reputation management. It supports Swisscom’s
business activities, gives guidance to customers and
partners, and also acts to attract and motivate current
and future staff.
The Swisscom brand is implemented across all units in a
consistent and high-quality manner. At the same time, it
has to be extremely flexible, bridging the gap between
the familiar and the new and standing equally for net-
work infrastructure, best experiences, entertainment,
ICT and digitisation.
In Switzerland, Swisscom offers core business products
and services under the main Swisscom brand, as well as
under the secondary brand Wingo and the third-party
brands Coop Mobile and M-Budget. Its portfolio also
includes other brands which are associated with other
themes and business areas. Outside Switzerland,
Swisscom’s main market is Italy, where it operates under
the Fastweb brand. The strategic management and
development of the entire brand portfolio is an integral
part of corporate communications.
Main brand
Product family
Secondary brand
Tertiary brands
Other brands
(excerpt)
Swisscom brand portfolio
Society, technology and the environment are changing
ever more rapidly. A brand must absorb these changes
while offering direction and stability. To that end,
Swisscom has given the imagery and individual design
elements of its brand a gentle makeover. Vision, values
and the Swisscom promise determine the positioning of
the Swisscom brand. To revitalise its brand both internally
and externally, Swisscom works with the brand platform
it created in 2020: ‘ready’. It expects its employees to
demonstrate trustworthiness, commitment and curiosity
in everything they do. Based on these foundations,
Swisscom presents itself as a reliable provider, builds on
its position as market leader and opens up new business
areas. Swisscom offers its customers the opportunity to
make even easier use of the networked future and pre-
pares them for this. The ‘ready’ brand platform expresses
this positioning to the outside world, which has a positive
effect on the brand perception measured.
priced profiles with varying levels of service for each of the
components. As the profiles differ mainly in terms of
Internet speed, the number of TV channels available and
the recording and replay functions, inOne can be easily
adapted to individuals’ needs; new mobile devices such
as smart watches, trackers and tablets are also easy to
integrate.
The ‘Swisscom blue’ product family, which combines all of
Swisscom’s entertainment offerings, became well estab-
lished on the market in the year under review. It ensures a
high level of visibility and recognition, particularly via
Swisscom blue TV and blue News. Swisscom blue aims to
continue making the connection between the individual
offerings clear, enables new offerings and makes the
Swisscom brand even more appealing and dynamic. All
this is in line with Swisscom’s one-brand strategy.
Swisscom has also made its mark in terms of employer
branding. The ‘My Internet App – MIA’ brings topics from
the intranet to the mobile phones of all employees, thus
strengthening identification with the company and help-
ing employees to act as ambassadors for the brand.
Trustworthiness and service remain important factors
in confirming to existing customers that they made the
right decision in opting for Swisscom and in winning
new customers, while also helping to underscore the
importance of Swisscom for Switzerland: Swisscom is
part of a modern Switzerland, is always recognisable as
a Swiss company and positions itself clearly and credibly
through its stance on responsibility. All this rounds off
the positive image of the Swisscom brand and enriches
the Group’s diverse customer relationships. This is one
reason why the reputation values achieved by Swisscom
are exceptionally high for a company in the telecommu-
nications sector by global standards.
External assessments also confirm this image. In the
‘Switzerland 50’ study conducted by the consulting firm
Brand Finance, Swisscom moved up one place in the list
of the most valuable Swiss brands and is now ranked
eighth. According to Brand Finance, the Swisscom brand
is worth nearly CHF 5 billion.
Products and services in Switzerland
Residential Customers
In order to offer the best communications experiences,
Swisscom is constantly adjusting its portfolio of offer-
ings to meet customer needs. It has further developed
the successful inOne subscriptions and made them even
more attractive. inOne includes a choice of TV, mobile
and fixed-line telephony on top of the broadband con-
nection. Customers can choose from three separately
At the same time, Swisscom is continuously expanding
the inOne mobile subscription. Thanks to inOne mobile
go, customers benefit from unlimited use of their smart-
phones in Switzerland. Swisscom is also the first pro-
vider in Switzerland to include use within the EU/West-
ern Europe in the subscription. Swisscom customers
thus enjoy carefree calling, SMS messaging and surfing
in the Internet in Switzerland and on most trips abroad.
Plus, customers can add on devices such as tablets, lap-
tops, smart watches, GPS trackers or a second smart-
phone easily and inexpensively, all under their existing
contract. Customers are increasingly keen to have
devices of this kind with a mobile connection. Swisscom
revised its offer for its younger customers in early 2021:
Following the launch of inOne mobile go young,
Swisscom customers not only surf and make phone calls
across Europe without limits until their 30th birthday,
but also at speeds of up to 2 Gbps.
Home networking (smart home) for controlling lighting,
music or alarm systems grew strongly in 2021. At the
end of 2021, around 400,000 devices (+17%) were con-
nected via the Swisscom Home app. The number of
households that activated one or more devices in the
app increased by 80%. In entertainment, Swisscom blue
offers a comprehensive entertainment experience with
TV, streaming and cinema along with the freedom of
being able to access this content from anywhere. This
new offering is based on blue TV. It is available both via
the Swisscom Box as well as an app for smartphones and
tablets, a web player for laptops at blue.ch and a smart
TV app on Samsung and LG devices. The app is also avail-
able with the complete blue+ offering on the TV boxes
of UPC TV, Quickline, Wingo, Net+ and Apple TV. blue TV
is thus not only accessible to Swisscom customers, but
also to customers of other operators.
The broadest blue TV package is still only available in com-
bination with the Swisscom Box, because only the
Swisscom Box integrates streaming offers from Netflix,
Prime Video, Sky, OCS, DAZN, YouTube and Play Suisse in
addition to traditional television and blue+ content (live
sport, films and series). In addition, the Swisscom Box
offers access to the MySports channels, which broadcast
matches from the top Swiss ice hockey leagues, among
other things.
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Swisscom targets its other brands – Wingo, Coop Mobile
and M-Budget – at customers who do not want the
high-quality service and extensive range offered by
Swisscom products. M-Budget and Wingo offer custom-
ers straightforward attractive mobile, Internet and
fixed-line services. Coop Mobile is exclusively a mobile
subscription.
Swisscom is constantly expanding its service offerings to
meet the ever-changing needs of its customers. In addi-
tion to the standard channels such as hotlines, chats and
contact forms, customers can get in touch with Swisscom
via WhatsApp, Facebook, Twitter and Google Business
Messenger. In summer 2021, Swisscom also introduced
automatic speech recognition on its hotline, thereby elim-
inating the need to respond by pressing keys (after
announcements such as ‘Select 1’). This approach con-
nects customers even more quickly with the employees
responsible for their concerns. Customers can go to the
115 Swisscom Shops to have damaged mobile devices
repaired on site in eleven Swisscom Repair Centers. As a
rule, repairs are carried out within 24 hours, or even in just
three hours in the case of express repairs. myCloud offers
Swisscom customers a Swiss solution for securely manag-
ing and sharing their personal data such as photos, videos
and documents. Thanks to the My Swisscom app, custom-
ers always have an overview of their data and services
and have the opportunity to view their bill, report a move,
contact Swisscom or change other settings at any time.
Business customers
The digital transformation continues to be a key issue for
companies and is changing their business processes,
business models, customer experiences and working
environments. The digital transformation depends on
solid communication networks. Swisscom makes use of
its many years of experience as an integrated telecom-
munications and IT company in supporting its custom-
ers through the digitisation process. It works together
with customers to develop future-oriented solutions,
supported by one of the most comprehensive ICT portfo-
lios in Switzerland, which comprises cloud, outsourcing,
workplace and IoT solutions, as well as mobile phone
solutions for mobile working and communication, net-
working solutions, location networking, business pro-
cess optimisation, SAP solutions, security and authenti-
cation solutions and a full range of services tailored to
the banking industry. The company makes hospitals
more efficient by providing them with support in the
digitisation of their processes. It also helps health insur-
ance companies by assuming the operation of their core
IT systems. Swisscom is driving digitisation in the health-
care sector by providing its networking solutions for ser-
vice providers and implementing the electronic patient
dossier system.
inOne SME offers SME customers a standardised, yet cus-
tomisable bundled package for Internet and telephony.
SMEs with more complex needs can use Smart Business
Connect, a scalable communication solution with collab-
oration and networking features. Both bundled offerings
include integrated services such as an Internet failover
and can be supplemented with blue TV, blue TV Public or
blue TV Host for hotels and homes. blue TV Host com-
prises an info channel and an in-house channel and offers
the best infotainment. IT infrastructure is increasingly
becoming the lifeline of companies. SMEs are dependent
on their IT functioning flawlessly throughout and being
able to adapt easily and flexibly to market and company
changes at any time. Swisscom thus provides SMART ICT,
a complete IT outsourcing package, as a modular inte-
grated solution. For this, Swisscom works together with
regional IT partners to operate the ICT infrastructure and
ensure customers’ data security in a professional manner.
In the year under review, Swisscom also launched the
Security Assessment and introduced the digital POS solu-
tion Swisscom Business POS. Mobile subscriptions geared
to the needs of business customers, IoT solutions or cloud-
based software for mobile working and web services
round off Swisscom’s SME portfolio.
Swisscom gives SMEs access to information and directory
services in the form of localsearch, which makes it easy to
publish addresses, telephone numbers and detailed infor-
mation on companies – on the Internet, via the mobile
app and in the printed telephone directory (Local Guide).
In addition, localsearch operates the local.ch and search.
ch directories. The subsidiary Swisscom Broadcast AG pro-
vides radio networks for broadcasting, security and pro-
fessional mobile radio and makes around 450 transmitter
sites available for co-use. Its offering also includes numer-
ous video-related services, ranging from the provision of
IPTV and Web TV platforms to sophisticated video sur-
veillance solutions. It is supplemented by temporary ICT,
media and entertainment services. Swisscom also offers
infrastructure solutions and services for telecoms/ICT,
transport, energy and companies or authorities in Swit-
zerland via cablex Ltd.
Wholesale
Swisscom provides a variety of copper- and fibre-optic-
based connectors as per customer requirements. With
its Carrier Ethernet and Carrier Line services and lines
leased under the TCA, Swisscom Wholesale offers tele-
coms service providers high-quality, transparent con-
nections tailored to their needs with a range of band-
widths and interfaces and/or a flexible Ethernet service
allowing tailored bandwidths and service level agree-
ments. Swisscom Wholesale also provides basic offer-
ings for the connection (interconnection) of telecoms
systems and services, and supplies its customers with
infrastructure products such as the shared use of cable
ducts and the mobile network. In addition, Swisscom
Wholesale is opening up advanced business areas in the
over-the-top (OTT) content field.
Products and services in Italy
In the residential customer segment, Fastweb has focused
on transparency and simplicity in both the fixed and
mobile markets. It introduced additional services in 2021
to further strengthen its Fixed-Mobile convergent busi-
ness as well as its Go-To-Market approach. In the fixed net-
work segment, Fastweb newly implemented 5G FWA
(Fixed Wireless Access) in order to offer its customers
bandwidths comparable to fibre-optic cables in locations
where FTTH coverage is not yet available. Fastweb also
launched the ‘NeXXt’ Internet box, which is the first
Wi-Fi 6 router with the Alexa voice assistant built-in. This
innovative Internet box transforms the Wi-Fi network into
a home’s ‘digital heart’. In the mobile segment, Fastweb
first launched 5G services in Milan, Bologna, Rome and
Naples. It subsequently extended 5G coverage to Italy’s
main city centres to provide the best possible data speeds
to its mobile customers. This earned Fastweb top rankings
in terms of customer satisfaction in the area of mobile
communications – and the company held on to its leading
position in terms of satisfaction among its fixed-network
customers.
Fastweb has maintained its leading position in the busi-
ness customers segment, mainly in the corporate busi-
ness segment, where Fastweb has a broadband market
share of 34.5%. Fastweb’s market share grew to 46%
within the public administration segment, partly as a
result of the successful conclusion of national public
framework contracts for wireline and ICT services. In
order to expand its service offering in the ICT and secu-
rity market, Fastweb acquired a 100% stake in Cutaway
and a 70% stake in 7Layers in 2020. Fastweb has increased
its autonomy through these two acquisitions. Not only is
it now able to offer end-to-end cloud solutions, but is
expanding its cybersecurity-related expertise.
To take advantage of business opportunities in the public
cloud, where telecommunications service providers have
limited reach, partnering with a hyperscaler is essential.
Fastweb 2021 has therefore partnered with global leader
Amazon Web Services (AWS) to provide its customers
with a multicloud offering through AWS’s Restack pro-
gramme and further expand both its customer base and
portfolio in the process.
Fastweb also launched its own 5G mobile service for busi-
ness customers, marking another step towards a fully con-
vergent digital offering.
In the wholesale market, Fastweb successfully provides
ultra-fast broadband services to residential and business
customers of Sky, WindTre, BT, Linkem, Tiscali and other
companies.
Customer satisfaction
Swisscom Switzerland conducts segment-specific sur-
veys and studies in order to measure customer satisfac-
tion. It measures customer satisfaction twice a year, in
the second and fourth quarters of the year. The Whole-
sale segment measures customer satisfaction once a
year. For all segments, the most important metrics are
the extent to which customers are willing to recom-
mend Swisscom to others and the related Net Promoter
Score (NPS), which represents the emotional aspects of
customer loyalty and reflects customers’ attitudes
towards Swisscom. It is calculated from the difference
between ‘promoters’ (customers who would strongly
recommend Swisscom) and ‘critics’ (customers who
would only recommend Swisscom with reservations or
would not recommend the company). Swisscom also
conducts the following segment-specific surveys and
studies:
●
●
●
The Residential Customers segment conducts repre-
sentative surveys to determine customer satisfaction
and customers’ willingness to recommend Swisscom
to others. Callers to the Swisscom hotline and visitors
to the Swisscom Shops are questioned regularly
about waiting times and staff friendliness. Product
studies also continuously survey buyers and users to
determine product satisfaction, service and quality.
The Business Customers segment conducts surveys
among customers to measure satisfaction along the
customer experience chain. Feedback instruments
are also used at key customer contact points in order
to determine customer satisfaction. After each inter-
action with the service desk or after placing orders, IT
users can submit feedback or enter their comments
in the order system. Customers can also assess the
quality and success of their projects on completion.
The Wholesale segment measures customer satisfac-
tion along the entire customer experience chain.
The results of these studies and surveys help Swisscom
formulate measures to further improve its services and
products. They also influence the variable perfor-
mance-related component of remuneration for employ-
ees and management.
39
Innovation
and development
Global competition, new technologies and changing customer needs are leading to
an ever more rapid pace of change . Swisscom invests constantly in the development
of new products and services for its customers and additionally optimises its
processes to secure its long-term market position .
Innovation as a key driver
of business performance
Innovation is central to the success of the company and
to Swisscom’s strategic ambitions. Swisscom offers its
customers the best customer experience by further
developing products and improving customer journeys.
With the help of analytical tools, artificial intelligence
and automation, Swisscom designs processes to be even
more efficient – and creates new growth by developing
new products and business segments. Innovation also
helps to differentiate the Swisscom brand, attract and
retain top talent and counteract potential market dis-
ruptions at an early stage. To this end, Swisscom works
closely with partners, universities, start-ups and estab-
lished technology companies.
In its Silicon Valley office, Swisscom has been engaged in
technology scouting and transfer for over 20 years. The
Swisscom Ventures division networks Swisscom’s busi-
ness units with start-ups in order to stimulate innova-
tion. Since 2007, Swisscom has invested in more than 70
young companies – six to ten new start-ups every year
with the volume of capital expenditure amounting to
CHF 10 to 12 million per year. Swisscom also advises
funds that invest an additional CHF 30 to 40 million. In
the year under review, Swisscom made investments in
nine new companies and twelve follow-up investments
in existing holdings. SOPHiA GENETICS, another start-up
funded by Swisscom, went public in 2021. This is the
fourth IPO of a Swisscom Ventures start-up. Swisscom
uses the Swisscom StartUp platform to support start-
ups and entrepreneurs in Switzerland through consult-
ing, discounts on IT and cloud services, expert know-
how, coaching programmes, financing and community
events. The Swisscom StartUp Challenge 2021 focused
on the topic of cyber security. More than 80 start-ups
and research teams worldwide applied for the promo-
tional programme available for the winners of the
StartUp Challenge. By the end of the Challenge, five win-
ners had secured their spots in the week-long explora-
tion programme, which included an exchange of experi-
ences with Swisscom’s cyber security community as well
as valuable contacts with mentors, potential partners
and customers. Swisscom strengthens the internal inno-
vation process through the internal intrapreneurship
programme Kickbox, which provides employees with
tools, a clear process and resources for innovation pro-
jects. The programme is available to other companies
via the spin-off rready AG.
N See www.swisscom.ch/innovation
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Innovation focused on specific topics
Swisscom is focusing its innovation activities on seven
areas of innovation, which in turn directly help the
Group achieve its goals:
Analytics and artificial intelligence
Entertainment
Internet of Things
Security
Digital business
Network and infrastructure
Digital Swisscom
Network and infrastructure
Swisscom is focusing on a technology mix so that the
whole of Switzerland can benefit from the best infra-
structure. Its innovative architecture also enables it to
renew all components from the core network to the con-
nection. Swisscom is thus laying the foundations to ena-
ble the rapid introduction of new services in the future
and make new developments available to customers.
Mobile communications
New self-organising network (SON) algorithms auto-
mate and improve the mobile network, for example, by
automatically adjusting parameters, antenna inclina-
tion, and power levels according to specifications. Before
SON was introduced, network data was processed man-
ually and resulted in 40 to 50 network adjustments per
week. SON automated both the processing of network
data and the creation of the improvement proposals,
with some of those proposals being automatically
uploaded to the Internet so that around 10,000 network
adjustments are currently being made each week.
Fixed network
Broadband demand will continue to grow going for-
ward. It has increased more than tenfold in ten years –
with another growth surge prompted in particular by a
heightened use of streaming services as well as an
increase in video calls during the Covid-19 pandemic. For
example, data usage per household in Europe increased
by 40% within the space of one year. This is why
Swisscom continually invests in network expansion and
relies on both the latest technologies as well as digitisa-
tion (such as that offered by software-defined network-
ing). Similarly, network security and protection against
cybercrime are issues that are gaining importance. In
collaboration with the Swiss National Bank and the SIX
Group, Swisscom and other telecommunications service
providers collaborated in 2021 to launch the Secure
Swiss Finance Network (SSFN). This network is based on
the innovative SCION Internet architecture developed at
the ETH; Swisscom has been providing financial support
for its development for ten years now. SCION technol-
ogy offers a very high level of protection against cyber-
crime by operating the communications network sepa-
rately from the conventional Internet and by clearly
defining network users and data paths. Following a pilot
project conducted within the SSFN framework, Swisscom
is now offering products based on SCION technology to
its business customers.
Convergent products
Swisscom developed a new device for Fixed Wireless
Access (FWA) in 2021 that allows residential customers
to use the mobile network as Internet access at home.
Internet of Things (IoT)
The Internet of Things (IoT) enables lucrative business
models, automated processes, and novel customer
interactions through smart products. Swisscom sup-
ports companies through various formats to success-
fully enter the IoT and to develop their systems further.
Swisscom partnered with Microsoft to develop an
advanced IoT solution for the Rhomberg Sersa Rail
Group, a leading international full-service provider of
41
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railway technology. The solution collects position and
operating data from the equipment, analyses the data
with the help of artificial intelligence and evaluates it.
This approach to digitised railway construction is already
enabling faster and correspondingly more economical
work processes in several countries.
At the same time, the IoT is becoming increasingly impor-
tant to residential customers in their smart homes or on
the move. The Swisscom Home app bundles smart helpers
from ten manufacturers – like the Swisscom Smart Switch
adapter, products from the Philips Hue family or devices
from Sonos – and controls them centrally. Launched in
2021, the Home app offers even smarter rules for auto-
mating homes and using TVs as smart home devices. In
turn, users can conveniently use their TV remote control to
operate the Swisscom Home app and play stations offered
by blue radio on Sonos speakers.
Analytics and artificial intelligence (AI)
Swisscom makes targeted use of artificial intelligence
(AI) to offer its customers even better service and opti-
mise processes. It uses AI in its customer service and to
detect network faults, for example. Since last year, cus-
tomers have been navigating the automated voice dia-
logue on the Swisscom hotline via AI-based speech rec-
ognition instead of conventional numerical inputs
through the keypad. This makes it possible for customer
concerns to be identified via an automated process, clas-
sified more quickly and for customers to be forwarded
directly to the agent best qualified to assist them.
Swisscom plans to expand the use of AI to customer ser-
vice in other languages (French, Italian and English).
Ongoing training of the AI application is improving the
service continuously, so that certain customer enquiries
can be resolved entirely via automated voice dialogue in
the future. The same AI foundation is used in the
Swisscom chatbot via webchat, Apple Business Chat
(ABC), SMS and WhatsApp. The chatbot recognises cus-
tomer enquiries and resolves them in an automated pro-
cess whenever possible. If the chatbot is unable to
resolve a case, it hands the case off to an agent. Cur-
rently, the Swisscom chatbot already provides answers
and solutions to around 180 different questions. In addi-
tion, it is capable of resolving the ten most frequent cus-
tomer enquiries completely independently.
Security
Security is part of Swisscom’s values and culture. Threats
from the Internet are constantly growing in number and
becoming increasingly intelligent. Many processes and
business models in today’s companies are completely
IT-based and thus become attractive targets for attackers.
In addition, the use of multi-cloud and hybrid cloud solu-
tions are making IT landscapes increasingly complex and
vulnerable. By combining professional security services,
skills, processes and tools, Swisscom offers highly effective
security and thus the best possible protection for its cus-
tomers, stakeholders and its own company. For business
customers, Swisscom offers dedicated facilities through
Managed Security Services to monitor and safeguard the
infrastructure. In doing so, it adds new detection patterns
to its Threat Detection & Response solutions and expands
them to cover multi- and hybrid-cloud environments.
In addition to the high level of protection that the Swisscom
network offers every user as well as its premium virus pro-
tection programme, Swisscom now also offers online iden-
tity protection to its Residential Customers, which protects
their data from being stolen by viruses, hackers or spyware.
Swisscom has also launched an Internet legal protection
insurance policy (Cyber Insurance): This policy helps cus-
tomers in cases of online crime such as cyberbullying or
cyberattacks and offers protection for online shopping.
Entertainment
Swisscom combined all its entertainment offerings
under the new ‘Swisscom blue’ product family in 2020
and expanded the Swisscom blue offering even further
during the year under review. blue TV is now available on
LG devices, Apple TV and on Wingo’s TV box. A new sport
hub on the TV makes sporting content even more enjoy-
able as it gives users direct access to highlights from cur-
rent sporting events. Swisscom also provides its custom-
ers with a free media library entitled blue Play and
launched the new Swisscom Box 21 in 2021, which fea-
tures even lower energy consumption.
Digital Swisscom
In 2021, Swisscom again took further steps to digitise its
network, jobs and processes, thereby consolidating its role
as the leading service provider among Swiss telecommuni-
cations providers. The new My Swisscom app passed the
test carried out by trade magazine connect and came in
first place with the highest score among all service apps
operated by European telecommunications companies.
This app delights some 500,000 customers a month
with its revamped areas for billing and cost-related
information (including a link to the TWINT payment sys-
tem), a shopping area with personalised content, the
weekly ‘Spin & Win’ competition and user-relevant noti-
fications.
Swisscom uses innovations from the field of digitisation
on the customer channels it serves (such as in shops and
call centres). During a pilot trial in 2021, for example, it
successfully tested self-checkouts via the My Swisscom
app in its own shop. In future, the self-checkout function
will become an integral part of the My Swisscom app as
one of the elements of the digital customer journey.
Digital business
In the field of digital business innovation, Swisscom sup-
ported developments within and outside its own com-
pany in 2021, by setting up and further developing joint
ventures with strategic partners and promoting intrapre-
neurship. The Swisscom Digital Business Unit (DBU)
focuses on digital services for SMEs via localsearch
(Swisscom Directories Ltd), fintech activities and trust ser-
vices. It is also continuously examining other action areas
that could become relevant to its activities.
Swisscom Directories Ltd (localsearch)
Today, even small SMEs have to be competitive in the
online world. The Swisscom subsidiary Swisscom Direc-
tories Ltd (localsearch) offers efficient marketing prod-
ucts that are geared to the needs of the SME segment:
simple, inexpensive and time-saving solutions for the
success of Swiss industry in the digital world. Thanks to
localsearch products, SMEs can be found online, acquire
new customers and retain existing ones. This is why
localsearch brings the five principles of digital marketing
to Swiss SMEs: seen, found, booked, bought and liked. In
addition, localsearch operates the popular and well-used
local.ch and search.ch directories.
Fintech
The fintech area of the Digital Business Unit focuses on
the digital assets and trust services segments. In the dig-
ital assets segment, Swisscom is working on the future
of the Swiss financial infrastructure. It does this jointly
with daura ltd and Custodigit Ltd (in which it holds a
minority interest). Using the digital share platform of
daura ltd, the existing share register can be easily digit-
ised, capital increases can be processed quickly and inex-
pensively, practically at the push of a button, and digital
general meetings can be held. Custodigit Ltd offers regu-
lated financial service providers an easy-to-integrate,
secure platform to store and manage digital assets.
Trust services
Through its trust services, Swisscom, as a leading pro-
vider of trust services, aims to digitally issue, verify,
transmit and store high-quality documents such as con-
tracts, certificates and register extracts. Swisscom sub-
sidiary Ajila AG is already providing major support to
numerous Swiss companies and administrations to help
them completely digitise their document-based busi-
ness processes. Customer identification and onboarding
as well as contract signings often pose bottlenecks in
the customer journey. However, fully digital processes
call for tools that avoid media discontinuity and inte-
grate seamlessly into companies’ offerings. This is
ensured by Swisscom Trust Services, which is a leading
provider in Switzerland and Europe of legally valid elec-
tronic signature and identity solutions in accordance
with the EU’s eIDAS Regulation and the Swiss Signatures
Act ZertES. Swisscom transferred its existing trust ser-
vices business division to the subsidiary Swisscom Trust
Services Ltd in spring 2021.
Intelligent automobile networking
autoSense Ltd, a joint venture between Swisscom,
AMAG and Zurich Insurance, focuses on the develop-
ment of advanced automotive services. autoSense
offers services related to the intelligent networking of
cars for private individuals and companies as well as
partner services. The portfolio of services includes a
driver’s logbook, remote diagnosis with warnings in the
event of engine problems, an app for cashless refuelling,
pay-per-kilometre insurance and digital assistance for
driving instructors and learners. The offering is con-
stantly being expanded.
Intrapreneurship
Swisscom’s efforts to promote intrapreneurship gave
rise to an innovation programme entitled Getkickbox.
This software structures the company’s own innovation
process and makes it easy to understand, thereby ena-
bling easy access to this process for all employees.
Whether it’s a flash of inspiration or a sophisticated,
carefully conceived innovation, everything can be fed
directly into the Kickbox. The Getkickbox software solu-
tion gave rise to the new rready AG start-up during the
year under review. rready’s goal is to promote employ-
ees’ innovativeness, structure innovation processes and
make innovation management globally scalable for
companies in the process.
43
Financial review
Alternative performance measures
Swisscom uses key indicators defined in the Interna-
tional Financial Reporting Standards (IFRS) throughout
its entire financial reporting, as well as selected alterna-
tive performance measures (APMs). These alternative
measures provide useful information on the Group’s
financial situation and are used for financial manage-
ment and control purposes. As these measures are not
defined under IFRS, the calculation may differ from the
published APMs of other companies. For this reason,
comparability across companies may be limited.
The key alternative performance measures used at
Swisscom for 2021 financial reporting are defined as fol-
lows:
Key performance measure
Adjustments
Swisscom definition
Significant items that, due to their exceptional nature, cannot be considered part of the
Swisscom Group’s ongoing performance, such as termination benefits and significant positions
in connection with legal cases or other non-recurring items . In addition, the application of
changes in the IFRS accounting principles and standards can have an impact on comparability
with the previous year if these principles are not applied retrospectively .
At constant exchange rates
Key performance measures considering currency effects (figures for 2021 are translated
at the 2020 exchange rate to calculate the currency effect) .
Operating income before depreciation and amortisation (EBITDA) Operating income before depreciation, amortisation and impairment losses of property, plant
and equipment, intangible assets and right-of-use assets, financial expense and financial
income, result of equity-accounted investees and income tax expense .
Operating income (EBIT)
Capital expenditure
Operating free cash flow proxy
Free cash flow
Net debt
Operating income before depreciation and amortisation of property, plant and equipment,
intangible assets and right-of-use assets, financial expense and financial income, result of
equity-accounted investees and income tax expense .
Purchase of property, plant and equipment and intangible assets and payments for indefeasible
rights of use (IRU) which are classified as leases under IFRS 16 . In general, IRUs are paid in full at
the beginning of use .
Operating income before depreciation and amortisation (EBITDA) minus capital expenditure
in property, plant and equipment, intangible assets and payments for indefeasible rights of
use (IRU) and lease expense . Lease expense includes interest expenses on lease liabilities and
depreciation of rights of use excluding depreciation of indefeasible rights of use (IRU) and
impairment losses on right-of-use assets .
Cash flows from operating and investing activities excl . cash flows from the acquisition and
sale of subsidiaries as well as income and expenses for equity-accounted investments and other
financial assets .
Financial liabilities less cash and cash equivalents, listed debt instruments, certificates of
deposit, derivative financial instruments held for hedging financial liabilities and other current
financial assets .
Net debt incl. lease liabilities
Net debt and lease liabilities .
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Reconciliation of alternative performance measures
in million CHF
Net revenue
Net revenue
Operating income before depreciation and amortisation (EBITDA)
EBITDA
Termination benefits
Gain from change in pension plan
Additions to provisions for legal proceedings in Switzerland
EBITDA adjusted
Capital expenditure
Capital expenditure in property, plant and equipment
and intangible assets
Payments for indefeasible rights of use (IRU)
Capital expenditure
In CHF million
Operating free cash flow proxy
Cash inflow from operating activities
Capital expenditure
Depreciation of right-of-use assets
Depreciation of indefeasible rights of use (IRU)
Impairment losses on right-of-use assets
Proceeds from finance leases
Change in deferred gain from the sale and leaseback of real estate
Change in operating assets and liabilities
Change in provisions
Change in defined benefit obligations
Gain on sale of property, plant and equipment
Expense for share-based payments
Revenue from finance leases
Interest received
Interest paid on financial liabilities
Dividends received
Income taxes paid
Operating free cash flow proxy
Free cash flow
Cash inflow from operating activities
Cash flow used in investing activities
Repayment of lease liabilities
Acquisition of subsidiaries, net of cash and cash equivalents acquired
Proceeds from sale of subsidiaries, net of cash and cash equivalents sold
Purchase of equity-accounted investees
Proceeds from sale of equity-accounted investees
Purchase of other financial assets
Proceeds from other financial assets
Free cash flow
2021
2020
Change
reported
Change at
constant
currencies
11,183
11,100
0.7%
0.6%
4,478
4,382
2 .2%
2 .0%
14
(60)
52
–
–
–
4,484
4,382
2.3%
2.2%
2,270
16
2,286
2,188
41
2,229
3 .7%
–61 .0%
2.6%
3 .5%
–
2.3%
2021
2020
Change
4,044
(2,286)
(281)
23
1
(112)
11
(65)
73
9
10
(1)
120
(14)
81
(1)
279
1,891
4,044
(2,120)
(259)
42
(1)
3
(149)
73
(120)
1,513
4,169
(2,229)
(286)
24
7
(100)
16
(178)
22
(65)
10
(1)
101
(24)
93
(15)
309
1,853
4,169
(2,331)
(287)
39
–
15
–
121
(20)
1,706
(125)
(57)
5
(1)
(6)
(12)
(5)
113
51
74
–
–
19
10
(12)
14
(30)
38
(125)
211
28
3
(1)
(12)
(149)
(48)
(100)
(193)
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Summary
In CHF million, except where indicated
Net revenue
Operating income before depreciation and amortisation (EBITDA)
EBITDA as % of net revenue
Operating income (EBIT)
Net income
Earnings per share (in CHF)
Operating free cash flow proxy
Capital expenditure
Net debt
Equity ratio
Full-time equivalent employees
Swisscom’s net revenue was up by 0.7% or CHF 83 million
at CHF 11,183 million, while operating income before
depreciation and amortisation (EBITDA) increased by
2.2% or CHF 96 million to CHF 4,478 million. Adjustments
to post-employment benefits and provisions impacted
EBITDA mainly in the Swiss core business, but these were
balanced out across the Group as a whole. The consoli-
dated net income of CHF 1,833 million is significantly
higher than in the previous year (+20.0% or CHF 305 mil-
lion), primarily due to non-recurring items in the financial
result and the higher EBITDA. Payment of an unchanged
dividend of CHF 22 per share for the 2021 financial year
will be proposed to the Annual General Meeting.
In the Swiss core business, net revenue decreased by 0.2%
or CHF 17 million to CHF 8,233 million. The continuing
competitive and price pressure led to a 3.3% drop in reve-
nue from telecoms services to CHF 5,478 million. By con-
trast, revenue in the solutions business with business cus-
tomers increased by 5.0% or CHF 53 million. EBITDA in the
Swiss core business decreased by 0.4% or CHF 13 million to
CHF 3,453 million. On a like-for-like basis, there was an
increase of 1.4%. The decline in revenue from telecoms
services and the higher costs involved in services and sub-
scriber acquisition and retention were offset by ongoing
efficiency improvements. Revenue at the Italian subsidiary
Fastweb increased by 3.8% or EUR 88 million to EUR 2,392
million. In the broadband business, Fastweb’s customer
base remained close to stable over the year at 2.75 million
despite fiercer competition, while in mobile communica-
tions it grew by 26.1% to 2.47 million. EBITDA at Fastweb
rose by 5.4% or EUR 42 million in local currency to EUR 826
million, as a result of the growth in revenue.
2021
11,183
4,478
40 .0
2,066
1,833
35 .37
1,891
2,286
5,689
43 .6
2020
11,100
4,382
39 .5
1,947
1,528
29 .54
1,853
2,229
6,218
39 .1
Change
0 .7%
2 .2%
6 .1%
20 .0%
19 .7%
2 .1%
2 .6%
–8 .5%
18,905
19,062
–0 .8%
Swisscom’s capital expenditure increased by 2.6% or
CHF 57 million to CHF 2,286 million. Capital expenditure
in the Swiss core business rose by 2.7% or CHF 43 million
to CHF 1,642 million. Capital expenditure in broadband
and mobile communications networks increased, while
capital expenditure in other infrastructure decreased.
Fastweb recorded an increase in capital expenditure of
2.4% or EUR 14 million to EUR 601 million as a result of
higher customer-driven investments and higher invest-
ment in the mobile network infrastructure.
The operating free cash flow proxy increased by 2.1% or
CHF 38 million to CHF 1,891 million. The improved oper-
ating income before depreciation and amortisation
(EBITDA) was partially offset by the higher capital
expenditure. Net debt decreased by 8.5% to CHF 5,689
million, while the net debt/EBITDA after lease expense
ratio fell from 1.5 to 1.4.
The number of Swisscom employees decreased by 0.8%
or 157 FTEs to 18,905 FTEs. In Switzerland, headcount
decreased by 1.0% or 166 FTEs to 15,882 FTEs.
Swisscom expects net revenue of CHF 11.1 to 11.2 bil-
lion, EBITDA of around CHF 4.4 billion and capital
expenditure of around CHF 2.3 billion for 2022. Subject
to achieving its targets, Swisscom will propose payment
of an unchanged, attractive dividend of CHF 22 per share
for the 2022 financial year at the 2023 Annual General
Meeting.
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Segment results
In CHF million, except where indicated
2021
2020
Change
Net revenue
Residential Customers
Business Customers
Wholesale 1
Infrastructure & Support Functions
Intersegment elimination
Swisscom Switzerland
Fastweb
Other Operating Segments
Intersegment elimination
Revenue from external customers
Operating income before depreciation and amortisation (EBITDA)
Residential Customers
Business Customers
Wholesale
Infrastructure & Support Functions
Intersegment elimination
Swisscom Switzerland
Fastweb
Other Operating Segments
Reconciliation pension cost 2
Intersegment elimination
4,592
3,058
971
76
(464)
8,233
2,583
1,033
(666)
4,560
3,100
976
83
(469)
8,250
2,470
1,014
(634)
11,183
11,100
2,771
1,287
525
(1,131)
1
3,453
892
166
14
(47)
2,698
1,348
524
(1,104)
–
3,466
840
184
(65)
(43)
Operating income before depreciation and amortisation (EBITDA)
4,478
4,382
0 .7%
–1 .4%
–0 .5%
–8 .4%
–1 .1%
–0.2%
4 .6%
1 .9%
5 .0%
0.7%
2 .7%
–4 .5%
0 .2%
2 .4%
–0.4%
6 .2%
–9 .8%
9 .3%
2.2%
1 Incl. intersegment recharges of services performed by other network providers.
2 Operating income of segments includes ordinary employer contributions as
pension fund expense. The difference to the pension cost according to IAS 19 is
recognised as a reconciliation item.
Swisscom’s reporting focuses on the operating divisions
Swisscom Switzerland and Fastweb. The other business
divisions are grouped together under Other Operating
Segments. Swisscom Switzerland comprises the cus-
tomer segments Residential Customers, Business Cus-
tomers and Wholesale, along with the Infrastructure &
Support Functions business division. Fastweb is a tele-
communications provider for residential and business
customers in Italy. Other Operating Segments primarily
comprises the Digital Business division, Swisscom Broad-
cast Ltd (radio transmitters) and cablex Ltd (network
construction and maintenance).
For its services, the Infrastructure & Support Functions
business division does not charge any network costs or
management fees to other segments. All other services
between the segments are charged at market prices.
Network costs in Switzerland are budgeted, monitored
and controlled by the Infrastructure & Support Func-
tions segment, which is managed as a cost centre. For
this reason, no revenue is credited to the Infrastructure
& Support Functions segment within the segment
reporting, with the exception of the rental and adminis-
tration of buildings and vehicles. The results of the Resi-
dential Customers, Business Customers and Wholesale
segments thus correspond to a contribution margin
before network costs.
47
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Swisscom Switzerland
In CHF million, except where indicated
Net revenue and results
Telecom services
Solution business
Merchandise
Wholesale
Revenue other
Revenue from external customers
Intersegment revenue
Net revenue
Direct costs
Indirect costs
Segment expenses
Segment result before depreciation and amortisation (EBITDA)
Margin as % of net revenue
Lease expense
Depreciation and amortisation
Segment result
Operating free cash flow proxy
Segment result before depreciation and amortisation (EBITDA)
Lease expense
EBITDA after lease expense (EBITDA AL)
Capital expenditure
Operating free cash flow proxy
Operational data in thousand and full-time equivalent employees
Fixed telephony access lines
Broadband access lines retail
TV access lines
Mobile access lines
Revenue generating units (RGU)
Broadband access lines wholesale
Headcount
2021
2020
Change
5,478
1,111
776
658
154
8,177
56
8,233
(1,826)
(2,954)
(4,780)
3,453
41 .9
(232)
(1,475)
1,746
3,453
(232)
3,221
(1,642)
1,579
1,424
2,037
1,592
6,177
11,230
596
12,889
5,667
1,058
759
661
48
8,193
57
8,250
(1,772)
(3,012)
(4,784)
3,466
42 .0
(232)
(1,509)
1,725
3,466
(232)
3,234
(1,599)
1,635
1,523
2,043
1,588
6,224
11,378
555
12,845
–3 .3%
5 .0%
2 .2%
–0 .5%
220 .8%
–0.2%
–1 .8%
–0.2%
3 .0%
–1 .9%
–0.1%
–0.4%
0 .0%
–2 .3%
1.2%
–0 .4%
0 .0%
–0.4%
2 .7%
–3.4%
–6 .5%
–0 .3%
0 .3%
–0 .8%
–1 .3%
7 .4%
0 .3%
Swisscom Switzerland’s net revenue decreased by 0.2%
or CHF 17 million to CHF 8,233 million. The continuing
competitive and price pressure led to a drop of 3.3% or
CHF 189 million in revenue from telecoms services to
CHF 5,478 million. Of this decline, CHF 105 million
(–2.7%) was attributable to the Residential Customers
segment and CHF 84 million (–4.9%) to the Business Cus-
tomers segment. By contrast, revenue from the solu-
tions business increased by 5.0% or CHF 53 million to
CHF 1,111 million.
The market is showing signs of saturation and competi-
tive pressure in the area of mobile communications and
fixed-network services. The subscriber base in mobile
communications shrank by 0.8% or 47,000 year-on-year
to 6.18 million. The number of postpaid lines increased
by 128,000 year-on-year, while the number of prepaid
lines decreased by 175,000. In the Residential Customers
segment, the share of the secondary brand Wingo and
third-party brands such as M-Budget Mobile and Coop
Mobile in the postpaid portfolio increased from 19% to
23%. The number of broadband and TV connections
remained virtually stable year-on-year, at 2.04 million
broadband connections and 1.59 million for TV. As at the
end of 2021, the Residential Customers segment had
2.52 million inOne customers. In this segment, inOne
accounted for 66% of postpaid mobile lines and 81% of
broadband connections. The number of fixed telephony
access lines fell by 6.5% or 99,000 year-on-year to 1.42
million.
Segment expense fell by 0.1% or CHF 4 million to
CHF 4,780 million. Direct costs increased by 3.0% or
CHF 54 million to CHF 1,826 million. Costs for merchan-
dise and services and costs for acquiring and retaining
customers both went up. Indirect costs decreased by
1.9% or CHF 58 million to CHF 2,954 million. During
2021, indirect costs were also impacted by a CHF 52 mil-
lion increase in provisions for litigation and an increase
in provisions for headcount reduction. On a like-for-like
basis, indirect costs fell by 4.0% or CHF 119 million,
chiefly due to ongoing efficiency improvements. As a
consequence of the acquisitions of Webtiser and JLS Dig-
ital, the number of employees increased by 0.3% or 44
FTEs to 12,889 FTEs. The segment result before depreci-
ation and amortisation decreased by 0.4% or CHF 13 mil-
lion to CHF 3,453 million, but increased by 1.4% on a like-
for-like basis. The decline in revenue from telecoms
services and the higher costs associated with services
and subscriber acquisition and retention were offset by
ongoing efficiency improvements. Capital expenditure
rose by 2.7% or CHF 43 million to CHF 1,642 million. Cap-
ital expenditure on the expansion of broadband net-
Fastweb
works and mobile networks increased, while capital
expenditure on other infrastructure decreased. As at the
end of 2021, around 4.8 million Swiss homes and busi-
nesses, or 90% of the total, were connected with ultra-
fast broadband exceeding 80 Mbps. More than 3.9 mil-
lion homes and businesses, or 72% of the total, enjoy
even faster connections with speeds of more than
200 Mbps.
There is currently a great deal of uncertainty shrouding
the continued rolling out of the fibre-optic network to
homes and businesses (FTTH), which Swisscom is imple-
menting for the whole of Switzerland. In 2021, the Fed-
eral Administrative Court confirmed the precautionary
measures taken by the Competition Commission in
December 2020, which partly call
into question
Swisscom’s network architecture. Until the situation is
clarified, Swisscom is only building network elements
relating to the P2P (point-to-point) network element
(e.g. feeder to the home) or that are being built under
cooperations.
In EUR million, except where indicated
2021
2020
Change
Net revenue and results
Residential Customers
Corporate Business
Wholesale
Revenue from external customers
Intersegment revenue
Net revenue
Segment expenses
Segment result before depreciation and amortisation (EBITDA)
Margin as % of net revenue
Lease expense
Depreciation and amortisation
Segment result
Operating free cash flow proxy
Segment result before depreciation and amortisation (EBITDA)
Lease expense
EBITDA after lease expense (EBITDA AL)
Capital expenditure
Operating free cash flow proxy
Operational data in thousand and full-time equivalent employees
Broadband access lines
Mobile access lines
Headcount
1,142
979
263
2,384
8
2,392
(1,566)
826
34 .5
(54)
(590)
182
826
(54)
772
(601)
171
2,750
2,472
2,753
1,133
907
257
2,297
7
2,304
(1,520)
784
34 .0
(52)
(577)
155
784
(52)
732
(587)
145
2,747
1,961
2,703
0 .8%
7 .9%
2 .3%
3.8%
14 .3%
3.8%
3 .0%
5.4%
3 .8%
2 .3%
17.4%
5 .4%
3 .8%
5.5%
2 .4%
17.9%
0 .1%
26 .1%
1 .8%
49
Fastweb’s net revenue rose by 3.8% or EUR 88 million
year-on-year to EUR 2,392 million. Competition intensi-
fied in the broadband business. Fastweb’s customer
growth weakened in the course of the year. The cus-
tomer base remained almost unchanged year-on-year,
at 2.75 million (+0.1%). The number of mobile access
lines increased by 26.1% or 511,000 year-on-year to 2.47
million, despite stiff competition. Bundled offers con-
tinue to play an important role. 38% of broadband cus-
tomers use a bundled offering combining fixed network
and mobile. Residential customer revenue rose by 0.8%
or EUR 9 million to EUR 1,142 million as a result of cus-
tomer growth. Fastweb is also growing in the business
customer market. Revenue from business customers
Other Operating Segments
In CHF million, except where indicated
Net revenue and results
Revenue from external customers
Intersegment revenue
Net revenue
Segment expenses
Segment result before depreciation and amortisation (EBITDA)
Margin as % of net revenue
Lease expense
Depreciation and amortisation
Segment result
Operating free cash flow proxy
Segment result before depreciation and amortisation (EBITDA)
Lease expense
EBITDA after lease expense (EBITDA AL)
Capital expenditure
Operating free cash flow proxy
Full-time equivalent employees
Headcount
The net revenue of the Other Operating Segments rose
by 1.9% or CHF 19 million to CHF 1,033 million. This was
due to higher revenue from construction services pro-
vided by cablex. The segment result before depreciation
and amortisation decreased by 9.8% or CHF 18 million to
CHF 166 million, and the profit margin shrank accord-
ingly to 16.1% (prior year: 18.1%). The headcount
decreased by 7.1% or 251 FTEs to 3,263 FTEs, mainly as a
result of the sale of the French subsidiary local.fr.
was up by 7.9% or EUR 72 million to EUR 979 million,
driven by higher revenue from public authorities. Reve-
nue from wholesale business increased by 2.3% or EUR 6
million to EUR 263 million.
The segment result before depreciation and amortisa-
tion was 5.4% or EUR 42 million higher at EUR 826 million
on the back of the growth in revenue. Capital expendi-
ture increased by 2.4% or EUR 14 million to EUR 601 mil-
lion as a result of higher customer-driven investments
and higher investments in the mobile network infra-
structure. Fastweb’s headcount increased by 1.8% or 50
FTEs to 2,753 FTEs as the company’s growth created a
need for more personnel.
2021
2020
Change
431
602
1,033
(867)
166
16 .1
(11)
(56)
99
166
(11)
155
(41)
114
445
569
1,014
(830)
184
18 .1
(12)
(62)
110
184
(12)
172
(44)
128
–3 .1%
5 .8%
1.9%
4 .5%
–9.8%
–8 .3%
–9 .7%
–10.0%
–9 .8%
–8 .3%
–9.9%
–6 .8%
–10.9%
3,263
3,514
–7 .1%
Pension cost reconciliation
and intersegment eliminations
Net costs not allocated to the operating segments, which
comprise pension cost reconciliation and intersegment
elimination, fell by CHF 75 million year-on-year to CHF 33
million. The reconciliation item for pension cost is the dif-
ference between total employer contributions and the
cost under IFRS. The first half of 2021 included a non-re-
curring expense reduction of CHF 60 million due to a
change in plan. In addition, changes in assumptions (par-
ticularly with regard to the discount rate) led to lower
costs. Intersegment elimination relates to intragroup
profits on capitalised services of other Group companies.
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Depreciation and amortisation, non-operating results
In CHF million, except where indicated
Operating income before depreciation and amortisation (EBITDA)
Depreciation and amortisation of property, plant and equipment and intangible assets
Depreciation of right-of-use assets
Operating income (EBIT)
Net interest expense on financial assets and liabilities
Interest expense on lease liabilities
Other financial result
Result of equity-accounted investees
Income before income taxes
Income tax expense
Net income
Attributable to equity holders of Swisscom Ltd
Attributable to non-controlling interests
Earnings per share (in CHF)
2021
4,478
(2,131)
(281)
2,066
(60)
(44)
200
(10)
2,152
(319)
1,833
1,832
1
35 .37
2020
4,382
(2,149)
(286)
1,947
(69)
(45)
(38)
4
1,799
(271)
1,528
1,530
(2)
Change
2.2%
–0 .8%
–1 .7%
6.1%
–13 .0%
–2 .2%
19.6%
17 .7%
20.0%
19 .7%
29 .54
19 .7%
Swisscom’s net income rose by CHF 305 million or 20.0%
to CHF 1,833 million, largely due to non-recurring items
in the financial result and the higher EBITDA. Earnings
per share rose accordingly from CHF 29.54 to CHF 35.37.
Income before income taxes rose by 19.6%. The depreci-
ation and amortisation of property, plant and equip-
ment and intangible assets decreased by CHF 18 million
or 0.8% year-on-year to CHF 2,131 million; these went
down at Swisscom Switzerland and up at Fastweb. The
non-recurring items in the financial result originate from
the first quarter of 2021. As part of its strategic partner-
ship with TIM, Fastweb transferred its stake in Flash-
Fiber as a capital contribution to the newly established
fibre-optic company FiberCop. This resulted in an
upward revaluation of the participation recognised in
the income statement of CHF 169 million. In addition,
Swisscom realised a gain of CHF 38 million on the sale of
its investment in Belgacom International Carrier Ser-
vices. Income tax expense stood at CHF 319 million
(prior year: CHF 271 million), which corresponds to an
effective income tax rate of 14.8% (prior year: 15.1%).
51
Income taxes
Income tax expense increased by CHF 48 million year-
on-year, from CHF 271 million to CHF 319 million, corre-
sponding to an effective income tax rate of 14.8% (prior
year: 15.1%) The tax expense in 2021 was positively
impacted by the low taxation of income from participa-
tions and the capitalisation of deferred tax assets in con-
nection with a change in Italian tax laws. Swisscom
anticipates a future effective consolidated tax rate of
19.5%. The CHF 30 million decrease in income taxes paid
to CHF 279 million was mainly due to the difference
between the expense recorded and the payment of
income taxes due.
In CHF million, except where indicated
Switzerland
Italy
Other countries
Total
2021 financial year
Income before income taxes
Income tax expense
Effective income tax rate
Income taxes paid
2020 financial year
Income before income taxes
Income tax expense
Effective income tax rate
Income taxes paid
1,827
339
18 .6%
264
1,669
242
14 .5%
299
306
(22)
19
2
–7 .2%
10 .5%
15
108
25
–
22
4
23 .1%
18 .2%
10
–
2,152
319
14 .8%
279
1,799
271
15 .1%
309
Swisscom operates principally in Switzerland and Italy,
so the information on income taxes is divided into Swit-
zerland, Italy and other countries.
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Cash flows
In CHF million
Operating income before depreciation and amortisation (EBITDA)
Lease expense
EBITDA after lease expense (EBITDA AL)
Capital expenditure
Operating free cash flow proxy
Change in net working capital
Change in defined benefit obligations
Net interest payments on financial assets and liabilities
Income taxes paid
Other operating cash flow
Free cash flow
Dividends paid to equity holders of Swisscom Ltd
Net expenditures for company acquisitions and disposals
Other changes
Decrease in net debt
The operating free cash flow proxy increased by 2.1% or
CHF 38 million year-on-year to CHF 1,891 million. The
higher operating income before depreciation and
amortisation (EBITDA) was partially offset by the
increased capital expenditure. Free cash flow decreased
by 11.3% or CHF 193 million to CHF 1,513 million. Over-
all, net debt decreased by 8.5% or CHF 529 million to
CHF 5,689 million.
Development of free cash flow
in CHF million
4,478
2021
4,478
(301)
4,177
(2,286)
1,891
(19)
(9)
(67)
(279)
(4)
1,513
(1,140)
105
51
529
2020
4,382
(300)
4,082
(2,229)
1,853
140
65
(69)
(309)
26
1,706
(1,140)
(54)
28
540
Change
96
(1)
95
(57)
38
(159)
(74)
2
30
(30)
(193)
–
159
23
(11)
The decrease in free cash flow was mainly attributable
to the change in net working capital. Net working capi-
tal went up by CHF 19 million in 2021 (prior year:
decrease of CHF 140 million). The change in defined
benefit obligations includes a one-off adjustment of
CHF 60 million arising from a plan amendment in the
first half of 2021, which is recognised in EBITDA. In
2021, net cash inflows from acquisitions and disposals
included the proceeds of CHF 126 million from the sale
of the participation in Belgacom International Carrier
Services. Swisscom paid an unchanged dividend of
CHF 22 per share in 2021. This is equivalent to a total
dividend payout of CHF 1,140 million.
–2,286
–301
1,891
–19
–279
–67
–13
1,513
EBITDA
Capital
expenditure
Lease
expense
Operating
free cash
flow proxy
Change in
net working
capital
Taxes
paid
Interest
payments
Other effects
Free
cash flow
53
Capital expenditure
In CHF million, except where indicated
Fixed access and infrastructure
Expansion of the fibre-optic network
Mobile network
Customer driven
Projects and others
Swisscom Switzerland
Fastweb
Other Operating Segments
Elimination
Total capital expenditure
Thereof Switzerland
Thereof other countries
Capital expenditure as % of net revenue
2021
428
555
323
64
272
1,642
649
41
(46)
2,286
1,634
652
20 .4
Change
–2 .3%
6 .9%
5 .6%
–15 .8%
4 .6%
2.7%
3 .2%
–6 .8%
7 .0%
2.6%
2 .4%
3 .0%
2020
438
519
306
76
260
1,599
629
44
(43)
2,229
1,596
633
20 .1
Capital expenditure climbed by CHF 57 million or 2.6%
year-on-year to CHF 2,286 million, corresponding to 20.4%
of net revenue (prior year: 20.1%). Swisscom Switzerland
accounted for 72% of capital expenditure in 2021, and
Fastweb for the remaining 28%.
Capital expenditure incurred by Swisscom Switzerland
increased by CHF 43 million or 2.7% year-on-year to
CHF 1,642 million, corresponding to 19.9% of net revenue
(prior year: 19.4%). Swisscom invested CHF 53 million
more than in the previous year in the expansion of
fibre-optic broadband in the fixed network and in the
expansion of the mobile network.
Fastweb increased its capital expenditure by CHF 20 mil-
lion or 3.2% to CHF 649 million. Measured in local cur-
rency, capital expenditure increased by EUR 14 million or
2.4% to EUR 601 million as a result of higher custom-
er-driven investments and higher investments in the
mobile network infrastructure. The ratio of capital
expenditure to net revenue consequently fell to 25.1%
(prior year: 25.5%).
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Net asset position
In CHF million
Property, plant and equipment
Intangible assets
Goodwill
Right-of-use assets
Trade receivables
Receivables from finance leases
Trade payables
Provisions
Deferred gain on sale and leaseback of real estate
Other operating assets and liabilities, net
Net operating assets
Net debt
Lease liabilities
Defined benefit assets and obligations, net
Income tax assets and liabilities, net
Equity-accounted investees and other non-current financial assets
Equity
Equity ratio
31.12.2021
31 .12 .2020
Change
10,771
10,725
1,714
5,157
2,134
2,315
99
(1,600)
(1,149)
(95)
(438)
18,908
(5,689)
(2,017)
(13)
(835)
459
10,813
43 .6
1,745
5,162
2,138
2,132
87
(1,525)
(1,216)
(106)
(240)
18,902
(6,218)
(1,988)
(795)
(643)
233
9,491
39 .1
46
(31)
(5)
(4)
183
12
(75)
67
11
(198)
6
529
(29)
782
(192)
226
1,322
Operating assets
Net operating assets were unchanged at CHF 18.9 billion,
of which CHF 12.5 billion or 66% was attributable to
property, plant and equipment and intangible assets.
The net carrying amount of goodwill was CHF 5.2 billion,
the bulk of which relates to Swisscom Switzerland
(CHF 4.3 billion). This goodwill arose primarily in 2007 in
connection with the repurchase of the 25% stake in
Swisscom Mobile Ltd sold to Vodafone in 2001. Follow-
ing the repurchase, the mobile, fixed-network and solu-
tions businesses were organisationally combined and
merged to create the new company Swisscom (Switzer-
land) Ltd. The valuation risk of this goodwill item is
extremely low. The net carrying amount of Fastweb’s
goodwill is EUR 0.5 billion (CHF 0.5 billion). The total car-
rying amount of Fastweb’s net assets is EUR 3.4 billion
(CHF 3.5 billion).
Post-employment benefits
Defined benefit obligations recognised in the consoli-
dated financial statements are measured in accordance
with IFRS provisions. Net defined benefit obligations
were CHF 13 million. These were down steeply year-on-
year, by CHF 782 million. The main reasons behind this
were an increase in the interest rate used for the valua-
tion, a change in the actuarial bases (in particular the life
expectancy assumption) and a positive return on plan
assets. Under the Swiss accounting standards applicable
to the pension fund (Swiss GAAP FER), there is a funding
surplus of CHF 2.0 billion, corresponding to a coverage
ratio of 120% on the plan’s assets of CHF 13.1 billion. The
main reasons for the difference of CHF 2.0 billion com-
pared with the measurement according to IFRS are two-
fold. Firstly, the use of different assumptions, in particu-
lar the interest rate for discounting future pension
benefits, has a net effect of CHF 1.4 billion. Secondly, the
valuation method treats future salary increases, contri-
bution rates scaled by age group and early retirement
differently, resulting in a net effect of CHF 0.6 billion. The
ordinary pension cost recognised in personnel expenses in
accordance with IFRS is significantly higher than the actual
contributions made. The difference between the contribu-
tion payments and the IFRS expense is not included in the
segment results; instead it is recognised in the reconcili-
ation to EBITDA according to the consolidated financial
statements. In 2021, a change in the pension plan resulted
in a positive non-recurring effect in EBITDA of CHF 60 mil-
lion and contributed to a positive overall reconciliation
position of CHF 14 million (prior year: negative position of
CHF 65 million).
55
Net debt
Net debt and the net debt to EBITDA ratio are presented
both with and without classification of leases as finan-
cial liabilities. For credit rating purposes, rating agencies
include lease liabilities in the calculation of net debt. How-
In CHF million
Ratio of net debt/EBITDA after lease expense
Debenture bonds
Bank loans
Private placements
Other financial liabilities
Total financial liabilities
Cash and cash equivalents
Listed debt instruments
Derivative financial instruments for financing
Other current financial assets
Net debt
EBITDA after lease expense (EBITDA AL)
Ratio of net debt/EBITDA after lease expense
Ratio of net debt incl. lease liabilities/EBITDA
Net debt
Lease liabilities
Net debt incl. lease liabilities
EBITDA
Ratio of net debt incl. lease liabilities/EBITDA
ever, for the financial target of the Federal Council’s
financing structure, leases are not classified as financial
liabilities or part of net debt.
31.12.2021
31 .12 .2020
5,564
6,110
488
151
242
6,445
(401)
(278)
(19)
(58)
5,689
4,177
1.4
5,689
2,017
7,706
4,478
1.7
484
151
297
7,042
(340)
(271)
(79)
(134)
6,218
4,082
1.5
6,218
1,988
8,206
4,382
1.9
The ratio of net debt including lease liabilities to EBITDA
was 1.7 at the end of 2021 (prior year: 1.9). Without clas-
sification of the leases as financial liabilities, the ratio of
net debt to EBITDA after lease expense was 1.4 (prior
year: 1.5). Both ratios reflect an improved debt situation
compared with the previous year. Swisscom’s goal of
maintaining its single-A credit rating was achieved. The
limit on net debt set by the Federal Council in the finan-
cial targets of 2.1x EBITDA after lease expense was also
complied with.
In recent years, Swisscom has taken advantage of
favourable capital market conditions with a view to
optimising the interest and maturity structure of the
Group’s financial liabilities. The share of fixed-inter-
est-bearing financial liabilities is 88%. At the end of 2021,
the average interest expense on all financial liabilities
was 0.9%, and the average residual term to maturity was
6.2 years. Swisscom also has two lines of credit totalling
CHF 2.2 billion, which have not been used. Financial liabil-
ities with a term of one year or less stood at CHF 0.6 bil-
lion at 31 December 2021.
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56
Equity
Swisscom has equity of CHF 10.8 billion (prior year:
CHF 9.5 billion) and an equity ratio of 43.6% (prior year:
39.1%). As the combined total of net income of CHF 1.8
billion and other comprehensive income of CHF 0.6 bil-
lion was higher than the dividend payment of CHF 1.1
billion, equity increased by CHF 1.3 billion. The foreign
currency differences arising from the translation of for-
eign subsidiaries are recognised in equity. As a result of
the weaker euro, cumulative currency translation losses
increased by CHF 0.1 billion to CHF 1.9 billion (after tax)
in 2021. Distributable reserves are not determined on
the basis of the equity as reported in the consolidated
financial statements, but rather on the basis of equity as
reported
in the separate financial statements of
Swisscom Ltd. The equity in the 2021 separate financial
statements of Swisscom Ltd was CHF 4.8 billion. The dif-
ference of CHF 6.0 billion versus the equity reported in
the consolidated balance sheet is largely due to earnings
retained by subsidiaries and different accounting meth-
ods. Under accounting and measurement rules in Swiss
company law, share capital and that part of the general
reserves representing 20% of the share capital may not
be distributed. On 31 December 2021, Swisscom Ltd held
distributable reserves of CHF 4.7 billion.
Financial outlook
Key figures or as noted
Net revenue
Swisscom Group
Switzerland 2
Fastweb
Operating income before depreciation and amortisation (EBITDA)
Swisscom Group
Switzerland 2
Fastweb
Capital expenditure
Swisscom Group
Switzerland 2
Fastweb
2021
reported
2022
outlook
3
CHF 11,183 mn
CHF 8,600 mn
EUR 2,392 mn
CHF 4,478 mn
CHF 3,586 mn
EUR 826 mn
CHF 2,286 mn
CHF 1,637 mn
EUR 601 mn
CHF 11.1–11.2 bn
CHF 8 .5–8 .6 bn
~ EUR 2 .5 bn
1
~ CHF 4.4 bn
~ CHF 3 .5 bn
EUR 0 .8–0 .9 bn
~ CHF 2.3 bn
~ CHF 1 .7 bn
~ EUR 0 .6 bn
1 EBITDA after lease expense (EBITDA AL) 2021: CHF 4,177 mn;
EBITDA AL guidance 2022: ~ CHF 4.1 bn
2 Swisscom w/o Fastweb
3 Exchange rate CHF/EUR 1.04 (2021: CHF/EUR 1.08)
Swisscom expects net revenue of CHF 11.1 to 11.2 bil-
lion, EBITDA of around CHF 4.4 billion and capital
expenditure of around CHF 2.3 billion for 2022. Subject
to achieving its targets, Swisscom will propose payment
of an unchanged, attractive dividend of CHF 22 per share
for the 2022 financial year at the 2023 Annual General
Meeting.
57
Value-oriented business management
Key performance indicators for planning and managing
business operations are revenue, operating income
before depreciation and amortisation (EBITDA) and cap-
ital expenditure. The enterprise value/EBITDA ratio also
permits comparisons of Swisscom’s enterprise value
derived from the share price on the balance sheet date
with that of its peers (European telecommunications
companies) and with its own figure for the prior year.
The members of the Board of Directors and Group Exec-
utive Board are paid a portion of their remuneration in
the form of Swisscom shares, which are blocked for a
period of three years. They are also subject to a mini-
mum shareholding requirement. Variable remuneration
based on financial and non-financial targets, the partial
settlement of remuneration in shares and the minimum
shareholding requirement ensure that the financial
interests of management are aligned with the interests
of shareholders.
In CHF million, except where indicated
Enterprise value
Market capitalisation
Net debt incl . lease liabilities
Defined benefit assets and obligations, net
Income tax assets and liabilities, net
Equity-accounted investees and other non-current financial assets
Non-controlling interests
Enterprise value (EV)
Operating income before depreciation and amortisation (EBITDA)
Ratio enterprise value/EBITDA
31.12.2021
31 .12 .2020
26,657
7,706
13
835
(459)
2
34,754
4,478
7.8
24,715
8,206
795
643
(233)
1
34,127
4,382
7.8
Swisscom’s enterprise value increased by 1.8% or
CHF 0.6 billion to CHF 34.8 billion in 2021. The main
reason for this was the increase of CHF 1.9 billion in the
company’s market capitalisation to CHF 26.7 billion.
The ratio of enterprise value to EBITDA remained at 7.8
on higher EBITDA. Swisscom’s relative market valua-
tion is therefore well above the average for comparable
companies in Europe’s telecoms sector. The higher rela-
tive valuation is supported by Swisscom’s solid market
position and attractive dividend. In addition, the lower
interest rates and lower income tax rates in Switzer-
land compared with other European countries have a
positive effect.
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58
Statement of added value
Thanks to a modern, high-performance network infra-
structure and a comprehensive, needs-driven service
offering, Swisscom makes an important contribution to
Switzerland’s competitiveness and economic success
and generates direct added value.
In CHF million
Added value
Net revenue
Capitalised self-constructed assets and other income
Direct costs
Other operating expense 1
Lease expense
Switzer-
land
Other
countries
2021
Total
Switzer-
land
Other
countries
2020
Total
8,579
2,604
11,183
8,614
2,486
11,100
459
(1,840)
(1,184)
(243)
139
(939)
(661)
(58)
598
362
(2,779)
(1,784)
(1,845)
(1,147)
(301)
(244)
104
(885)
(641)
(56)
466
(2,669)
(1,788)
(300)
Depreciation and amortisation 2
(1,500)
(635)
(2,135)
(1,531)
(618)
(2,149)
Intermediate inputs
Operating added value
Other non-operating result 3
Total added value
Allocation of added value
Employees 4
Public sector 5
Shareholders (dividends)
Third-party lenders (net interest expense)
Company (retained earnings) 6
Total added value
(4,308)
(2,154)
(6,462)
(4,344)
(2,096)
(6,440)
4,271
450
4,721
4,270
390
2,412
320
269
17
126
4,847
2,681
2,428
317
337
1,141
60
628
4,847
224
14
4,660
(110)
4,550
2,652
331
1,141
69
357
4,550
1 Other operating expense: excl. taxes on capital and other taxes not based on
4 Employees: employer contributions are reported as pension cost, rather than as
income.
expenses according to IFRS.
2 Depreciation and amortisation: excl. amortisation of acquisition-related intangi-
5 Public sector: current income tax expense, capital taxes and other taxes not
ble assets such as brands or customer relations.
3 Other non-operating result: financial result excl. net interest expense, result of
equity-accounted investees, and amortisation of acquisition-related intangible
assets.
based on income. Excl. payments for VAT and mobile communication frequencies.
6 Company: incl. changes in deferred income taxes and defined benefit obligations.
Of the consolidated operating added value of CHF 4.7 bil-
lion, 90% or CHF 4.3 billion was generated in Switzer-
land. Operating added value
in Switzerland was
unchanged year-on-year. The value added per FTE was
CHF 267,000 (prior year: CHF 263,000). In addition to
direct added value, purchases from suppliers provide
significant indirect added value for Switzerland’s econ-
omy. Taking into account capital expenditure instead of
depreciation and amortisation, the purchasing volume
in the Swiss business was around CHF 4.4 billion in 2021,
with added value of approximately 60% or CHF 2.7 bil-
lion contributed by suppliers in Switzerland.
59
Capital market
Swisscom achieved its financial targets in 2021 by consistently implementing its
strategy, meaning it has succeeded in creating added value for shareholders once
again this year . Thanks to its ratings of A (stable) from Standard & Poor’s and A2
(stable) from Moody’s, Swisscom is one of the best-rated telecommunications
companies in Europe .
Swisscom share
Swisscom’s market capitalisation as at 31 December 2021
amounted to CHF 26.7 billion (previous year: CHF 24.7 bil-
lion). The number of shares issued remained the same at
51.8 million. Par value per registered share is CHF 1. Each
share entitles the holder to one vote. Voting rights can
only be exercised if the shareholder is entered in the
share register of Swisscom Ltd with voting rights. The
Board of Directors may refuse to enter a shareholder with
voting rights if such voting rights exceed 5% of the com-
pany’s share capital.
Share performance 2021
in CHF
580
530
480
430
515
.
0
2
2
1
1
3
.
.
1
2
1
0
1
3
.
.
1
2
2
0
8
2
.
.
1
2
3
0
1
3
.
.
1
2
4
0
0
3
.
.
1
2
5
0
1
3
.
.
1
2
6
0
0
3
.
.
1
2
7
0
1
3
.
.
1
2
8
0
1
3
.
.
1
2
9
0
0
3
.
.
1
2
0
1
1
3
.
.
1
2
1
1
0
3
.
.
1
2
2
1
1
3
.
Swisscom
SMI (indexed)
Stoxx Europe 600 Telcos (in CHF, indexed)
The Swiss Market Index (SMI) rose by 20.3% compared
with the previous year. The Swisscom share price
increased by 7.9% to CHF 514.60, lagging somewhat
behind the performance of the Stoxx Europe 600 Tele-
communications Index (+11.5% in EUR). The average
daily trading volume decreased by 34% year on year to
118,509 shares. The total trading volume of Swisscom
shares in 2021 was CHF 30.1 billion.
N See www.swisscom.ch/shareprice
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60
Shareholder return
On 05 April 2021, Swisscom paid out an ordinary divi-
dend of CHF 22 per share. Based on the closing price at
the end of 2020, this equates to a return of +4.6%.
Taking into account the increase in the share price, the
Swisscom share achieved a total shareholder return
(TSR) of +12.9% in 2021. The TSR for the SMI was +23.7%
and for the Stoxx Europe 600 Telecommunications
Index +16.1% in EUR.
Shareholder structure
Stock exchanges
Swisscom shares are listed on the SIX Swiss Exchange
under the symbol SCMN (Securities No. 874251). In the
United States (Over The Counter, Level 1), they are traded
in the form of American Depositary Receipts (ADR) at a
ratio of 1:10 under the symbol SCMWY (Pink Sheet
No. 69769).
Confederation
Natural persons
Institutions
Number of
shareholders
Number of
shares
1
26,394,000
69,275
4,853,898
2,772
10,484,218
Unregistered shareholdings
–
10,069,827
31.12.2021
Share
in %
51 .0%
9 .4%
20 .2%
19 .4%
Number of
shareholders
Number of
shares
1
26,394,000
69,308
4,817,812
2,833
10,891,021
–
9,699,110
31 .12 .2020
Share
in %
51 .0%
9 .3%
21 .0%
18 .7%
Total
72,048
51,801,943
100.0%
72,142
51,801,943
100.0%
The majority shareholder as at 31 December 2021 was the
Swiss Confederation, which is obligated by current law to
hold the majority of the capital and voting rights. As at 31
December 2021, some 19% of the shares were held in
unregistered shareholdings, as in the previous year.
Analysts’ recommendations
Investment specialists analyse Swisscom’s business per-
formance, results and market situation on an ongoing
basis. Their findings and recommendations offer valua-
ble indicators for investors. Twenty-four analysts regu-
larly publish studies on Swisscom. At the end of 2021,
17% of the analysts issued a buy rating for the Swisscom
share, 50% a hold rating and 33% a sell rating. The aver-
age price target at 31 December 2021, according to the
analysts’ estimates, was CHF 502 per share.
Dividend policy
Swisscom pursues a return policy with a stable dividend.
At the forthcoming Annual General Meeting on 30
March 2022, the Board of Directors will propose an
unchanged ordinary dividend of CHF 22 per share for the
2021 financial year. This is equivalent to a total dividend
payout of CHF 1,140 million.
Since going public in 1998, Swisscom has distributed a
total of CHF 35 billion to its shareholders: CHF 23 billion
in dividend payments and CHF 12 billion in capital reduc-
tions and share buybacks. Swisscom has paid out a total
of CHF 455 per share since the initial public offering.
Together with the overall increase in share price of CHF
176 per share, this amounts to an average annual total
return of 5.1%.
Credit ratings and financing
Swisscom enjoys good ratings from the Standard &
Poor’s and Moody’s rating agencies, at A (stable) and A2
(stable) respectively. Swisscom aims to maintain the sin-
gle-A credit rating. To avoid structural downgrading,
Swisscom endeavours to raise financing at the level of
Swisscom Ltd. Swisscom aims to have a broadly diversi-
fied debt portfolio. This involves paying particular atten-
tion to balancing maturities and diversification of
currencies.
instruments, markets and
financing
Swisscom’s solid financial standing gave it unrestricted
access to money and capital markets again in 2021.
61
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Risks
Changes in competition, customer behaviour, technologies and the regulatory
framework are drivers of risk . Swisscom uses opportunities and minimises risks by
adapting its business model, innovating and undergoing transformation . Its risk
management system is responsible for protecting the value of the company based
on measures introduced at an early stage .
Risk situation
Sales in the core business of Swisscom are under pres-
sure from intense competition. New offerings in the
areas of digitisation and IT services, such as cloud ser-
vices, IT security and IoT solutions, are intended to com-
pensate at least in part for sagging revenue from the
core business. Market developments result in changes to
the business model and demand a profound transfor-
mation of Swisscom’s own company and efficiency
improvement. The key risk factors are addressed below.
The risk factors arising in the supply chain are described
in the Sustainability Report.
N See www.swisscom.ch/cr-report2021
Risk factors
Competitive dynamics in the
telecommunications market
Competitive dynamics are currently being driven by infra-
structure providers and service providers without their
own network infrastructure. Swisscom is countering this
pressure and the decline in revenue from the traditional
telecommunications business by transforming the com-
pany and through constant innovation. Megatrends such
as increasing connectivity, customisation and demographic
change are indelibly shaping and altering our society and
the economy and have a long-term impact on the activities
of Swisscom. Swisscom conducts a comprehensive exter-
nal environment analysis at least once a year in order to
identify potential disruptions at an early stage, harness the
opportunities these create and counter the risks in good
time. It evaluates the future trends and developments
identified by the analysis: for example, to categorise new,
potentially disruptive developments and to model possible
scenarios in a timely manner. Swisscom also produces reg-
ular analyses of the economic and regulatory environment.
It also examines the activities of global Internet corpora-
tions in greater depth to identify relevant changes and
respond with appropriate measures. To respond to changes
in the market, Swisscom consistently focuses on customer
needs when transforming its own company and optimises
or adapts its processes and organisation.
Policy, regulation and compliance
The manner in which regulations are implemented
entails risks for Swisscom, which could have an adverse
impact on the company’s financial position and results
of operations. Sanctions by the Competition Commis-
sion could also reduce Swisscom’s operating results and
cause reputational damage to the company. Finally,
excessively high political demands threaten to funda-
mentally undermine the current competitive system.
Swisscom’s wide range of business activities, coupled
with the complexity of the applicable regulations, calls
for an effective compliance management system (CMS).
Swisscom’s central CMS covers the entire Group. It mon-
itors group-wide adherence to laws relating to anti-cor-
ruption, money laundering, banking, data protection
and confidentiality, antitrust and competition, telecom-
munications, stock exchange and product safety.
Increasing bandwidth in the access network
Customer demand for broadband access is growing rap-
idly, as is the growing popularity of mobile devices and
IP-based
(smart-
(Internet Protocol-based) services
phones, IPTV, OTTs, etc.). Swisscom faces tough competi-
tion from cable companies and other network operators
as it strives to meet current and future customer needs
and defend its own market share. The network expan-
sion this necessitates calls for major investments. To mit-
igate financial risks and ensure optimum network cover-
age, network expansion is geared towards population
density and customer demand. Swisscom also enters
into partnerships for network expansion. Substantial
risks would arise if Swisscom were forced to spend more
on network expansion than planned or if projected long-
term earnings were to fall. Swisscom minimises the risks
by adapting the broadband expansion of the access net-
work to changing conditions and technical opportunities
on an ongoing basis.
Health and the environment
In the year under review, claims were again made that
electromagnetic radiation (e.g. from mobile antennas or
mobile handsets) is potentially harmful to health. Under
the terms of the Ordinance on Non-Ionising Radiation
(ONIR), Switzerland has adopted the precautionary prin-
ciple. It has introduced limits for base stations that are
ten times stricter than both those prescribed by the
WHO and the legal provisions in neighbouring countries
and they apply to all mobile frequencies (including 5G).
The public’s wary attitude towards 5G, in particular
when it comes to mobile communication antennas, is
impeding Swisscom Switzerland’s network expansion.
Even without stricter legislation, public concerns about
the effects of electromagnetic radiation on the environ-
ment and health could further hamper the construction
of wireless networks in the future and drive up costs.
Climate change poses risks for Swisscom. These risks are
driven by changes in climatic parameters (e.g. increased
average or extreme temperatures, more intense precipi-
tation, melting permafrost), changes in the legal frame-
work and other economic or reputational factors. The
resulting developments could impact the operability of
Swisscom’s telecoms infrastructure, particularly in view
of the potential risk to base stations, transmitter sta-
tions and local exchanges. The analysis of the risks posed
by climate change reflects the various emissions scenar-
ios and is largely based on the official reports of the Fed-
eral Office for the Environment (FOEN) on climate change
Impacts and CH2018 Climate Scenarios).
(CH2014
Swisscom also publishes its annual climate report and
takes into account the recommendations of the Task
Force on Climate-related Financial Disclosures (TCFD) in
the areas of governance and strategy. Swisscom made
progress in 2021 in its efforts to implement the recom-
mendations of the TCFD.
N See www.swisscom.ch/climatereport2021
Competitive dynamics and regulation in Italy
The competitive dynamics in Italy carry risks that have a
detrimental impact on Fastweb’s strategy and could
jeopardise projected revenue growth as a result. In par-
ticular, risks may arise in connection with the entry of
new competitors in the market. Fastweb is countering
this pressure by constantly adapting its services, organi-
sation, processes and partnerships. Changes in the legal
and regulatory environment can have a negative impact
on business activities and thus also on the value of the
company.
Business interruption
Usage of Swisscom Switzerland’s and Fastweb’s services
is heavily dependent on technical infrastructure such as
communications networks and IT platforms. Any major
disruption to business operations poses a financial risk as
well as a substantial reputational risk. Force majeure,
natural disasters, human error, hardware or software
failure, criminal acts by third parties (e.g. computer
viruses, hacking activities) and the ever-growing complex-
ity and interdependence of modern technologies can
cause damage or interruption to operations. Built-in
redundancy, contingency plans, deputising arrange-
ments, alternative locations, careful selection of suppli-
ers and other measures are designed to ensure that
Swisscom can deliver the level of service that customers
expect at all times.
Information and security technologies
Swisscom’s complex IT architecture entails risks during
both the implementation and operating phases. These
risks have the potential to delay the rollout of new ser-
vices, increase costs and impact competitiveness. The
transformation is being closely monitored by the Group
Executive Board. The area of Internet security has devel-
oped and changed with immense speed with respect to
technology, economics and society and their interde-
pendencies. Constant innovations and the capacity they
create go hand in hand with new opportunities as well
as new risks. Even if the rise in security threats posed by
cyber attacks is making prevention increasingly difficult,
the objective is to identify potential risks at an early
stage, systematically document them and take appropri-
ate steps to sustainably reduce them.
63
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Corporate Governance _______ 1 Principles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
2 Group structure and shareholders . . . . . . . . . . . . . . . . . . . 66
3 Capital structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
4 Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
5 Group Executive Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
6 Remuneration, shareholdings and loans . . . . . . . . . . . . . 88
7 Shareholders’ participation rights . . . . . . . . . . . . . . . . . . . . 88
8 Change of control and defensive measures . . . . . . . . . . 90
9 Auditor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
10 Information policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
11 Financial calendar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
Remuneration Report ________ 1 Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
2 Remuneration of the Board of Directors . . . . . . . . . . . . . 95
3 Remuneration of the Group Executive Board . . . . . . . . 98
4 Other remuneration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
Report of the statutory auditor . . . . . . . . . . . . . . . . . . . . . . . . . 105
65
Corporate Governance
Corporate governance is a fundamental component of Swisscom’s corporate policy .
Swisscom is committed to effective and transparent corporate governance as part
of its effort to deliver long-term value .
1 Principles
2 Group structure and shareholders
2.1 Group structure
Operational Group structure
Swisscom Ltd is a holding company and responsible for
the overall management of the Swisscom Group. It com-
prises five Group divisions: Group Business Steering,
Group Human Resources, Group Strategy & Board Ser-
vices, Group Communications & Responsibility and
Group Security, which have staff functions. The Board of
Directors delegates day-to-day business management to
the CEO of Swisscom Ltd. The Group Executive Board is
comprised of the CEO of Swisscom Ltd and the heads of
the Group divisions Group Business Steering (CFO) and
Group Human Resources (CPO), plus the heads of the
business divisions Residential Customers, Business Cus-
tomers, and IT Network & Infrastructure. The Group also
includes the Digital Business division and Group compa-
nies such as the Italian subsidiary Fastweb S.p.A. Società.
In performing their activities, the Board of Directors and
Group Executive Board of Swisscom are guided by the
objective of long-term and sustainable business manage-
ment. They incorporate the interests of Swisscom share-
holders, customers, employees and other interest groups
into their decisions. To this end, the Board of Directors
practises effective, transparent corporate governance,
which is characterised by clearly assigned responsibilities
and based on recognised standards. In this regard,
Swisscom complies with the recommendations of the
Swiss Code of Best Practice for Corporate Governance
2014 issued by economiesuisse, the umbrella organisa-
tion representing Swiss business, and the requirements
of the Ordinance against Excessive Compensation in
Listed Stock Companies (OaEC).
The interaction of investors, proxy advisors and other
stakeholder groups with the respective specialist divi-
sions allows the Board of Directors to identify trends at
an early stage and to adjust its corporate governance to
new requirements as and when necessary.
Swisscom’s principles and rules on corporate governance
are set out primarily in the company’s Articles of Incorpo-
ration, Organisational Rules and the Rules of Procedure
of the Board of Directors’ committees. Of particular
importance is the Code of Conduct approved by the
Board of Directors. It contains an explicit declaration by
Swisscom of its commitment to absolute integrity as
well as compliance with the law and all other external
and internal rules and regulations. Swisscom expects its
employees to take responsibility for their actions, show
consideration for people, society and the environment,
comply with applicable rules, demonstrate integrity and
report any violations of the Code of Conduct.
The latest versions of these documents as well as their
earlier, unamended and superseded versions can be
viewed online on the Swisscom website under ‘Basic
principles’.
N See www.swisscom.ch/basicprinciples
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The operational Group structure is shown in the organisational chart below.
Our Customers
Residential
Customers
Business
Customers
IT, Network
& Infrastructure
Group Business
Steering
Group Human
Resources
Digital
Business
Fastweb
Group Communications
& Responsibility
Group Strategy
& Board Services
Group Security
CEO Swisscom Ltd
Internal Audit
Group Executive Board
Board of Directors
Organigram Swisscom Ltd
The business activities are carried out by Swisscom
Group companies. Strategic and financial management
is assured through the rules governing the assignment
of powers and responsibilities set by the Board of
Directors of Swisscom Ltd. The Group companies are
divided into three categories: strategic, important and
other. Swisscom Ltd, Swisscom (Switzerland) Ltd and
Fastweb S.p.A. are classified as strategic companies.
The members of the Board of Directors and the manag-
ing directors of the strategic companies are appointed
by the Board of Directors of Swisscom Ltd and elected
via the competent statutory bodies. The Board of
Directors of Swisscom (Switzerland) Ltd comprises the
CEO of Swisscom Ltd as Chairman, the CFO of Swisscom
Ltd and the Head of Business Customers. The CEO of
Swisscom Ltd is responsible for the executive manage-
ment of Swisscom (Switzerland) Ltd. Seats on the Board
of Directors of Fastweb S.p.A. are held by the CEO of
Swisscom Ltd, who acts as Chair, together with the CFO
of Swisscom Ltd, the Head of IT, Network & Infrastruc-
ture as well as one representative of Swisscom’s man-
agement. The Board of Directors is supplemented by an
independent external member and the delegate of the
Board of Directors, who has been empowered with the
executive management of the company. Fastweb con-
trols two subsidiaries. All other Swisscom Group com-
panies are assigned to a Group division or business divi-
sion for management purposes. The members of the
Board of Directors of the other Group companies and
their managing directors are appointed by the CEO of
Swisscom Ltd. In some cases, external parties also
serve as members of the Board of Directors. A list of
Group companies, including company name, registered
office, percentage of shares held and share capital, is
provided in Note 5.4 to the consolidated financial
statements.
D See report pages 161–162
For financial reporting purposes, Swisscom’s business divi-
sions and Group companies are allocated to individual seg-
ments. Further information on segment reporting can be
found in the Management Commentary.
D See report page 44
Listed company
Swisscom Ltd is a company governed by Swiss law and has
its registered office in Ittigen (Canton of Berne, Switzer-
land). It is listed in the Standard for Equity Securities,
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Sub-Standard International Reporting, of the SIX Swiss
Exchange (Securities No.: 874251; ISIN: CH0008742519;
ticker symbol SCMN).
Trading in the United States is conducted over the
counter (OTC) as a Level 1 programme (ticker symbol:
SCMWY;
for ADR:
ISIN: CH008742519; CUSIP
871013108). Within the framework of the programme,
the Bank of New York Mellon Corporation issues the
American Depositary Shares (ADS). ADS are American
securities that represent Swisscom shares. Ten ADS
correspond to one share. The ADS are evidenced by
American Depositary Receipts (ADR).
As at 31 December 2021, the stock market capitalisation
of Swisscom Ltd was CHF 26,657 million. There are no
other listed companies in the Swisscom Group.
2.2 Major shareholders
Pursuant to Article 120 of the Federal Act on Financial
Market Infrastructures and Market Conduct in Securities
and Derivatives Trading (Financial Market Infrastruc-
tures Act; FMIA), there is a duty to disclose a sharehold-
ing to Swisscom Ltd and SIX Swiss Exchange whenever a
person or group subject to the disclosure obligation
reaches, exceeds or falls below 3, 5, 10, 15, 20, 25, 331/3,
50 or 662/3 per cent of the voting rights of Swisscom Ltd,
irrespective of whether or not the voting rights can be
exercised. The detailed disclosure requirements and the
method for calculating these limits are specified in the
Infrastructure Ordinance
FINMA Financial Market
(FMIO-FINMA). Under the FMIO-FINMA, nominee com-
panies which are not able to independently decide how
voting rights are exercised are not required to disclose
when any of their shareholdings reach, exceed or fall
below these limits. As shareholders are only required to
notify the company and SIX Swiss Exchange if their
shareholdings reach, exceed or fall below one of the lim-
its indicated above, the current percentage of shares
actually held by significant shareholders may at any
time differ from the percentage most recently disclosed.
The shareholding notifications can be viewed on the web-
site of the SIX Exchange Regulation at https://www.
six-exchange-regulation.com/en/home/publications/
significant-shareholders.html
In the 2021 reporting year, no shareholdings subject to
Article 120 FMIA were reported to Swisscom. In August
2017, BlackRock, Inc., New York, reported a shareholding
of 3.44% of the voting rights in Swisscom Ltd. According
to the Swisscom share register, Chase Nominees Ltd.,
London, held 4.02% of the voting rights in Swisscom Ltd
on 31 December 2021.
The Swiss federal government (Swiss Confederation), as
majority shareholder, held 50.95% of the issued share
capital of Swisscom Ltd on 31 December 2021, which
was unchanged from the previous year. The Telecommu-
nications Enterprise Act (TEA) provides that the Swiss
Confederation shall hold the majority of the share capi-
tal and voting rights of Swisscom Ltd. The Federal Coun-
cil defines the goals which the Confederation as princi-
pal shareholder of the company aims to achieve in the
next four years. As a rule, stakeholder talks with the
Chairman of the Board, the CEO and government repre-
sentative are conducted three times a year by the
responsible federal government departments – the Fed-
eral Department of the Environment, Transport, Energy
and Communications (DETEC) and the Federal Depart-
ment of Finance (FEF) – led by the Head of DETEC. During
these talks, the participants examine the status of tar-
get achievement. After the close of the business year,
target achievement is assessed by the Federal Council.
N See www.swisscom.ch/ziele_2018-2021
N See www.swisscom.ch/ziele_2022-2025
2.3 Cross-shareholdings
No cross-shareholdings exist between Swisscom Ltd and
other public limited companies.
3 Capital structure
3.1 Capital
The share capital of Swisscom Ltd has remained
unchanged since 2009, totalling CHF 51,801,943. There
is no authorised or conditional share capital. Informa-
tion concerning equity can be found in the financial
statements of Swisscom Ltd.
D See report page 178
3.2 Shares, participation
and profit-sharing certificates
All of the shares issued by Swisscom Ltd are fully paid-up
registered shares with a par value of CHF 1. Each share
entitles the holder to one vote. Shareholders may only
exercise their voting rights, however, if their shares have
been entered with voting rights in the share register of
Swisscom Ltd. All registered shares with the exception of
treasury shares held by Swisscom are eligible for a divi-
dend. There are no preferential rights.
Registered shares of Swisscom Ltd are not issued in certif-
icate form but are held as book-entry securities in the
depositary holdings of SIX SIS AG, up to a maximum limit
determined by the Swiss Confederation. Shareholders
may at any time request confirmation of the registered
shares they hold. However, they have no right to request
the printing and delivery of certificates for their shares
(registered shares with no right to printed certificates).
The holder of an ADR possesses the rights listed in the
Deposit Agreement (e.g. the right to issue instructions
for the exercise of voting rights and the right to divi-
dends). The Bank of New York Mellon Corporation, which
acts as the ADR depositary, is listed as the shareholder in
the share register. ADR holders are therefore unable to
directly enforce or exercise shareholder rights. The Bank
of New York Mellon Corporation exercises the voting
rights in accordance with the instructions it receives
from the ADR holders. If it does not receive instructions,
it does not exercise the voting rights.
Swisscom Ltd has issued neither participation nor prof-
it-sharing certificates.
Further information on the shares is available in Section 7
‘Shareholders’ participation rights’ as well as in the Man-
agement Commentary.
D See report page 88
D See report page 60
3.3 Limitations on transferability
and nominee registrations
Swisscom shares are freely transferable, and the voting
rights of the shares registered in the share register in
accordance with the Articles of Incorporation are not
subject to restrictions of any kind. In accordance with
Article 3.5.1 of the Articles of Incorporation, the Board of
Directors may refuse to recognise an acquirer of shares as
a shareholder if the total holding, when the new shares
are added to any voting shares already registered in its
name, exceeds the limit of 5% of all registered shares
entered in the commercial register. For the shares in
excess of the limit, the acquirer is entered in the share
register as a shareholder or beneficial holder without
voting rights. The other statutory provisions on
restricted transferability are described in Section 7.1 of
this Corporate Governance report, ‘Voting right restric-
tions and proxies’.
N See www.swisscom.ch/basicprinciples
D See report page 88
Swisscom has issued special regulations governing the
registration of trustees and nominees in the share regis-
ter. To facilitate the tradability of the company’s shares
on the stock exchange, the Articles of Incorporation
(Article 3.6) allow the Board of Directors, by means of
regulations or agreements, to permit the fiduciary entry
of registered shares with voting rights for trustees and
nominees in excess of the 5% threshold, provided they
disclose their trustee capacity. In addition, they must be
subject to supervision by a banking or financial market
supervisory authority or otherwise provide the neces-
sary assurance that they are acting for the account of
one or more unrelated parties. They must also be able to
provide evidence of the names, addresses and holdings
of the beneficial owners of the shares. This provision of
the Articles of Incorporation may be changed by resolu-
tion of the Annual General Meeting, for which an abso-
lute majority of valid votes cast is required. In accord-
ance with this provision, the Board of Directors has
issued regulations governing the entry of trustees and
nominees in the Swisscom Ltd share register.
N See www.swisscom.ch/basicprinciples
The entry of trustees and nominees as shareholders
with voting rights is subject to application and the con-
clusion of an agreement by which the trustee or nomi-
nee acknowledges the applicable entry restrictions and
disclosure obligations as binding. Trustees and nominees
related in terms of capital or voting rights either con-
tractually or through common management or other
means are treated as a single shareholder (trustee or
nominee).
3.4 Convertible bonds,
debenture bonds and options
Swisscom has no convertible bonds outstanding. Details
of the debenture bonds are given in Note 2.2 to the con-
solidated financial statements.
D See report pages 124–127
Swisscom does not issue options on registered shares of
Swisscom Ltd to its employees.
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4 Board of Directors
4.1 Members of the Board of Directors
At the Annual General Meeting on 31 March 2021, the
Chairman of the Board of Directors, Hansueli Loosli,
stepped down from the Board of Directors, having served
the maximum permitted twelve-year term of office.
Information about him is available in the 2020 corporate
governance report. The Annual General Meeting elected
Michael Rechsteiner as the new Chairman of the Board of
Directors and Guus Dekkers as a new Board member.
N See www.swisscom.ch/report2020
As of 31 December 2021, the Board of Directors com-
prised the following non-executive members:
Name
Michael Rechsteiner 1
Roland Abt
Alain Carrupt
Guus Dekkers 2
Frank Esser
Barbara Frei
Sandra Lathion-Zweifel
Anna Mossberg
Renzo Simoni 3
Nationality
Switzerland
Switzerland
Switzerland
Netherlands
Germany
Switzerland
Switzerland
Sweden
Switzerland
Year of birth
Function
Taking office at the Annual General Meeting
1963
1957
1955
1965
1958
1970
1976
1972
1961
Chairman
Member
Member, representative of the employees
Member
Deputy Chairman
Member
Member, representative of the employees
Member
2019
2016
2016
2021
2014
2012
2019
2018
Member, representative of the Confederation
2017
1 Since 31 March 2021 Chairman.
2 Elected to the Board of Directors on 31 March 2021.
3 Designated by the Swiss Confederation.
4.2 Education, professional activities
and affiliations
Key details of the career and qualifications of each mem-
ber of the Board of Directors are provided in the sum-
mary below, along with the mandates held outside the
Group and other significant activities. Pursuant to the
Articles of Incorporation, Board members may perform
no more than three additional mandates in listed com-
panies and no more than ten additional mandates in
non-listed companies. In total, they may not perform
more than ten such additional mandates. These restric-
tions on the number of mandates do not apply to man-
dates performed by a Board member by order of
Swisscom or to mandates in interest groups, charitable
associations, institutions and foundations, or employee
retirement-benefit foundations. The number of man-
dates held by order of Swisscom is limited to ten, while
the number of mandates in interest groups, charitable
associations, institutions and foundations, and employee
retirement-benefit foundations is limited to seven. The
Board members are obligated to consult the Chairman
of the Board of Directors prior to accepting new man-
dates and to immediately advise him of any changes in
their professional lives. If the Chairman is concerned, he
shall consult or inform the Deputy Chairman. The Chair-
man or Deputy Chairman, as the case may be, then
informs the Board of Directors about these changes and
potential conflicts of interest. The issue of affiliations is
addressed with the Board of Directors as part of an
annual internal training session that focuses on stock
exchange regulations. Details on the regulation of exter-
nal mandates, in particular the definition of the term
‘mandate’ and information on other mandates that do
not fall under the aforementioned numerical restric-
tions for listed and non-listed companies, are set out in
Article 8.3 of the Articles of Incorporation. One member
of the Board of Directors exceeds the limits set for man-
dates in listed companies during a transitional period of
six months until the mandate is relinquished at the end
of the term of office.
N See www.swisscom.ch/basicprinciples
The members of the Board of Directors are required to
order their personal and business affairs and take what-
ever measures necessary to ensure that conflicts of
interest are avoided as far as possible. Should a conflict
of interest nevertheless arise, the member concerned
must inform the Chairman of the Board of Directors
and/or the Deputy Chairman immediately, for the atten-
tion of the Board of Directors. The members of the Board
of Directors and the Chairman are obliged to abstain
from negotiations in business which conflict with their
own interests or with the interests of natural or legal
persons closely associated with them.
Michael Rechsteiner
Master of Science in Mechanical Engineering,
Zurich Federal Institute of Technology (ETH);
Master of Business Administration,
University of St. Gallen (HSG)
Career history
1990–2000 various roles at ABB Kraftwerke AG, most
recently General Manager of ABB Power Generation
Asia, Kuala Lumpur, Malaysia; 2000–2002 Head of Power
Plants, Vice President Project Execution, Alstom Power;
2003–2007 Chief Operating Officer, Sultex; 2007–2015
various roles at Alstom Power, most recently CEO and
Senior Vice President Power Service; 2015–2017 General
Electric (GE) Officer and Vice President of Global Product
Lines at GE Power Services; April 2017–March 2021 man-
agerial responsibility for GE Power Services Europe and
CEO of GE Gas Power Europe; since April 2021 external
advisor to General Electric (Switzerland) GmbH; since
March 2021 Chairman of the Board of Directors of
Swisscom Ltd
Mandates in non-listed companies
Until March 2021 President of the Executive Board, Gen-
eral Electric (Switzerland) GmbH, Baden, Switzerland;
until January 2021 member of the Supervisory Board, GE
Power Sp. z o.o., Warsaw
Mandates in interest groups, charitable
associations, institutions and foundations,
and employee retirement-benefit foundations
Member of the Board of Trustees of General Electric
Switzerland Pension Fund
Mandates by order of Swisscom
Since September 2021 Member of the Board of Directors
and the Board Committee of economiesuisse
Other significant activities
Until April 2021 Member of the Board of Swissmem
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Roland Abt
Doctorate in Business Administration (Dr. oec.)
University of St. Gallen (HSG)
Alain Carrupt
Swiss school-leaving certificate in economics
Career history
1985–1987 CFO of a group of companies with opera-
tions in the areas of IT and real estate; 1987–1996 Eter-
nit Group (later Nueva Group): 1987–1991 Head of Con-
trolling, 1991–1993 CEO, Industrias Plycem, Venezuela,
1993–1996 Division Manager, Fibre Cement Activities;
1996–2016 Georg Fischer Group: 1996–1997 Chief
Financial Officer (CFO), Georg Fischer Piping Systems,
1997–2004 CFO, Agie Charmilles Group (currently Georg
Fischer Machining Solutions), 2004–2016 CFO, Georg
Fischer AG, and member of the Group Executive Board
Career history
1978–1994 PTT companies, most recently as Head of
Administration at the telecoms directorate in Sion;
1994–2000 PTT Union, Central Secretary of the Tele-
communications sector; 2000–2010 Communications
Union: 2000–2002 Deputy General Secretary and Head
of Personnel, 2003–2008 Vice Chairman, 2008–2010
Chairman; 2011–2016 syndicom Trade Union: 2011–
2013 Joint Chairman, 2013–February 2016 Chairman
Mandates
–
Mandates in listed companies
Member of the Board of Directors of Bystronic AG (for-
merly Conzzeta AG), Zurich
Other significant activities
President of the association Opération Boule à Zéro, Bel-
faux
Mandates in non-listed companies
Mandates for Aargau Verkehr AG (AVA), Aarau: Chairman
of the Board of Directors of Aargau Verkehr AG, Aarau,
Chairman of the Board of Directors of Limmat Bus AG;
other mandates: Chairman of the Board of Directors of
Eisenbergwerk Gonzen AG, Sargans; Member of the
Board of Directors of Raiffeisenbank Zufikon
Mandates in interest groups, charitable
associations, institutions and foundations,
and employee retirement-benefit foundations
President of the Board of Trustees of Fürsorgestiftung
Conzzeta, Zurich
Other significant activities
–
Guus Dekkers
Master’s degree in Computer Science,
Radboud University Nijmegen;
Master of Business Administration,
School of Management Rotterdam
Career history
1990–2001 various functions, mainly in the area of busi-
ness process optimisations, Volkswagen AG, Wolfsburg;
2002–2005 Head of Information Technology Europe &
International and Vice President, Johnson Controls Auto-
motive; 2005–2007 Chief Information Officer and Vice
President, Siemens VDO Automotive AG, Germany;
2008–2016 Chief Information Officer, Airbus Group,
France; since April 2018 Chief Technology Officer, Tesco
PLC, London
Frank Esser
Graduate in Business Administration,
Doctorate in Economics (Dr. rer. pol.)
Career history
1988–2000 Mannesmann Deutschland, most recently
from 1996 member of the Executive Board of Mannes-
mann Eurokom; 2000–2012 Société Française du Radi-
otéléphone (SFR): 2000–2002 Chief Operating Officer
(COO), 2002–2012 CEO, in this function from 2005–2012
also a member of the Group Executive Board of the Viv-
endi Group
Mandates in listed companies
Chairman of the Board of Directors of SES S.A., Luxem-
bourg
Mandates
–
Other significant activities
–
Other significant activities
Member of the Advisory Board of the Fraunhofer Insti-
tute for Secure Information Technology, Darmstadt;
Member of the Advisory Board of the National Research
Center for Cybersecurity, Darmstadt
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Barbara Frei
Degree in Mechanical Engineering, ETH;
Doctorate (Dr. sc. techn.), ETH Zurich;
Master of Business Administration, IMD Lausanne
Sandra Lathion-Zweifel
Degree in Law, attorney-at-law;
Master of Laws from the University of Zurich
and Columbia University, New York;
trader’s licence from SIX Swiss Exchange
Career history
1998–2016 ABB Group in various managerial positions,
including 2008–2010 ABB s.r.o., Prague, Country Man-
ager; 2010–2013 ABB S.p.A., Sesto San Giovanni (Italy),
Country Manager and Regional Manager Mediterra-
nean; 2013–2015 Drives and Control Unit, Managing
Director; 2016 Head of Strategic Portfolio Reviews for
the Power Grids division; since December 2016 Schneider
Electric, Paris: Chair of the Executive Committee of
Schneider Electric GmbH, Germany, in which capacity
she was also Zone President Germany until June 2017;
July 2017–December 2018 Zone President Germany,
Austria and Switzerland, January 2019–April 2021 Exec-
utive Vice President Europe Operations, since May 2021
Executive Vice President Industrial Automation
Mandates in listed companies
Member of the Board of Directors, Swiss Prime Site, Olten
Mandates in non-listed companies
Mandates for Schneider Electric Group: until July 2021
Chairman of the Board of Directors of Schneider Nordic
Baltic A/S; until July 2021 Member of the Board of Direc-
tors of Schneider Electric Industries SAS, Rueil Malmaison
Other significant activities
–
Career history
2005–2010 attorney-at-law for Mergers & Acquisitions,
Lenz & Staehelin law firm, Zurich; 2010–2014 Head of
Financial Products, Legal & Compliance, Credit Suisse
AG, Zurich; 2014–2018 Head of department in the Asset
Management division of the Swiss Financial Market
Supervisory Authority (FINMA); 2018–2019 counsel for
Banking & Finance, Lenz & Staehelin law firm, Geneva
Mandates in listed companies
Until December 2021 Member of the Board of Directors,
Banque Cantonale du Valais, Sion
Mandates in non-listed companies
Since December 2021 Member of the Board of Directors
of the Raiffeisen Switzerland cooperative, St. Gallen
Other significant activities
Member of the Advisory Board of the Capital Markets
and Technology Association, Geneva; since March 2021
Member of the Executive Board of swissVR, Rotkreuz
Anna Mossberg
Executive MBA for Growing Companies,
Stanford Business School, Palo Alto, USA;
Master of Science in Industrial Engineering
and Management, Luleå University of Technology
Career history
1996–2010 Telia: in various roles, including Vice Presi-
dent and Head of Business & Product Management,
Head of Internet, Consumer Segment, Director Data Ser-
vices, Product & Services; 2010 Bahnhof AB, CEO; 2011
Stanley Securities AB, Senior Advisor; 2012–2014
Deutsche Telekom, Senior Vice President Strategy and
Portfolio Management; 2015–March 2018 Google Ltd,
Sweden, member of the Management Team; March 2021
to February 2022 Managing Director Silo AI, Sweden
Mandates in listed companies
Member of the Board of Directors, Swedbank AB, Stock-
holm; until April 2022 member of the Board of Directors,
Schibsted ASA, Oslo; member of the Board of Directors,
Orkla ASA, Oslo; since July 2021 member of the Board of
Directors, Byggfakta AB, Stockholm (listed since 15 Octo-
ber 2021)
Other significant activities
–
Renzo Simoni
Doctorate in Mechanical Engineering (Dr. sc. techn.),
Zurich Federal Institute of Technology (ETH)
Career history
1985–1989 technical assistant in Civil Engineering and
Building Construction, Gruner Group; 1989–1995 scien-
tific assistant, Federal Institute of Technology in Zurich
(ETH Zurich); 1995–1998 lecturer (part-time), ETH Zurich;
1995–2002 Civil Engineering Developer Consulting Ser-
vices, Ernst Basler + Partner AG; 2002–2006 member of
the Management Board, most recently as Co-CEO, Hel-
bling Beratung + Bauplanung AG; 2007–2017 Chairman
of the Management Board, AlpTransit Gotthard AG
Mandates in non-listed companies
Member of the Board of Directors, Gruner AG, Basel;
member of the Board of Directors, Rhätische Bahn AG,
Chur; Chairman of the Board of the Psychiatric Hospital
of the University of Zurich; Chairman of Verkehrsbe-
triebe Luzern AG, Lucerne
Other significant activities
–
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4.3 Composition of the Board of Directors
The Board of Directors regularly examines its composi-
tion and plans the appointments to the committee posi-
tions on an annual basis. The members of the Board of
Directors possess comprehensive expertise in relevant
areas and broad experience.
The following diagrams show breakdowns of the Board
of Directors by competency, term of office and gender.
Board of Directors by career,
experience, skills and knowledge
In % and (number of members) as of 31 December 2021
Telecommunications, IT,
Media and/or entertain-
ment
Innovation, technology
and/or digitisation
Residential Customers
(B2C)
Business Customers
(B2B)
International
business experience
33%
(3)
56%
(5)
33%
(3)
78%
(7)
67%
(6)
Finance, Risk Management
and/or M&A
89%
(8)
Strategy and/or Transfor-
mation
Human Resources
Legal
Sustainability
Leadership position in
top management
Member of the Board
of Directors in stock ex-
change listed companies
89%
(8)
89%
(8)
11%
(1)
44%
(4)
89%
(8)
55%
(5)
Sector
Specialization
Role
Board of Directors by length
of term of office
In % and (number of members) as of 31 December 2021
44%
(4)
44%
(4)
under
4 years
4
to 7 years
8
to 12 years
11%
(1)
Board of Directors by gender
In % and (number of members) as of 31 December 2021
67%
(6)
33%
(3)
Male
Female
The Board of Directors of Swisscom Ltd thus already
complies with the requirements of Swiss company law
regarding gender representation on the boards of direc-
tors of listed companies.
4.4 Independence
To establish the independence of its members, the Board
of Directors applies the criteria set out in the Swiss Code
of Best Practice for Corporate Governance published by
economiesuisse. Independent members are thus under-
stood to mean non-executive members of the Board of
Directors who were never a member of the executive
management or who have not been a member of the
executive management for at least three years and who
have no or only comparatively minor business relations
with the company. The term of office of a member of the
Board of Directors is not a criterion that can be used to
assess independence. No members of the Board of Direc-
tors hold an executive role within the Swisscom Group or
have held such a role in any of the three business years
prior to the reporting year. The Board members have no
significant commercial links with Swisscom Ltd or the
Swisscom Group. The Swiss Confederation, represented
on the Board by Renzo Simoni, holds the majority of the
capital and voting rights in Swisscom in accordance with
the Telecommunications Enterprise Act (TEA). Customer
and supplier relationships exist between the Swiss Con-
federation and Swisscom. Details of these are provided in
Note 6.2 to the consolidated financial statements.
D See report page 166
4.5 Election and term of office
Under the terms of the Articles of Incorporation, the
Board of Directors comprises between seven and nine
members and, if necessary, the number can be increased
temporarily. Under the Articles of Incorporation of
Swisscom Ltd, the Swiss Confederation is entitled to
appoint two representatives to the Board of Directors of
Swisscom Ltd. At present, one representative
is
appointed. Under the terms of the TEA, employees must
be granted appropriate representation on the Board of
Directors of Swisscom Ltd. The Articles of Incorporation
also stipulate that the Board of Directors is to include
two employee representatives and that employees are
entitled to make proposals for their employee repre-
sentatives. Alain Carrupt was nominated as employee
representative by the syndicom trade union and Sandra
Lathion-Zweifel was nominated as employee represent-
ative by the transfair staff association. The employee
representatives are elected by the shareholders at the
Annual General Meeting upon a motion proposed by the
Board of Directors, as are the other members of the
Board of Directors with the exception of the representa-
tive of the Swiss Confederation, who is appointed by the
Federal Council.
The Annual General Meeting elects the members and
the Chairman of the Board of Directors as well as the
members of the Compensation Committee individually
for a term of one year. The term of office runs until the
conclusion of the following Annual General Meeting.
Re-election is permitted. If the office of the Chairman is
vacant or the number of members of the Compensation
Committee falls below the minimum number of three
members, the Board of Directors nominates a chairman
from among its members or appoints the missing mem-
ber(s) of the Compensation Committee to serve until the
conclusion of the next Annual General Meeting. Other-
wise, the Board of Directors constitutes itself. The maxi-
mum term of office for members elected by the Annual
General Meeting, as a rule, is a total of twelve years. This
flexible arrangement makes it possible for shareholders
to extend the maximum term of office in exceptional
cases if special circumstances exist. Members who reach
the age of 70 retire from the Board as of the date of the
next Annual General Meeting. The maximum term of
office and age limit for the representative of the Swiss
Confederation are determined by the Federal Council.
4.6 Succession planning
The Board of Directors regularly examines whether its
members’ qualifications, abilities and experience are
still aligned with the Board’s needs and requirements.
The Board commences the evaluation of potential new
members early on so as to ensure that it has access to
the expertise it requires, is well-diversified and can nom-
inate new members as needed in the future. As a guide
for the ad-hoc Nomination Committee, the Board of
Directors formulates a requirements profile specifying
the qualifications, skills and experience that are desired.
On the basis of this, the Nomination Committee evalu-
ates potential candidates and makes recommendations
to the Board of Directors for the election of new Board
members by the Annual General Meeting. The Board of
Directors submits a motion to the Annual General Meet-
ing regarding the approval of new Board members.
4.7 Ongoing development
and continuing education
The Board of Directors attaches great importance to the
ongoing development and continuing education of the
Board and its individual members. The Board of Directors
and its individual committees generally assess their own
performance and efficiency once a year in December or
January on the basis of a survey sent out in advance. This
self-evaluation asks them to assess both the work of the
respective body as well as the performance of the Board or
Committee Chairman. The evaluation additionally covers
the composition, organisation and work processes of the
body, responsibilities under the Organisational Rules and
the priorities and goals for the reporting year. The Board of
Directors and the Committees meet to discuss the results
of the survey and formulate goals and measures for the fol-
lowing/current year. The Chairman also conducts a one-on-
one annual discussion with each member in which possibil-
ities for further individual development are addressed.
Once a year, a one-day mandatory training course is
held, most recently in January 2021 and 2022. At least
four times per year, the members of the Board of Direc-
tors also have the opportunity to explore in depth the
upcoming challenges facing the Group and business
divisions as well as the subsidiaries as part of ‘company
experience days’. The majority of the Board members
regularly take advantage of these opportunities. In addi-
tion, all the members of the Board of Directors attend
the Swisscom Group’s annual management meeting
whenever possible. New Board members are given a
task-specific introduction to their duties. At a one-day
introduction, they are provided with an overview of
Group management, the business and the current oper-
ational challenges. In addition, they are introduced to
topics related to the Italian subsidiary Fastweb S.p.A.
and attend task-related training courses.
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4.8 Chairman of the Board of Directors
Hansueli Loosli stepped down as Chairman on 31 March
2021 after reaching the twelve-year term limit. The
Annual General Meeting selected Michael Rechsteiner
as his successor. The tasks and responsibilities of the
Chairman are defined in the Organisational Rules. In the
event that the Chairman of the Board of Directors is una-
vailable or there is a potential conflict of interest, the
Vice-Chairman, Frank Esser, takes over the Chairman’s
tasks and responsibilities.
N See www.swisscom.ch/basicprinciples
4.9 Internal organisation and modus operandi
The Board of Directors is responsible for the strategic
and financial management of Swisscom and for moni-
toring the company’s executive management. As the
supreme governing body of the company, it has deci-
sion-making authority unless such authority is granted
to the Annual General Meeting by virtue of law.
The Board of Directors is usually convened once per
month by the Chairman (except in July and November)
for a one-to-two-day meeting. Further meetings are
convened as business requires (ad-hoc meetings). In the
event that the Chairman is hindered, the meeting is con-
vened by the Vice-Chairman. The Chairman sets the
agenda. Any Board member may request the inclusion of
further items on the agenda. The Board members receive
the agenda and supporting documentation approxi-
mately ten days prior to the meetings, so that they can
Total
Average duration (in hours)
Participation:
Michael Rechsteiner, Chairman 1
Hansueli Loosli, Chairman 2
Roland Abt
Alain Carrupt
Guus Dekkers 3
Frank Esser, Deputy Chairman
Barbara Frei
Sandra Lathion-Zweifel
Anna Mossberg
Renzo Simoni
prepare. The CEO, the CFO and the Head of Group Strat-
egy & Board Services always attend the Board meetings
as well. At every Board meeting, the Chairman of the
Board, the CEO and the Chief Personnel Officer report on
particular events, on the general course of business and
major business transactions, as well as on any measures
that have been implemented. To further ensure appro-
priate reporting to the members of the Board, the Board
of Directors invites members of the Group Executive
Board and senior employees of Swisscom as well as audi-
tors and other internal and external experts, as neces-
sary, to all its meetings as dictated by the specific issues
being addressed. Furthermore, as a result of the network
outages experienced in July 2021, the CEO, in consulta-
tion with the Board of Directors, commissioned an
external follow-up audit on the audits related to last
year’s network faults.
The duties, responsibilities and modus operandi of the
Board of Directors and its conduct with respect to con-
flicts of interest are defined in the Organisational Rules
and in the rules governing the standing committees.
N See www.swisscom.ch/basicprinciples
The following table gives an overview of the Board of
Directors’ meetings and circular resolutions in 2021. The
Board of Directors held individual meetings via videocon-
ference due to the measures implemented by the author-
ities as a result of the Covid-19 pandemic. Members were
connected to individual meetings via videoconference.
Meeting days
Ad-hoc meetings
Circular resolutions
13
07:21
2
02:10
13
3
13
13
10
13
13
13
12
13
2
2
2
2
2
2
2
2
2
2
1
–
1
1
1
1
1
1
1
1
1
1
1 Since 31 March 2021 Chairman.
2 Left the Board of Directors on 31 March 2021.
3 Elected to the Board of Directors on 31 March 2021.
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4.10 Committees of the Board of Directors
The Board of Directors has delegated individual tasks to
committees. The standing committees of the Board of
Directors of Swisscom Ltd were constituted as follows as
at 31 December 2021:
Board of Directors
Audit & ESG
Reporting Committee 1
Roland Abt 2
Sandra Lathion-Zweifel
Renzo Simoni
Michael Rechsteiner
Compensation Committee
Barbara Frei 2
Roland Abt
Frank Esser
Renzo Simoni
Michael Rechsteiner 3
Finance Committee
Frank Esser 2
Alain Carrupt
Guus Dekkers
Anna Mossberg
Michael Rechsteiner
1 Called Audit Committee by the end of 2021
2 Chairman/chairwoman of the Board of Directors committee
3 No voting rights
The Board of Directors has three standing committees
(Finance, Audit & ESG Reporting and Compensation) and
one ad-hoc committee (Nomination) tasked with carry-
ing out detailed examinations of matters of importance.
In accordance with the rules governing the committees,
they usually each consist of three to six members. As a
rule, each member of the Board of Directors sits on at
least one of the standing committees. Subject to being
appointed to the Compensation Committee (without
voting rights), the Chairman of the Board of Directors is
a member of all the standing committees. The standing
committees are chaired by other members, however.
The chairs of the committees report verbally on the lat-
est committee meetings at the next meeting of the
Board of Directors. All members of the Board of Direc-
tors also receive copies of all meeting minutes from the
Finance Committee and the Audit & ESG Reporting
Committee. The minutes of the Compensation Commit-
tee and the Nomination Committee are provided to the
other members of the Board of Directors upon request.
Finance Committee
The Finance Committee prepares information for the
Board of Directors on corporate transactions, for exam-
ple, in connection with setting up or dissolving signifi-
cant Group companies, acquiring or disposing of signifi-
cant shareholdings, and entering into or terminating
strategic alliances. The Committee also acts in an advi-
sory capacity on matters relating to major investments
and divestments and examines specific current issues in
depth. The Finance Committee has the ultimate deci-
sion-making authority when it comes to issuing rules of
procedure and directives in the areas of Mergers &
Acquisitions and Corporate Venturing. Details of the
Committee’s activities and responsibilities are set out in
the Finance Committee rules of procedure.
N See www.swisscom.ch/basicprinciples
The Finance Committee is convened by the Chairman or
at the request of a Committee member as often as busi-
ness requires, but as a rule once per quarter within the
framework of a half-day meeting. The CEO, the CFO and
the Head of Group Strategy & Board Services always
attend the meetings of the Finance Committee. In 2021,
all the meetings were also attended by other members
of the Group Executive Board, members of the Manage-
ment Boards of strategic Group companies or project
managers, depending on the agenda items. The Finance
Committee did not call on any external consultants dur-
ing the reporting year.
79
The following table gives an overview of the Finance
Committee’s meetings and circular resolutions in 2021.
The Committee held individual meetings via videocon-
ference due to the measures implemented by the
authorities as a result of the Covid-19 pandemic. Mem-
bers were connected to individual meetings via video-
conference.
Meetings
Ad-hoc meetings
Circular resolutions
Total
Average duration (in hours)
Participation:
Frank Esser, Chairman
Alain Carrupt
Guus Dekkers 1, 2
Anna Mossberg
Michael Rechsteiner
Hansueli Loosli 3
5
03:40
5
5
4
5
5
1
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1 Elected to the Board of Directors on 31 March 2021.
2 Since 31 March 2021 member of the Committee.
3 Left the Board of Directors on 31 March 2021.
Audit & ESG Reporting Committee
The Audit & ESG Reporting Committee handles all busi-
ness relating to financial management (for example,
accounting, financial controlling, financial planning, tax
strategy and financing), assurance (risk management, the
internal control system, compliance and internal audit),
data protection and security as well as external audit. It
also handles matters dealt with by the Board of Directors
that call for specific financial expertise (dividend policy, for
example). In 2021, the Committee also addressed the topic
of ESG (environment, social and governance) reporting in
detail. The Committee is the Board of Directors’ most
important controlling instrument and is responsible for
monitoring the Group-wide assurance functions. It formu-
lates positions on business matters which lie within the
decision-making authority of the Board of Directors and
has the final say on those business matters for which it has
the decision-making authority. Details of the Committee’s
activities and responsibilities are set out in the rules of pro-
cedure of the Audit & ESG Reporting Committee.
N See www.swisscom.ch/basicprinciples
The Audit & ESG Reporting Committee is composed of
four independent members. The Chairman of the Com-
mittee is an expert in the financial field, and the major-
ity of the members are experienced in finance and
accounting. The Audit & ESG Reporting Committee is
convened by the Chairman or at the request of a Com-
mittee member as often as business requires, but at
least once per quarter and one additional time in
December. The meetings usually last between three
and six hours. The CEO, CFO, Head of Group Strategy &
Board Services, Head of Accounting, Head of Internal
Audit and the external auditors always attend the
meetings. In 2021, the Board of Directors called upon
other members of the Group Executive Board and
Swisscom management to attend, depending on the
agenda. The Audit & ESG Reporting Committee can
also involve independent third parties such as lawyers,
public accountants and tax experts as required. The
Committee invited external consultants to one of its
meetings during the reporting year.
The Chairman of the Audit & ESG Reporting Committee
also liaises closely with the Heads of Internal Audit and
Accounting and the representatives of Swisscom’s
external auditors outside of the meetings. He and indi-
vidual members of the Committee also meet with the
persons responsible for Fastweb’s internal and external
audits once a year to discuss the current challenges fac-
ing Fastweb.
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The following table gives an overview of the Audit &
ESG Reporting Committee’s meetings and circular reso-
lutions in 2021. The Committee held one meeting via
videoconference due to the measures implemented by
the authorities as a result of the Covid-19 pandemic.
Members were connected to one meeting via video-
conference.
Total
Average duration (in hours)
Participation:
Roland Abt, Chairman 1
Sandra Lathion-Zweifel
Renzo Simoni
Michael Rechsteiner 2
Hansueli Loosli 1, 3
Meetings
Ad-hoc meetings
Circular resolutions
6
04:25
6
6
6
5
1
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1 Financial expert.
2 Since 31 March 2021 member of the Committee.
3 Left the Board of Directors on 31 March 2021.
Compensation Committee
For information on the Compensation Committee, refer
to the section ‘Remuneration Report’.
D See report page 93
Nomination Committee
The Nomination Committee is formed on an ad-hoc
basis for the purpose of preparing the groundwork for
electing new members to the Board of Directors and
the Group Executive Board when needed. The Commit-
tee is presided over by the Chairman of the Board of
Directors and its composition is determined on a case-
by-case basis. The Committee carries out its work
based on a specific requirements profile defined by the
Board of Directors outlining the qualifications and
experience sought. It then presents suitable candi-
dates to the Board of Directors, but has no further deci-
sion-making authority. The Board of Directors appoints
the members of the Group Executive Board and decides
upon the motion to be proposed to the Annual General
Meeting for the election and approval of members of
the Board of Directors. The Nomination Committee is
convened by the Chairman or at the request of a Com-
mittee member as often as business requires. In the
2021 financial year, a Nomination Committee consist-
ing of Michael Rechsteiner (Chairman), Frank Esser, Bar-
bara Frei and Anna Mossberg held four meetings. The
average duration of the meetings was 1 hour and 45
minutes. All members participated.
Amendment as at 1 January 2022
The Board of Directors revised the corporate responsibility
governance in 2021. From 2022 onward, the Board of Direc-
tors will assume overall responsibility for ESG issues (envi-
ronmental, social, governance), approve the sustainability
strategy as part of the corporate strategy and monitor
compliance with it. The Audit & ESG Reporting Committee
is assigned a key role in the area of sustainability reporting.
Accordingly, the Audit Committee has been renamed ‘Audit
& ESG Reporting Committee’ as of January 2022. The new
ESG governance is described in the Sustainability Report.
N See www.swisscom.ch/cr-report2021
4.11 Assignment of powers of authority
The Telecommunications Enterprise Act (TEA) refers to
the Swiss Code of Obligations regarding the non-trans-
ferable and irrevocable duties of the Board of Directors
of Swisscom Ltd. Pursuant to Article 716a of the Code of
Obligations, the Board of Directors is responsible for the
overall management and supervision of persons
entrusted with managing the company’s operations. It
decides on the appointment and removal of members of
the Group Executive Board. The Board of Directors also
sets the strategic, organisational, financial planning and
accounting guidelines, including the tax strategy, taking
into account the goals that the Swiss Confederation, as
majority shareholder, aims to achieve. The Federal Coun-
cil formulates these goals for a four-year period in
accordance with the provisions of the TEA.
N See www.swisscom.ch/ziele_2018-2021
N See www.swisscom.ch/ziele_2022-2025
The Board of Directors has delegated day-to-day busi-
ness management to the CEO in accordance with the
TEA and the Articles of Incorporation. In addition to the
duties reserved for it under the law, the Board of Direc-
tors decides on business transactions of major impor-
tance to the Group, including, for example, the acquisi-
tion or disposal of companies with a financial exposure
in excess of CHF 20 million and capital investments or
divestments thereof with a financial exposure in excess
of CHF 50 million. The division of powers between the
Board of Directors and the CEO is set out in detail in the
Organisational Rules and in Annex 2 to the Organisa-
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tional Rules, ‘Rules of Procedure and Accountability’ (see
function diagram).
N See www.swisscom.ch/basicprinciples
4.12 Information and controlling
instruments of the Board of Directors
vis-à-vis the Group Executive Board
The Board of Directors is briefed comprehensively so it
can fulfil its tasks and responsibilities. The Chairman of
the Board of Directors and the CEO discuss fundamental
issues concerning Swisscom Ltd and its Group compa-
nies at least once a month. The Chairman also meets in
person with each member of the Group Executive Board
as well as the heads of other Group and business divi-
sions at least once a year for an in-depth discussion of
topical issues.
The CEO also provides the Board of Directors at every
ordinary meeting with detailed information on the
course of business, major projects and events, and any
measures adopted. Every month, the Board of Directors
receives a report containing all key performance indica-
tors relating to the Group and the segments. In addition,
the Board of Directors receives a quarterly report on the
course of business, financial position, results of opera-
tions and risk position of the Group and the segments. It
also receives projections for operational and financial
developments for the current financial year. The man-
agement reporting is carried out in accordance with the
same financial statement reporting policies as for exter-
nal financial reporting. It also includes key non-financial
information that is important for controlling and steer-
ing purposes. The Board of Directors is informed in writ-
ing about other current or material issues on an ongoing
and timely basis. Every member of the Board of Direc-
tors is entitled to request information on all matters
relating to the Group at any time, provided this does not
conflict with the provisions regarding the reclusion of a
member from Board deliberations or confidentiality
obligations. The Board of Directors is informed immedi-
ately of any events of an exceptional nature.
The Board of Directors is responsible for establishing
and monitoring the Group wide assurance functions of
risk management, internal control system, compliance
and internal audit and is briefed comprehensively on
these matters at least once a year.
Risk management
The Board of Directors has set the objective of protect-
ing the company’s enterprise value through the imple-
mentation of Group-wide risk management. A corpo-
rate culture that promotes the conscious handling of
risks facilitates the achievement of this objective.
Accordingly, Swisscom has implemented a Group-wide,
central risk management system that is based on ISO
Standard 31000 and takes account of both external and
internal events. Swisscom engages in level-appropriate,
comprehensive reporting and maintains the appropriate
documentation. Its objective is to identify, assess and
address significant risks and opportunities in good time.
To this end, the central Risk Management unit, which
reports to both the CFO and Controlling, works closely
with the Controlling and Strategy departments and
other assurance functions and line functions. The risk
management system is examined periodically by an
external auditor. Swisscom assesses its risks in terms of
the probability that they will occur and their quantita-
tive and qualitative effects in the event that they do
occur. It manages risks on the basis of a risk strategy. The
risks are evaluated in terms of their impact on key per-
formance indicators. Swisscom reviews and updates its
risk profile on a quarterly basis. The Audit & ESG Report-
ing Committee and the Group Executive Board are pro-
vided with a report on risks every quarter. The Board of
Directors and the Audit & ESG Reporting Committee are
provided with in-depth information in April and Decem-
ber on significant risks, their potential effects and the
status of remedial measures. In urgent cases, the Chair-
man of the Audit & ESG Reporting Committee is
informed without delay about any significant new risks.
The risk factors are described in the Risks section of the
Management Commentary.
D See report page 62
Internal control system and financial reporting
The internal control system (ICS) ensures the reliability of
financial reporting with an appropriate degree of assur-
ance. It acts to prevent, uncover and correct substantial
errors in the consolidated financial statements, the
financial statements of the Group companies and the
remuneration report. The ICS encompasses the follow-
ing internal control components: control environment,
assessment of accounting risks, control activities, moni-
toring controls, information and communication. The
Accounting unit, which reports to the CFO, manages and
monitors the ICS. Internal Audit periodically reviews the
functioning and effectiveness of the ICS. Significant
shortcomings in the ICS identified during these monitor-
ing and review activities are reported together with the
corrective measures in a status report to the Audit &
ESG Reporting Committee twice a year and to the Board
of Directors on an annual basis. Should the ICS risk
assessment change significantly, the Chairman of the
Audit & ESG Reporting Committee is informed without
delay. Corrective measures to remedy the shortcomings
are monitored by the Accounting unit. The Audit & ESG
Reporting Committee assesses the performance and
effectiveness of the ICS on the basis of the periodic
reporting.
Compliance management
The Board of Directors has set the objective of safe-
guarding the Swisscom Group and its executive bodies
and employees from legal sanctions, financial losses and
reputational damage by ensuring Group-wide compli-
ance. A corporate culture that promotes willingness to
behave in a way that complies with the relevant regula-
tions is intended to help achieve this objective. The
applicable principles are laid down in the Code of Con-
duct approved by the Board of Directors. Swisscom has
therefore implemented a Group-wide, central compli-
ance system. Within the framework of this system, every
year Group Compliance applies a risk-based approach to
identify areas of legal compliance that require monitor-
ing by the central system. Within these areas of legal
compliance, the business activities of the Group compa-
nies are reviewed periodically in a proactive manner in
order to identify risks in good time and determine the
required corrective measures. The employees affected
are informed of the measures and their implementation
is monitored. The decentralised Compliance functions
independently monitor legal compliance in the areas for
which they are responsible and report their findings to
Group Compliance. Once every year, Group Compliance
reviews the appropriateness and effectiveness of the
system. In certain areas, an annual audit of the imple-
mented measures is also performed by external audi-
tors (financial intermediation in accordance with the
Money Laundering Act). Group Compliance reports to
the Audit & ESG Reporting Committee and the Board of
Directors once per annum on its activities and its risk
assessments. Should there be significant changes in the
risk assessment or if serious breaches are identified, the
Chairman of the Audit & ESG Reporting Committee is
informed without delay.
N See www.swisscom.ch/basicprinciples
Internal auditing
Internal auditing is carried out by the Internal Audit unit.
Internal Audit supports the Swisscom Ltd Board of Direc-
tors and its Audit & ESG Reporting Committee in fulfill-
ing their statutory and regulatory supervisory and con-
Internal Audit also supports
trolling obligations.
management by highlighting areas of potential for
improving business processes and the assurance func-
tions. It documents the audit findings and monitors the
implementation of measures.
Internal Audit is responsible for planning and perform-
ing audits throughout the Group in compliance with
professional auditing standards and possesses maxi-
mum independence. It is under the direct control of the
Chairman of the Board of Directors and provides reports
to the Audit & ESG Reporting Committee. At an adminis-
trative level, Internal Audit provides reports to the Head
of Group Strategy & Board Services.
Internal Audit liaises closely and exchanges information
with the external auditors. The external auditors have
unrestricted access to the audit reports and audit files of
Internal Audit. Based on a risk analysis and in close coor-
dination with the external auditors, Internal Audit pre-
pares the integrated strategic audit plan annually and
presents it to the Audit & ESG Reporting Committee for
approval. Notwithstanding the above, the Audit & ESG
Reporting Committee can commission special audits,
also based on information received on the whistle-blow-
ing platform operated by Internal Audit. This reporting
procedure, which has been approved by the Audit & ESG
Reporting Committee, allows complaints relating to
external reporting and financial reporting, among other
things, to be submitted anonymously to Internal Audit,
which in turn ensures that these will be followed up. At
its meetings, which are held at least quarterly, the Audit
& ESG Reporting Committee is briefed on audit findings,
the reports submitted to the whistle-blowing platform
and the status of any corrective measures implemented.
The Head of Internal Audit took part in all six meetings of
the Audit & ESG Reporting Committee in 2021. He
reported on audit findings at one meeting of the full
Board of Directors.
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5 Group Executive Board
5.1 Members of the Group Executive Board
In accordance with the Articles of Incorporation, the
Executive Board comprises one or more members, who
must not be members of the Board of Directors of
Swisscom Ltd at the same time. Temporary exceptions
are only permitted in exceptional cases. The Board of
Directors has delegated responsibility for the overall
executive management of Swisscom Ltd to the CEO. The
CEO is entitled to delegate his powers to subordinates,
mainly to other members of the Group Executive Board.
The members of the Group Executive Board are
appointed by the Board of Directors. The Board of Direc-
tors has appointed Klementina Pejic as Head of Human
Resources (CPO) and member of the Group Executive
Board with effect from 1 February 2021. She succeeds
Hans Werner, who stepped down with effect from
31 January 2021. The Board of Directors has appointed
Eugen Stermetz as Chief Financial Officer (CFO), Head of
Group Business Steering and member of the Group Exec-
utive Board with effect from 1 March 2021. The current
CFO, Mario Rossi, relinquished his position on 28 Febru-
ary 2021. Further information regarding Hans Werner
and Mario Rossi can be found in the 2020 Corporate
Governance Report.
N See www.swisscom.ch/report2020
D See report page 66
An overview of the composition of the Group Executive
Board as at 31 December 2021 is given in the table below.
Name
Urs Schaeppi 1
Eugen Stermetz
Klementina Pejc
Urs Lehner
Christoph Aeschlimann
Dirk Wierzbitzki
1 Since November 2013 CEO.
Nationality
Switzerland
Austria
Germany
Switzerland
Switzerland
Germany
Year of birth
Function
1960
1972
1974
1968
1977
1965
CEO Swisscom Ltd
CFO Swisscom Ltd
CPO Swisscom Ltd
Appointed to the Group
Executive Board as of
March 2006
March 2021
February 2021
Head of Business Customers
June 2017
Head of IT, Network & Infrastructure February 2019
Head of Residential Customers
January 2016
5.2 Education, professional activities
and affiliations
Key details of the careers and qualifications of the mem-
bers of the Group Executive Board are provided below
along with a summary of the mandates they hold out-
side the Group and other significant activities. Pursuant
to the Articles of Incorporation, the Group Executive
Board members may perform no more than one addi-
tional mandate in listed companies and no more than
two additional mandates in non-listed companies. In
total, they may not perform more than two such addi-
tional mandates. These restrictions on the number of
mandates do not apply to mandates performed by an
Executive Board member by order of Swisscom or to
mandates in interest groups, charitable associations,
institutions and foundations or employee retire-
ment-benefit foundations. The number of mandates
held by order of Swisscom is limited to ten, while the
number of mandates in interest groups, charitable asso-
ciations, institutions and foundations, and employee
retirement-benefit foundations is limited to seven. Prior
to accepting new mandates and other duties outside the
Swisscom Group, the members of the Group Executive
Board are obligated to obtain the approval of the Chair-
man of the Board of Directors. Details on the regulation
of external mandates, in particular the definition of the
term ‘mandate’ and information on other mandates
that do not fall under the aforementioned numerical
restrictions for listed and non-listed companies, are set
out in Article 8.3 of the Articles of Incorporation. None of
the members of the Group Executive Board exceeds the
set limits for mandates. The members of the Group
Executive Board perform most of their other significant
activities by order of Swisscom.
N See www.swisscom.ch/basicprinciples
The members of the Group Executive Board are required
to order their personal and business affairs and take
whatever measures are necessary to ensure that con-
flicts of interest are avoided as far as possible. Should a
conflict of interest nevertheless arise, the member con-
cerned must inform the CEO and/or Chairman immedi-
ately. The members of the Group Executive Board are
obliged to abstain from negotiations in business which
conflict with their own interests or with the interests of
natural or legal persons closely associated with them.
Urs Schaeppi
Degree in Engineering (Dipl. Ing., Zurich
Federal Institute of Technology (ETH))
and Business Administration
(lic. oec., University of St. Gallen (HSG))
Career history
Career history 1994–1998 plant manager, Biberist paper
factory; 1998–2006 Head of Commercial Business,
Swisscom Mobile; 2006–2007 CEO, Swisscom Solutions
Ltd; 2007–August 2013 Head of Enterprise Customers,
Swisscom (Switzerland) Ltd; since January 2013 Head of
Swisscom (Switzerland) Ltd; 23 July–6 November 2013
acting CEO, Swisscom Ltd, since 7 November 2013 CEO
and since March 2006 member of the Swisscom Group
Executive Board
Mandates by order of Swisscom
Member of the Executive Board, Association Suisse des
Télécommunications (asut), Berne; member of the Founda-
tion Board, International Institute for Management
Development (IMD), Lausanne; member of the Board of
Trustees of the Swiss Entrepreneurs Foundation
Other significant activities
Member of the Board of Directors, Swiss-American Cham-
ber of Commerce, Zurich; member of the Executive Board,
Glasfasernetz Schweiz, Berne; member of the Advisory
Board of the Department of Economics of the University
of Zurich; member of the Steering Committee of digital-
switzerland, Zurich (formerly Digital Zurich 2025); mem-
ber of the international Advisory Committee of the ZHAW
School of Management and Law, Winterthur
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Eugen Stermetz
Degree in Business Administration (lic. oec.),
University of St. Gallen; PhD in Social
and Economic Sciences (Dr. rer. soc. oec.),
Vienna University of Economics and Business
Klementina Pejic
Dortmund University of Applied Sciences;
École Supérieure des Sciences Économique
et Commerciales ESSEC, Cergy-Pontoise,
International Business M. A.
Career history
1996–2000 Boston Consulting Group, Munich and
Vienna; 2001–2005 Chief Financial Officer (CFO), Ige-
neon AG, Vienna; 2006–2008 CFO and Managing Direc-
tor, F-star GmbH, Vienna; 2009–2011 CFO and member
of the Executive Board, SVOX AG, Zurich; since 2012
Swisscom: until 2017 CFO Participations, 2017–2018
CFO Participations and Head of M&A, 2018–February
2021 Group Treasurer (Treasury, Insurance and M&A),
since March 2021 Chief Financial Officer (CFO) and mem-
ber of the Swisscom Group Executive Board
Career history
2001–2002 Watson Wyatt AG, Zurich, Consultant;
2003–2020 Clariant International AG: 2003–2004 Divi-
sional HR Manager, 2005–2007 Global HR Business Part-
ner, 2008–2009 Head of Management Development
Europe, 2009-2011 Head of Global Talent Management,
2012–2013 Head of Senior Management Development,
2014–2017 Head of SMD & People Excellence, 2018–
January 2021 Head of Human Resources; since 1 Febru-
ary 2021 Swisscom Ltd, Chief Personnel Officer (CPO)
and member of the Group Executive Board
Mandates by order of Swisscom
Since March 2021 Vice President of the Board of Trustees
of the comPlan pension fund, Berne
Mandates by order of Swisscom
Since February 2021 member of the Board of Trustees of
the comPlan pension fund, Berne
Other significant activities
–
Other significant activities
–
Urs Lehner
Degree in IT Engineering (UAS, University
of Applied Sciences), Executive MBA in Business
Engineering, University of St. Gallen (HSG)
Christoph Aeschlimann
Degree in Computer Science (Dipl. Ing.),
École polytechnique fédérale de Lausanne (EPFL);
MBA, McGill University (Canada)
Career history
1997–2013 Trivadis Group, most recently: 2004–2008
Solution Portfolio Manager, member of the Executive
Board of Trivadis Group, 2008–2011 Chief Operating
Officer (COO) of Trivadis Group, 2011–2013 member of
the Board of Directors of Trivadis Holding AG; July 2011–
June 2017 Swisscom (Switzerland) Ltd: July 2011–
December 2013 Head of Marketing & Sales Corporate
Business, 2014–2015 Head of Marketing & Sales Enter-
prise Customers, 2016–June 2017 Head of Sales & Ser-
vices Enterprise Customers; since June 2017 Head of
Enterprise Customers (known as ‘Enterprise Customers’
until 2019) and member of the Swisscom Group Execu-
tive Board
Mandates
–
Other significant activities
Member of the Advisory Board of BKW Innovation
GmbH, Berlin
Career history
2001–2004 Odyssey Asset Management Systems, Soft-
ware Development Manager; 2006–2007 Zühlke Group,
Business Unit Manager; 2007–2011 Odyssey Financial
Technologies: 2007–2008 Area Services Manager, 2008–
2011 Senior Account Manager EMEA; 2011–2012 BSB,
Head of Switzerland and General Manager D-A-CH &
CIS; 2012–2018 ERNI Group: 2012–2014 Business Area
Manager, 2014–2017 Managing Director Switzerland,
2017–2018 CEO; since February 2019 Swisscom Ltd,
Head of IT, Network & Infrastructure and member of the
Swisscom Group Executive Board
Mandates
–
Other significant activities
Member of Dell’s CIO Advisory Board; since January
2022, member of the Cisco Global Customer Advisory
Board, San José
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Dirk Wierzbitzki
Degree in Electrical Engineering (Dipl. Ing.)
Career history
1994–2001 Mannesmann (now Vodafone Germany):
various management roles in the area of product man-
agement; 2001–2010 Vodafone Group: 2001–2003
Director for Innovation Management, Vodafone Global
Products and Services, 2003–2006 Director of Commer-
cial Terminals, 2006–2008 Director of Consumer Internet
Services and Platforms, 2008–2010 Director of Commu-
nications Services; 2010–2015 Swisscom (Switzerland)
Ltd: member of Management Residential Customers,
2010–2012 Head of Customer Experience Design for
Residential Customers, 2013–2015 Head of Fixed-net-
work Business & TV for Residential Customers; since
January 2016 Swisscom Ltd: until 2019 Head of Products
& Marketing and since 2020 Head of Residential
Customers; since 2016 member of the Swisscom Group
Executive Board
Mandates by order of Swisscom
Member of the Board of Directors of SoftAtHome, Paris
Other significant activities
–
5.3 Management agreements
Neither Swisscom Ltd nor any of the Group companies
included in the scope of consolidation have entered into
management agreements with third parties.
6 Remuneration,
shareholdings and loans
All information on the remuneration of the Board of
Directors and the Group Executive Board of Swisscom
Ltd is provided in the separate Remuneration Report.
D See report page 93
7 Shareholders’ participation rights
7.1 Voting right restrictions and proxies
Each registered share entitles the holder to one vote.
Voting rights can only be exercised if the shareholder is
entered in the share register of Swisscom Ltd with voting
rights. The Board of Directors may refuse to recognise an
acquirer of shares as a shareholder or beneficial holder
with voting rights if the latter’s total holding, when the
new shares are added to any voting shares already regis-
tered in its name, exceeds the limit of 5% of all regis-
tered shares entered in the commercial register. For the
shares in excess of the limit, the acquirer is entered in
the share register as a shareholder or beneficial holder
without voting rights. This restriction on voting rights
also applies to registered shares acquired through the
exercise of subscription, option or conversion rights. The
calculation of the percentage restriction is subject to the
Group clause in accordance with Article 3.5.1 of the Arti-
cles of Incorporation.
N See www.swisscom.ch/basicprinciples
The 5% voting right restriction does not apply to the
Swiss Confederation, which, under the terms of the Tel-
ecommunications Enterprise Act (TEA), holds the major-
ity of the capital and voting rights in Swisscom Ltd. The
Board of Directors may also recognise an acquirer of
shares with more than 5% of all registered shares as a
shareholder or beneficial holder with voting rights, in
particular in the following exceptional cases:
● where shares are acquired as a result of a merger or a
business combination
● where shares are acquired as a result of a non-cash
contribution or an exchange of shares
● where shares are acquired with a view to cementing
a long-term partnership or strategic alliance
In addition to the percentage restriction on voting rights,
the Board of Directors may refuse to recognise and enter
as shareholders or beneficial holders with voting rights
any persons acquiring shares who fail to expressly
declare upon request that they have acquired the shares
in their own name and for their own account or as bene-
ficial holders. Should acquirers of shares refuse to make
such a declaration, they will be entered as shareholders
without voting rights.
Where an entry has been made on the basis of false
statements by the acquirer, the Board of Directors may,
after consulting the party concerned, delete the share
register entry as a shareholder with voting rights and
enter the acquirer as a shareholder without voting
rights. The acquirer must be notified of the deletion
immediately.
The restrictions on voting rights provided for in the Arti-
cles of Incorporation may be changed by resolution of the
Annual General Meeting, for which an absolute majority
of valid votes cast is required.
During the year under review, the Board of Directors did
not recognise any acquirers of shares with more than 5%
of all registered shares as a shareholder or beneficial
holder with voting rights, did not reject any requests for
recognition or registration and did not remove any
shareholders with voting rights from the share register
due to the provision of false data.
7.2 Statutory quorum requirements
The Annual General Meeting of Shareholders of Swisscom
Ltd adopts its resolutions and decides its elections by the
absolute majority of valid votes cast. Abstentions are not
deemed to be votes cast. In addition to the special quo-
rum requirements under the Swiss Code of Obligations,
a two-thirds majority of the voting shares represented is
required in the following cases:
●
introduction of restrictions on voting rights
● conversion of registered shares to bearer shares
● change in the Articles of Incorporation concerning
special quorums for resolutions
7.3 Convocation of the Annual
General Meeting and agenda items
The Board of Directors convenes the Annual General
Meeting at least 20 calendar days prior to the date of the
meeting by means of an announcement in the Swiss
Commercial Gazette. The meeting can also be convened
by registered or unregistered letter to all registered
shareholders. One or more shareholders who together
represent at least 10% of the share capital can demand
in writing that an extraordinary general meeting be con-
vened, stating the agenda item and the proposal or, in the
case of elections, by stating the names of the proposed
candidates.
The Board of Directors is responsible for defining the
agenda. Shareholders representing shares with a par
value of at least CHF 40,000 may request that an item
be placed on the agenda. This request must be submit-
ted in writing to the Board of Directors at least 45 days
prior to the Annual General Meeting, stating the
agenda item and the proposal (Article 5.4.3 of the Arti-
cles of Incorporation).
N See www.swisscom.ch/basicprinciples
7.4 Representation at the
Annual General Meeting
Shareholders may be represented at the Annual General
Meeting by another shareholder with voting rights or by
the independent proxy elected by the Annual General
Meeting. The law firm Reber Rechtsanwälte, Zurich, was
appointed as independent proxy for the period up until
the conclusion of the Annual General Meeting in March
2022. Partnerships and legal entities may be repre-
sented by authorised signatories, while minors and
wards may be represented by their legal representative,
even if the representative is not a shareholder.
A power of attorney may be granted in writing or elec-
tronically via the shareholder portal operated by Com-
putershare Switzerland Ltd. Shareholders who are repre-
sented by a proxy may issue instructions for each agenda
item and also for all unannounced agenda items and
motions, stating whether they wish to vote for or against
the motion or abstain. The independent proxy must cast
the votes entrusted to him by shareholders according to
their instructions. If the independent proxy receives no
instructions, he shall abstain. Abstentions are not
deemed to be votes cast (Article 5.7.4 of the Articles of
Incorporation).
In accordance with the measures prescribed by the Fed-
eral Council to combat the coronavirus (Covid-19 Ordi-
nance 3), the Annual General Meeting of 31 March 2021
took place without the physical participation of share-
holders. Shareholders were able to authorise the inde-
pendent proxy to cast their votes and execute their
instructions on their behalf. The independent proxy cast
the votes in person at the Annual General Meeting.
7.5 Entries in the share register
Shareholders entered in the share register with voting
rights are entitled to vote at the Annual General Meet-
ing. To ensure due procedure, the Board of Directors
defines a cut-off date at its own discretion for determin-
ing voting entitlements, which is normally three busi-
ness days before the respective Annual General Meet-
ing. Entries in and deletions from the share register can
be made at any time, regardless of the cut-off date. The
cut-off date is announced with the invitation to the
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Annual General Meeting and also published in the finan-
cial calendar on the Swisscom website. Shareholders
entered in the share register with voting rights as of
5 p.m. on 26 March 2021 were entitled to vote at the
Annual General Meeting of 31 March 2021. Sharehold-
ers entered in the share register with voting rights as
of 5 p.m. on 25 March 2022 are entitled to vote at the
Annual General Meeting of 30 March 2022.
8 Change of control
and defensive measures
Under the terms of the Telecommunications Enterprise Act
(TEA), the Swiss Confederation must hold the majority of
the capital and voting rights in Swisscom Ltd. This
requirement is also set out in the Articles of Incorpora-
tion. There is thus no duty to submit a takeover bid as
defined in the Financial Market Infrastructures Act, since
this would contradict the TEA.
Details on change of control clauses are given in the sec-
tion ‘Remuneration Report’.
D See report page 93
9 Auditor
9.1 Selection process, duration of mandate
and term of office of the auditor-in-charge
The statutory auditor is appointed annually by the
Annual General Meeting following a proposal submitted
by the Board of Directors. Re-election is permitted. The
policies for appointing the statutory auditor have been
set forth in a policy by the Audit & ESG Reporting Com-
mittee. A new invitation to tender is issued for the stat-
utory auditor’s mandate at least every ten to 14 years.
The statutory auditor’s tenure is limited to 20 years. As
stipulated by the Swiss Code of Obligations, the auditor-
in-charge may only perform the mandate for a maxi-
mum of seven years. A request for tenders for the audit
mandate was issued in 2018. PricewaterhouseCoopers
(PwC), Zurich, has performed the mandate since the
2019 financial year. The auditor-in-charge is Peter
Kartscher.
9.2 Audit fees
The fees paid to PwC as auditors for the 2021 financial
year amount to CHF 3,084 thousand (prior year: CHF
2,989 thousand).
9.3 Supplementary fees
The fees charged by PwC for additional audit-related
services in the year under review amounted to CHF 701
thousand (prior year: CHF 802 thousand), and the fees
for other services were CHF 120 thousand (prior year:
CHF 34 thousand).
Audit-related services include audit services in connection
with IT outsourcing orders from business customers, IT pro-
jects, reporting requirements related to the outstanding
green bonds and the reporting of financial information.
Other services include consulting services related to cyber-
security, international VAT in connection with roaming, the
reporting of financial information, and the variance analy-
sis for international sustainability certification.
9.4 Supervision and controlling instruments
vis-à-vis the auditors
The Audit & ESG Reporting Committee verifies the qual-
ifications and independence of the statutory auditors as
a state-supervised auditing firm on behalf of the Board
of Directors. It also assesses the performance and remu-
neration of the auditors. Assessment criteria are the
competence and availability of the audit team, the audit
process, and reporting and communication. It is also
responsible for observing the statutory rotation princi-
ple for the auditor-in-charge and for reviewing and issu-
ing the new invitations to tender for the audit mandate.
The Audit & ESG Reporting Committee approves the
integrated strategic audit plan, which includes the
annual audit plan of both the internal and external audi-
tors, and the annual fee for the auditing services pro-
vided to the Group and Group companies. To help ensure
independence, the Audit & ESG Reporting Committee
has laid down principles for awarding additional services
to the auditors, including a list of prohibited services. In
order to ensure the independence of the auditors, addi-
tional service mandates must be approved by the Audit
& ESG Reporting Committee where the fee exceeds
CHF 300 thousand. The Audit & ESG Reporting Commit-
tee requires that the CFO reports to it quarterly and the
auditors annually on current mandates being performed
by the auditors, broken down according to audit ser-
vices, audit-related services and non-audit services, and
on their independence.
The statutory auditors, represented by the auditor-in-
charge and his deputy, usually attend all Audit & ESG
Reporting Committee meetings. They inform the Com-
mittee in detail on the performance and results of
their work, in particular regarding the annual financial
statement audit. They further submit a written report
annually to the Board of Directors and the Audit & ESG
Reporting Committee on the conduct and results of
the audit of the annual financial statements, as well as
on their findings with regard to accounting and the
internal control system. Finally, the Chairman of the
Audit & ESG Reporting Committee liaises closely with
the auditor-in-charge beyond the meetings of the
Committee and regularly reports to the Board of Direc-
tors. Representatives of PwC, the statutory auditors,
attended all six meetings of the Audit & ESG Reporting
Committee in 2021. They did not participate in the
meetings of the full Board of Directors. The Head of
Internal Audit attended all six meetings of the Audit &
ESG Reporting Committee in 2021. He reported on
audit findings at one meeting of the full Board of
Directors.
Swisscom meets investors regularly throughout the year,
presents its financial results at analysts’ meetings and
road shows, attends selected conferences for financial
analysts and investors, and keeps its shareholders and
other interested parties continuously informed about its
business through press releases.
Related presentations and the ad-hoc press releases
published by Swisscom are available on the Swisscom
website under ‘Investors’. It is possible to subscribe
online to the ad-hoc press releases published by
Swisscom.
N See www.swisscom.ch/adhoc
10 Information policy
Swisscom pursues an open, active information policy
vis-à-vis shareholders, the general public and the capital
markets. Shareholders are provided with notifications
and announcements in accordance with Article 12 of the
Articles of Incorporation, which are published in the
Swiss Commercial Gazette. Swisscom publishes compre-
hensive, consistent and transparent financial informa-
tion on a quarterly basis. Furthermore, it publishes an
annual sustainability report in accordance with the
Global Reporting Initiative (GRI) and an annual report
including a management commentary, corporate gov-
ernance report, remuneration report, consolidated
financial statements and a condensed version of the
financial statements of Swisscom Ltd. The interim
reports, annual report and financial statements of
Swisscom Ltd are available on the Swisscom website
under ‘Investors’ or may be ordered directly from
Swisscom. The Sustainability Report is available on the
Swisscom website under ‘Company’.
N See www.swisscom.ch/basicprinciples
N See www.swisscom.ch/financialreports
N See www.swisscom.ch/cr-report2021
The comprehensive minutes of the Annual General
Meeting of 30 March 2021 and minutes from past meet-
ings are available on the Swisscom website.
N See www.swisscom.ch/generalmeeting
Those responsible for investor relations can be con-
tacted via the website or by email, telephone or post.
The contact details and address of the head office may
be found in the website publishing details.
D See report page 185
11 Financial calendar
● Annual General Meeting for the 2021 financial year:
30 March 2022, in Volketswil, without the personal
attendance of shareholders
● 1st Quarter Interim Report: 28 April 2022
● Half-Year Interim Report: 4 August 2022
● 3rd Quarter Interim Report: 27 October 2022
● Annual Report 2022: 9 February 2023
The detailed financial calendar is published on the
Swisscom website under ‘Investors’ and is updated on a
regular basis.
N See www.swisscom.ch/financialcalendar
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92
Letter from the Chair of the
Compensation Committee
Dear Shareholders
On behalf of the Board of Directors and the Compensa-
tion Committee, I am pleased to present our Remunera-
tion Report for the 2021 reporting year.
tect the environment. Further details on our commit-
ment can be found in the Sustainability Report.
N See www.swisscom.ch/cr-report2021
The year under review was shaped by the measures taken
to contain the Covid-19 pandemic and a slowly recovering
economy. Over the past year, Swisscom was able to suc-
cessfully assert itself in the saturated IT and telecoms
markets, both of which are characterised by strong price
and promotional pressure. It did so thanks to top-rated
broadband and mobile networks, innovative products
and services that have already received multiple awards.
On top of that, simplification and a systematic digital
transformation were able to reduce the cost base and
hone the company’s competitive edge. In order to ensure
high network quality, Swisscom invested CHF 1.6 billion
in Switzerland again last year in the maintenance and
expansion of its networks. In Switzerland, Swisscom saw
growth in particular in the business customer market for
IT services and in the residential customers market for
home networking. Once again, Fastweb’s performance in
the Italian market was impressive, with growth reported
in terms of revenue, EBITDA and customers. Swisscom
consolidated its role as a pioneer in the area of climate
protection with the goal of becoming climate-neutral
across the entire value chain in Switzerland by 2025.
With regard to the compensation of the Group Executive
Board, the Compensation Committee reviewed the vari-
able remuneration system and proposed adjustments to
the Board of Directors. The changes approved by the
Board of Directors now tie remuneration even more
closely to strategy implementation. They also weight
long-term sustainable remuneration criteria more heav-
ily. The variable performance-related salary component
for members of the Group Executive Board will continue
to be paid out in cash and blocked shares. As in the past,
the Group’s financial performance indicators play a key
role in determining overall target achievement. A new
minimum EBITDA requirement was added to supple-
ment the remuneration criteria. The Board of Directors
also fleshed out the business transformation topics and
added sustainability-related topics. With these changes,
the remuneration system not only incorporates financial
performance but also indicators relating to operating
performance, customers, growth and sustainability. It
now reflects our responsibility to make a significant con-
tribution to society’s positive development and to pro-
In addition to the excellent financial results, the year under
review also saw exceptional performance in the areas of
customer satisfaction and sustainability. In its overall eval-
uation, the Board of Directors weighed this against oper-
ating performance (network faults) that was not entirely
satisfactory. This results in an overall target achievement
of 118% to 120% for the members of the Executive Com-
mittee, depending on their respective functions. As
explained in this Remuneration Report, the total remuner-
ation for the members of the Board of Directors for the
2021 reporting year is within the range approved by the
2020 Annual General Meeting. Likewise, the total remu-
neration paid to members of the Group Executive Board is
within the range approved at the 2020 Annual General
Meeting.
Like every year, you, dear shareholders, will have an
opportunity at the 2022 Annual General Meeting to cast
your vote on Swisscom’s remuneration principles and
the remuneration system as part of the consultative
vote on the Remuneration Report. In addition, the maxi-
mum total remuneration paid to the Board of Directors
and the Group Executive Board for the 2023 financial
year will be put to a vote. The proposed amounts for the
Board of Directors and the Group Executive Board
remain unchanged over the prior year.
To meet up to our responsibilities, the Compensation
Committee will conduct regular reviews of the remuner-
ation strategy and system again in the coming year to
ensure that our principles are aligned with the interests
of shareholders and other stakeholders and that perfor-
mance is rewarded appropriately and sustainably. We
look forward to your continued support and thank you
for your trust.
Kind regards
Barbara Frei
Chair of the Compensation Committee
Remuneration Report
Remuneration paid to the Board of Directors and the Group Executive Board is tied
to the generation of sustainable returns and therefore creates an incentive to achieve
long-term corporate success as well as added value for shareholders .
1 Governance
1.1 General principles
The Remuneration Report is based on sections 3.5 and 5
of the annex to the Corporate Governance Directive
issued by the SIX Swiss Exchange and Articles 13 to 16 of
the Ordinance against Excessive Compensation in Listed
Stock Companies (OaEC). Swisscom implements the
requirements of the OaEC and complies with the recom-
mendations of the Swiss Code of Best Practice for Corpo-
rate Governance issued by economiesuisse, the umbrella
organisation representing Swiss business.
Swisscom’s internal principles for determining the level
of remuneration are primarily set out in the Articles of
Incorporation, the Organisational Rules and the Regula-
tions of the Compensation Committee. The latest ver-
sions of these documents as well as their earlier, una-
mended and superseded versions can be viewed online
on the Swisscom website under ‘Basic principles’.
N See www.swisscom.ch/basicprinciples
As in previous years, the Remuneration Report will be
put to a consultative vote at the Annual General Meet-
ing on 30 March 2022.
1.2 Division of responsibilities
between the Annual General Meeting,
the Board of Directors and the
Compensation Committee
The Annual General Meeting approves the maximum
total remuneration amounts payable to the Board of
Directors and the Group Executive Board for the follow-
ing financial year upon the motion proposed by the
Board of Directors. Details of the relevant regulation and
the consequences of a negative decision by the Annual
General Meeting are set out in Articles 5.7.7 and 5.7.8 of
the Articles of Incorporation. Article 7.2.2 of the Articles
of Incorporation also defines the requirements for and
the maximum level of the additional amount that can
be paid to a member of the Group Executive Board who
is newly appointed during a period for which the Annual
General Meeting has already approved the remunera-
tion. In addition, the Articles of Incorporation contain
the following provisions relating to the remuneration
policy:
● Remuneration of the Board of Directors (Articles 6.4
and 8.1)
● Compensation Committee (Article 6.5)
● Remuneration of the Group Executive Board (Articles
7.2 and 8.1)
● Contracts of the Board of Directors and the Group
Executive Board (Article 8.2)
● Number of external mandates for the Board of Direc-
tors and Group Executive Board (Article 8.3)
The Board of Directors approves, inter alia, the person-
nel and remuneration policy for the entire Group, as well
as the general terms and conditions of employment for
members of the Group Executive Board. It sets the remu-
neration of the Board of Directors and decides on the
remuneration of the CEO as well as the total remunera-
tion for the Group Executive Board. In doing so, it takes
into account the maximum total amounts approved by
the Annual General Meeting for the remuneration to be
paid to the Board of Directors and the Group Executive
Board for the financial year in question.
The Compensation Committee handles all business
matters of the Board of Directors concerning remunera-
tion, submits proposals to the Board of Directors in this
context, and, within the framework of the approved
total remuneration, is empowered to decide upon the
remuneration of the individual Group Executive Board
members (with the exception of the CEO). Neither the
CEO nor the other members of the Group Executive
Board participate in meetings at which any change to
their remuneration is discussed or decided.
The decision-making powers are governed by the Arti-
cles of Incorporation, the Organisational Rules of the
Board of Directors and the Regulations of the Compen-
sation Committee.
N See www.swisscom.ch/basicprinciples
93
The table below shows the division of responsibilities
between the Annual General Meeting, the Board of
Directors and the Compensation Committee.
Subject
Maximum total amounts for remuneration of the Board of Directors
and Group Executive Board
Additional amount for the remuneration of newly appointed members of the Group Executive Board
(Articles of Incorporation)
Personnel and remuneration policy
Principles of the performance and shareholding plans for the Board of Directors
and Group Executive Board (Articles of Incorporation)
Principles underlying retirement-benefit plans and social security payments
Equity-share and performance-based participation plans of the Group
General terms of employment of the Group Executive Board
Definition of performance targets for the variable performance-related salary component
Concept of remuneration to members of the Board of Directors
Remuneration of the Board of Directors
Remuneration of the CEO Swisscom Ltd
Total remuneration of the Group Executive Board
Remuneration of the members of the Group Executive Board (excl . CEO)
Remuneration report
Remuneration
Committee
Board
of Directors
Annual
General Meeting
V
1
V
V
V
V
V
V
V
V
V
V
V
G
5, 6
V
A
2
A
G
4
A
G
G
4
G
4
G
4
G
4
G
5
G
5
G
5
–
A
3
G
G
–
G
–
–
–
–
–
–
–
–
–
7
G
1 V stands for preparation and proposal to the Board of Directors.
2 A stands for proposal to the Annual General Meeting.
3 G stands for approval.
4 In the framework of the Articles of Incorporation.
5 In the framework of the maximum total remuneration defined by the Annual
General Meeting.
6 In the framework of the total remuneration defined by the Board of Directors.
7 Advisory vote.
1.3 Election, composition and modus
operandi of the Compensation Committee
The Compensation Committee consists of three to six
members. They are elected individually each year by the
Annual General Meeting. If the number of members falls
below three, the Board of Directors appoints the missing
member(s) from its midst until the conclusion of the
next Annual General Meeting. The Board of Directors
appoints the Chairman of the Compensation Commit-
tee, which constitutes itself. If the Annual General Meet-
ing elects the Chairman of the Board of Directors to the
Compensation Committee, he has no voting rights. The
Chairman of the Board of Directors recuses himself
when discussions take place or decisions are made with
regard to changes in his own remuneration. The CEO,
CPO, Head of Group Strategy & Board Services and the
Head of Rewards & HR Analytics attend the meetings in
an advisory capacity. In the case of agenda items that
concern the Board of Directors exclusively or concern
changes in the remuneration of the CEO and CPO, the
CEO and CPO may not be present. Other members of the
Board of Directors, auditors or experts may be called
upon to attend the meetings in an advisory capacity.
Minutes are kept of the meetings, which are provided to
the members of the Committee and to other members
of the Board of Directors on request. The Chairman of
the Compensation Committee reports verbally on the
activities of the Committee at the next meeting of the
Board of Directors. The meetings of the Compensation
Committee are generally held in February, June and
December. Further meetings can be convened as and
when required. The Compensation Committee did not
call on any external consultants during the reporting year.
The details are governed by Article 6.5 of the Articles of
Incorporation, the Organisational Rules of the Board of
Directors and the Regulations of the Compensation
Committee.
N See www.swisscom.ch/basicprinciples
The members of the Compensation Committee neither
work nor have worked for Swisscom in an executive
capacity, nor do they maintain any significant commercial
links with Swisscom Ltd or the Swisscom Group. Customer
and supplier relationships exist between the Swiss Con-
federation and Swisscom. Details of these are provided in
Note 6.2 to the consolidated financial statements.
D See report page 166
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The following table gives an overview of the composition
of the Committee, the Committee meetings and circular
resolutions in 2021.
Total
Average duration (in hours)
Participation:
Barbara Frei, Chairwoman
Roland Abt
Frank Esser
Renzo Simoni 1
Michael Rechsteiner 2, 3
Hansueli Loosli 2, 4
Meetings
Ad-hoc meetings Circular resolutions
3
01:10
3
3
3
3
2
1
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1 Representative of the Confederation.
2 Participation without voting rights.
3 Elected to the Committee on 31 March 2021.
4 Left the Board of Directors on 31 March 2021.
2 Remuneration
of the Board of Directors
2.1 Principles
The remuneration system for the members of the
Board of Directors is designed to attract and retain
experienced and motivated individuals for the Board of
Directors’ function. It also seeks to align the interests
of the members of the Board of Directors with those of
the shareholders. The remuneration is commensurate
with the activities and level of responsibility of each
member. The basic principles regarding the remunera-
tion of the Board of Directors and the allocation of
equity shares are set out in Articles 6.4 and 8.1 of the
Articles of Incorporation.
N See www.swisscom.ch/basicprinciples
The remuneration is made up of a fixed Director’s fee
that varies in relation to the member’s function (basic
emolument plus functional allowances), statutory and
regulatory employer contributions to social security
and to the occupational pension, as well as any addi-
tional benefits. Additional remuneration is not given
for attendance at meetings. No variable perfor-
mance-related emoluments are paid. The members of
the Board of Directors are obligated to draw a portion
of their fee in the form of equity shares and to comply
with the requirements on minimum shareholdings,
thus ensuring they directly participate financially in the
performance of Swisscom’s shares.
The remuneration is normally reviewed every Decem-
ber for the following year for ongoing appropriateness.
In December 2020, the Board of Directors assessed the
appropriateness of the remuneration as part of a dis-
cretionary decision. The Board of Directors compared
Swisscom’s remuneration with that of other listed
companies domiciled
like
Swisscom, must fulfil Swiss and foreign legal require-
ments, including full personal liability. The Board of
Directors used as a comparison the remuneration paid
by Compagnie
Financière Richemont, Geberit,
Givaudan, Lonza, SGS, Sika and Swatch Group. The
Board of Directors did not call on any external consult-
ants with regard to the determination of the remuner-
ation nor to review its appropriateness.
in Switzerland, which,
95
2.2 Remuneration components
Director’s fee
The Director’s fee is made up of a basic emolument and
allowances as compensation for the individual func-
tions. The following amounts are paid per year:
in CHF
Base salary per member
Functional allowances 1
Presidium
Vice presidium
Representative of the Confederation
Audit Committee & ESG Reporting, Chair
Audit Committee & ESG Reporting, Member
Finance Committee, Chair
Finance Committee, Member
Remuneration Committee, Chair
Remuneration Committee, Member
1 No functional allowance is paid for participation in ad-hoc committees
appointed on a case-by-case basis.
Under the Management Incentive Plan, the members of
the Board of Directors are obligated to draw one third of
their Director’s fee in the form of shares. For members
who resign from the Board of Directors at the Annual
General Meeting, the fee is paid fully in cash on a pro
rata basis. The shares are allocated on the basis of their
tax value, rounded up to whole numbers of shares.
Shares are blocked from sale for three years. This restric-
tion on disposal also applies if members leave the com-
pany during the blocking period. The shares, which are
allocated in April of the reporting year for the reporting
year, are recorded at market value on the date of alloca-
tion. The share-based remuneration is augmented by a
factor of 1.19 in order to take account of the difference
between the tax value and the market value. In April
2021, a total of 1,512 shares were allocated to the mem-
bers of the Board of Directors (prior year: 1,548 shares)
with a tax value of CHF 423 per share (prior year: CHF
439). Their market value was CHF 504 (prior year:
CHF 522.80) per share.
2021
Gross
2020
Gross
146,000
146,000
308,000
308,000
25,000
48,000
61,000
17,000
25,000
17,000
25,000
15,000
25,000
48,000
61,000
17,000
25,000
17,000
25,000
15,000
Contributions to social security and occupational
pension as well as additional benefits
Swisscom pays the statutory and regulatory employer
contributions to social security and occupational pen-
sion on the fee. The contributions are disclosed sepa-
rately and are included in the total remuneration.
If required by law, the individual members of the Board
of Directors are insured against the economic conse-
quences of old age, death and disability; their basic
emolument is covered through the comPlan pension
plan (see www.pk-complan.ch for the regulations) and
their functional allowances are covered as part of a
1e plan with VZ Sammelstiftung. The reported pension
benefits cover all savings, guarantee and risk contribu-
tions paid by the employer to the pension plan.
The disclosure of service-related and non-cash benefits
and expenses relies on a tax-based point of view.
Swisscom does not offer any significant service-related
or non-cash benefits. Expenses are reimbursed on the
basis of actual costs incurred. Accordingly, neither ser-
vice-related and non-cash benefits nor out-of-pocket
expenses are included in the reported remuneration.
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2.3 Total remuneration
The total remuneration paid to the individual members
of the Board of Directors for the 2020 and 2021 financial
years is presented in the tables below, broken down into
individual components. The higher total compensation
in 2021 is primarily due to higher contributions to the
occupational pension plan.
Total remuneration to members of the Board of Directors
1,400
761
1 Elected as chairman on 31 March 2021.
2 Left the Board of Directors on 31 March 2021.
3 Elected to the Board of Directors on 31 March 2021.
4 Frank Esser is subject to social security contributions in Germany. No employer
contributions are paid.
5 Anna Mossberg is subject to social security contributions in Sweden.
2021, in CHF million
Michael Rechsteiner, Chairman 1
Hansueli Loosli, Chairman 2
Roland Abt
Alain Carrupt
Guus Dekkers 3
Frank Esser 4
Barbara Frei
Sandra Lathion-Zweifel
Anna Mossberg 5
Renzo Simoni
2020, in CHF thousand
Hansueli Loosli
Roland Abt
Alain Carrupt
Frank Esser 1
Barbara Frei
Sandra Lathion-Zweifel
Anna Mossberg 2
Michael Rechsteiner
Renzo Simoni
Base salary and functional allowances
Cash
remuneration
Share-based
payment
Employer
contributions to
Employer
pension plan contributions to SS
Total 2021
279
126
159
109
82
152
124
109
109
151
167
–
95
65
49
91
74
65
65
90
47
–
35
–
–
–
–
22
–
33
137
25
–
15
8
8
–
12
10
32
14
518
126
304
182
139
243
210
206
206
288
124
2,422
Base salary and functional allowances
Cash
remuneration
Share-based
payment
Employer
contributions to
pension plan
Employer
contributions
to social security
Total 2020
335
159
109
152
124
109
109
109
151
200
95
65
91
74
65
65
65
90
–
35
7
–
–
22
–
–
33
97
23
15
8
–
12
10
32
10
14
558
304
189
243
210
206
206
184
288
124
2,388
Total remuneration to members of the Board of Directors
1,357
810
1 Frank Esser is subject to social security contributions in Germany.
2 Anna Mossberg is subject to social security contributions in Sweden.
The total remuneration paid to the members of the Board
of Directors for the 2021 financial year is within the maxi-
mum total amount approved by the 2020 Annual General
Meeting (AGM) for 2021 of CHF 2.5 million.
97
2.4 Minimum shareholding requirement
The members of the Board of Directors are required to
maintain a minimum shareholding equivalent to one
annual emolument (basic emolument plus functional
allowances). As a rule, they have four years from the
start of their term of office or assumption of a new func-
tion to acquire the prescribed shareholding in the form
of the blocked shares paid as part of remuneration and,
if necessary, through share purchases on the open mar-
ket, observing internal and legal trading restrictions.
Compliance with the shareholding requirement
is
reviewed annually by the Compensation Committee. If a
member’s shareholding falls below the minimum
Number
Michael Rechsteiner
Hansueli Loosli 1
Roland Abt
Alain Carrupt
Guus Dekkers 2
Frank Esser
Barbara Frei
Sandra Lathion-Zweifel
Anna Mossberg
Renzo Simoni
requirement due to a drop in the share price, the differ-
ence must be made up by no later than the time of the
next review. In justified cases, such as personal hardship
or legal obligations, the Chairman of the Board of Direc-
tors can approve individual exceptions at his discretion.
2.5 Shareholdings of the members
of the Board of Directors
As at 31 December 2020 and 2021, the members of the
Board of Directors and/or related parties held blocked
and non-blocked shares as shown in the table below.
None of the individuals required to make notification
holds voting shares exceeding 0.1% of the share capital.
31.12.2021
31 .12 .2020
565
–
915
692
148
1,152
1,336
367
475
831
233
3,856
726
563
–
972
1,189
238
346
652
Total shares held by the members of the Board of Directors
6,481
8,775
1 Left the Board of Directors on 31 March 2021.
2 Elected to the Board of Directors on 31 March 2021.
3 Remuneration
of the Group Executive Board
3.1 Principles
The remuneration policy of Swisscom applicable to the
Group Executive Board is designed to attract and retain
highly skilled and motivated specialists and executive
staff over the long term and provide an incentive to
achieve a lasting increase in the enterprise value. It is
systematic, transparent and long-term-oriented, and is
predicated on the following principles:
● Total remuneration is competitive and is in an appro-
priate relation to the market as well as the internal
salary structure.
● Remuneration is based on performance in line with
the results achieved by Swisscom.
● Through direct financial participation in the perfor-
mance of the Swisscom share, the interests of manage-
ment are aligned with the interests of shareholders.
The remuneration of the Group Executive Board is a bal-
anced combination of fixed and variable salary compo-
nents. The fixed component is made up of a base salary,
fringe benefits (mainly a car allowance) and retirement
benefits. The variable remuneration includes a perfor-
mance-related component settled partly in cash and
partly in shares.
The members of the Group Executive Board are required
to hold a minimum shareholding, which strengthens
their direct financial participation in the medium-term
performance of the Swisscom share and thus aligns their
interests with those of shareholders. To facilitate com-
pliance with the minimum shareholding requirement,
Group Executive Board members have the possibility of
drawing up to 50% of the variable performance-related
component of their salary in shares.
The basic principles regarding the performance-related
remuneration and the profit and equity participation
plans of the Group Executive Board are set out in Arti-
cle 8.1 of the Articles of Incorporation.
N See www.swisscom.ch/basicprinciples
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Remuneration system
Remuneration components and determining factors
Remuneration
Assets
Instruments
Fixed remuneration
Variable remuneration
Base salary
Pension benefits
Fringe benefits
Performance-related
component in cash
and shares
Minimum shareholding
requirement
Requirement to hold
a minimum amount
of Swisscom shares
Influencing factors
Function, experience
and qualifications,
market
Achievement of
annual performance
targets
Long-term growth
of enterprise value
Purpose
Employee recruitment,
employee retention
and protection
Focus on annual targets
and sustain able
corporate results
Alignment with
shareholders interests
The Compensation Committee decides at its discretion
on the level of remuneration, taking into consideration
the external market value of the function in question,
the internal salary structure and individual performance.
For the purpose of assessing market values, Swisscom
relies on cross-sector market comparisons with Swiss
companies as well as international sector comparisons.
These two comparative perspectives allow Swisscom to
form an optimal overview of the relevant employment
market for managerial positions. In the year under
review, Swisscom consulted a national and international
comparative study conducted by Willis Towers Watson in
2020. The comparison with the Swiss market covers
twelve major companies domiciled in Switzerland from
various sectors, with the exception of the financial and
pharmaceutical sectors. On average, these companies
generate revenue of CHF 14.63 billion and employ 16,403
people. The international sector comparison covers tele-
communications companies from eight western Euro-
pean countries with median revenue of CHF 7.5 billion
and a median workforce of 19,500 employees. The evalu-
ation of the two comparative studies takes into account
the comparability of the extent of responsibility in terms
of revenue, number of employees and international
scope. In 2020, both the Compensation Committee and
the Board of Directors took an in-depth look at the fur-
ther development of the remuneration system. A consul-
tancy firm was called on in order to review the existing
remuneration system from an external perspective and
factor in the latest developments. This company had no
other Swisscom mandates. The Compensation Commit-
tee did not call on any external consultants during the
reporting year.
As a rule, the Compensation Committee reviews the
individual remuneration paid to members of the Group
Executive Board every three years of employment. The
Board of Directors made no adjustments to the salary of
any member of the Group Executive Board during the
year under review.
3.2 Remuneration components
Base salary
The base salary is the remuneration paid according to the
function, qualifications and performance of the individ-
ual member of the Group Executive Board. It is deter-
mined based on a discretionary decision taking into
account the external market value of the function and
the salary structure for the Group’s executive manage-
ment. The base salary is paid in cash.
Variable performance-related salary component
The members of the Group Executive Board are entitled
to a variable performance-related salary component
which represents 70% of the base salary if objectives are
achieved
in full (performance-related bonus). The
amount of the performance-related component paid
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out depends on the extent to which the targets are
achieved, as set by the Compensation Committee, tak-
ing into account the performance evaluation by the CEO.
If targets are exceeded, the performance-related bonus
may amount to no more than 130% of the target bonus.
The maximum performance-related salary component
is thus limited to 91% of the base salary. This ensures
that the performance related salary component does not
exceed the annual base salary, even taking account of
the market value of the component paid in shares.
Targets and achievement of targets for the
variable performance-related salary component
The Board of Directors adjusted the targets for the vari-
able performance-related component during the year
under review. This was done to:
●
●
●
reduce complexity
align the targets more closely with the interests of
shareholders
specifically take long-term and sustainable aspects
into consideration
The targets for the members of the Group Executive
Board consist of financial targets as well as topics relat-
ing to the business transformation. The target structure
therefore increasingly anchors long-term, strategic con-
siderations such as strengthening the core business by
offering the best customer experiences and the best
infrastructure, realising new growth opportunities, and
continuously developing operational excellence.
Overall target achievement also depends on the achieve-
ment of the minimum EBITDA requirement, referred to as
the ‘EBITDA threshold’. The EBITDA threshold is set annu-
ally by the Board of Directors in relation to the Group
EBITDA target. Once the EBITDA threshold is reached, over-
all target achievement is measured based on financial tar-
get achievement and topics related to business transfor-
mation (0-130%). If the EBITDA threshold is not reached,
overall target achievement for the members of the Group
Executive Board is 0% and no variable performance-re-
lated salary component is paid out.
Determination of target achievement
As the decisive basis for the payment of the performance-related component
Financial targets
Business transformation
a
b
c
Net revenue
Operating perfomance
EBITDA margin
+/-
Customers
=
OpFCF proxy
Growth
Financial targets Fastweb
Sustainability
Overall target achievement
(depending on the achievement
of the ‘EBITDA threshold’)
between 0% and 130%
a) Financial targets
The financial targets underlying the variable perfor-
mance-related salary component are adopted annually
in December for the following year by the Board of
Directors following a proposal submitted by the Com-
pensation Committee. The targets relevant to the
reporting year are left unchanged from the previous
year, in line with the Group’s continuing corporate strat-
egy. The targets are based on the budget figures for the
respective year under review.
The financial targets include net revenue, operating
income before interest, taxes, depreciation and amorti-
sation as a percentage of net revenue (EBITDA margin),
and operating free cash flow proxy. The Group Executive
Board members delegated by Swisscom to the Board of
Directors of the Italian subsidiary Fastweb S.p.A. are also
measured on the basis of the Fastweb financial targets.
The Compensation Committee’s decision is based on an
assessment of the extent to which financial targets have
been met using a scale for the overachievement and/or
underachievement of each target. The achievement of an
individual target can vary from 0% to 200%. The achieve-
ment of the financial targets is determined according to
the weighting of the individual targets and cannot exceed
200% overall.
Weighting of financial targets
Financial targets
Net revenue
EBITDA margin
Free cash flow proxy
Financial targets Fastweb
Weighting CEO, CFO and Head
of IT, Network & Infrastructure
Weighting other members
of Group Executive Board
24%
24%
32%
20%
30%
30%
40%
0%
b) Business transformation
The topics relevant to Swisscom’s long-term success are
summarised under the term ‘business transformation’.
These topics sharpen the degree to which compensation
is focused on shareholder interests even further by
allowing Swisscom’s performance, which is geared to
the long term, to be assessed even more comprehen-
sively. As a result, indicators on market share, network
and service stability and reputation have been included
in the assessment of operating performance. The topic
of customers includes customer satisfaction as meas-
ured by the Net Promoter Score for residential and busi-
ness customers; this is a recognised indicator of cus-
tomer loyalty. Growth is measured on the basis of
innovation indicators and the implementation of strate-
gic projects, while the new topic of sustainability
indicators on employee satisfaction and
includes
Business transformation topics
Securing long-term success
Swisscom’s contribution toward protecting the environ-
ment (CO2 reduction; ESG criterion). This therefore incor-
porates Swisscom’s responsibility to help promote socie-
ty’s positive development and protect the environment
into the remuneration system. Further information on
customer satisfaction can be found in the Management
Commentary. Further information on Swisscom’s contri-
bution to the environment and society can be found in
the Sustainability Report.
D See report page 39
N See www.swisscom.ch/cr-report2021
The Compensation Committee uses key figures and
deviations from the multi-year average or previous year
to deliberate on the performance of the business trans-
formation. It assesses the outcome at its own discretion
on a scale of +/– 0 to 20 percentage points.
Business transformation
Topics
Assessment based
among others on
Operating Performance
Customers
Growth
• Market share
• Stability
• Reputation
• Customer satisfaction
or net promoter score
•
Innovation or
strategic projects
Sustainability
• Employees
• Environment
• Quantitative
key figures
per topic
• Multy-year
average
• Previous year
• Current year
+/– 0 to 20 per-
centage points on
financial target
achievement
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c) Overall target achievement
Overall target achievement is calculated based on
achievement of financial targets plus or minus the busi-
ness transformation assessment. In order to ensure that
this definition of overall target achievement appropri-
ately describes the Group’s performance and reflects
shareholders’ interests in terms of long-term value crea-
tion, the Compensation Committee may, in exceptional
situations, exercise its discretion in determining the
overall target achievement in order to appropriately depict
actual management performance. In doing so, it may take
into account certain special factors e.g. currency fluctua-
tions, extraordinary financial effects or unforeseen indus-
try and market developments. The overall achievement
of targets is limited to a maximum of 130%. Based on
the overall achievement of targets, the Compensation
Committee submits a proposal for the approval of the
Board of Directors for the amount of the perfor-
mance-related salary component to be paid to the
Group Executive Board and the CEO.
Thresholds for overall target achievement
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200%
130%
0%
Lower threshold
(EBITDA minimum requirement)
Upper threshold
(Cap at 130 % target achievement)
Payment of the variable performance-related
salary component
The variable performance-related salary component for
a given financial year is paid in April of the following year,
with 25% being paid in the form of Swisscom shares, in
accordance with the Management Incentive Plan. Group
Executive Board members may opt to increase the share
component up to a maximum of 50% of the total variable
performance-related compensation. The remaining por-
tion of the performance-related component is settled in
cash. In the event of a departure from the Group Execu-
tive Board during the course of the year, the payment of
the performance-related component for the current year
is generally made in cash only. The decision as to what
percentage of the variable performance-related salary
component is to be drawn in the form of shares must be
communicated prior to the end of the reporting year, but
no later than in November following the publication of
the third-quarter results. In the year under review, two
members of the Group Executive Board opted for a
higher share component. The shares are allocated on the
basis of their tax value, rounded up to whole numbers of
shares. Shares are blocked from sale for three years. This
restriction on disposal also applies if the employment
relationship is terminated during the blocking period.
The share-based remuneration disclosed in the year
under review is augmented by a factor of 1.19 in order to
take account of the difference between the market value
and the tax value. The market value is determined as of
the date of allocation. The allocation of shares for the
year under review will be made in March 2022.
In April 2021, a total of 1,454 shares (prior year: 1,452
shares) with a tax value of CHF 423 (prior year: CHF 439)
per share and a market value of CHF 504 (prior year: CHF
522.80) per share were allocated for the 2020 financial
year to the members of the Group Executive Board.
Pension fund and fringe benefits
The members of the Group Executive Board, like all eligi-
ble employees in Switzerland, are insured against the
financial consequences of old age, death and disability
through the comPlan pension plan (for pension fund
regulations, see www.pk-complan.ch). The reported
pension benefits cover all savings, guarantee and risk
contributions paid by the employer to the pension plan.
They also include the pro-rata costs of the AHV bridging
pension paid by comPlan in the event of early retirement
and the premium for the term life insurance concluded
for Swisscom management staff in Switzerland. Further
information about this is provided in Note 4.3 to the
consolidated financial statements.
D See report pages 151-156
A tax-based point of view is taken in reporting ser-
vice-related and non-cash benefits and expenses. The
members of the Group Executive Board are entitled to a
car allowance. Out-of-pocket expenses are reimbursed
on a lump-sum basis in accordance with expense reim-
bursement rules approved by the tax authorities, and
other expenses are reimbursed on an actual cost basis.
They are not included in the reported remuneration.
3.3 Total remuneration
The following table shows the total remuneration paid
to the members of the Group Executive Board for the
2020 and 2021 financial years, broken down into individ-
ual components and including the highest amount paid
to one member. In the year under review, the financial
targets relevant to remuneration were considerably
In CHF thousand
Fixed base salary paid in cash
Variable performance-related remuneration paid in cash
Variable performance-related remuneration paid in shares 1
Service-related and non-cash benefits
Employer contributions to social security 2
Retirement benefits
Total remuneration to members of the Group Executive Board
Benefits paid following retirement from Group Executive Board 3
Total remuneration paid to Group Executive Board,
incl. benefits paid following retirement from Board
1 The shares are reported at market value and are blocked from sale for three
years.
2 Employer contributions to social security (AHV, IV, EO and FAK, incl. adminis-
tration costs, and daily sickness benefits and accident insurance) are included
in the total remuneration.
exceeded. At the same time, expectations were also
exceeded in the context of the business transformation.
This mainly related to the topics of customers and sus-
tainability. The EBITDA threshold was reached. The
resulting overall target achievement of the perfor-
mance-related component is 118% of the target bonus
for the CEO and between 118 and 120% for the other
members of the Group Executive Board. The Board of
Directors took network faults into account when deter-
mining target achievement. In the year under review,
the variable performance-related salary component for
members of the Group Executive Board (CHF 2,769 thou-
sand in total) was around 88% of the base salary (CHF
3,165 thousand in total). The total remuneration paid to
the highest-earning member of the Group Executive
Board (CEO, Urs Schaeppi) increased by 5.7% compared
to the prior year. The increase in total remuneration paid
to the Group Executive Board and the CEO is primarily
attributable to the higher variable remuneration as
compared to the prior year.
Total Group
Executive Board
2021
Total Group
Executive Board
2020
Thereof
Urs Schaeppi
2021
Thereof
Urs Schaeppi
2020
3,165
1,916
853
118
526
766
7,344
1,026
3,221
1,708
731
109
510
796
7,075
190
882
547
217
17
146
149
1,958
–
882
477
189
18
139
148
1,853
–
8,370
7,265
1,958
1,853
3 Contractual compensation payments made during the notice period to Group
Executive Board members who resigned from Board during the financial year
or in 2020.
Total remuneration paid to the members of the Group
Executive Board for the 2021 financial year is within the
maximum total amount approved by the 2020 Annual
General Meeting (AGM) for 2021 of CHF 8.7 million.
3.4 Minimum shareholding requirement
The members of the Group Executive Board are required
to hold a minimum amount of Swisscom shares. The
minimum shareholding to be held by the CEO is equiva-
lent to two years’ base salary and the other Group Exec-
utive Board members are required to maintain a share-
holding equivalent to one year’s base salary. The
members of the Group Executive Board build up the pre-
scribed shareholding over four allocation periods in the
form of the blocked shares paid as part of remuneration
and, if necessary, through share purchases on the open
market, observing internal trading restrictions. Compli-
ance with the shareholding requirement is reviewed
annually by the Compensation Committee. If a mem-
ber’s shareholding falls below the minimum require-
ment due to a drop in the share price or a salary adjust-
ment, the difference must be made up by no later than
the time of the next review. In justified cases, such as
personal hardship or legal obligations, the Chairman of
the Board of Directors can approve individual exceptions
at his discretion.
103
3.5 Shareholdings of the members
of the Group Executive Board
Blocked and non-blocked shares held by members of the
Group Executive Board and/or related parties as at
31 December 2020 and 2021 are shown in the table
below. None of the individuals required to make notifi-
cation holds voting shares exceeding 0.1% of the share
capital.
Number
Urs Schaeppi (CEO)
Eugen Stermetz 1
Mario Rossi 2
Klementina Pejic 3
Hans C . Werner 4
Urs Lehner
Christoph Aeschlimann
Dirk Wierzbitzki
Total shares held by the members of the Group Executive Board
31.12.2021
31 .12 .2020
5,445
–
–
–
–
1,019
422
1,323
8,209
5,069
–
1,897
–
1,588
821
145
1,122
10,642
1 Elected to the Group Executive Board on 1 March 2021.
2 Left the Group Executive Board on 28 February 2021.
3 Elected to the Group Executive Board on 1 February 2021.
4 Left the Group Executive Board on 31 January 2021.
3.6 Employment contracts
The employment contracts of the members of the Group
Executive Board are subject to a twelve-month notice
period. No termination benefits apply beyond the salary
payable for a maximum of twelve months. The employ-
ment contracts stipulate that Swisscom may allow any
wrongfully awarded remuneration to lapse or may
reclaim any remuneration that is wrongfully paid. The
contracts do not contain either a non-competition clause
or a clause on change of control.
4 Other remuneration
4.1 Remuneration for additional services
Swisscom may pay remuneration to members of the
Board of Directors for assignments in Group companies
and assignments performed by order of Swisscom (Arti-
cle 6.4 of the Articles of Incorporation). No such remu-
neration was paid in the year under review.
N See www.swisscom.ch/basicprinciples
The members of the Group Executive Board are not enti-
tled to separate remuneration for any directorships they
hold either within or outside the Swisscom Group.
4.2 Remuneration for former members
of the Board of Directors or Group
Executive Board and related parties
In the year under review, no remuneration was paid to
former members of the Board of Directors in connec-
tion with their earlier activities as a member of a gov-
erning body of the company or which are not at arm’s
length. Similarly, no such remuneration was paid to
former members of the Group Executive Board. Fur-
ther, there were no payments to individuals who are
closely related to any former or current member of the
Board of Directors or the Group Executive Board which
are not at arm’s length.
4.3 Loans and credits granted
Swisscom Ltd has no statutory basis for the granting of
loans, credit facilities or pension benefits apart from the
retirement benefits paid to the members of the Board of
Directors and Group Executive Board.
In the 2021 financial year, Swisscom did not grant any
collateral, loans, advances or credit facilities of any kind
either to former or current members of the Board of
Directors or related parties, or to former or current
members of the Group Executive Board or related par-
ties. There are therefore no corresponding receivables
outstanding.
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104
Report of the statutory auditor
to the General Meeting of Swisscom Ltd
Ittigen
We have audited the remuneration report of Swisscom Ltd for the year ended 31 December 2021. The audit was limited to
the information according to articles 14 - 16 of the Ordinance against Excessive compensation in Stock Exchange
Listed Companies contained in the sections 2.3, 2.5, 3.3, 3.5 and 4.1 to 4.3 on pages 93 to 104 of the remuneration report.
Board of Directors’ responsibility
The Board of Directors is responsible for the preparation and overall fair presentation of the remuneration report in accord-
ance with Swiss law and the Ordinance against Excessive Compensation in Stock Exchange Listed Companies (Ordi-
nance). The Board of Directors is also responsible for designing the remuneration system and defining individual remunera-
tion packages.
Auditor’s responsibility
Our responsibility is to express an opinion on the remuneration report. We conducted our audit in accordance with Swiss
Auditing Standards. Those standards require that we comply with ethical requirements and plan and perform the audit to
obtain reasonable assurance about whether the remuneration report complies with Swiss law and articles 14–16 of the Ordi-
nance.
An audit involves performing procedures to obtain audit evidence on the disclosures made in the remuneration report with
regard to compensation, loans and credits in accordance with articles 14–16 of the Ordinance. The procedures selected
depend on the auditor’s judgment, including the assessment of the risks of material misstatements in the remuneration re-
port, whether due to fraud or error. This audit also includes evaluating the reasonableness of the methods applied to value
components of remuneration, as well as assessing the overall presentation of the remuneration report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Opinion
In our opinion, the remuneration report of Swisscom Ltd for the year ended 31 December 2021 complies with Swiss law and
articles 14–16 of the Ordinance.
PricewaterhouseCoopers AG
Peter Kartscher
Audit expert
Auditor in charge
Zürich, 2 February 2022
Petra Schwick
Audit expert
PricewaterhouseCoopers AG, Birchstrasse 160, Postfach, CH-8050 Zürich, Switzerland
Telefon: +41 58 792 44 00, Telefax: +41 58 792 44 10, www.pwc.ch
PricewaterhouseCoopers AG is a member of the global PricewaterhouseCoopers network of firms, each of which is a separate and independent legal entity.
105
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Consolidated Financial
Statements ________________
Consolidated statement of comprehensive income . . . .
108
Consolidated balance sheet . . . . . . . . . . . . . . . . . . . . . . . . . . . .
109
Consolidated statement of cash flows . . . . . . . . . . . . . . . . . . 110
Consolidated statement of changes in equity . . . . . . . . . . . 111
Notes to the consolidated
financial statements _________
1 Operating performance
1 .1 Segment information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114
1 .2 Operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 120
2 Capital and financial risk management
2 .1 Capital management and equity . . . . . . . . . . . . . . . . . . . 122
2 .2 Financial liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124
2 .3 Leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127
2 .4 Financial result . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131
2 .5 Financial risk management . . . . . . . . . . . . . . . . . . . . . . . . . 131
3 Operating assets and liabilities
3 .1 Net current operating assets . . . . . . . . . . . . . . . . . . . . . . . 139
3 .2 Property, plant and equipment . . . . . . . . . . . . . . . . . . . .
142
3 .3 Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
144
3 .4 Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145
3 .5 Provisions and contingent liabilities . . . . . . . . . . . . . . . . . 147
4 Employees
4 .1 Employee headcount and personnel expense . . . . . . . 150
4 .2 Key management compensation . . . . . . . . . . . . . . . . . . . 151
4 .3 Post-employment benefits . . . . . . . . . . . . . . . . . . . . . . . . . 151
5 Scope of consolidation
5 .1 Group structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158
5 .2 Changes in the scope of consolidation . . . . . . . . . . . . . . 158
5 .3 Equity-accounted investees . . . . . . . . . . . . . . . . . . . . . . . . 159
5 .4 Group companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161
6 Other disclosures
6 .1 Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 163
6 .2 Related parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
166
6 .3 Other accounting policies . . . . . . . . . . . . . . . . . . . . . . . . . . 167
Report of the statutory auditor . . . . . . . . . . . . . . . . . . . . . . . .
168
107
Consolidated Financial Statements
Consolidated statement
of comprehensive income
In CHF million, except for per share amounts
Note
2021
2020
Income statement
Net revenue
Direct costs
Personnel expense
Other operating expense
Capitalised self-constructed assets and other income
Operating income before depreciation and amortisation
Depreciation and amortisation of property, plant and equipment and intangible assets
Depreciation of right-of-use assets
Operating income
Financial income
Financial expense
Result of equity-accounted investees
Income before income taxes
Income tax expense
Net income
Other comprehensive income
Actuarial gains and losses from defined benefit pension plans
Change in fair value of equity instruments
Items that will not be reclassified to income statement
Foreign currency translation adjustments of foreign subsidiaries
Change in cash flow hedges
Other comprehensive income from equity-accounted investees
Items that may be reclassified to income statement
Other comprehensive income
Comprehensive income
Net income
Other comprehensive income
Comprehensive income
Share of net income and comprehensive income
Equity holders of Swisscom Ltd
Non-controlling interests
Net income
Equity holders of Swisscom Ltd
Non-controlling interests
Comprehensive income
Earnings per share
1 .1
1 .2
1 .2, 4 .1
1 .2
1 .2
3 .2, 3 .3
2 .3
2 .4
2 .4
5 .3
6 .1
2 .1
2 .1
2 .1
2 .1
2 .1
11,183
11,100
(2,779)
(2,667)
(1,857)
598
4,478
(2,131)
(281)
2,066
269
(173)
(10)
2,152
(319)
1,833
638
71
709
(75)
(6)
2
(79)
630
1,833
630
2,463
1,832
1
1,833
2,462
1
2,463
(2,669)
(2,717)
(1,798)
466
4,382
(2,149)
(286)
1,947
41
(193)
4
1,799
(271)
1,528
261
(9)
252
(5)
(3)
(5)
(13)
239
1,528
239
1,767
1,530
(2)
1,528
1,769
(2)
1,767
Basic and diluted earnings per share (in CHF)
2 .1
35.37
29.54
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Consolidated balance sheet
In CHF million
Assets
Cash and cash equivalents
Trade receivables
Receivables from finance leases
Other operating assets
Other financial assets
Current income tax assets
Total current assets
Property, plant and equipment
Intangible assets
Goodwill
Right-of-use assets
Equity-accounted investees
Receivables from finance leases
Other financial assets
Defined benefit assets
Deferred tax assets
Total non-current assets
Total assets
Liabilities and equity
Financial liabilities
Lease liabilities
Trade payables
Other operating liabilities
Provisions
Current income tax liabilities
Total current liabilities
Financial liabilities
Lease liabilities
Defined benefit obligations
Provisions
Deferred gain on sale and leaseback of real estate
Deferred tax liabilities
Total non-current liabilities
Total liabilities
Share capital
Capital reserves
Retained earnings
Foreign currency translation adjustments
Hedging reserves
Equity attributable to equity-holders of Swisscom Ltd
Non-controlling interests
Total equity
Total liabilities and equity
Note
31.12.2021
31 .12 .2020
3 .1
2 .3
3 .1
6 .1
3 .2
3 .3
3 .4
2 .3
5 .3
2 .3
4 .3
6 .1
2 .2
2 .3
3 .1
3 .1
3 .5
6 .1
2 .2
2 .3
4 .3
3 .5
2 .3
6 .1
2 .1
2 .1
2 .1
401
2,315
33
1,179
93
2
4,023
10,771
1,714
5,157
2,134
30
66
691
11
204
340
2,132
33
1,029
137
4
3,675
10,725
1,745
5,162
2,138
155
54
425
–
183
20,778
24,801
20,587
24,262
559
217
1,600
1,617
118
230
4,341
5,886
1,800
24
1,031
95
811
9,647
13,988
52
136
12,485
(1,864)
2
10,811
2
10,813
24,801
792
226
1,525
1,269
144
186
4,142
6,250
1,762
795
1,072
106
644
10,629
14,771
52
136
11,085
(1,791)
8
9,490
1
9,491
24,262
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Consolidated statement
of cash flows
In CHF million
Net income
Income tax expense
Result of equity-accounted investees
Financial income
Financial expense
Note
6 .1
5 .3
2 .4
2 .4
Depreciation and amortisation of property, plant and equipment and intangible assets
3 .2, 3 .3
Depreciation of right-of-use assets
Gain on sale of property, plant and equipment
Expense for share-based payments
Revenue from finance leases
Proceeds from finance leases
Change in deferred gain from the sale and leaseback of real estate
Change in operating assets and liabilities
Change in provisions
Change in defined benefit obligations
Interest received
Dividends received
Interest payments on financial liabilities
Interest payments on lease liabilities
Income taxes paid
Cash flow from operating activities
2 .3
1 .2
2 .3
3 .1
3 .5
4 .3
5 .3
2 .2
2 .3
6 .1
Purchase of property, plant and equipment and intangible assets
3 .2, 3 .3
Proceeds from sale of property, plant and equipment and intangible assets
Acquisition of subsidiaries, net of cash and cash equivalents acquired
Proceeds from sale of subsidiaries, net of cash and cash equivalents sold
Acquisition of equity-accounted investees
Proceeds from sale of equity-accounted investees
Purchase of other financial assets
Proceeds from other financial assets
Other cash flows from investing activities
Cash flow used in investing activities
Issuance of financial liabilities
Repayment of financial liabilities
Repayment of lease liabilities
Dividends paid to equity holders of Swisscom Ltd
Dividends paid to non-controlling interests
Acquisition of non-controlling interests
Other cash flows from financing activities
Cash flow used in financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at 1 January
Foreign currency translation adjustments in respect of cash and cash equivalents
Cash and cash equivalents at 31 December
5 .2
5 .2
5 .2
5 .2
2 .2
2 .2
2 .3
2 .1
2021
1,833
319
10
(269)
173
2,131
281
(10)
1
(120)
112
(11)
65
(73)
(9)
14
1
(81)
(44)
(279)
4,044
(2,270)
17
(42)
1
(3)
149
(73)
120
(19)
(2,120)
350
(792)
(259)
(1,140)
(1)
–
(14)
2020
1,528
271
(4)
(41)
193
2,149
286
(10)
1
(101)
100
(16)
178
(22)
65
24
15
(93)
(45)
(309)
4,169
(2,188)
16
(39)
–
(15)
–
(121)
20
(4)
(2,331)
732
(1,110)
(287)
(1,140)
(1)
(1)
(17)
(1,856)
(1,824)
68
340
(7)
401
14
328
(2)
340
Consolidated statement
of changes in equity
In CHF million
Share
capital
Capital
reserves
Foreign
currency
Retained translation
earnings adjustments
Equity
attributable
Non-
to equity
Hedging holders of controlling
interests
Swisscom
reserves
Balance at 1 January 2020
52
136
10,454
(1,781)
11
8,872
Net income
Other comprehensive income
Comprehensive income
Dividends paid
Other changes
–
–
–
–
–
–
–
–
–
–
1,530
252
1,782
(1,140)
(11)
–
(10)
(10)
–
–
Balance at 31 December 2020
52
136
11,085
(1,791)
Net income
Other comprehensive income
Comprehensive income
Dividends paid
Other changes
–
–
–
–
–
–
–
–
–
–
1,832
709
2,541
(1,140)
(1)
–
(73)
(73)
–
–
Balance at 31 December 2021
52
136
12,485
(1,864)
–
(3)
(3)
–
–
8
–
(6)
(6)
–
–
2
1,530
239
1,769
(1,140)
(11)
9,490
1,832
630
2,462
(1,140)
(1)
10,811
3
(2)
–
(2)
(1)
1
1
1
–
1
(1)
1
2
Total
equity
8,875
1,528
239
1,767
(1,141)
(10)
9,491
1,833
630
2,463
(1,141)
–
10,813
111
Notes to the consolidated
financial statements
The financial report is a translation from the original German version. In case of any inconsistency the German
version shall prevail.
General information and changes in accounting policies
General information
The Swisscom Group (hereinafter referred to as ‘Swisscom’) provides telecommunications services, and is active
primarily in Switzerland and Italy. The consolidated financial statements for the year ended 31 December 2021
comprise Swisscom Ltd, as the parent company, and its subsidiaries. Swisscom Ltd is a public limited company
with special status under Swiss law and has its registered office in Ittigen (Berne). Its address is: Swisscom Ltd,
Alte Tiefenaustrasse 6, 3048 Worblaufen. Swisscom is listed on the SIX Swiss Exchange. The number of issued
shares is unchanged from the prior year and totals 51,801,943. The shares have a nominal value of CHF 1 and are
fully paid-up. Each share entitles the holder to one vote. The majority shareholder of Swisscom Ltd remains, as in
the prior year, the Swiss Confederation (‘Confederation’). The Confederation is obligated by current law to hold
the majority of the capital and voting rights. The Board of Directors of Swisscom approved the issuance of these
consolidated financial statements on 2 February 2022. As of this date, no material events after the reporting date
have occurred. The consolidated financial statements are subject to approval by the shareholders of Swisscom Ltd
in its Annual General Meeting to be held on 30 March 2022.
Basis of preparation
The consolidated financial statements of Swisscom have been prepared in accordance with International Financial
Reporting Standards (IFRS), and in compliance with the provisions of Swiss law. The reporting period covers twelve
months. The consolidated financial statements are presented in Swiss francs (CHF), which corresponds to the
functional currency of Swisscom Ltd. Unless otherwise noted, all amounts are stated in millions of Swiss francs.
The consolidated financial statements are drawn up on the historical cost basis, unless a standard or interpreta-
tion prescribes another measurement basis for a particular line item, in which case this is explicitly stated in the
accounting policies. Material accounting policies of relevance for an understanding of the consolidated financial
statements are set out in the specific notes to the financial statements.
Significant judgements, estimates and assumptions in applying the accounting policies
The preparation of consolidated financial statements is dependent upon assumptions and estimates being made
in applying the accounting policies, for which management can exercise a certain degree of judgement. In par-
ticular, this concerns the following positions:
Description
Leases
Property, plant and equipment
Intangible assets
Goodwill
Provisions for dismantlement and restoration costs
Provision for regulatory and competition law procedures
Defined benefit plans
Further information
Note 2 .3
Note 3 .2
Note 3 .3
Note 3 .4
Note 3 .5
Note 3 .5
Note 4 .3
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Amendments to International Financial Reporting Standards and Interpretations
which are to be applied for the first time in the financial year
Standard
Name
Amendments to IFRS 9, IAS 39, IFRS 7,
IFRS 4 and IFRS 16
IBOR reform: phase 2
As of 1 January 2021, Swisscom adopted various amendments to existing International Financial Reporting
Standards (IFRS) and Interpretations, which have no material impact on the results or financial position of the
Group. Further information regarding the changes to the IFRS which must be applied in 2022 or later are set out in
Note 6.3.
Changes in the presentation
In order to better reflect the operating nature of proceeds from finance lease arrangements, these will be reported
under cash flows from operating activities from 2021 onwards. Previously, these cash flows were presented in
investing activities. The prior year’s comparatives have been restated accordingly. As a result of the amendment,
cash inflow from operating activities and cash outflow from investing activities each increased by CHF 100 million
for the 2020 financial year.
113
1 Operating performance
This chapter sets out information on the operating performance of Swisscom
in the current financial year . The classification according to operating segments
corresponds to the reporting system used internally to evaluate performance
and allocate resources as well as to Swisscom’s management structure .
1.1 Segment information
Changes in segment reporting
As of 1 January 2021, Swisscom amended its organisational structure in Switzerland and the segment formerly
known as IT, Network & Infrastructure was renamed Infrastructure & Support Functions. The departments with
overlapping functions were merged organisationally at Swisscom Switzerland. As a result, the Group Headquarters
division is no longer reported separately in segment reporting. In addition, Swisscom transferred various divisions
between the segments of Swisscom Switzerland and the Other Operating Segments as of 1 January 2021. The prior
year’s figures were restated as follows:
In CHF million
Net revenue
2020 financial year
Residential Customers
Business Customers
Wholesale
Infrastructure & Support Functions (previously IT, Network & Infrastructure)
Elimination
Swisscom Switzerland
Fastweb
Other Operating Segments
Elimination
Total net revenue
Segment result
2020 financial year
Residential Customers
Business Customers
Wholesale
Infrastructure & Support Functions (previously IT, Network & Infrastructure)
Swisscom Switzerland
Fastweb
Other Operating Segments
Group Headquarters
Elimination
Total segment result
Reported
Adjustment
Restated
4,564
3,100
976
85
(450)
8,275
2,470
1,020
(665)
11,100
2,586
1,235
523
(2,556)
1,788
166
111
(64)
(99)
1,902
(4)
–
–
(2)
(19)
(25)
–
(6)
31
–
(2)
3
–
(64)
(63)
–
(1)
64
–
–
4,560
3,100
976
83
(469)
8,250
2,470
1,014
(634)
11,100
2,584
1,238
523
(2,620)
1,725
166
110
–
(99)
1,902
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General information
Swisscom Group
Swisscom Switzerland
Residential
Customers
Business
Customers
Wholesale
Infrastructure
& Support
Functions
Fastweb
Other Operating
Segments
Segment
Activity
Residential Customers
Business Customers
Wholesale
Infrastructure & Support
Functions
Fastweb
The Residential Customers segment provides mobile and fixed-network services in Switzerland, such as telephony, broad-
band, TV and mobile offerings . The segment also includes the sale of terminal equipment .
The Business Customers segment focuses on telecom services and overall communications solutions for large corporations
and customers from small and medium-sized enterprises in Switzerland . Its offering in the area of business ICT infrastruc-
ture covers the entire range from individual products to complete solutions .
This segment incorporates the use of the Swisscom fixed-line and mobile network by other telecommunications service
providers and the use of external networks by Swisscom . In addition, Wholesale includes roaming by foreign operators
whose customers use the Swisscom mobile network, as well as broadband services and regulated access services to the
access network .
The segment Infrastructure & Support functions is responsible for the planning, operation and maintenance of Swisscom’s
network infrastructure and all IT systems . It is responsible for the development and production of IT and network services
in Switzerland . In addition, Infrastructure & Support Functions also includes Group-wide support functions such as finance,
human resources or strategy as well as the management of real estate and the vehicle fleet in Switzerland .
Fastweb provides broadband and mobile services to residential, business and wholesale customers in Italy . The offering
includes telephony, broadband and mobile offerings . For business customers, Fastweb offers comprehensive ICT solutions .
Other Operating Segments Other Operating Segments mainly comprises Digital Business and Participations . Digital Business mainly comprises Swiss-
com Directories Ltd (localsearch), which operates in the field of online directories and telephone directories . Participations
mainly comprises the subsidiaries cablex Ltd and Swisscom Broadcast Ltd . The operations of cablex Ltd are in the building
and maintenance of wired and wireless networks in Switzerland, primarily in the field of telecommunications . Swisscom
Broadcast Ltd is the leading provider in Switzerland of broadcast services, of cross-platform retail media services, and of
security communications .
Reporting is divided into the segments Residential Customers, Business Customers, Wholesale, and Infra-
structure & Support Functions, which are grouped under Swisscom Switzerland, as well as Fastweb and Other
Operating Segments.
For its services, the Infrastructure & Support Functions segment does not charge any network costs or manage-
ment fees to other segments. Any other services between the segments are charged at market prices. The results
of the Residential Customers, Business Customers and Wholesale segments thus correspond to a contribution
margin before network costs.
Segment expense encompasses the direct and indirect costs, which include personnel expense and other oper-
ating costs less capitalised costs of self-constructed assets and other income. Pension cost includes ordinary
employer contributions. The difference between the ordinary employer contributions and the pension cost as
provided for under IAS 19 is reported in the column ‘Eliminations’. The Eliminations segment result of CHF –20
million (prior year: CHF –99 million) includes income of CHF 14 million (prior year: expense of CHF 65 million) as
a pension cost reconciliation item in accordance with IAS 19.
Leases between the segments are not recognised in the balance sheet in accordance with IFRS 16. The reported
lease expense of the segments comprises depreciation and interest on right-of-use assets excl. depreciation of pre-
paid indefeasible rights of use (IRU) of CHF 23 million (prior year: CHF 24 million), impairments on right-of-use
assets of CHF 1 million (prior year: CHF 7 million) and the accounting for the rental of buildings between segments.
The lease expense of assets of low value is presented as direct costs.
115
Capital expenditure consists of the purchase of property, plant and equipment and intangible assets and pay-
ments for indefeasible rights of use (IRU). In general, IRU are paid in full at the beginning of the usage period. If
the criteria of IFRS 16 are met, they are classified as a lease. From an economic point of view, pre-paid IRU will be
considered as capital expenditure in the segment information. IRU payments in 2021 amounted to CHF 16 mil-
lion (prior year: CHF 41 million).
Swisscom Switzerland sometimes sells mobile handsets at a subsidised rate as part of a bundled offering with a
mobile contract. As a result of the reallocation of revenue over the pre-delivered components (mobile handset),
revenue is recognised earlier than the date of invoicing. This results in contract assets deriving from this business
being recognised. In the segment reporting of Swisscom Switzerland, the recognition and derecognition of these
contract assets is reported as other revenue. The amounts invoiced are reported under revenue from telecoms
services or merchandise.
Segment information 2021
2021, in CHF million
Residential customers
Corporate customers
Wholesale customers
Net revenue from external customers
Net revenue from other segments
Net revenue
Direct costs
Indirect costs
Segment result before depreciation and amortisation
Lease expense
Depreciation and amortisation
Segment result
Interest expense on lease liabilities
Operating income
Financial income and financial expense, net
Result of equity-accounted investees
Income before income taxes
Income tax expense
Net income
Swisscom
Switzerland
4,515
3,004
658
8,177
56
8,233
(1,826)
(2,954)
3,453
(232)
(1,475)
1,746
Other
Operating
Segments
–
431
–
431
602
Fastweb
1,233
1,057
285
2,575
8
2,583
1,033
(933)
(758)
892
(58)
(637)
197
(72)
(795)
166
(11)
(56)
99
Elimi-
nation
–
–
–
–
(666)
(666)
52
581
(33)
–
13
(20)
Segment result before depreciation and amortisation
Capital expenditure
Lease expense
Operating free cash flow proxy
3,453
(1,642)
(232)
1,579
892
(649)
(58)
185
166
(41)
(11)
114
(33)
46
–
13
Total
5,748
4,492
943
11,183
–
11,183
(2,779)
(3,926)
4,478
(301)
(2,155)
2,022
44
2,066
96
(10)
2,152
(319)
1,833
4,478
(2,286)
(301)
1,891
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Segment information Swisscom Switzerland 2021
Residential
Customers
Business
Customers
Whole-
sale
Infrastructure
& Support
Functions
Elimi-
nation
Total
Swisscom
Switzerland
2021, in CHF million
Fixed-line
Mobile
Telecom services
Solution business
Merchandise
Wholesale
Revenue other
Net revenue from external customers
4,515
2,982
Net revenue from other segments
Net revenue
Direct costs
Indirect costs
77
4,592
(1,135)
(686)
76
3,058
(821)
(950)
Segment result before depreciation and amortisation
2,771
1,287
1,987
1,854
3,841
–
548
–
126
927
710
1,637
1,111
228
–
6
(40)
(55)
(31)
(67)
2,676
1,189
–
–
–
–
–
658
–
658
313
971
(426)
(20)
525
(1)
–
524
–
–
–
–
–
–
22
22
54
76
(7)
(1,200)
(1,131)
(160)
(1,353)
(2,644)
(40)
(42)
–
(1,560)
Swisscom
Switzerland
4,484
3,048
661
8,193
57
8,250
(1,772)
(3,012)
3,466
(232)
(1,509)
1,725
Other
Operating
Segments
–
445
–
445
569
Fastweb
1,214
973
275
2,462
8
2,470
1,014
(887)
(743)
840
(56)
(618)
166
(70)
(760)
184
(12)
(62)
110
–
–
–
–
–
–
–
–
(464)
(464)
563
(98)
1
–
–
1
–
Elimi-
nation
–
–
–
–
(634)
(634)
60
466
(108)
–
9
(99)
Lease expense
Depreciation and amortisation
Segment result
Capital expenditure
Segment information 2020
2020, in CHF million, restated
Residential customers
Corporate customers
Wholesale customers
Net revenue from external customers
Net revenue from other segments
Net revenue
Direct costs
Indirect costs
Segment result before depreciation and amortisation
Lease expense
Depreciation and amortisation
Segment result
Interest on lease liabilities
Operating income
Financial income and financial expense, net
Result of equity-accounted investees
Income before income taxes
Income tax expense
Net income
Segment result before depreciation and amortisation
Capital expenditure
Lease expense
Operating free cash flow proxy
3,466
(1,599)
(232)
1,635
840
(629)
(56)
155
184
(44)
(12)
128
(108)
43
–
(65)
2,914
2,564
5,478
1,111
776
658
154
8,177
56
8,233
(1,826)
(2,954)
3,453
(232)
(1,475)
1,746
(1,642)
Total
5,698
4,466
936
11,100
–
11,100
(2,669)
(4,049)
4,382
(300)
(2,180)
1,902
45
1,947
(152)
4
1,799
(271)
1,528
4,382
(2,229)
(300)
1,853
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Segment information Swisscom Switzerland 2020
2020, in CHF million, restated
Fixed-line
Mobile
Telecom services
Solution business
Merchandise
Wholesale
Revenue other
2,012
1,934
3,946
–
524
–
14
960
761
1,721
1,058
235
–
12
Net revenue from external customers
4,484
3,026
Net revenue from other segments
Net revenue
Direct costs
Indirect costs
76
4,560
(1,088)
(774)
74
3,100
(810)
(942)
Segment result before depreciation and amortisation
2,698
1,348
Residential
Customers
Business
Customers
Whole-
sale
Infrastructure
& Support
Functions
Elimi-
nation
Total
Swisscom
Switzerland
–
–
–
–
–
661
–
661
315
976
(433)
(19)
524
(1)
–
523
–
–
–
–
–
–
22
22
61
83
(8)
(1,179)
(1,104)
(155)
(1,361)
(2,620)
–
–
–
–
–
–
–
–
(469)
(469)
567
(98)
–
–
–
–
–
2,972
2,695
5,667
1,058
759
661
48
8,193
57
8,250
(1,772)
(3,012)
3,466
(232)
(1,509)
1,725
(1,599)
(43)
(71)
(33)
(77)
2,584
1,238
(27)
(40)
–
(1,532)
Lease expense
Depreciation and amortisation
Segment result
Capital expenditure
Disclosure by geographical regions
In CHF million
Switzerland
Italy
Other countries
Not allocated
Total
Disclosure by products and services
In CHF million
Telecom services
Solution business
Merchandise
Wholesale
Revenue other
Total net revenue
2021
Non-current
assets
15,984
3,811
11
972
2020
Non-current
assets
15,814
4,044
67
662
Net revenue
8,614
2,462
24
–
Net revenue
8,579
2,575
29
–
11,183
20,778
11,100
20,587
2021
7,673
1,111
851
942
606
2020
7,770
1,058
828
936
508
11,183
11,100
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Accounting policies
Telecoms services
Telecoms services encompass mobile and fixed-network services both in Switzerland and abroad. Mobile phone
services comprise the basic charges; in addition, they include the domestic and international cellular traffic by
Swisscom customers within Switzerland and abroad. Swisscom offers subscriptions with a monthly flat-rate fee,
the revenue for which is recognised on a straight-line basis over the minimum term of the contract. Depending
on the type of subscription, revenue is recognised on the basis of the minutes used. The minimum contract term
is generally 12 or 24 months. If a mobile handset is sold as part of a bundled offering with a mobile contract, it is
considered as a multiple-element contract. Similar multiple-element contracts are grouped into portfolios for
revenue accounting. The transaction price for multiple-element contracts is allocated to each identified perfor-
mance obligation on the basis of relative stand-alone selling prices. In this process, the stand-alone selling price
of each component is considered in relation to the sum of the stand-alone selling prices of all performance obli-
gations under the contract. The stand-alone selling prices of mobile handsets and subscriptions correspond to
Swisscom’s list price and the minimum contract term. Non-refundable connection fees which do not constitute
a separate performance obligation are considered as part of the total transaction price and allocated to the sep-
arate performance obligations arising under the customer contract on a pro rata basis. In the event that there is
no minimum contract term, the revenue is recognised at the time of connection. Fixed-network services princi-
pally comprise the basic charges for fixed telephony, broadband and TV connections, as well as the domestic and
international telephony traffic of individuals and corporate customers. In addition, Swisscom makes bundled
offerings comprising broadband and TV connections with an optional fixed-line telephony connection. These
subscription fees are flat rate. The minimum contract term is twelve months. Revenues are recognised on a
straight-line basis over the term of the contract. Revenue for telephone calls is recognised at the time when the
calls are made.
Solutions
The service area of communications and IT solutions principally comprise advisory services and the implementa-
tion, maintenance and operation of communication infrastructures. Furthermore, the area includes applications
and services, as well as the integration, operation and maintenance of data networks and outsourcing services.
Revenue from customer-specific orders is recognised using a measure of progress method, which is measured on
the basis of the relationship of the costs incurred to total anticipated costs. Revenue arising on long-term out-
sourcing contracts is recognised as a function of performance to date provided to the customer. The duration of
these contracts is generally between three and seven years. Transition projects in connection with an outsourc-
ing contract are not recorded as separate performance obligations. Maintenance revenues are recognised on a
straight-line basis over the term of the maintenance contracts. Variable consideration is only included in the
transaction price if it is highly probable that no significant revenue reversals will occur in the future.
Sales of merchandise
Mobile handsets, fixed-line devices and miscellaneous supplies are recognised as revenue at the time of delivery
or provision of the service. Swisscom sells routers and TV boxes to be used for services provided by Swisscom. As
these are only compatible with the Swisscom network and cannot be used for networks of other telecommuni-
cations service providers, they are not recorded as separate performance obligations. Revenue is deferred and
recognised over the minimum contract term of the related broadband or TV subscription.
Wholesale
The services principally comprise leased lines and the use of the Swisscom fixed network by other telecommuni-
cations service providers (roaming). Leased-line charges are recognised as revenue on a straight-line basis over
the terms of the contract. Roaming services are recognised as revenue on the basis of the call minutes or as
contractually agreed charges as of the time of providing the service. Roaming fees charged to other telecommu-
nications service providers are reported on a gross basis.
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1.2 Operating expenses
Direct costs
In CHF million
Customer premises equipment and merchandise
Services purchased
Costs to obtain a contract
Costs to fulfil a contract
Network access costs of Swiss subsidiaries
Network access costs of foreign subsidiaries
Total direct costs
Indirect costs
In CHF million
Salary and social security expenses
Other personnel expense
Total personnel expense 1
Information technology cost
Maintenance expense
Energy costs
Advertising and selling expenses
Consultancy expenses and freelance workforce
Call centre services purchased
Administration expense
Allowances for receivables and contract assets
Miscellaneous operating expenses
Total other operating expense
Capitalised self-constructed tangible and intangible assets
Own work for capitalised contract costs
Gain on sale of property, plant and equipment
Miscellaneous income
Total capitalised self-constructed assets and other income
Total indirect costs
1 See Note 4.1.
2021
1,035
730
219
31
338
426
2020
980
646
285
20
344
394
2,779
2,669
2021
2,580
87
2,667
257
284
120
201
127
139
59
64
606
1,857
(432)
(60)
(11)
(95)
(598)
2020
2,657
60
2,717
255
267
116
186
130
136
57
94
557
1,798
(359)
(40)
(11)
(56)
(466)
3,926
4,049
Capitalised self-constructed tangible and intangible assets include personnel costs for the manufacturing of tech-
nical installations, the construction of network infrastructure and the development of software for internal use.
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Accounting policies
Costs to obtain a contract
Swisscom pays commissions to dealers for the acquisition and retention of mobile-phone customers. The com-
mission payable is dependent on the type of subscription. Costs to obtain a contract are deferred and amortised
over the related revenue-recognition period. In addition, Swisscom will reimburse the dealer for any handset
subsidies they grant to customers when they take out a Swisscom mobile subscription at the same time. The
associated costs are deferred and recognised on a straight-line basis over the contract term as the costs of obtain-
ing a contract. The amortisation period corresponds to the related revenue-recognition period. See Note 1.1.
Costs to fulfil a contract
In connection with a broadband or TV subscription, the customer must purchase a router or TV box in order to
use the services of Swisscom. Routers and TV boxes may be used exclusively for services provided by Swisscom.
The cost of routers and TV boxes are reported as costs to fulfil a contract and amortised over the minimum term
of the contract. The set-up costs incurred to transfer and integrate outsourcing transactions with corporate cus-
tomers are deferred and amortised against income on a straight-line basis over the duration of the operating
contract. The amortisation period corresponds to the related revenue-recognition period. See Note 1.1.
121
2 Capital and financial risk management
The following chapter sets out the procedures and guidelines governing the
active management of the capital structure and the financial risks to which
Swisscom is exposed . Swisscom strives to achieve a robust equity basis, which
enables it to guarantee its ability to continue as a going concern and to offer
investors an appropriate return based on the risks assumed .
2.1 Capital management and equity
Ratio of net debt to EBITDA after lease expense
Swisscom has a single A credit rating with rating agencies Standard & Poor’s and Moody’s. Swisscom aims to
maintain this single A credit rating. An important quantitative criterion for the credit rating and the assessment
and control of the financial situation by the management is the ratio of net debt to operating result before
depreciation, amortisation and impairment losses after lease expense (EBITDA AL). Net debt comprises financial
liabilities less cash and cash equivalents, listed debt instruments, certificates of deposit, derivative financial instru-
ments held for hedging financial liabilities and other current financial assets. Lease expense includes depreciation
and interest on right-of-use assets excluding depreciation on prepaid indefeasible rights of use (IRU) and impair-
ment losses. The net debt to EBITDA AL ratio is as follows:
In CHF million
Net debt
EBITDA after lease expense (EBITDA AL)
Ratio net debt/EBITDA AL
31.12.2021
31 .12 .2020
5,689
4,177
1.4
6,218
4,082
1.5
Equity ratio
Swisscom strives to achieve an equity ratio of a minimum of 30%. The equity ratio is computed as follows:
In CHF million
Equity
Total assets
Equity ratio in %
31.12.2021
31 .12 .2020
10,813
24,801
43.6
9,491
24,262
39.1
Dividend policy
Swisscom pursues a dividend policy with a stable dividend, taking into account its financial situation and cash flow
generation. Distributable reserves are not determined on the basis of the equity as reported in the consolidated
financial statements but rather on the basis of equity as reported in the statutory financial statements of the
parent company, Swisscom Ltd. As at 31 December 2021, Swisscom Ltd’s distributable reserves amounted to CHF
4,691 million. The dividend is proposed by the Board of Directors and must be approved by the Annual General
Meeting of Shareholders. Treasury shares are not entitled to a dividend. Swisscom Ltd paid the following dividends
in 2020 and 2021:
In CHF million, except where indicated
Number of registered shares eligible for dividend (in millions of shares)
Ordinary dividend per share (in CHF)
Dividends paid
2021
51 .802
22 .00
1,140
2020
51 .802
22 .00
1,140
The Board of Directors will propose the payment of an unchanged dividend of CHF 22 per share for the 2021
financial year to the Annual General Meeting of Shareholders of Swisscom Ltd on 30 March 2022. This equates to
an aggregate dividend distribution of CHF 1,140 million. The expected dividend payment date is 5 April 2022.
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Earnings per share
In CHF million, except where indicated
Share of net income attributable to equity holders of Swisscom Ltd
Weighted average number of shares outstanding (number)
Basic and diluted earnings per share (in CHF)
2021
1,832
2020
1,530
51,801,334
51,800,587
35.37
29.54
Supplementary information on equity
Development of retained earnings and other reserves as well as comprehensive income 2021
In CHF million
Balance at 1 January 2021
Net income
Actuarial gains and losses from defined
benefit pension plans
Change in fair value of equity instruments
Income tax expense
Items that will not be reclassified
to income statement
Foreign currency translation adjustments
of foreign subsidiaries
Foreign currency translation losses of foreign
subsidiaries transferred to income statement
Fair value losses of cash flow hedges transferred
to income statement
Equity-accounted investees
Income tax expense
Items that may be reclassified
to income statement
Other comprehensive income
Comprehensive income
Dividends paid
Other changes
Foreign
currency
Retained
translation
earnings adjustments
11,085
(1,791)
1,832
777
84
(152)
709
–
–
–
–
–
–
709
2,541
(1,140)
(1)
–
–
–
–
–
(107)
25
–
2
7
(73)
(73)
(73)
–
–
Balance at 31 December 2021
12,485
(1,864)
Hedging
reserves
Equity
holders of
Swisscom
Non-
controlling
interests
8
–
–
–
–
–
–
–
(7)
–
1
(6)
(6)
(6)
–
–
2
9,302
1,832
777
84
(152)
709
(107)
25
(7)
2
8
(79)
630
2,462
(1,140)
(1)
10,623
1
1
–
–
–
–
–
–
–
–
–
–
–
1
(1)
1
2
Total
9,303
1,833
777
84
(152)
709
(107)
25
(7)
2
8
(79)
630
2,463
(1,141)
–
10,625
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Development of retained earnings and other reserves as well as comprehensive income 2020
Foreign
currency
Retained
translation
earnings adjustments
Hedging
reserves
Equity
holders of
Swisscom
Non-
controlling
interests
10,454
(1,781)
11
In CHF million
Balance at 1 January 2020
Net income
Actuarial gains and losses from defined benefit pension plans
Change in fair value of equity instruments
Income tax expense
Items that will not be reclassified to income statement
Foreign currency translation adjustments of foreign subsidiaries
Fair value losses of cash flow hedges transferred to income statement
Equity-accounted investees
Items that may be reclassified
to income statement
Other comprehensive income
Comprehensive income
Dividends paid
Other changes
1,530
330
(10)
(68)
252
–
–
–
–
252
1,782
(1,140)
(11)
–
–
–
–
–
(5)
–
(5)
(10)
(10)
(10)
–
–
–
–
–
–
–
–
(3)
–
(3)
(3)
(3)
–
–
8
Balance at 31 December 2020
11,085
(1,791)
2.2 Financial liabilities
In CHF million
Balance at 1 January
Issuance of bank loans
Issuance of debenture bonds
Issuance of other financial liabilities
Issuance of financial liabilities
Repayment of bank loans
Repayment of debenture bonds
Repayment of other financial liabilities
Repayment of financial liabilities
Interest expense
Interest payments
Foreign currency translation adjustments
Change in fair value
Accrual of deferred purchase price margins from business combinations
Expenses for deferred consideration arising on business combinations 1
Other changes
Balance at 31 December
Bank loans
Debenture bonds
Private placements
Derivative financial instruments 2
Other financial liabilities
Total financial liabilities
Thereof current financial liabilities
Thereof non-current financial liabilities
1 Reported in the cash flow statement as cash flow used in investing activities.
2 See Note 2.5.
See Note 5.2.
8,684
1,530
330
(10)
(68)
252
(5)
(3)
(5)
(13)
239
1,769
(1,140)
(11)
9,302
3
(2)
–
–
–
–
–
–
–
–
–
(2)
(1)
1
1
2021
7,042
221
100
29
350
(192)
(544)
(56)
(792)
63
(81)
(88)
(25)
6
(10)
(20)
6,445
488
5,564
151
64
178
6,445
559
5,886
Total
8,687
1,528
330
(10)
(68)
252
(5)
(3)
(5)
(13)
239
1,767
(1,141)
(10)
9,303
2020
7,460
2
719
11
732
(557)
(540)
(13)
(1,110)
75
(93)
(41)
6
–
(26)
39
7,042
484
6,110
151
90
207
7,042
792
6,250
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Credit lines
Swisscom has two confirmed lines of credit. In 2021, one line of credit was increased from CHF 1,000 million to
CHF 1,200 million and the maturity date was extended to 2026. The second line of credit of CHF 1,000 million
was converted in 2021 into a sustainability linked loan with a maturity date in 2026. The amount of the credit
margin is linked to the achievement of defined sustainability targets by Swisscom. The two confirmed lines of
credit are affected by the Interest Rate Benchmark Reform (known as the IBOR Reform). In Switzerland, the
changeover from the reference interest rate LIBOR to SARON is taking place. In the course of the renewal or con-
version of the lines of credit, the reference interest rate for CHF was also changed from LIBOR to SARON in each
case. As of 31 December 2021, none of these lines of credit had been drawn down, as in the prior year.
Bank loans
In CHF million
Bank loans in CHF 1
Bank loans in EUR 1, 3
Bank loans in EUR 2, 3
Bank loans in USD 2
Bank loans in USD 2
Total bank loans
1 Variable interest-bearing.
2 Fixed interest-bearing.
Maturity years
2020–2021
2021–2023
2017–2024
2009–2028
2009–2028
Par value
in currency
Nominal
interest rate
Effective
interest rate
31.12.2021
31 .12 .2020
Carrying amount
199
0 .00%
200 Euribor +0 .63%
150
58
51
0 .67%
8 .30%
7 .65%
0 .00%
0 .10%
0 .67%
4 .62%
4 .63%
–
207
155
68
58
488
199
–
163
66
56
484
3 Designated for hedge accounting of net investments in foreign operations.
As of 31 December 2021, Swisscom had not taken on any short-term bank loans on a weekly or monthly basis (prior
year: CHF 199 million). In the second quarter of 2021, Swisscom took on a bank loan of EUR 200 million (CHF 207
million), maturing in 2023. The funds received were used to repay existing debt. Bank loans to the value of EUR 350
million (CHF 362 million) may become due for immediate repayment if the shareholding of the Confederation in
the capital of Swisscom falls below one third, or if another shareholder can exercise control over Swisscom.
125
Debenture bonds
In CHF million
Maturity years
Par value
in currency
Nominal
interest rate
Effective
interest rate
31.12.2021
31 .12 .2020
Carrying amount
Debenture bond in EUR
(ISIN: XS1051076922) 1
Debenture bond in CHF
(ISIN: CH0114695379)
Debenture bond in CHF
(ISIN: CH0268988174) 2
Debenture bond in CHF
(ISIN: CH0188335365)
Debenture bond in EUR
(ISIN: XS1288894691)
Debenture bond in CHF
(ISIN: CH0247776138)
Debenture bond in EUR
(ISIN: XS1803247557) 1
Debenture bond in CHF
(ISIN: CH0344583783) 2
Debenture bond in CHF
(ISIN: CH0362748359)
Debenture bond in CHF
(ISIN: CH0317921663)
Debenture bond in CHF
(ISIN: CH0437180935)
Debenture bond in EUR
(ISIN: XS21692434791) 1
Debenture bond in CHF
(ISIN: CH0254147504)
Debenture bond in CHF
(ISIN: CH0419040982)
Debenture bond in CHF
(ISIN: CH0515152467)
Debenture bond in CHF
(ISIN: CH0336352775)
Debenture bond in CHF
(ISIN: CH0373476164)
Debenture bond in CHF
(ISIN: CH1112455766)
Debenture bond in CHF
(ISIN: CH0580291968)
Debenture bond in CHF
(ISIN: CH0268988182) 2
Debenture bond in CHF
(ISIN: CH0494734335)
Total debenture bonds
2014–2021
2010–2022
2015–2023
2012–2024
2015–2025
2014–2026
2018–2026
2016–2027
2017–2027
2016–2028
2018–2028
2020–2028
2014–2029
2019–2029
2020–2031
2016–2032
2017/
2019–2033
2021–2033
2020–2034
2015/
2018–2035
2019–2044
500
500
250
500
500
200
500
200
350
200
150
500
160
200
100
300
230
100
100
300
125
1 .88%
2 .06%
2 .63%
2 .81%
0 .25%
–0 .38%
3
1 .75%
1 .77%
1 .75%
–0 .06%
4
1 .50%
1 .47%
1 .13%
1 .25%
0 .38%
–0 .37%
3
0 .38%
0 .39%
0 .38%
0 .30%
0 .75%
0 .72%
0 .38%
0 .53%
1 .50%
1 .47%
0 .50%
0 .43%
0 .13%
0 .15%
0 .13%
0 .14%
0 .75%
0 .66%
0 .25%
0 .27%
0 .25%
0 .27%
1 .00%
0 .26%
3
0 .00%
0 .00%
–
503
252
504
537
202
515
203
351
202
151
511
161
201
100
299
233
100
100
314
542
503
255
504
578
202
538
208
351
202
151
534
161
201
100
299
233
–
100
323
125
5,564
125
6,110
1 Designated for hedge accounting of net investments in foreign operations.
2 Thereof CHF 575 million designated for fair value hedge accounting.
3 After hedging with interest rate swap.
4 After hedging with currency swap and taking hedge accounting into consider-
ation.
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In the second quarter of 2021, Swisscom issued a green bond for CHF 100 million. It has a coupon of 0.25% and
matures in 2033. The funds raised were used within the Green Bond Framework. Swisscom repaid a EUR 500
million (CHF 544 million) bond upon maturity in the third quarter of 2021.
In the second quarter of 2020, Swisscom became the first listed company in Switzerland to issue a Green Bond in
EUR. The amount borrowed totalled EUR 500 million (CHF 519 million). The coupon was 0.375% and the bond has
a maturity of 8.5 years. The funds raised will be used within Swisscom’s Green Bond Framework. In the third
quarter of 2020, Swisscom issued a CHF 100 million bond with a maturity of 11 years and a coupon of 0.125%. In
the fourth quarter of 2020, Swisscom issued a CHF 100 million bond with a maturity of 14 years and a coupon of
0.245%. The funds received were used to repay existing debt. Swisscom repaid a EUR 500 million (CHF 540 million)
bond upon maturity in the third quarter of 2020.
Private placements
The outstanding private placement of CHF 150 million matures in 2031. It may become due for immediate repay-
ment if the shareholding of the Confederation in the capital of Swisscom falls below 35% or if another share-
holder can exercise control over Swisscom.
Other financial liabilities
As at 31 December 2021, the carrying amount of other financial liabilities was CHF 178 million (prior year: CHF
207 million), consisting primarily of loans.
2.3 Leases
Lessee
Swisscom’s leases comprise the rental of operation and office buildings, antenna sites, and network infrastructure
in particular. In addition, indefeasible rights of use (IRU) are classified as leases under IFRS 16. In general, IRU are
paid in full at the beginning of use. The Italian subsidiary Fastweb procures various access services from other
fixed-network operators and uses their connection cables to the end customer. Swisscom applies the low value
asset exemption for these leases. Accordingly, no right-of-use assets and lease liabilities will be recognised for
these access services, the costs of which will be reported as direct costs. There are no material lease commit-
ments arising from leases that began after the balance sheet date.
Swisscom concluded two agreements in 2001 for the sale of real estate. At the same time, it entered into long-
term agreements to lease back part of the real estate sold which, in part, qualify as finance leases. The gain
realised on real estate classified as finance leases was deferred. As at 31 December 2021, the carrying amount of
the deferred gains was CHF 95 million (prior year: CHF 106 million). The deferred gains are released to other
income over the term of the individual leases.
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Right-of-use assets
In CHF million
At cost
Balance at 1 January 2020
Additions
Disposals
Business combinations
Foreign currency translation adjustments
Balance at 31 December 2020
Additions
Disposals
Sales of subsidiaries
Foreign currency translation adjustments
Balance at 31 December 2021
Accumulated depreciation and impairment losses
Balance at 1 January 2020
Depreciation
Impairments
Disposals
Foreign currency translation adjustments
Balance at 31 December 2020
Depreciation
Impairments
Disposals
Foreign currency translation adjustments
Balance at 31 December 2021
Net carrying amount
Net carrying amount at 31 December 2021
Net carrying amount at 31 December 2020
Net carrying amount at 1 January 2020
Lease liabilities
In CHF million
Balance at 1 January
Additions
Interest expense
Payments
Disposals
Business combinations
Foreign currency translation adjustments
Balance at 31 December
Land and buildings
Technical installations
Other leases
Total lease liabilities 1
Thereof current lease liabilities
Thereof non-current lease liabilities
1 Note 2.5 shows the maturity analysis for lease liabilities.
Land
and buildings
Technical
installations
Other
right-of-use
assets
1,999
202
(29)
1
(1)
2,172
261
(78)
(1)
(13)
2,341
(393)
(223)
(7)
22
–
(601)
(223)
(1)
71
3
(751)
1,590
1,571
1,606
1,006
53
(9)
–
(4)
1,046
47
(12)
–
(43)
1,038
(442)
(53)
–
9
1
(485)
(53)
–
12
21
(505)
533
561
564
8
3
(1)
–
–
10
9
(1)
–
–
18
(1)
(3)
–
–
–
(4)
(4)
–
1
–
(7)
11
6
7
2021
1,988
317
44
(303)
(7)
–
(22)
Total
3,013
258
(39)
1
(5)
3,228
317
(91)
(1)
(56)
3,397
(836)
(279)
(7)
31
1
(1,090)
(280)
(1)
84
24
(1,263)
2,134
2,138
2,177
2020
2,027
258
45
(332)
(8)
1
(3)
2,017
1,988
1,653
349
15
2,017
217
1,800
1,624
356
8
1,988
226
1,762
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Income and expenses arising from leases
In CHF million
Revenue
Income from leases excluding subleases
Income from subleases
Other income
Deferred gain on sale and leaseback of real estate
Financial income
Interest income on finance lease
Direct costs
Expense from leases of low value assets
Depreciation and impairment losses
Depreciation of right-of-use assets
Impairment losses on right-of-use assets
Financial expense
Interest expense on lease liabilities
2021
189
6
11
2
2020
187
7
16
2
(110)
(134)
(280)
(1)
(279)
(7)
(44)
(45)
Lessor
Swisscom supplies other providers of telecommunications services with access lines for use, which are classified
either as finance or operating leases. At the same time, Swisscom leases space in operations and offices buildings
and at antenna sites, which is classified as an operating lease. Future lease payments in respect of receivables
from finance leases as at 31 December 2020 and 2021 break down as follows:
In CHF million
Within 1 year
Between 1 and 2 years
Between 2 and 3 years
Between 3 and 4 years
Between 4 and 5 years
After 5 years
Total future payments from finance leases
Future interest income
Total receivables from finance leases
Thereof current receivables from finance leases
Thereof non-current receivables from finance leases
31.12.2021
31 .12 .2020
33
24
7
6
4
26
100
(1)
99
33
66
34
22
6
4
3
19
88
(1)
87
33
54
Future lease payments in respect of operating leases are as follows as at 31 December 2020 and 2021:
In CHF million
Within 1 year
Between 1 and 2 years
Between 2 and 3 years
Between 3 and 4 years
Between 4 and 5 years
After 5 years
31.12.2021
31 .12 .2020
44
40
39
39
38
38
62
41
39
38
15
16
Total future payments from operating leases
238
211
129
Significant judgements or estimates
When determining the terms of leases, management considers all facts and circumstances that encompass an
economic incentive to exercise renewal options or not exercise termination options. Renewal and termination
options are only included in the contract term where there is sufficient certainty that they will be exercised. This
assessment is reviewed in the event of a material occurrence or change in circumstances that may affect the
previous assessment, where this is within the lessee’s control.
Accounting policies
Financial liabilities
Financial liabilities are initially recognised at fair value less direct transaction costs. In subsequent accounting
periods, they are re-measured at amortised cost using the effective interest method.
Leases
A lease is a contract or part of a contract that transfers the right to control the use of an identifiable asset for an
agreed period of time in return for payment. In particular, Swisscom leases comprise the rental of operation and
office buildings, antenna sites as well as network infrastructure and indefeasible rights of use (IRU). As a lessee,
for each lease Swisscom recognises a lease liability for future lease payments and a right of use for the underly-
ing asset as at the time when the leased asset becomes available to Swisscom. The lease payments are divided
into a repayment component and an interest component. The interest component is recognised as an interest
expense over the lease term computed on the basis of the effective interest method. The right-of-use asset is
depreciated on a straight-line basis over the shorter of the useful life and the lease term. As a lessor, Swisscom has
to distinguish between finance and operating leases. A lease is recorded as a finance lease whenever essentially
all of the risks and rewards incidental to ownership of the asset are transferred. Unless implicitly specified in the
lease, the interest rate used to measure the rights of use and lease liabilities is the incremental borrowing rate.
In the area of network access services, for selected leases Swisscom applies the exemptions regarding the sepa-
ration of lease and non-lease components. The non-lease components are accounted for in accordance with
other standards. Swisscom procures various access services from other network operators and uses their connec-
tion cables to the end customer. Under IFRS 16, part of these access services is classified as a lease. The value of the
individual connection cable fulfils the criteria as an asset of low value. Swisscom applies the low value asset
exemption for these leases. Accordingly, no right-of-use assets and lease liabilities will be recognised for these
access services, the costs of which will continue to be reported as operating expense. The exemption for short-
term leases is not applied. A number of leases for the rental of operation and office buildings include renewal
and termination options which are taken into account in the initial measurement by category of building. Rental
contracts of antenna sites have an initial lease term of 10 to 15 years. In general, these rental contracts include
renewal and mutual termination options. For these leases, it is not reasonably certain that all renewal options
will be exercised. Accordingly, no renewal options are taken into account in the initial measurement of lease con-
tracts of antenna sites. Given Swisscom’s planning horizon of a maximum of five years and technological develop-
ments, it is not possible to estimate the amount of additional undiscounted payments which are currently not
included in the lease liabilities.
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2.4 Financial result
In CHF million
Interest income on financial assets
Foreign exchange gains
Change in fair value of interest rate swaps 1
Gain on sale of equity-accounted investees 2
Gain on exchange of financial assets
Other financial income
Total financial income
Interest expense on financial liabilities
Interest expense on lease liabilities
Interest expense on defined benefit obligations 3
Foreign exchange losses
Change in fair value of interest rate swaps 1
Present-value adjustments on provisions 4
Other financial expense
Total financial expense
Financial income and financial expense, net
Interest expense on lease liabilities
Net interest expense on financial assets and liabilities
1 See Note 2.5.
2 See Note 5.3.
3 See Note 4.3.
4 See Note 3.5.
2021
3
14
21
219
–
12
269
(63)
(44)
(1)
–
–
(32)
(33)
(173)
96
(44)
(60)
2020
6
–
–
–
31
4
41
(75)
(45)
(2)
(5)
(9)
(39)
(18)
(193)
(152)
(45)
(69)
In the third quarter of 2020, Swisscom exchanged certificates of deposit for U.S. treasury bond strips (listed debt
instruments). The exchange of financial assets resulted in a valuation difference of CHF 31 million, which was rec-
ognised as financial income.
2.5 Financial risk management
Swisscom is exposed to various financial risks arising from its operating and financing activities. Financial risk
management is conducted in accordance with established guidelines, with the objective of containing the
potential adverse effects thereof on the financial situation of Swisscom. The identified risks and measures to
minimise them are presented below:
Risk
Source
Risk mitigation
Currency risks
Swisscom is exposed to foreign exchange changes
which can impact the Group’s cash flows,
financial result and equity .
● Reduction in cash flow volatility by use of forward
currency contracts/swaps and currency swaps and
designation for hedge accounting (transaction risk)
● Reduction in translation risk by foreign currency
financing and designation for hedge accounting
● Hedging of currency risk of foreign currency financing
by use of currency swaps
● Use of interest rate swaps to manage
fixed/variable share of financial debt
● Guideline establishing minimum requirements
for counterparties
● Designated counterparty limits
● Employment of netting agreements foreseen under
ISDA (International Swaps and Derivatives Association)
Interest rate risks result from changes in interest rates
which can negatively impact cash flows and the financial
situation of Swisscom .
Through its operating business activities and derivative
financial instruments and financial investments,
Swisscom is exposed to the risk of default
of a counterparty .
Interest rate risk
Credit risks
from operating
business activities
and financial
transactions
Liquidity risk
Prudent liquidity management involves the holding
of adequate reserves of cash and cash equivalents,
negotiable securities as well as the possibility
of obtaining confirmed lines of credit .
● Use of collateral agreements
● Procedures and principles
to ensure adequate liquidity
● Two guaranteed bank credit lines
totaling CHF 2,200 million
131
Foreign exchange risks
As regards financial instruments, the following currency risks and hedging contracts existed for foreign currencies
as of 31 December 2020 and 2021:
In CHF million
Cash and cash equivalents
Trade receivables
Other financial assets
Financial liabilities
Trade payables
Net exposure at carrying amounts
Net exposure to forecasted cash flows in the next 12 months
Net exposure before hedges
Forward currency contracts
Foreign currency swaps
Currency swaps
Hedges
Net exposure
EUR
11
6
13
(1,931)
(60)
(1,961)
(15)
(1,976)
–
131
517
648
(1,328)
31.12.2021
31 .12 .2020
USD
14
7
403
(217)
(41)
166
(219)
(53)
219
(36)
–
183
130
EUR
30
(15)
30
(2,350)
(37)
(2,342)
2
(2,340)
–
86
540
626
(1,714)
USD
19
9
315
(221)
(49)
73
(307)
(234)
307
(34)
–
273
39
In addition, as at 31 December 2021, Swisscom had outstanding financial liabilities with a nominal value totalling
EUR 1,350 million (CHF 1,395 million, prior year: EUR 1,650 million, CHF 1,782 million), which are designated for
hedge accounting of net investments in foreign operations. In 2021, income of CHF 61 million (prior year: income
of CHF 9 million) arising from the measurement of financial liabilities was recognised in other comprehensive
income in the position of foreign currency translation of foreign Group companies. As at 31 December 2021, the
cumulative positive amount of foreign currency translation differences in equity totals CHF 304 million.
Foreign currency sensitivity analysis
The following sensitivity analysis shows the impact on the income statement should the EUR/CHF and USD/CHF
exchange rates change in line with their implicit volatility over the next twelve months. The analysis assumes
that all other variables, in particular the interest rate level, remain constant.
In CHF million
31.12.2021
EUR volatility 5 .02%
USD volatility 6 .24%
31.12.2020
EUR volatility 5 .14%
USD volatility 6 .39%
Income impact on
Hedges for
balance sheet items balance sheet items
Planned
Hedges for
cash flows planned cash flows
98
(10)
120
(5)
(32)
2
(32)
2
1
14
–
20
–
(14)
–
(22)
The volatility of balance sheet positions and scheduled cash flows is partially offset by the volatility of the related
hedging contracts.
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Interest rate risks
The structure of interest-bearing financial instruments at nominal values is as follows:
In CHF million
Fixed interest-bearing financial liabilities
Variable interest-bearing financial liabilities
Total interest-bearing financial liabilities
Fixed interest-bearing financial assets
Variable interest-bearing financial assets
Total interest-bearing financial assets
Total interest-bearing financial assets and liabilities, net
Variable interest-bearing
Variable through interest rate swaps
Variable interest-bearing, net
Fixed interest-bearing
Variable through interest rate swaps
Fixed interest-bearing, net
Total interest-bearing financial assets and liabilities, net
31.12.2021
31 .12 .2020
6,050
230
6,280
(275)
(584)
(859)
5,421
(354)
1,092
738
5,775
(1,092)
4,683
5,421
6,565
274
6,839
(271)
(561)
(832)
6,007
(287)
1,115
828
6,294
(1,115)
5,179
6,007
Interest rate sensitivity analysis
A shift in interest rates by 100 basis points has an impact of CHF 7 million on the income statement (previous
year: CHF 8 million), but no impact on equity as at 31 December 2020 and 2021.
Credit risks
Credit risks from financial transactions
The carrying amounts of cash and cash equivalents and other financial assets exposed to credit risk (excluding trade
receivables, receivables from finance leases and contract assets) may be analysed as follows:
In CHF million
Cash and cash equivalents
Financial assets at amortised cost
Derivative financial instruments
Other assets valued at fair value
Total carrying amount of financial assets
31.12.2021
31 .12 .2020
401
356
19
2
778
340
391
79
1
811
The carrying amounts analysed by the Standard & Poor’s rating of the counterparties may be summarised as follows:
In CHF million
AAA
AA– to AA+
A– to A+
BBB– to BBB+
Without rating
Total
31.12.2021
31 .12 .2020
118
530
75
11
44
778
87
441
218
40
25
811
133
Financial risks from operating activities
Credit risks on trade receivables, contract assets and other receivables arise from the Group’s operating activities.
Credit risks from other receivables are insignificant. As an initial step, Swisscom divides the credit risks from
operating activities between Swisscom Switzerland and Fastweb. Default risks are principally impacted by the
individual attributes of the customers. They are also influenced by the default risk of customer groups and indus-
try sectors. Swisscom has a receivables management system in place to minimise default losses. New customers
are reviewed for their creditworthiness and maximum payment targets are set for customer groups. As regards
their creditworthiness, customers are divided into groups for the purposes of monitoring default risk. In the
process a differentiation is made between individual and business customers, among other things. In addition,
the ageing structure of the receivables is taken into account, as is the industry segment in which a business
customer is active. The split of trade receivables and contract assets by operating segment is as follows:
In CHF million
Notional amount
Residential Customers
Business Customers
Wholesale
Infrastructure & Support Functions
Swisscom Switzerland
Fastweb
Other Operating Segments
Total notional amount
Allowances for doubtful debts
Residential Customers
Business Customers
Wholesale
Infrastructure & Support Functions
Swisscom Switzerland
Fastweb
Other Operating Segments
Total allowances for doubtful debts
Total notional amount less allowances for doubtful debts
31.12.2021
31 .12 .2020
868
559
186
36
1,649
821
170
2,640
(51)
(22)
(4)
(1)
(78)
(48)
(25)
1,003
421
141
22
1,587
643
219
2,449
(59)
(14)
(2)
(2)
(77)
(60)
(27)
(151)
(164)
2,489
2,285
As at 31 December 2021, the maturities of trade receivables and contract assets as well as any related valuation
allowances may be analysed as follows:
In CHF million
Not overdue
Past due up to 3 months
Past due 4 to 6 months
Past due 7 to 12 months
Past due over 1 year
Total
Rate
0 .30%
3 .80%
40 .82%
45 .83%
76 .29%
5.72%
Par value
1,657
789
49
48
97
31.12.2021
Allowance
(5)
(30)
(20)
(22)
(74)
2,640
(151)
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As at 31 December 2020, the maturities of trade receivables and contract assets as well as any related valuation
allowances may be analysed as follows:
In CHF million
Not overdue
Past due up to 3 months
Past due 4 to 6 months
Past due 7 to 12 months
Past due over 1 year
Total
Rate
0 .65%
6 .82%
42 .31%
27 .88%
67 .68%
6.70%
31 .12 .2020
Par value
Allowance
1,681
513
52
104
99
(11)
(35)
(22)
(29)
(67)
2,449
(164)
Movements in valuation allowances for trade receivables and contract assets may be analysed as follows:
In CHF million
Balance at 1 January
Additions to allowances
Write-off of irrecoverable receivables subject to allowance
Release of unused allowances
Sales of subsidiaries
Foreign currency translation adjustments
Balance at 31 December
Liquidity risk
Contractual maturities including estimated interest payable
2021
164
87
(66)
(23)
(9)
(2)
151
2020
144
97
(74)
(3)
–
–
164
In CHF million
31.12.2021
Bank loans
Debenture bonds
Private placements
Derivative financial instruments
Other financial liabilities
Lease liabilities
Trade payables
Total
In CHF million
31.12.2020
Bank loans
Debenture bonds
Private placements
Derivative financial instruments
Other financial liabilities
Lease liabilities
Trade payables
Total
Carrying Contractual Due within Due within Due within
1 year 1 to 2 years 3 to 5 years
amount
payments
Due after
5 years
488
526
5,564
5,779
151
64
178
2,017
1,600
158
61
178
2,680
1,600
10,062
10,982
7
556
1
(1)
27
261
1,517
2,368
214
293
1
(3)
45
245
70
865
173
1,832
2
28
20
600
13
132
3,098
154
37
86
1,574
–
2,668
5,081
Carrying Contractual Due within Due within Due within
1 year 1 to 2 years 3 to 5 years
amount
payments
Due after
5 years
484
526
6,110
6,356
151
90
207
1,988
1,525
159
83
207
2,653
1,525
10,555
11,509
206
606
1
14
11
271
1,502
2,611
7
181
556
1,409
132
3,785
155
55
79
2
11
24
1
3
93
233
15
908
560
1,589
8
–
2,195
5,795
135
Derivative financial instruments
In CHF million
Interest rate swaps in CHF
Currency swaps in EUR
Total fair value hedges
Forward currency contracts in USD
Total cash flow hedges
Interest rate swaps in CHF
Currency swaps in USD
Currency swaps in EUR
Forward currency contracts in USD
Total other derivative financial instruments
Contract value
Positive fair value
Negative fair value
31.12.2021
31 .12 .2020
31.12.2021
31 .12 .2020
31.12.2021
31 .12 .2020
575
517
575
540
1,092
1,115
166
166
200
36
131
53
420
90
90
200
34
87
216
537
19
–
19
–
–
–
–
–
–
–
19
1
18
37
41
78
–
–
–
1
–
–
1
79
1
78
–
(2)
(2)
(2)
(2)
(58)
–
(1)
(1)
(60)
(64)
(4)
(60)
–
–
–
(3)
(3)
(79)
–
(1)
(7)
(87)
(90)
(11)
(79)
Total derivative financial instruments
1,678
1,742
Thereof current derivative financial instruments
Thereof non-current derivative financial instruments
Swisscom has entered into interest rate and foreign currency swaps, designated as fair value hedges, in order to
hedge interest rate and foreign currency risks of fixed interest-bearing finance denominated in CHF and EUR.
Derivative financial instruments contains forward contracts, designated as cash flow hedges, for hedging future
purchases of goods and services in USD. Furthermore, derivative financial instruments include interest rate
swaps which are not designated for hedge accounting purposes. In addition, derivative financial instruments
exclusively comprise forward foreign currency transactions and foreign currency swaps in EUR and USD which
serve to hedge future transactions in connection with financing or the operating business activities of Swisscom,
and which were not designated for hedge accounting purposes. Swisscom does not enter into derivative financial
instruments for speculative purposes.
The interest rate and currency swaps entered into by Swisscom are affected by the Interest Rate Benchmark
Reform (known as the IBOR Reform). In Switzerland, the changeover from the reference interest rate LIBOR to
SARON is taking place. In the EUR zone, the EURIBOR was recently reformed and ESTR is to be replaced by the
EONIA. In 2021, Swisscom switched the reference interest rate for interest rate swaps worth CHF 775 million and
for currency swaps worth EUR 500 million.
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Valuation category and fair value of financial instruments
The fair values of financial assets and financial liabilities are summarised in the following table. Not included
therein are cash and cash equivalents, trade receivables and trade payables, as well as miscellaneous receivables
and liabilities whose carrying amount corresponds to a reasonable estimation of their fair value.
In CHF million
Other financial assets
Term deposits
Listed debt instruments
Loans
At amortised cost
Equity instruments valued at fair value
Equity instruments valued at fair value
Fair value through other comprehensive income
Loans
Derivative financial instruments
Fair value through profit or loss
Total other financial assets
Financial liabilities
Bank loans
Debenture bonds
Private placements
Derivative financial instruments
Other financial liabilities
Total financial liabilities
In CHF million
Other financial assets
Term deposits
Quoted debt instruments
Loans
At amortised cost
Equity instruments valued at fair value
At fair value through other comprehensive income
Loans
Derivative financial instruments
Fair value through profit or loss
Total other financial assets
Financial liabilities
Bank loans
Debenture bonds
Private placements
Derivative financial instruments
Other financial liabilities
Total financial liabilities
Carrying amount
Fair value
31.12.2021
Level
57
278
21
356
26
381
407
2
19
21
784
488
5,564
151
64
178
6,445
57
273
21
351
26
381
407
2
19
21
779
514
5,717
154
64
187
6,636
2
1
2
1
3
2
2
2
1
2
2
2
Carrying amount
Fair value
31 .12 .2020
Level
107
271
13
391
91
91
1
79
80
562
484
6,110
151
90
207
7,042
107
277
13
397
91
91
1
79
80
568
519
6,381
160
90
223
7,373
2
1
2
3
2
2
2
1
2
2
2
Financial assets amounting to CHF 284 million (prior year: CHF 277 million) are not freely available as they serve
as security for liabilities.
137
Accounting policies
Derivative financial instruments
Derivative financial instruments are initially recognised at fair value and are subsequently measured at fair
value. The method of recording the fluctuations in fair value depends on the underlying transaction and the
objective pursued by purchasing or entering into this underlying transaction. On the date a derivative contract is
concluded, management designates the purpose of the hedging relationship: hedge of the fair value of an asset
or liability (‘fair value hedge’) or a hedge of future cash flows in the case of future transactions (‘cash flow hedge’).
Changes in the fair value of derivative financial instruments that were designated as hedging instruments for
‘fair value hedges’ are recognised in the income statement. Changes in the fair value of derivative financial
instruments that were designated as ‘cash flow hedges’ are dealt with in other comprehensive income, and are
recognised in the hedging reserve as part of equity. If a hedge of an anticipated transaction subsequently results
in the recording of a financial asset or financial liability, the amount included in equity is recognised in the income
statement in the same period in which the financial asset or financial liability impacts the results. Otherwise, the
amounts recorded in equity are recognised in the income statement as income or expense in the same period as
the cash flows of the intended or agreed future transaction occur. Changes in the fair value of derivative financial
instruments that are not designated as hedging instruments are immediately recorded as income.
Estimation of fair values
Fair values are allocated to one of the following three hierarchical levels:
● Level 1: exchange-quoted prices in active markets for identical assets or liabilities;
● Level 2: other factors which are observable on markets for assets and liabilities, either directly or indirectly;
● Level 3: factors that are not based on observable market data.
The fair value of publicly traded equity and debt instruments of Level 1 is based upon their stock exchange quo-
tations as of the balance sheet date. The fair value of Level 2 financial assets and liabilities which are not quoted
on exchanges are computed on the basis of future maturing payments discounted at market interest rates. Level
3 assets consist of investments in various investment funds and individual companies. The fair value is deter-
mined on the basis of a computational model. Interest rate and currency swaps are discounted at market rates.
Foreign currency forward transactions and foreign currency swaps are valued by reference to forward foreign
exchange rates as of the balance sheet date.
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3 Operating assets and liabilities
The following chapter discloses information on the movement in net operating
assets and liabilities as well as in significant non-current tangible and intangible
assets . In addition, it outlines the allocation of goodwill to the individual
cash-generating units and the results of any applicable impairment tests . Changes
in provisions and contingent liabilities are also presented in this chapter .
3.1 Net current operating assets
Movements in operating assets and liabilities
In CHF million
2021 financial year
Trade receivables
Other operating assets
Trade payables
Other operating liabilities
Total operating assets and liabilities, net
1 Foreign currency translation and adjustments from acquisition and sale of
subsidiaries.
In CHF million
2020 financial year
Trade receivables
Other operating assets
Trade payables
Other operating liabilities
Total operating assets and liabilities, net
1 Foreign currency translation and adjustments from acquisition and sale of
subsidiaries.
Trade receivables
In CHF million
Billed revenue
Accrued revenue
Allowances
Total trade receivables 1
1 Credit risks. See Note 2.5.
01 .01 .2021
Operational
changes
Other
1
changes
31.12.2021
2,132
1,029
(1,525)
(1,269)
367
269
161
(110)
(385)
(65)
(86)
(11)
35
37
(25)
2,315
1,179
(1,600)
(1,617)
277
01 .01 .2020
Operational
changes
Other
1
changes
31 .12 .2020
2,183
1,156
(1,614)
(1,194)
531
(54)
(127)
86
(83)
(178)
3
–
3
8
14
2,132
1,029
(1,525)
(1,269)
367
31.12.2021
31 .12 .2020
2,335
131
(151)
2,315
2,180
116
(164)
2,132
139
Other operating assets and liabilities
In CHF million
Other operating assets
Contract assets
Contract costs
Other receivables
Inventories
Prepaid expenses
Advance payments made
Value-added taxes receivable
Other non-financial assets
Total other operating assets
Other operating liabilities
Contract liabilities
Accruals for variable performance-related bonus
Value-added taxes payable
Accruals for annual holiday, overtime
Liabilities from collection activities
Miscellaneous liabilities
Total other operating liabilities
Contract assets and liabilities
In CHF million
Contract assets
Swisscom Switzerland
Other
Total contract assets
Contract liabilities
Swisscom Switzerland
Fastweb
Other
Total contract liabilities
31.12.2021
31 .12 .2020
174
263
84
114
430
38
22
54
153
224
79
120
349
17
27
60
1,179
1,029
1,012
172
68
43
19
303
1,617
737
160
100
45
12
215
1,269
31.12.2021
31 .12 .2020
113
61
174
559
379
74
1,012
89
64
153
535
122
80
737
Contract assets of Swisscom Switzerland primarily include deferrals arising in connection with the sale of bundled
offerings in the mobile-phone area. In part, mobile handsets are sold on a subsidised basis, together with a mobile
contract in a bundled offering. As a result of the allocation of revenue over the pre-delivered components (mobile
handset), revenues are recognised earlier than the invoicing thereof. This results in contract assets deriving from
this business being recognised. Contractual liabilities above all cover deferrals from payments for prepaid cards
and prepaid Swisscom Switzerland subscription fees. In 2021, an amount of CHF 305 million was recorded as
revenue which had been recognised as a contract liability as at 31 December 2020. Swisscom avails itself of the
rules of IFRS 15.121 regarding the disclosure of the transaction price allocated to the performance obligations
that are unsatisfied. The exemption is not applied in the case of mobile-phone contracts with the sale of a sub-
sidised mobile handset and a minimum contract term. These contracts incorporate revenue of CHF 613 million
(2022: CHF 462 million; 2023: CHF 151 million).
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Contract costs
Contract costs include deferred costs to obtain a contract as well as costs to fulfil a contract, which may be ana-
lysed as follows:
In CHF million
Costs to obtain a contract
Swisscom Switzerland
Fastweb
Other
Total costs to obtain a contract
Costs to fulfil a contract
Router and TV boxes
Initial costs from outsourcing contracts
Total costs to fulfil a contract
Total contract costs
Accounting policies
31.12.2021
31 .12 .2020
39
54
45
138
34
91
125
263
42
25
41
108
44
72
116
224
Operating assets and liabilities
Total operating assets and liabilities used in the normal course of business are disclosed as current items in the
balance sheet.
Trade receivables
Trade and other receivables are measured at amortised cost less impairment losses. Impairment losses on trade
receivables are recognised, depending on the nature of the underlying transaction, in the form of individual
valuation allowances or portfolio-based general valuation allowances which cover the anticipated default risk. As
regards portfolio-based general valuation allowances, financial assets are grouped together based on homogene-
ous credit risk attributes, reviewed collectively for impairment and, whenever required, impairment losses are
recognised. In addition to the contractually foreseen payment conditions, historical default rates and current
information and expectations are taken into consideration in determining the expected future cash flows from
the portfolio. Impairment losses for trade receivables are recognised as other operating expenses.
141
Technical
installations
Land, buildings
and leasehold
improvements
Advances made
and assets
installations under construction
Other
3.2 Property, plant and equipment
In CHF million
Cost of acquisition
Balance at 1 January 2020
Additions
Disposals
Adjustment to dismantlement and restoration costs
Reclassifications
Foreign currency translation adjustments
27,955
1,241
(1,042)
46
135
(18)
1,684
2
(10)
–
(1)
–
4,614
209
(110)
18
70
–
Balance at 31 December 2020
28,317
1,675
4,801
Additions
Disposals
Adjustment to dismantlement and restoration costs
Reclassifications
Business combinations
Sales of subsidiaries
Foreign currency translation adjustments
Balance at 31 December 2021
Accumulated depreciation and impairment losses
Balance at 1 January 2020
Depreciation
Impairment losses
Disposals
Foreign currency translation adjustments
Balance at 31 December 2020
Depreciation
Impairment losses
Disposals
Sales of subsidiaries
Foreign currency translation adjustments
1,020
(946)
15
158
–
–
(248)
28,316
(19,548)
(1,198)
(8)
1,038
10
(19,706)
(1,215)
(3)
943
–
156
4
(15)
–
15
–
–
(4)
197
(444)
(36)
97
1
(1)
(1)
1,675
4,614
(1,390)
(18)
–
8
–
(3,270)
(303)
–
103
–
(1,400)
(3,470)
(17)
–
14
–
2
(298)
(4)
438
1
–
Balance at 31 December 2021
(19,825)
(1,401)
(3,333)
484
229
–
–
(205)
–
508
489
–
–
(270)
–
–
(2)
725
–
–
–
–
–
–
–
–
–
–
–
–
Total
34,737
1,681
(1,162)
64
(1)
(18)
35,301
1,710
(1,405)
(21)
–
1
(1)
(255)
35,330
(24,208)
(1,519)
(8)
1,149
10
(24,576)
(1,530)
(7)
1,395
1
158
(24,559)
10,771
10,725
10,529
Net carrying amount
Net carrying amount at 31 December 2021
Net carrying amount at 31 December 2020
Net carrying amount at 1 January 2020
8,491
8,611
8,407
274
275
294
1,281
1,331
1,344
725
508
484
Commitments for future capital expenditures
Firm contractual commitments for future capital investments in property, plant and equipment as at 31 Decem-
ber 2021 aggregated CHF 899 million (prior year: CHF 800 million).
Non-cash investing and financing transactions
As a result of changes in the assumptions made in estimating the provisions for dismantlement and restoration
costs, a decrease therein of CHF 21 million (prior year: increase of CHF 64 million) was recognised in property,
plant and equipment with no impact on the income statement. See Note 3.5.
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Significant judgements or estimates
Management estimates the useful economic lives and residual values of technical facilities, real estate and other
installations and equipment, on the basis of the anticipated period over which economic benefits will accrue to
the company from the use of the assets. Useful economic lives are reviewed annually on the basis of historical
and forecast expectations concerning future technological developments, economic and legal changes, as well
as further external factors.
Accounting policies
Property, plant and equipment is recognised at historical cost less depreciation and impairment losses. In addi-
tion to historical cost and the costs directly attributable to bringing the asset to the location and condition nec-
essary for it to be capable of operating in the manner intended by management, the purchase or manufacturing
cost also includes the estimated costs for dismantling and restoring the site. Borrowing costs are capitalised
insofar as they are directly attributable to the acquisition or production of a qualifying asset. Costs of replace-
ment, renewal or renovation of property, plant and equipment are capitalised as replacement investments if a
future inflow of economic benefits is probable and costs can be measured reliably. The carrying amount of the
parts replaced is de-recognised. Depreciation is calculated using the straight-line method except for land, which
is not depreciated. The estimated useful lives for the main categories of property, plant and equipment are:
Category
Ducts 1
Cables 1
Transmission and switching equipment 1
Other technical installations 1
Buildings and leasehold improvements
Other installations
1 Technical installations.
Years
40
15 to 30
4 to 15
3 to 15
10 to 40
3 to 15
Whenever significant parts of an item of property, plant and equipment comprise individual components with
differing useful lives, each component is depreciated separately. The process for estimating useful lives takes
into account the expected use by the company, the expected wear and tear, technological developments, as well
as empirical values with comparable assets. Leasehold improvements and installations in leased premises are
depreciated on a straight-line basis over the shorter of their estimated useful lives and the remaining minimum
lease term. The impact from adjusting useful economic lives and residual values is recognised on a prospective
basis. Whenever indications exist that the value of an asset may be impaired, the recoverable amount of the
asset is determined. If the recoverable amount of the asset, which is the greater of the fair value less costs to sell
and the value in use, is less than its carrying amount, the carrying amount is written down to the recoverable
amount. The carrying amount of an item of property, plant and equipment is de-recognised upon disposal or
whenever no future economic benefits are expected from its use. Gains and losses arising on the disposal of
property, plant and equipment are recognised as other income or other operating expenses.
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3.3 Intangible assets
In CHF million
Cost of acquisition
Balance at 1 January 2020
Additions
Disposals
Reclassifications
Business combinations
Sales of subsidiaries
Foreign currency translation adjustments
Balance at 31 December 2020
Additions
Disposals
Reclassifications
Business combinations
Sales of subsidiaries
Foreign currency translation adjustments
Balance at 31 December 2021
Accumulated amortisation and impairment losses
Balance at 1 January 2020
Amortisation
Impairment losses
Disposals
Foreign currency translation adjustments
Balance at 31 December 2020
Amortisation
Impairment losses
Disposals
Reclassifications
Sales of subsidiaries
Foreign currency translation adjustments
Balance at 31 December 2021
Net carrying amount
Net carrying amount at 31 December 2021
Net carrying amount at 31 December 2020
Net carrying amount at 1 January 2020
Purchased
software
Internally
generated
software
Brands and
customer
relations
Other
intangible
assets
Licenses
2,143
190
(16)
34
2
–
(6)
2,347
210
(10)
11
–
(13)
(80)
2,465
(1,696)
(229)
–
16
5
(1,904)
(229)
(1)
10
14
6
69
(2,035)
430
443
447
1,404
145
(26)
79
–
(2)
–
1,600
194
(111)
107
–
–
(8)
1,782
(955)
(252)
(1)
26
–
(1,182)
(221)
–
110
(14)
–
6
(1,301)
481
418
449
949
61
(2)
–
–
–
(1)
1,007
83
(26)
–
–
–
(12)
1,052
(246)
(98)
–
2
–
(342)
(113)
–
26
–
–
3
(426)
626
665
703
461
–
–
–
–
–
(1)
460
–
(67)
–
29
–
(13)
409
(381)
(32)
(2)
–
–
(415)
(21)
–
67
–
–
12
(357)
52
45
80
284
114
(7)
(112)
16
–
–
295
78
(35)
(118)
2
(1)
(2)
219
(121)
(8)
–
7
1
(121)
(9)
–
35
–
–
1
(94)
125
174
163
Total
5,241
510
(51)
1
18
(2)
(8)
5,709
565
(249)
–
31
(14)
(115)
5,927
(3,399)
(619)
(3)
51
6
(3,964)
(593)
(1)
248
–
6
91
(4,213)
1,714
1,745
1,842
As at 31 December 2021, other intangible assets include advance payments made and uncompleted development
projects of CHF 107 million (prior year: CHF 150 million).
Commitments for future capital expenditures
As at 31 December 2021, firm contractual commitments for future capital investments in intangible assets aggre-
gated CHF 63 million (prior year: CHF 54 million).
Significant judgements or estimates
Management estimates the useful economic lives and residual values of intangible assets on the basis of the
anticipated period over which economic benefits will accrue to the company from the use of the assets. Useful
economic lives are reviewed annually on the basis of historical and forecast expectations concerning future tech-
nological developments, economic and legal changes as well as further external factors.
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Accounting policies
Mobile-phone licences, self-developed software as well as other intangible assets are recorded at historical cost less
accumulated amortisation. Intangible assets resulting from business combinations, such as brands and customer
relationships, are recognised at cost less accumulated amortisation, which equates to fair market value as at the
date of acquisition. Mobile-phone licences are amortised based on the term of the licence. It begins as soon as the
related network is ready for operation, unless other information is at hand which would suggest the need to modify
the useful lives. The impact from adjusting useful economic lives and residual values is recognised on a prospec-
tive basis. Amortisation is computed on a straight-line basis over the following estimated useful economic lives:
Category
Software internally generated and purchased
Brands and customer relationships
Licenses
Other intangible assets
Years
3 to 7
5 to 10
2 to 16
3 to 10
Whenever indications exist that the value of an asset may be impaired, the recoverable amount of the asset is
determined. If the recoverable amount of the asset, which is the greater of the fair value less costs to sell and the
value in use, is less than its carrying amount, the carrying amount is written down to the recoverable amount.
3.4 Goodwill
Goodwill is allocated to the cash-generating units of Swisscom based upon their business activities. Goodwill
arising in a business combination is allocated to each cash-generating unit which can derive synergies from the
business combination. The goodwill allocated to the cash-generating units may be analysed as follows:
Residential
Customers
Swisscom
Switzerland
Business
Customers
Swisscom
Switzerland
Fastweb
Other cash-
generating
units
1
In CHF million
At cost
Balance at 1 January 2020
Foreign currency translation adjustments
Balance at 31 December 2020
Additions
Foreign currency translation adjustments
2,769
–
2,769
–
–
1,453
–
1,453
9
–
1,922
(7)
1,915
–
(83)
Balance at 31 December 2021
2,769
1,462
1,832
Accumulated impairment losses
Balance at 1 January 2020
Foreign currency translation adjustments
Balance at 31 December 2020
Foreign currency translation adjustments
Balance at 31 December 2021
Net carrying amount
Net carrying amount at 31 December 2021
Net carrying amount at 31 December 2020
Net carrying amount at 1 January 2020
–
–
–
–
–
–
–
–
–
–
2,769
2,769
2,769
1,462
1,453
1,453
(1,384)
6
(1,378)
60
(1,318)
514
537
538
1 Comprises the cash-generating units Wholesale Swisscom Switzerland and
Swisscom Directories.
403
–
403
9
–
412
–
–
–
–
–
412
403
403
Total
6,547
(7)
6,540
18
(83)
6,475
(1,384)
6
(1,378)
60
(1,318)
5,157
5,162
5,163
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Impairment testing
In the fourth quarter of 2021 and after the conclusion of business planning, individual goodwill amounts were
subjected to an impairment test. The recoverable amount of a cash-generating unit is determined based on its
value in use, applying the discounted cash flow (DCF) method. The projected free cash flows are estimated on
the basis of the business plans approved by management, which as a rule cover a three-year period. A planning
horizon of five years was used for the Fastweb impairment test. For free cash flows extending beyond the
detailed planning period, a terminal value was computed by capitalising the normalised cash flows. A steady
long-term growth rate that corresponds to the growth rates customary in the country or market was assumed.
The projected cash flows and management assumptions are corroborated by external sources of information.
The discount rate is derived from the Capital Asset Pricing Model (CAPM). This latter comprises the weighted
value of own equity and external borrowing costs. For the risk-free interest rate which forms the basis of the
discount rate, the yield from Swiss government bonds is taken (abroad: Germany) with a maturity of ten years and
a zero-interest rate, subject to minimum interest rates of 1.5% (Switzerland) and 2.0% (abroad). For cash-gener-
ating units abroad, a risk premium for the country risk is then added.
Discount rates and long-term growth rates
Cash-generating unit
Residential Customers Swisscom Switzerland
Business Customers Swisscom Switzerland
Fastweb
Other cash-generating units
WACC
pre-tax
5 .01%
4 .99%
7 .21%
5 .01–
9 .64%
2021
WACC
post-tax
Long-term
growth rate
4 .09%
4 .09%
5 .36%
4 .09–
8 .28%
0%
0%
0 .8%
0–
1 .0%
WACC
pre-tax
5 .25%
5 .25%
6 .91%
5-25–
7-27%
2020
WACC
post-tax
Long-term
growth rate
4 .30%
4 .30%
5 .13%
4 .30–
5 .84%
0%
0%
0 .5%
0%
Results and sensitivity of impairment tests
Residential Customers and Business Customers Swisscom Switzerland
As at the measurement date, the recoverable amount at all cash-generating units, based on their value in use, is
higher than the carrying amount relevant for the impairment test. Swisscom believes none of the anticipated
changes in key assumptions which can rationally be expected would cause the carrying amount of the cash-gen-
erating units to exceed the recoverable amount.
Fastweb
As at the date of the impairment test, no impairment of goodwill resulted. The recoverable amount exceeded
the net carrying amount by EUR 641 million (CHF 680 million). In the prior year, the difference amounted to
EUR 2,241 million (CHF 2,398 million). The following changes in material assumptions would lead to a situation
where the value in use would equate to the carrying amount:
Average annual revenue growth until 2026 (2025)
with EBITDA margin unchanged compared to business plan
Normalised EBITDA margin
Normalised capital expenditure rate
Post-tax discount rate
Long-term growth rate
2021
2020
Assumptions
Sensitivity
Assumptions
Sensitivity
6 .6%
31%
21%
5 .36%
0 .8%
5 .6%
30%
22%
6 .27%
–0 .4%
8 .8%
33%
20%
5 .13%
0 .5%
5 .6%
28%
25%
8 .10%
–3 .3%
Significant judgements or estimates
The allocation of goodwill to the cash-generating units as well as the computation of the recoverable amount is
subject to the judgement of Management. This encompasses the estimation of future cash flows, the determi-
nation of the discounting rate, and the growth rate on the basis of historic data and current forecasts.
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Accounting policies
For the purposes of the impairment test, goodwill is allocated to the cash-generating units. The impairment test is
performed annually on a mandatory basis. Whenever there is any indication during the year that goodwill may
be impaired, the cash-generating unit is tested for impairment at that time. An impairment loss is recognised if
the recoverable amount of a cash-generating unit is lower than its carrying amount. The recoverable amount is the
greater of the fair value less costs to sell and the value in use.
3.5 Provisions and contingent liabilities
Provisions
In CHF million
Balance at 1 January 2021
Additions to provisions
Dismantlement
and restoration
costs
Regulatory and
competition law
proceedings
Termination
1
benefits
741
–
233
63
–
28
–
(148)
–
176
–
176
63
30
–
–
(17)
(21)
–
55
44
11
Other
179
88
–
–
(26)
(31)
(4)
206
74
132
Total
1,216
181
(21)
32
(43)
(212)
(4)
1,149
118
1,031
Adjustments recorded under property, plant and equipment (21)
Present-value adjustments
Release of unused provisions
Use of provisions
Sales of subsidiaries
Balance at 31 December 2021
Thereof current provisions
Thereof non-current provisions
1 See Note 4.1.
4
–
(12)
–
712
–
712
Provisions for dismantling and restoration costs
The provisions are computed by reference to estimates of future anticipated dismantling costs and are discounted
using an average interest rate of 0.91% (prior year: 0.58%). Adjustments as a result of reassessments in the amount
of CHF -21 million were recognised under property, plant and equipment with no impact on the income state-
ment in 2021. Of this amount, CHF -45 million resulted from the use of different interest rates, CHF 9 million
from the adjustment of the cost index used to calculate dismantling costs and CHF 15 million from other effects.
An increase of estimated costs by 10% would result in an increase of CHF 69 million in the amount of the provi-
sion. A delay of another ten years in the timing of the dismantling would lead to an increase of CHF 41 million in
the provisions.
Provisions for regulatory and competition law proceedings
In accordance with the revised Telecommunications Act, Swisscom provides access services (incl. interconnection)
to other telecommunications service providers in Switzerland. In previous years, several telecommunications service
providers demanded ComCom reduce the prices charged to them by Swisscom. In February 2019, ComCom issued
its decision on the disputed access prices for 2013 to 2016. Swisscom has filed an appeal against this decision with
the Federal Administrative Court. In its judgement of 16 July 2021, the Federal Administrative Court ruled on the
appeal and referred the matter back to ComCom for reassessment on a number of points. The procedures for
setting access prices for 2013 onwards are still pending before ComCom. In February 2020, a provider of telecom-
munications services requested from ComCom that the interest on recovery claims from access-related proceed-
ings should be based on the weighted average cost of capital (WACC). This led to a reassessment of the interest
effect, which was recognised as a present value adjustment in the amount of CHF 15 million. In June 2021, Com-
Com confirmed this interest rate regulation. Swisscom has appealed against this complaint before the Federal
Administrative Court. The appeal procedure is pending.
In its investigation as to the invitation to tender for the corporate network of the Swiss Post in 2008, the Compe-
tition Commission (COMCO) reached the conclusion in November 2015 that Swisscom has a dominant position
on the market for broadband access for business clients. As a result of this conduct, which was judged to be
unlawful under competition law, COMCO imposed a penalty of CHF 8 million. Swisscom challenged COMCO’s rul-
147
ing concerning the invitation to tender for the corporate network of Swiss Post in the Federal Administrative
Court. In June 2021, the Federal Administrative Court largely confirmed COMCO’s ruling and ordered Swisscom
to pay a fine of CHF 7 million. Swisscom has filed an appeal against this decision with the Federal Court. In the
event of a legally binding finding of abuse of a market-dominant position, claims could be asserted against
Swisscom under civil law.
In 2009, COMCO imposed a fine on Swisscom for abuse of a market-dominant position in the area of ADSL services
during the period to 2007. Swisscom challenged the fine in the last instance before the Federal Court. In Decem-
ber 2019, the Federal Court dismissed Swisscom’s appeal and confirmed the sanction. As a result of the legally
binding determination of market abuse, civil law claims were filed by telecommunications service providers in
the second quarter of 2020. In the third and fourth quarters of 2021, negotiations took place with telecommuni-
cations service providers, which were concluded with an out-of-court settlement.
On 17 December 2020, COMCO opened an investigation into Swisscom’s optical fibre network and ordered pre-
cautionary measures. Swisscom has filed an appeal against these precautionary measures. In its ruling of 30 Sep-
tember 2021, the Federal Administrative Court confirmed the precautionary measures ordered by COMCO and
dismissed Swisscom’s appeal. Swisscom has filed an appeal against this decision with the Federal Court. The
proceedings are still pending.
On the basis of legal opinions, Swisscom has recognised provisions for regulatory and competition law proceed-
ings. As a result of the reassessment of these proceedings, provisions of CHF 63 million were made in 2021 and
present-value adjustments of CHF 28 million were recorded. Any payments to be made will depend upon the
date on which legally binding decrees and decisions are issued, and could probably occur within five years.
Other provisions
Other provisions mainly include provisions for contractual risks. Any necessary payments of the non-current por-
tion of the provisions could likely occur within three years.
Contingent liabilities for regulatory and competition law proceedings
The Competition Commission (COMCO) is conducting several proceedings against Swisscom. In the event that a
legally enforceable finding of market abuse is reached, COMCO might impose a penalty on Swisscom. In addition,
claims under civil law might be asserted against Swisscom. In April 2013, COMCO opened an investigation against
Swisscom under the Federal Cartel Act concerning the broadcasting of live sporting events on pay-TV. In May
2016, COMCO imposed a penalty of CHF 72 million on Swisscom in these proceedings. On 25 August 2020,
COMCO launched an investigation against Swisscom into allegations that it abused its market-dominant posi-
tion for broadband connections to interconnect company sites. As things stand, Swisscom does not believe it is
probable that a court of final appeal will levy a penalty and, as in prior years, has therefore still not recognised a
provision in its consolidated financial statements as at 31 December 2021. In view of the previous proceedings
conducted by COMCO, further proceedings against Swisscom might be initiated.
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Significant judgements or estimates
The provisions for dismantling and restoration costs relate to the dismantling of telecommunications installa-
tions and transmitter stations as well as the restoration to its original state of land held by third-party owners.
The level of the provisions is determined to a significant degree by the estimation of future dismantling and
restoration costs, as well as the timing of dismantlement. The provisions and contingent liabilities for regulatory
and antitrust proceedings relate to proceedings in connection with regulated access services provided by Swisscom
and proceedings initiated by COMCO. The legal and accounting assessment of these proceedings is associated
with significant uncertainties in estimation and scope for discretion with regard to the probability of occurrence
and the amount of a possible cash outflow. The provisions recognised in this way constitute the best estimate of
the liability. Possible liabilities whose occurrence as at the balance-sheet date cannot be assessed, or liabilities
for which the level cannot be reliably estimated, are disclosed as contingent liabilities.
Accounting policies
Provisions are recognised whenever a legal or constructive obligation arises from past events, the outflow of
resources to settle the liability is probable, and the amount of the liability can be estimated reliably. Provisions
are discounted if the effect is material.
Provisions for dismantling and restoration costs
Swisscom is legally obligated to dismantle transmitter stations and telecommunications installations located on
land belonging to third-parties following decommissioning, and to restore to its original state the property
owned by third-parties in the locations where these installations are erected. The costs of dismantling are capital-
ised as part of the acquisition costs of the installations, and are amortised over their useful lives. The provisions are
measured at the present value of the aggregate future costs, and are reported under non-current provisions.
Whenever the provision is re-measured, the present value of the changes in the liability is either added to or
deducted from the cost of the related capitalised item of property, plant and equipment. The amount deducted
from the cost of the related asset may not exceed its carrying amount. Any excess is taken directly to income.
Provisions for termination benefits
Costs in connection with the implementation of restructuring programmes are first expensed when manage-
ment commits itself to a restructuring plan, it is probable that a liability has been incurred, the amount thereof
can be reliably estimated and the implementation of the programme has commenced, or the individuals involved
have been advised in sufficient detail as to the main terms of the restructuring programme. A public announce-
ment and/or communication to personnel associations are deemed to be equivalent to commencing the imple-
mentation of the programme.
149
4 Employees
Swisscom currently has around 19,000 full-time equivalent employees, of whom
almost 16,000 are in Switzerland . This chapter contains information on employee
headcount and personnel expense, the compensation paid to key management
personnel as well as retirement-benefit obligations .
4.1 Employee headcount and personnel expense
Employee headcount
In full-time equivalent
Residential Customers
Business Customers
Wholesale
Infrastructure & Support Functions
Swisscom Switzerland
Fastweb
Other Operating Segments
Total headcount
Thereof Switzerland
Thereof other countries
31.12.2021
31 .12 .2020
2,875
5,045
81
4,888
12,889
2,753
3,263
18,905
15,882
3,023
3,082
4,931
83
4,749
12,845
2,703
3,514
19,062
16,048
3,014
Average number of employees
19,099
19,095
Personnel expense
In CHF million
Salary and wage costs
Social security expenses
Expense of defined benefit plans 1
Expense of defined contribution plans
Expense for share-based payments
Termination benefits
Other personnel expense
Total personnel expense
Thereof Switzerland
Thereof other countries
1 See Note 4.3.
2021
2,060
248
260
11
1
13
74
2,667
2,399
268
Change
–6 .7%
2 .3%
–2 .4%
2 .9%
0.3%
1 .8%
–7 .1%
–0.8%
–1 .0%
0 .3%
0 .0%
2020
2,065
243
338
10
1
(1)
61
2,717
2,493
224
Termination benefits
Swisscom supports employees affected by restructuring through a social plan. In addition to other benefits, the
social plan benefits include continued salary payments beyond the contractual notice period for a maximum period
of time, which depends on the seniority and age of the employee concerned. Under certain conditions, older
employees affected by job cuts may transfer to the subsidiary Worklink AG at reduced guaranteed continued salary
payments. Worklink AG aims to place participants with third-parties for temporary work assignments, whereby the
participants are paid a share of the turnover as a wage supplement. Net expenditure for personnel reduction was
CHF 13 million (prior year: minus CHF 1 million). This is comprised of newly established provisions of CHF 30 million,
less the release of unused provisions to the value of CHF 17 million. As already announced, these personnel down-
sizing measures are connected with Swisscom’s aim for 2022, which is, as in previous years, to reduce the cost base
by around CHF 100 million.
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4.2 Key management compensation
In CHF thousand
Current compensation
Share-based payments
Pension contributions
Social security contributions
Total compensation to members of the Board of Directors
Current compensation
Share-based payments
Benefits paid following retirement from Group Executive Board
Pension contributions
Social security contributions
Total compensation to members of the Group Executive Board
Total compensation to members of the Board of Directors and of the Group Executive Board
2021
1,400
761
137
124
2,422
5,199
853
1,026
766
526
8,370
10,792
2020
1,357
810
97
124
2,388
5,038
731
190
796
510
7,265
9,653
Swisscom’s key management personnel are the members of the Group Executive Board and Board of Directors of
Swisscom Ltd. Compensation paid to members of the Board of Directors consists of a base salary plus functional
allowances. One third of the entire compensation of the Board of Directors is settled in the form of equity shares.
Compensation paid to the members of the Group Executive Board consists of a fixed basic salary paid in cash, a
variable performance-related component settled in cash and shares, payments in kind and non-cash benefits, as
well as pension and social insurance contributions. 25% of the variable performance-related share of the members
of the Group Executive Board is settled in shares. The Group Executive Board members may elect to increase this
share to 50%. The disclosures required by the Swiss Ordinance against Excessive Compensation in Listed Companies
(OaEC) are set out in the chapter Remuneration Report. Shares in Swisscom Ltd held by the members of the Board
of Directors and Group Executive Board are set out in the notes to the Consolidated Financial Statements of
Swisscom Ltd.
4.3 Post-employment benefits
Pension plans
comPlan
The majority of employees in Switzerland are insured under the Swisscom pension plan against the risks of old
age, death and disability. The pension plan is implemented by the comPlan foundation. The supreme governing
body of the pension fund is the Foundation Council, which is made up of an equal number of representatives
from the employees and the employer. The pension fund rules, together with the legal provisions concerning
occupational pension plans, constitute the formal regulatory framework of the pension plan. Individual retirement
savings accounts are maintained for each beneficiary, to which savings contributions varying with age are cred-
ited as well as any interest which accrues. The rate of interest to be applied to the retirement savings accounts is
set each year by the Foundation Council, having regard to the financial situation of the pension fund as well as
the statutory minimum interest rate. The amounts credited to the individual savings accounts are funded by
savings contributions from both the employer and employees. In addition, the employer pays risk contributions
to fund death and disability benefits.
The standard retirement age is 65. Employees are entitled to early retirement with a reduced old-age pension. The
amount of the old-age pension is the result of multiplying the individual retirement savings account at the time
of retirement by a conversion rate set out in the pension fund rules. The retirement benefits can also be paid out
in the form of a capital payment either in full or in part. In case of early retirement, the employer also finances an
OASI bridging pension until the standard retirement age. The amount of disability pensions is determined as a
percentage of the insured salary and is independent of the number of years of service.
The formal regulatory framework contains various provisions concerning risk sharing between the beneficiaries
and the employer. In the event of a funding shortfall, computed in accordance with Swiss accounting standards
for pension funds (Swiss GAAP FER 26), the Foundation Council lays down measures which shall lead to the elim-
ination of this funding deficit and the restoration of financial equilibrium within a timeframe of five to seven
151
years. Such measures may include a reduced or zero interest rate on retirement savings accounts, a reduction in
future benefits, the levying of restructuring contributions or a combination of these measures. Should a struc-
tural funding shortfall exist as a result of insufficient current interest-induced funding, the top priority is to
remedy this situation by adapting future benefits. Employer’s restructuring contributions must, at a minimum,
be equal to the sum of employee restructuring contributions. Under the formal regulatory framework, the
employer has no legal obligation to pay additional contributions to eliminate more than 50% of a funding short-
fall. From past common business practice, Swisscom has a de facto obligation over and above the legal minimum
to pay additional or restructuring contributions in the case of funding shortfalls and structural funding deficits.
The upper limit of the employer’s share of future benefit costs within the meaning of IAS 19.87(c) is assumed to
be at the level of the de facto obligation.
In the second quarter of 2021, the comPlan Board of Trustees adopted various measures to improve intergener-
ational equity. The key points of the measures include a reduction in the conversion rate in monthly steps from
1 January 2023 to 1 May 2024 and an increase in savings contributions. To cushion the impact of the conversion
rate reduction, special monthly contributions are credited to the individual retirement savings of active insured
persons during the reduction period. The special contributions are fully financed from comPlan’s reserves. In
addition, the vested or future spouse’s or partner’s pensions will be standardised at 60% of the old age pension
from 2023. The plan amendment will result in a net decrease of CHF 45 million in the defined benefit obligation
in the second quarter of 2021. An amount of CHF 60 million was recognised as negative past service cost in the
income statement and an amount of CHF 15 million was recognised as actuarial loss from changes in assump-
tions in other comprehensive income. This is based on a remeasurement of the net defined benefit obligation
using the current fair values of plan assets at the inception of the plan amendment and current actuarial assump-
tions, taking into account the risk-sharing characteristics. The past service cost is the difference between the
valuation with the previous regulatory benefits and contributions and the valuation with the amended regula-
tory benefits and contributions.
In accordance with the Swiss accounting standards (Swiss GAAP FER 26) which are relevant for the pension fund,
as at 31 December 2021 comPlan had a technical coverage ratio of 120% (prior year: 112%). The main reasons for
the difference compared with IFRS are the use of a higher discount rate as well as a differing actuarial measure-
ment method with the deferred recognition of the costs of future retirement benefits.
Other pension plans
Other pension plans exist for individual Swiss subsidiary companies which are not affiliated to comPlan and for
Fastweb. Employees of the Italian subsidiary Fastweb have acquired entitlements to future pension benefits up to
the end of 2006, which are recorded in the balance sheet as defined benefit obligations. The discount rate used
was 0.34% (prior year: 0.77%).
Pension cost
In CHF million
Current service cost
Employment termination benefits
Plan amendments
Administration expense
Total recognised in personnel expense
Interest expense on net defined benefit obligations
Total recognised in financial expense
Total expense of defined benefit plans recognised
in income statement
comPlan Other plans
2021
comPlan Other plans
312
–
(60)
3
255
1
1
256
4
–
–
1
5
–
–
5
316
–
(60)
4
260
1
1
326
5
–
3
334
2
2
261
336
3
–
–
1
4
–
–
4
2020
329
5
–
4
338
2
2
340
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In CHF million
Actuarial gains and losses from
Change of the demographical assumptions
Change of the financial assumptions
Experience adjustments to defined benefit obligations
Change in share of employee contribution (risk sharing)
Return on plan assets excluding the part
recognised in financial result
Asset ceiling
comPlan Other plans
2021
comPlan Other plans
2020
(250)
23
127
455
(1,161)
30
–
–
(1)
–
–
–
(250)
(114)
23
126
455
44
41
107
(1,161)
(409)
30
–
–
–
1
–
–
–
1
(114)
44
42
107
(409)
–
(330)
Total (income) expense of defined benefit plans recognised
in other comprehensive income
(776)
(1)
(777)
(331)
Status of pension plans
In CHF million
comPlan Other plans
2021
comPlan Other plans
2020
Defined benefit obligations
Balance at 1 January
Current service cost
Interest cost on defined benefit obligations
Employee contributions
Benefits paid
Actuarial losses (gains)
Change in scope of consolidation
Employment termination benefits
Plan amendments
Foreign currency translation adjustments
Transfer of pension plans
Balance at 31 December
Plan assets
Balance at 1 January
Interest income on plan assets
Employer contributions
Employee contributions
Benefits paid
Return (expense) on plan assets excluding the part recognised
in financial result
Administration expense
Change in scope of consolidation
Balance at 31 December
12,740
42
12,782
12,664
38
12,702
312
39
175
(509)
355
–
–
(60)
–
1
13,053
4
–
–
–
(1)
3
–
–
–
(1)
47
316
39
175
(509)
354
3
–
(60)
–
–
326
29
177
(537)
78
–
5
–
–
(2)
3
–
–
–
1
(1)
–
–
(1)
2
329
29
177
(537)
79
(1)
5
–
(1)
–
13,100
12,740
42
12,782
11,968
19
11,987
11,627
17
11,644
38
264
175
(509)
1,161
(3)
–
–
5
–
–
–
(1)
–
38
269
175
27
268
177
(509)
(537)
1,161
409
(4)
–
(3)
–
–
4
–
–
–
(1)
(1)
27
272
177
(537)
409
(4)
(1)
13,094
23
13,117
11,968
19
11,987
Net defined benefit obligations (assets)
Net defined benefit obligations (assets) before asset ceiling
Asset ceiling
(41)
30
Net defined benefit obligations (assets) recognised at 31 December
(11)
Thereof defined benefit asset
Thereof defined benefit obligations
(11)
–
24
–
24
–
24
(17)
30
13
(11)
24
772
–
772
–
772
23
–
23
–
23
795
–
795
–
795
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Movements in recognised defined benefit obligations (assets) are to be analysed as follows:
In CHF million
Balance at 1 January
Pension cost, net
Employer contributions and benefits paid
Change in scope of consolidation
(Income) expense of defined benefit plans,
recognised in other comprehensive income
Foreign currency translation adjustments
Transfer of pension plans
Balance at 31 December
comPlan Other plans
2021
comPlan Other plans
772
256
(264)
–
(776)
–
1
(11)
23
5
(5)
3
(1)
–
(1)
24
795
261
(269)
3
1,037
336
(268)
–
(777)
(331)
–
–
13
–
(2)
772
21
4
(4)
–
1
(1)
2
23
2020
1,058
340
(272)
–
(330)
(1)
–
795
The weighted average duration of the cash value of the defined benefit obligations for comPlan is 16 years (prior
year: 17 years).
Breakdown of comPlan pension plan assets
31.12.2021
31 .12 .2020
Category
Government bonds Switzerland
Corporate bonds Switzerland
Government bonds developed markets, World
Corporate bonds developed markets, World
Government bonds emerging markets, World
Private debt
Third-party debt instruments
Equity shares Switzerland
Equity instruments
Real estate Switzerland
Real estate World
Real estate
Commodities
Private markets
Cash and cash equivalents and other investments
Cash and cash equivalents and
alternative investments
Investment
strategy
Quoted
Not
quoted
Total
Quoted
Not
quoted
5 .0%
7 .0%
5 .0%
10 .0%
8 .0%
5 .0%
2 .0%
5 .5%
4 .6%
9 .8%
7 .7%
0 .0%
40.0%
29.6%
7 .0%
7 .5%
25.0%
27.1%
14 .5%
7 .0%
21.5%
3 .5%
9 .0%
1 .0%
6 .9%
0 .7%
7.6%
1 .5%
0 .0%
0 .0%
4 .9%
5 .5%
4 .6%
9 .8%
7 .7%
4 .8%
1 .1%
5 .8%
5 .4%
9 .9%
7 .9%
0 .0%
37.3%
30.1%
7 .5%
7 .1%
14 .3%
13 .6%
5 .3%
6 .7%
27.1%
27.4%
2 .9%
0 .0%
0 .0%
0 .0%
0 .0%
4 .8%
7.7%
0 .0%
0 .0%
0 .0%
0.0%
7 .6%
6 .7%
Total
4 .7%
5 .8%
5 .4%
9 .9%
7 .9%
5 .0%
38.7%
7 .1%
13 .6%
6 .7%
27.4%
13 .9%
6 .2%
3 .6%
0 .0%
0 .0%
0 .0%
0 .0%
5 .0%
8.6%
0 .0%
0 .0%
0 .0%
0.0%
6 .7%
5 .2%
14 .5%
7 .4%
14.3%
21.9%
1 .9%
9 .3%
1 .0%
3 .4%
9 .3%
1 .0%
7 .2%
1 .0%
8.2%
1 .7%
0 .0%
0 .0%
11.9%
20.1%
2 .2%
9 .4%
0 .5%
3 .9%
9 .4%
0 .5%
Equity shares developed markets, World
13 .0%
14 .3%
Equity shares emerging markets, World
5 .0%
5 .3%
13.5%
1.5%
12.2%
13.7%
1.7%
12.1%
13.8%
Total plan assets
100.0%
65.8%
34.2%
100.0%
67.4%
32.6%
100.0%
The Foundation Council determines the investment strategy and tactical bandwidths within the framework of
the legal provisions. Within its terms of reference, the Investment Commission undertakes the asset allocation,
and is the central steering, coordination and monitoring body for the management of the pension plan assets.
The investment strategy pursues the goal of achieving the highest possible return on assets within the frame-
work of its risk tolerance, and thus of generating income on a long-term basis to meet all financial obligations.
This is achieved through a broad diversification of risks over various investment categories, markets, currencies
and industry segments in both developed and emerging markets. The interest rate duration of interest-bearing
assets is 7.9 years (prior year: 7.8 years), and the average rating of these assets is BBB+ (prior year: A-). Within the
overall portfolio, all foreign currency positions are hedged against the Swiss franc following a currency strategy
to the extent necessary to meet a pre-determined ratio of 85% (CHF or CHF-hedged). Following this investment
strategy, comPlan expects its results prepared in accordance with Swiss GAAP FER to show a target value for the
value fluctuation reserve of 18.4% of total assets.
Additional information on plan assets
As at 31 December 2021, plan assets include Swisscom Ltd shares and bonds with a fair value of CHF 12 million
(prior year: CHF 10 million). The effective income from plan assets was CHF 1,199 million in 2021 (prior year: CHF
436 million). In 2022, Swisscom expects to make payments to the pension funds for statutory employer contri-
butions totalling CHF 268 million.
Assumptions underlying comPlan actuarial computations
Assumptions
Discount rate
Expected rate of salary increases
Expected rate of pension increases
Interest on old age savings accounts up to 5 years
Interest on old age savings accounts after 5 years
Share of employee contribution to funding shortfall
Share of employee contribution to surplus
Life expectancy at age of 65 – men (number of years)
Life expectancy at age of 65 – women (number of years)
2021
0 .30%
1 .23%
–%
1 .54%
0 .54%
40%
50%
22 .09
23 .83
2020
0 .19%
1 .08%
–%
0 .36%
0 .36%
40%
n .a .
22 .40
24 .20
The discount rate is based upon CHF-denominated corporate bonds with an AA rating of domestic and foreign
issuers and listed on the Swiss Exchange SIX. The development of salaries corresponds to the historical average
of recent years. No future pension increases are expected because comPlan does not have sufficient fluctuation
reserves for this under pension law. The interest rate on the individual savings balances was determined taking
into account the BVG minimum interest rate for the mandatory BVG portion. Life-expectancy assumptions are
arrived at through a projection of future mortality improvements in accordance with the Continuous Mortality
Investigation Model (CMI) and is based on improvements in mortality observed in Switzerland in the past. The
computations are made with a future long-term rate of mortality improvement of 1.75%. The actuarial gain of
CHF 250 million resulting from changes in demographic assumptions in 2021 is mainly due to the application of
new mortality tables. The insured person can draw the retirement benefit in full or in part by means of a one-off
lump-sum payment. Based on past values, a lump-sum withdrawal ratio of 24% (prior year: 22%) was assumed.
The risk-sharing attributes contained in the formal regulatory framework relating to the handling of funding
shortfalls were taken into account in the financial assumptions in two steps. As a first step, it is assumed that a
gradual lowering of future pensions by 3.0% (prior year: 9.7%) over a period of ten years will take place in order
to close the interest-induced structural funding gap. This is based upon a projection of the future conversion rate
using a mixed rate for the mandatory and extra-mandatory portions. The conversion rate in the mandatory
portion applies the current legal conversion rate. In the extra-mandatory portion, the conversion rate is computed
with a discount rate of 0.30%. As a second step, the present value of the remaining funding gap between the
regulatory contributions and the benefits adjusted in the first step is shared between the employer and the
employees. The legal and de facto obligation of the employer to pay additional contributions is unchanged and
assumed to be limited to 60% of the funding gap. This is based on the legal and regulatory provisions concerning
the elimination of funding shortfalls as well as the measures actually decided upon by the Foundation Council
and the employer in the past. The change of the employee share is recognised in other comprehensive income. If
there is a surplus under IFRS, no limit is placed on the employer’s share of a funding shortfall in the second step.
Instead, the gross surplus is reduced by an employee contribution of 50%. As at 31 December 2021, there is a
gross surplus, which has been reduced by the employee contribution of CHF 31 million. In the prior year, the
limitation of the employer’s contribution to the funding shortfall resulted in a reduction of the pension obliga-
tion of CHF 423 million. The change in the employee’s contribution to the funding shortfall or surplus is recog-
nised in other comprehensive income.
155
Sensitivity analysis comPlan
Sensitivity analysis 2021
In CHF million
Discount rate (change +/–0 .5%)
Expected rate of salary increases (change +/–0 .5%)
Expected rate of pension increases (change +0 .5%; –0 .0%)
Interest on old age savings accounts (change +/–0 .5%)
Share of employee contribution to funding shortfall (change +/–10%)
Share of employee contribution to surplus (change +/–10%)
Life expectancy at age of 65 (change +/–0 .5 year)
Sensitivity analysis 2020
Defined benefit obligations
Current service cost
Increase
assumption
Decrease
assumption
(431)
32
368
53
–
6
108
467
(25)
–
(46)
–
(6)
(103)
Increase
assumption
(34)
6
6
7
–
–
5
Decrease
assumption
41
(6)
–
(7)
–
–
(5)
In CHF million
Discount rate (change +/–0 .5%)
Expected rate of salary increases (change +/–0 .5%)
Expected rate of pension increases (change +0 .5%; –0 .0%)
Interest on old age savings accounts (change +/–0 .5%)
Share of employee contribution to funding shortfall (change +/–10%)
Life expectancy at age of 65 (change +/–0 .5 year)
Defined benefit obligations
Current service cost
Increase
assumption
Decrease
assumption
Increase
assumption
Decrease
assumption
(573)
39
558
21
106
142
668
(37)
–
–
(106)
(143)
(35)
6
26
7
–
4
41
(6)
–
–
–
(4)
The sensitivity analysis takes into consideration the movement in defined benefit obligations as well as current
service costs in adjusting the actuarial assumptions by half a percentage point and half a year, respectively. In the
process only one of the assumptions is adjusted each time, the other parameters remaining unchanged. In the
sensitivity analysis, no change was made in view of a negative movement in pension increases as it is not possi-
ble to reduce current pensions. The assumed gradual reduction in conversion rates is left unchanged in the sen-
sitivities of the discount rate shown. Due to the limitation of the assets, an increase in the discount rate of 0.5%
in the calculation of the conversion rate reduction does not lead to an increase in the pension obligation.
Significant judgements or estimates
The determination of post-employment retirement benefit obligations requires an estimation of the future ser-
vice periods, the development of future salaries and pensions, interest accruing on the employee savings
accounts, the timing of contractual pension benefit payments and the employees’ share of the funding shortfall.
This evaluation is made on the basis of prior experience and anticipated future trends. Anticipated future pay-
ments are discounted with the yields of Swiss franc-denominated corporate bonds from domestic and foreign
issuers quoted on the Swiss Exchange with an AA rating. The discount rates match the anticipated payment
maturities of the liabilities.
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Accounting policies
Actuarial computations of pension expenses and the related defined benefit obligations are carried out using the
projected unit credit method. Current service costs, past service costs arising from pension plan amendments and
plan settlements as well as administrative costs are reported in the income statement under personnel expense
and interest accruing on net obligations as a finance expense. Actuarial gains and losses and the return on plan
assets, excluding the amounts reflected in net interest income, are reported under other comprehensive income.
The assumptions regarding net future benefits are made in compliance with the formal set of regulations gov-
erning the pension plan. As regards the Swiss pension plans, the relevant formal regulations comprise the rules
of the pension fund as well as the relevant laws, ordinances and directives concerning occupational benefit plans,
in particular the provisions contained therein related to funding and measures to be taken to eliminate funding
shortfalls. Risk-sharing features in the formal regulatory framework are taken into account when arriving at
financial assumptions; these limit the employer’s share of the costs of future benefits as well as involving
employees in any necessary payment of additional contributions in order to eliminate funding deficits. Should
the level of committed long-term disability benefits (disability pensions), irrespective of the number of years of
service, be the same for all insured employees, the costs for these benefits are recognised on the date on which
the event causing the disability occurs. Any net asset value from a defined benefit plan is recognised at the lower
of the surplus and the present value of any economic benefit in the form of refunds or reductions in future con-
tributions, provided that the value fluctuation reserve set as a target by the Board of Trustees is exceeded.
157
5 Scope of consolidation
The following chapter sets out details of the Group structure of Swisscom and
includes disclosures concerning subsidiaries, joint ventures and associates . In
addition, it outlines material changes in Group structure and the corresponding
impact on the consolidated financial statements .
5.1 Group structure
Swisscom Ltd is the parent company of the Group. It essentially holds direct majority shareholdings in Swisscom
(Switzerland) Ltd, blue Entertainment Ltd, Swisscom Broadcast Ltd and Swisscom Directories Ltd. Fastweb S.p.A.
(Fastweb) is held indirectly via Swisscom (Switzerland) Ltd as well as an intermediate company in Italy. Swisscom
Re Ltd in Liechtenstein is the Group’s in-house reinsurance company. Swisscom raises finance in EUR through
Swisscom Finance B.V. in the Netherlands.
5.2 Changes in the scope of consolidation
Net cash flows from the acquisition and disposal of participations may be analysed as follows:
In CHF million
Expenses for business combinations net of cash and cash equivalents acquired
Expenses for deferred consideration arising on business combinations
Proceeds from sale of subsidiaries, net of cash and cash equivalents sold
Expenses for shareholdings accounted for using the equity method
Proceeds from sale of equity-accounted investees 1
Acquisition of non-controlling interests
Total cash flow from the purchase and sale of shareholdings, net
1 See Note 5.3.
2021
(32)
(10)
1
(3)
149
–
105
2020
(13)
(26)
–
(15)
–
(1)
(55)
Acquisitions and disposals of subsidiaries in 2021 are not individually material. Business combinations in 2021
include the full acquisition of Webtiser AG and JLS Digital as well as acquisition of a 90% stake in the Innovative
Web Group. Following its acquisition, Webtiser AG was merged with Swisscom (Switzerland) Ltd. Swisscom also
sold all its shares in local.fr SA in 2021 and relinquished control of Custodigit AG.
Additionally in 2021, Swisscom sold its shares in the equity-accounted investments Belgacom International Carrier
Services SA, Medgate AG, SEC Consult (Schweiz) AG, SmartLife Care AG, SwissSign Group AG and tiko Energy
Solutions AG. For further information, see Note 5.3.
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Accounting policies
Consolidation
Subsidiaries are all companies over which Swisscom Ltd has the effective ability to control the financial and business
policies. Control is generally assumed where Swisscom Ltd directly or indirectly holds the majority of the voting
rights or potential voting rights of the company. Companies acquired and sold are included in consolidation from
the date on which they are acquired and deconsolidated from the date they are disposed of, respectively. Intra-
group balances and transactions, income and expenses, shareholdings and dividends as well as unrealised gains
and losses are fully eliminated. Non-controlling interests in subsidiaries are reported within equity in the consoli-
dated balance sheet, but separately from equity attributable to the shareholders of Swisscom Ltd. The non-con-
trolling interests in net income or loss are shown in the consolidated income statement as a component of the
consolidated net income or loss. Changes in shareholdings of subsidiary companies are reported as trans actions
within equity insofar as control existed previously and continues to exist. Put options granted to owners of
non-controlling interests are disclosed as financial liabilities. The balance sheet date for all consolidated sub-
sidiaries is 31 December. There are no material restrictions on the transfer of funds from the subsidiaries to the
parent company.
Shareholdings over which Swisscom exercises significant influence but does not have control are accounted for
using the equity method. A significant influence is generally assumed to exist whenever between 20% and 50%
of the voting rights are held.
Business combinations
Business combinations are accounted for using the acquisition method. Acquisition costs are recognised at fair
value as at the date of the business combination. The purchase consideration includes the amount of cash paid
and the fair value of the assets ceded, liabilities incurred or assumed, and own equity instruments ceded.
Liabilities depending on future events based on contractual agreements are recognised at fair value. All identifiable
assets and liabilities that satisfy the recognition criteria are recognised at their fair values at the time of acquisi-
tion. The difference between the cost of acquisition and the fair value of the identifiable assets and liabilities
acquired or assumed is accounted for as goodwill, after taking into account any non-controlling interests.
5.3 Equity-accounted investees
In CHF million
Balance at 1 January
Additions
Disposals
Dividends
Share of net results
Share of other comprehensive income
Impairment losses
Foreign currency translation adjustments
Balance at 31 December
2021
155
18
(131)
(1)
(5)
(2)
(5)
1
30
2020
156
16
–
(15)
9
(5)
(5)
(1)
155
159
As part of its strategic partnership with TIM, Fastweb transferred its stake in Flash Fiber as a capital contribution to
the newly established fibre-optic company FiberCop. For contributing its 20% stake to Flash Fiber, Fastweb has
received a 4.5% stake in FiberCop. The transaction was completed in March 2021. The fair value of the FiberCop
investment is EUR 210 million (CHF 232 million). The transaction resulted in a gain on the Flash Fiber participation
of CHF 169 million, which was recognised in the income statement in the first quarter of 2021. In addition, in the
first quarter of 2021, Swisscom sold its share in Belgacom International Carrier Services SA (BICS) for a sale price of
EUR 115 million (CHF 126 million). Swisscom realised a gain of CHF 38 million from the sale of BICS.
Selected key performance indicators for equity-accounted investees
In CHF million
Income statement
Net revenue
Operating expense
Operating income
Net income
Other comprehensive income
Balance sheet at 31 December
Current assets
Non-current assets
Current liabilities
Non-current liabilities
Equity
2021
2020
368
(369)
(1)
(34)
(9)
158
19
(69)
(30)
78
1,614
(1,541)
73
41
(23)
820
1,343
(951)
(594)
618
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5.4 Group companies
Group companies in Switzerland
Registered name
Registered office
31.12.2021
Capital and
voting rights
share in %
31 .12 .2020
Capital and
voting rights
share in %
Share capital
in million Currency Segment
4
Switzerland
AdUnit Ltd 2
Ajila AG 2
Artificialy SA 2,3
autoSense Ltd 2,3
Billag Ltd in liquidation 1
Blue Entertainment Ltd 1
cablex Ltd 2
Credit Exchange Ltd 2,3
Custodigit Ltd 2,3
daura Ltd 2,3
ecmt AG 2,3
Entertainment Programm AG 2,3
finnova ltd bankware 2,3
Global IP Action Ltd 2
Innovative Government Ltd 1
Innovative Web Ltd 1
Innovative We Marketing & Service Ltd 1
itnetX (Switzerland) AG 2
JLS Digital AG 2
kitag kino-theater Ltd 2
Medgate Ltd 2,3
Medgate Technologies Ltd 2,3
Mona Lisa Capital AG in liquidation 2
SEC consult (Switzerland) Ltd 2,3
SmartLife Care Ltd 2,3
Swisscom Blockchain Ltd 2
Swisscom Broadcast Ltd 1
Swisscom Digital Technology SA 1
Swisscom Directories Ltd 1
Swisscom eHealth Invest GmbH 2
Swisscom Health AG 2
Swisscom Real Estate Ltd 1
Swisscom IT Services
Finance Custom Solutions Ltd 2
Swisscom (Switzerland) Ltd 1
Swisscom Services Ltd 2
Swisscom Trust Services Ltd 2
Swisscom Ventures Ltd 2
SwissSign Group Ltd 2,3
Teleclub AG 2
tiko Energy Solutions SA 2,3
United Security Provider Ltd 2
Worklink AG 1
1 Participation directly held by Swisscom Ltd.
2 Participation indirectly held by Swisscom Ltd.
Zurich
Sursee
Lugano
Zurich
Fribourg
Zurich
Muri near Berne
Zurich
Zurich
Zurich
Embrach
Zurich
Lenzburg
Freienbach
Freienbach
Freienbach
Zurich
Rümlang
Lucerne
Zurich
Basel
Basel
Ittigen
Zurich
Wangen
Zurich
Berne
Geneva
Zurich
Ittigen
Ittigen
Ittigen
Olten
Ittigen
Ittigen
Zurich
Ittigen
Opfikon
Zurich
Ittigen
Berne
Berne
100
60
18
33
100
100
100
25
41
26
20
33
9
68
90
90
90
100
100
–
–
–
100
–
–
–
100
75
100
100
–
100
100
100
100
100
100
–
–
–
100
100
100
60
18
33
100
100
100
25
75
31
20
33
9
79
–
–
–
100
–
100
40
40
100
47
48
100
100
75
100
100
100
100
100
100
100
–
100
10
100
29
100
100
0 .1 CHF
0 .1 CHF
1 .1 CHF
0 .3 CHF
0 .1 CHF
0 .5 CHF
5 .0 CHF
0 .1 CHF
1 .8 CHF
0 .4 CHF
0 .1 CHF
0 .6 CHF
0 .5 CHF
0 .2 CHF
0 .1 CHF
0 .1 CHF
0 .1 CHF
0 .1 CHF
1 .0 CHF
1 .0 CHF
0 .7 CHF
0 .1 CHF
5 .0 CHF
0 .1 CHF
0 .2 CHF
0 .1 CHF
25 .0 CHF
0 .1 CHF
2 .2 CHF
1 .4 CHF
0 .1 CHF
100 .0 CHF
0 .1 CHF
1,000 .0 CHF
0 .1 CHF
1 .0 CHF
2 .0 CHF
12 .5 CHF
1 .2 CHF
13 .3 CHF
0 .5 CHF
0 .5 CHF
OTH
OTH
OTH
OTH
OTH
SCS
OTH
OTH
OTH
OTH
OTH
SCS
SCS
OTH
OTH
OTH
OTH
SCS
SCS
SCS
OTH
OTH
OTH
OTH
OTH
OTH
OTH
SCS
OTH
OTH
SCS
SCS
SCS
SCS
SCS
OTH
OTH
OTH
SCS
OTH
SCS
SCS
3 Investment is accounted for using the equity method. Through its representa-
tion on the Board of Directors of the company, Swisscom can exercise a signifi-
cant influence.
4 SCS = Swisscom Switzerland, FWB = Fastweb, OTH = Other
161
Group companies in other countries
Registered name
Registered office
31.12.2021
Capital and
voting rights
share in %
31 .12 .2020
Capital and
voting rights
share in %
Share capital
in million Currency Segment
4
Belgium
Belgacom International Carrier Services Ltd 2,3
Brussels
–
22
1 .5 EUR
SCS
Germany
Swisscom Telco GmbH 2
France
local .fr SA 2
SoftAtHome SA 2,3
Great Britain
Ajila UK Ltd 2
Italy
7Layers Group S .r .l . 2
7Layers S .r .l . 2
Fastweb S .p .A . 2
Fastweb Air S .r .l . 2
Flash Fiber S .r .l . 2,3
Swisscom Italia S .r .l . 2
Latvia
Swisscom DevOps Latvia SIA 2
Liechtenstein
Swisscom Re Ltd 1
Luxembourg
DTF GP S .A .R .L 2
DTF GP II S .A .R .L . 2
Digital Transformation Fund
Carried Partner SCSp 2
Digital Transformation Fund
Initial Limited Partner SCSp 2
Netherlands
NGT International B .V . 2
Swisscom DevOps Center B .V . 2
Swisscom Finance B .V . 1
Austria
Swisscom IT Services Finance SE 2
Singapore
Swisscom IT Services Finance Pte Ltd 2
Spain
Webtiser Spain SA 2
USA
Swisscom Cloud Lab Ltd 2
1 Participation directly held by Swisscom Ltd.
2 Participation indirectly held by Swisscom Ltd.
Leipzig
100
100
– EUR
OTH
Bourg-en-Bresse
Comment/Section
London
Porcari
Florence
Milan
Milan
Milan
Milan
Riga
Vaduz
–
10
60
–
70
100
100
–
100
86
10
60
70
70
100
100
20
100
1 .0 EUR
6 .5 EUR
OTH
SCS
– GBP
OTH
– EUR
0 .2 EUR
41 .3 EUR
– EUR
– EUR
505 .8 EUR
FWB
FWB
FWB
FWB
FWB
SCS
100
100
– EUR
SCS
100
100
5 .0 CHF
SCS
Luxembourg
Luxembourg
Luxembourg
Luxembourg
Capelle a/d IJssel
Rotterdam
Rotterdam
100
100
100
100
100
–
100
100
100
100
100
100
100
100
– EUR
– EUR
– EUR
– EUR
– EUR
– EUR
– EUR
OTH
OTH
OTH
OTH
SCS
SCS
OTH
Vienna
100
100
3 .3 EUR
SCS
Singapore
100
100
0 .1 SGD
SCS
Madrid
100
–
0 .1 EUR
SCS
Delaware
100
100
– USD
OTH
3 Investment is accounted for using the equity method. Through its representa-
tion on the Board of Directors of the company, Swisscom can exercise a signifi-
cant influence.
4 SCS = Swisscom Switzerland, FWB = Fastweb, OTH = Other
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6 Other disclosures
This chapter details information which is not already disclosed in the other
parts of the report . For instance, it includes disclosures regarding income taxes
and related parties .
6.1 Income taxes
Income tax expense
In CHF million
Current income tax expense
Adjustments recognised for current tax of prior periods
Deferred income tax expense
Total income tax expense recognised in income statement
Thereof Switzerland
Thereof other countries
2021
337
(3)
(15)
319
339
(20)
2020
325
(5)
(49)
271
242
29
In addition, other comprehensive income includes current and deferred income taxes, which may be analysed
as follows:
In CHF million
Foreign currency translation adjustments of foreign subsidiaries
Actuarial gains and losses from defined benefit pension plans
Change to the fair value of equity instruments
Change in cash flow hedges
Total income tax expense recognised in other comprehensive income
2021
(7)
139
13
(1)
144
2020
–
69
(1)
–
68
Analysis of income taxes
The applicable income tax rate which serves to prepare the following analysis of income tax expense is the
weighted average income tax rate calculated on the basis of the Group’s operating subsidiaries in Switzerland.
The applicable income tax rate is 18.3% (prior year: 18.7%). The decline in the applicable income tax rate can be
attributed to a reduction in the tax rates in various Swiss cantons.
In CHF million
Income before income taxes in Switzerland
Income before income taxes other countries
lncome before income taxes
Applicable income tax rate
Income tax expense at the applicable income tax rate
Reconciliation to reported income tax expense
Effect from result of shareholdings accounted for using the equity method
Effect of changes in tax law in Switzerland
Effect of changes in tax law in other countries
Effect of use of different income tax rates in Switzerland
Effect of use of different income tax rates in other countries
Effect of non-recognition of tax loss carry-forwards
Effect of recognition and offset of tax loss carry-forwards not recognised in prior years
Effect of exclusively tax-deductible expenses and income
Effect of income tax of prior periods
Total income tax expense
Effective income tax rate
2021
1,827
325
2,152
18 .3%
394
2
5
(57)
1
6
1
–
(30)
(3)
319
2020
1,669
130
1,799
18 .7%
336
(2)
(29)
–
7
1
3
(14)
(26)
(5)
271
14 .8%
15 .1%
163
As a result of a change in tax law in Italy, Fastweb was able to revaluate its own goodwill to the carrying amount
for tax purposes in the third quarter of 2021. The revaluation resulted in a positive tax effect of CHF 57 million.
On 1 January 2020, various legislative changes affecting corporate taxation came into force in Switzerland. These
changes fundamentally abolish tax privileges for companies, such as the privileged taxation of the profits of
holding companies. In return, most of the cantons reduced the corporate income tax rates. In 2020, this led to
positive tax effects of CHF 29 million resulting from the revaluation of deferred tax liabilities.
Current income tax assets and liabilities
In CHF million
Current income tax liabilities at 1 January, net
Recognised in income statement
Recognised in other comprehensive income
Income taxes paid in Switzerland
Income taxes paid in other countries
Current income tax liabilities at 31 December, net
Thereof current income tax assets
Thereof current income tax liabilities
Thereof Switzerland
Thereof other countries
Deferred income tax assets and liabilities
In CHF million
Property, plant and equipment
Intangible assets
Provisions
Defined benefit obligations
Tax loss carry-forwards
Other
Total tax assets (tax liabilities)
Thereof deferred tax assets
Thereof deferred tax liabilities
Thereof Switzerland
Thereof other countries
2021
182
334
(9)
(264)
(15)
228
(2)
230
222
6
2020
170
320
1
(298)
(11)
182
(4)
186
182
–
Assets
Liabilities
31.12.2021
Net
amount
Assets
Liabilities
31 .12 .2020
Net
amount
50
12
102
–
12
140
316
(611)
(561)
(62)
(93)
(24)
–
(133)
(923)
(50)
9
(24)
12
7
(607)
204
(811)
(629)
22
45
–
91
118
57
117
428
(617)
(82)
(87)
–
–
(103)
(889)
(572)
(82)
4
118
57
14
(461)
183
(644)
(443)
(18)
Tax loss carry-forwards for which no deferred tax assets were recognised expire as follows:
In CHF million
Expiring within 1 year
Expiring within 2 to 7 years
No expiration
Total unrecognised tax loss carry-forwards
Thereof Switzerland
Thereof other countries
31.12.2021
31 .12 .2020
–
18
5
23
18
5
–
26
20
46
26
20
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Other disclosures
Deferred tax liabilities of CHF 6 million (prior year: CHF 6 million) were recognised on the undistributed earnings
of subsidiaries as at 31 December 2021. Temporary differences of subsidiaries and equity-accounted investees
for which no deferred tax liabilities are recognised as at 31 December 2021 amounted to CHF 2,838 million (prior
year: CHF 2,102 million). In 2021, the tax authorities definitively assessed some tax years. The assessments have
resulted in no material uncertain tax positions remaining as at 31 December 2021.
Accounting policies
Income taxes encompass all current and deferred taxes which are based on income. Taxes which are not based
on income, such as taxes on real estate and on capital, are recorded as other operating expenses. Deferred taxes
are computed using the balance sheet liability method, whereby as a general rule deferred taxes are recognised
on all temporary differences. Temporary differences arise from differences between the carrying amount of a
balance sheet position in the consolidated financial statements and its value as reported for tax purposes, which
will reverse in future periods. Deferred tax assets are only recognised as assets to the extent that it is probable
that they can be offset against future taxable income. Income tax liabilities on distributions of undistributed prof-
its of Group companies are only recognised if the distribution of profits is to be made in the foreseeable future.
If it is probable that the tax authority will accept the chosen tax treatment, the tax amount in the consolidated
financial statements is the same as that entered in the tax return submitted. However, if this is not probable, the
amounts will be different. The uncertainty is taken into account in the measurement, which requires a best-possible
estimate of the expected cash outflow. If there are few possible outcomes of the tax treatment, the most likely
outcome is used to determine the tax liability. If there are a large number of possible tax consequences, an
expected value is determined on the basis of a probability calculation. Current and deferred tax assets and liabil-
ities are offset whenever they relate to the same taxing authority and taxable entity.
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6.2 Related parties
Majority shareholder and equity-accounted investees
Majority shareholder
Pursuant to the Swiss Federal Telecommunications Enterprises Act (TEA), the Swiss Confederation (‘the Confed-
eration’) is obligated to hold a majority of the share capital and voting rights of Swisscom. On 31 December 2021,
the Confederation, as majority shareholder, continued to hold 51.0% of the issued shares of Swisscom Ltd. Any
reduction of the Confederation’s holding below a majority shareholding would require a change in law, which
would need to be voted upon by the Swiss Parliament and would also be subject to the right of optional referen-
dum by Swiss voters. As the majority shareholder, the Confederation has the power to control the decisions of
the annual general meetings of shareholders which are taken by the absolute majority of validly cast votes. This
relates primarily to resolutions concerning dividend distributions and the election of the members of the Board
of Directors. Swisscom supplies telecommunications services to, and also procures services from, the Confederation.
The Confederation comprises the various ministries and administrative bodies of the Confederation and the
other companies controlled by the Confederation (primarily the Swiss Post, Swiss Federal Railways, RUAG and
Skyguide). All transactions are conducted on the basis of normal customer/supplier relationships and on conditions
applicable to unrelated third-parties. In addition, financing transactions are entered into with the Swiss Post under
market conditions.
Equity-accounted investees
Services provided to/by equity-accounted investees are based upon market prices. Such participations are listed
in Note 5.3.
Transactions and balances
In CHF million
Income
Expense
Receivables
Liabilities
2021 financial year
Confederation
Equity-accounted investees
Total 2021/balance at 31 December 2021
186
18
204
69
50
119
278
6
284
159
4
163
In CHF million
Income
Expense
Receivables
Liabilities
2020 financial year
Confederation
Equity-accounted investees
Total 2020/balance at 31 December 2020
181
62
243
80
111
191
187
22
209
359
22
381
Occupational pension schemes and compensation payable to individuals in key positions
Transactions between Swisscom and the various pension funds are detailed in Note 4.3. Compensation paid to
individuals in key positions is disclosed in Note 4.2.
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6.3 Other accounting policies
Foreign currency translation
Foreign currency transactions which are not denominated in the functional currency are translated into the func-
tional currency using the exchange rate prevailing at the dates of the transactions. Monetary items as at the bal-
ance sheet date are translated into the functional currency at the exchange rate prevailing at the balance sheet
date, while non-monetary items are translated using the exchange rate on the date of the transaction. Trans-
lation differences are recognised in the income statement. Assets and liabilities of subsidiaries and equity-
accounted investees reporting in a different functional currency are translated at the exchange rates prevailing
on the balance sheet date, whereas the income statement and the cash flow statement are translated at the
average exchange rate. Translation differences arising from the translation of net assets and income statements
are recorded in other comprehensive income.
Significant foreign currency translation rates
Currency
1 EUR
1 USD
31.12.2021
31 .12 .2020
1 .033
0 .912
1 .080
0 .880
Closing rate
31 .12 .2019
1 .085
0 .966
2021
1 .080
0 .912
Average rate
2020
1 .072
0 .937
Amended International Financial Reporting Standards and Interpretations,
whose application is not yet mandatory
The following International Financial Reporting Standards and Interpretations published up to the end of 2021
are mandatory for annual periods beginning on or after 1 January 2022:
Standard
Name
Effective from
References to conceptual framework
Amendments to IFRS 3
Property, plant and equipment: Income before intended use
Amendments to IAS 16
Onerous contracts: Cost of fulfilling a contract
Amendments to IAS 37
Amendments to IFRS 2018–2020
Various
Insurance contracts
IFRS 17
Classification of liabilities as current or non-current
Amendments to IAS 1
Amendments to IFRS 10 and IAS 28 Sale or deposit of assets between an investor and an associated company or joint venture
1 January 2022
1 January 2022
1 January 2022
1 January 2022
1 January 2023
1 January 2023
still open
Swisscom will review its financial reporting for the impact of those new and amended standards which take
effect on or after 1 January 2022 and which Swisscom did not choose to adopt earlier than required. At present,
Swisscom anticipates no material impact on the consolidated financial statements.
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Report of the statutory auditor
to the General Meeting of Swisscom Ltd
Ittigen
Report on the audit of the consolidated financial statements
Opinion
We have audited the consolidated financial statements of Swisscom Ltd and its subsidiaries (the Group), which comprise
the consolidated statement of comprehensive income for the year ended 31 December 2021, the consolidated balance
sheet as at 31 December 2021, the consolidated statement of cash flows and the consolidated statement of changes in
equity for the year then ended, and notes to the consolidated financial statements, including a summary of significant
accounting policies.
In our opinion, the accompanying consolidated financial statements (pages 108 to 167) give a true and fair view of the
consolidated financial position of the Group as at 31 December 2021 and its consolidated financial performance and its
consolidated cash flows for the year then ended in accordance with the International Financial Reporting Standards
(IFRS) and comply with Swiss law.
Basis for opinion
We conducted our audit in accordance with Swiss law, International Standards on Auditing (ISAs) and Swiss Auditing
Standards. Our responsibilities under those provisions and standards are further described in the “Auditor’s responsibili-
ties for the audit of the consolidated financial statements” section of our report.
We are independent of the Group in accordance with the provisions of Swiss law and the requirements of the Swiss au-
dit profession, as well as the International Code of Ethics for Professional Accountants (including International Independ-
ence Standards) of the International Ethics Standards Board for Accountants (IESBA Code), and we have fulfilled our
other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have ob-
tained is sufficient and appropriate to provide a basis for our opinion.
Our audit approach
Overview
Overall materiality for the consolidated financial statements: CHF 80 million
We conducted full scope audit work at four Group companies in two countries.
These Group companies represent over 90% of the Group’s revenue. In addi-
tion, specified procedures were performed on selected balance sheet and in-
come statement line items for one additional Group company located in Swit-
zerland.
As key audit matters the following areas of focus have been identified:
• Recoverability of Fastweb goodwill
• Revenue recognition – Solutions business with Business Customers
• Recoverability of technical installations and intangible assets
• Assessment of litigation arising from regulatory and competition law pro-
ceedings
PricewaterhouseCoopers AG, Birchstrasse 160, Postfach, CH-8050 Zürich, Switzerland
Telefon: +41 58 792 44 00, Telefax: +41 58 792 44 10, www.pwc.ch
PricewaterhouseCoopers AG is a member of the global PricewaterhouseCoopers network of firms, each of which is a separate and independent legal entity.
Materiality
The scope of our audit was influenced by our application of materiality. Our audit opinion aims to provide reasonable
assurance that the consolidated financial statements are free from material misstatement. Misstatements may arise due
to fraud or error. They are considered material if, individually or in aggregate, they could reasonably be expected to influ-
ence the economic decisions of users taken on the basis of the consolidated financial statements.
Based on our professional judgement, we determined certain quantitative thresholds for materiality, including the overall
Group materiality for the consolidated financial statements as a whole as set out in the table below. These, together with
qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent of our audit
procedures and to evaluate the effect of misstatements, both individually and in aggregate, on the consolidated financial
statements as a whole.
Overall Group materiality
CHF 80 million
Benchmark applied
Profit before tax
Rationale for the materiality bench-
mark applied
We chose profit before tax as the benchmark because, in our view, it is the
benchmark against which the performance of the Group is most commonly
measured, and it is a generally accepted benchmark.
We agreed with the Audit Committee that we would report to them misstatements with impacts on the income statement
above CHF 4 million identified during our audit as well as any misstatements below that amount which, in our view, war-
ranted reporting for qualitative reasons.
Audit scope
We tailored the scope of our audit in order to perform sufficient work to enable us to provide an opinion on the consoli-
dated financial statements as a whole, taking into account the structure of the Group, the accounting processes and con-
trols, and the industry in which the Group operates.
The Group consists of three operating segments (Swisscom Switzerland, Fastweb, Other Operating Segments) and op-
erates mainly in Switzerland and Italy. Swisscom (Schweiz) Ltd generates most of the revenue. Another company that
we identified as significant is Fastweb S.p.A. (Fastweb).
The audits of Swisscom (Schweiz) Ltd and Swisscom Ltd were performed by the Group audit team. The audit of Fast-
web was performed by the PwC component auditor in Italy, to whom we provided instructions and with whom we are in
regular contact to discuss the treatment of transactions that are material to the consolidated financial statements as well
as questions regarding valuation and disclosure. In addition, we participate in important discussions with Fastweb’s man-
agement. The audit of these three companies addresses the major part of the consolidated financial statements. Another
company in Switzerland is audited by a Swiss PwC component auditor, whom we have instructed and with whom we are
also in regular contact. Finally, we identified an additional subsidiary with significant balance sheet and income state-
ment items, which is audited by the Group audit team. Group-wide topics, such as treasury, taxes, pension obligations,
investments including goodwill and the implementation of new accounting requirements are addressed by the Group
audit team.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the
consolidated financial statements of the current period. These matters were addressed in the context of our audit of the
consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
Swisscom Ltd | Report of the statutory auditor to the General Meeting
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Recoverability of Fastweb goodwill
Key audit matter
How our audit addressed the key audit matter
The impairment testing of goodwill relating to Fastweb was
deemed a key audit matter for the following reasons:
• As at 31 December 2021, the goodwill relating to the
Fastweb operating segment amounted to CHF 514
million (2020: CHF 537 million), which is a significant
amount.
•
In performing the annual impairment test of the Fast-
web goodwill, management has considerable scope
for judgement regarding the expected future cash
flows, the discount rate (WACC) used and the fore-
casted growth.
Please refer to note 3.4 ‘Goodwill’ (page 145) in the notes
to the consolidated financial statements.
During our audit, we assessed with regard to the impair-
ment test whether a correct valuation method was used,
the calculation was coherent and the assumptions made
were appropriate.
In doing so, we challenged the input data and assumptions
relating to the underlying cash flows of the impairment test.
In addition, we compared the results of the current year
with the forecasts made in the previous year in order to as-
sess the appropriateness of the previous year’s assump-
tions.
With regard to the discount rate used, we analyzed to-
gether with our own valuation specialists how it was de-
rived and compared it with our own calculation.
We also examined whether the information on impairment
testing in the notes to the consolidated financial statements
was disclosed correctly and whether the sensitivity anal-
yses presented indicate appropriately the risks of impair-
ment.
We consider the valuation method and the assumptions
used by management to test for the impairment of the Fast-
web goodwill to be appropriate.
Swisscom Ltd | Report of the statutory auditor to the General Meeting
Revenue recognition – Solutions business with Business Customers
Key audit matter
How our audit addressed the key audit matter
For the 2021 financial year, Swisscom reports net revenue
of CHF 11,183 million (2020: CHF 11,100 million). Of this
amount, CHF 1,111 million (2020: CHF 1,058 million) is
generated by the Solutions business with Business Cus-
tomers. The Solutions business with Business Customers
comprises integrated communications solutions (e.g. IT
outsourcing) for large enterprises in Switzerland.
We consider revenue recognition in the Solutions business
with Business Customers to be a key audit matter for the
following reasons:
• The specific projects within the Solutions business are
based on complex individual contracts that may in-
clude multiple performance obligations. The account-
ing treatment of these contracts requires management
to estimate the expected transaction price and the tim-
ing of revenue recognition of the individual perfor-
mance obligations.
• The projects typically last between three and seven
years. To ensure a loss-free valuation of ongoing pro-
jects, management has significant scope for judge-
ment in its assessment of the future costs of each pro-
ject.
Please refer to note 1.1 ‘Segment information’ (page 114)
in the notes to the consolidated financial statements.
We assessed the design and effectiveness of the controls
implemented to ensure the correct recognition of revenue
in the Solutions business with Business Customers.
Further, we performed analytical audit procedures. On the
basis of internal and external reports, we defined our ex-
pectations and critically assessed deviations from them.
For a sample of contracts entered into in the 2021 financial
year, we assessed the accounting treatment applied by
Swisscom. In doing so, we assessed whether manage-
ment’s estimate of the expected transaction price and of
the timing of revenue recognition relating to individual per-
formance obligations is appropriate.
To address the significant scope for judgement when as-
sessing future costs to ensure a loss-free valuation, we
performed the following audit procedures:
• We gained an understanding of the process imple-
mented by management to assess future develop-
ments in the Solutions business and critically as-
sessed that process.
• We discussed with Swisscom their expectations re-
garding the future development of individual projects
and critically assessed those expectations on the basis
of current developments.
• Using a sample of projects, we compared Swisscom’s
forecasts from the previous year with actual develop-
ments in the current financial year and analysed any
variances.
Finally, on the basis of a sample, we assessed whether
the revenue in the Solutions business with Business Cus-
tomers was recorded correctly. To do so, we checked
cash receipts for individual revenue transactions and ob-
tained external balance confirmations from Swisscom cus-
tomers.
We consider management’s estimates relating to the
recognition of revenue in the Solutions business with Busi-
ness Customers to be appropriate.
Swisscom Ltd | Report of the statutory auditor to the General Meeting
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Recoverability of technical installations and intangible assets
Key audit matter
How our audit addressed the key audit matter
We consider the impairment testing of technical facilities
and intangible assets to be a key audit matter for the fol-
lowing reasons:
We assessed the design and effectiveness of the controls
implemented to ensure the correct impairment testing of
technical installations and intangible assets.
• Swisscom recognises as of 31 December 2021 tech-
nical installations with a net book value of CHF 8,491
million (2020: CHF 8,611 million) and intangible assets
with a net book value of CHF 1,714 million (2020: CHF
1,745 million). Both represent significant amounts.
• Management has significant scope for judgement
when assessing and determining the useful life of
technologies that are in use.
Please refer to note 3.2 ‘Property, plant and equipment’
(page 142) and note 3.3 ‘Intangible assets’ (page 144) in
the notes to the consolidated financial statements.
We also discussed with management the estimates of the
future useful lives of existing technologies and critically as-
sessed these on the basis of current developments at
Swisscom and other telecommunications companies.
In addition, we assessed the completeness and appropri-
ateness of changes in useful lives and actual impairments
in the 2021 financial year.
We consider management's assessment of the expected
period over which Swisscom derives economic benefits
from the use of existing technologies to be appropriate.
Swisscom Ltd | Report of the statutory auditor to the General Meeting
Assessment of litigation arising from regulatory and competition law proceedings
Key audit matter
How our audit addressed the key audit matter
Swisscom recorded as at 31 December 2021 provisions
amounting to CHF 1,149 million (2020: CHF 1,216 million).
Of this amount, CHF 176 million (2020: CHF 233 million)
relates to provisions for litigation arising from regulatory
and competition law proceedings.
To address the significant scope for judgement in estimat-
ing the probability, the timing and the amount of a potential
cash outflow due to litigation, we performed together with
an internal legal expert the following audit procedures:
Swisscom provides regulated access services to other tele-
communications service providers in accordance with the
Telecommunications Act. The prices charged by Swisscom
are subject to reviews by the Federal Communications
Commission (ComCom). If the Commission issues a ruling
against Swisscom, the prices charged must be reduced
with retroactive effect.
Swisscom is also a party to proceedings conducted by the
Federal Competition Commission (COMCO). In the event
of a final verdict establishing market abuse by Swisscom,
COMCO may impose sanctions. A final verdict establishing
market abuse issued by COMCO could lead to civil claims
against Swisscom.
We consider the assessment of the financial implications of
litigation arising from regulatory and competition law pro-
ceedings to be a key audit matter because management
has significant scope for judgement in estimating the prob-
ability, the timing and the amount of a potential cash out-
flow due to litigation.
Please refer to note 3.5 ‘Provisions, contingent liabilities
and contingent assets’ (page 147) in the notes to the con-
solidated financial statements.
• We discussed pending litigation with management and
Swisscom’s internal legal counsel.
• We obtained written statements from Swisscom’s ex-
ternal and internal legal counsel.
• We gained an understanding of the process and con-
trols implemented by management to identify, assess
and recognise pending litigation, and critically as-
sessed it.
To assess the amount of the provisions established, we
considered whether the underlying data were adequately
factored into the calculation of the provisions.
Finally, we assessed the recognition and disclosure in the
consolidated financial statements of litigation arising from
regulatory and competition law proceedings.
We consider management’s approach to the treatment in
the consolidated financial statements of litigation arising
from regulatory and competition law proceedings to be ap-
propriate.
Other information in the annual report
The Board of Directors is responsible for the other information in the annual report. The other information comprises all
information included in the annual report, but does not include the consolidated financial statements, the stand-alone
financial statements and the remuneration report of Swisscom Ltd and our auditor’s reports thereon.
Our opinion on the consolidated financial statements does not cover the other information in the annual report and we do
not express any form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other information in
the annual report and, in doing so, consider whether the other information is materially inconsistent with the consolidated
financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on
the work we have performed, we conclude that there is a material misstatement of this other information, we are required
to report that fact. We have nothing to report in this regard.
Swisscom Ltd | Report of the statutory auditor to the General Meeting
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Responsibilities of the Board of Directors for the consolidated financial statements
The Board of Directors is responsible for the preparation of the consolidated financial statements that give a true and fair
view in accordance with IFRS and the provisions of Swiss law, and for such internal control as the Board of Directors
determines is necessary to enable the preparation of consolidated financial statements that are free from material mis-
statement, whether due to fraud or error.
In preparing the consolidated financial statements, the Board of Directors is responsible for assessing the Group’s ability
to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern
basis of accounting unless the Board of Directors either intends to liquidate the Group or to cease operations, or has no
realistic alternative but to do so.
Auditor’s responsibilities for the audit of the consolidated financial statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with
Swiss law, ISAs and Swiss Auditing Standards will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.
As part of an audit in accordance with Swiss law, ISAs and Swiss Auditing Standards, we exercise professional judg-
ment and maintain professional scepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient
and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrep-
resentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropri-
ate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal
control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and re-
lated disclosures made.
• Conclude on the appropriateness of the Board of Directors’ use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast
significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty ex-
ists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial
statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evi-
dence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to
cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclo-
sures, and whether the consolidated financial statements represent the underlying transactions and events in a man-
ner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities
within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction,
supervision and performance of the Group audit. We remain solely responsible for our audit opinion.
We communicate with the Board of Directors or its relevant committee regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that
we identify during our audit.
We also provide the Board of Directors or its relevant committee with a statement that we have complied with relevant
ethical requirements regarding independence, and communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safe-
guards applied.
Swisscom Ltd | Report of the statutory auditor to the General Meeting
From the matters communicated with the Board of Directors or its relevant committee, we determine those matters that
were of most significance in the audit of the consolidated financial statements of the current period and are therefore the
key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure
about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in
our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
Report on other legal and regulatory requirements
In accordance with article 728a paragraph 1 item 3 CO and Swiss Auditing Standard 890, we confirm that an internal
control system exists which has been designed for the preparation of consolidated financial statements according to the
instructions of the Board of Directors.
We recommend that the consolidated financial statements submitted to you be approved.
PricewaterhouseCoopers AG
Peter Kartscher
Audit expert
Auditor in charge
Zürich, 2 February 2022
Petra Schwick
Audit expert
Swisscom Ltd | Report of the statutory auditor to the General Meeting
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Further Information ___________ Financial statements Swisscom Ltd
General information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 178
Income statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 178
Balance sheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 179
Further information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 179
Proposed appropriation of retained earnings . . . . . . . . 179
Glossary
Technical terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 180
Other terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 182
Five-year review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 183
177
Financial statements
Swisscom Ltd
General information
This is a condensed version of the financial statements of Swisscom Ltd. The full version and the auditors’ report
can be viewed on the Swisscom website.
N See www.swisscom.ch/financialstatements2021
Swisscom Ltd is a holding company under Swiss law. As at 31 December 2021, the Swiss Confederation, as majority
shareholder, continued to hold 51.0% of the issued shares of Swisscom Ltd as in the prior year. The Telecommuni-
cations Enterprise Act (TEA) provides that the Swiss Confederation shall hold the majority of the share capital
and voting rights of Swisscom Ltd.
The financial statements of Swisscom Ltd have been prepared in accordance with statutory requirements and the
Articles of Incorporation. Distributable reserves are not determined on the basis of the equity as reported in the
consolidated financial statements, but rather on the basis of equity as reported in the separate financial state-
ments of Swisscom Ltd. The equity totalled CHF 4,753 million in the 2021 annual financial statements of
Swisscom Ltd. Under Swiss company law, share capital and that part of the general reserves representing 20% of the
share capital may not be distributed. On 31 December 2021, Swisscom Ltd held distributable reserves of CHF 4,691
million. The dividend is proposed by the Board of Directors and must be approved by Swisscom Ltd’s Annual
General Meeting of Shareholders on 30 March 2022. Treasury shares are not entitled to a dividend.
Income statement
In CHF million
Net revenue from the sale of goods and services
Other income
Total operating income
Personnel expense
Other operating expense
Total operating expenses
Operating income
Financial expense
Financial income
Income from participations
Income before taxes
Income tax expense
Net income
2021
19
16
35
(33)
(12)
(45)
(10)
(37)
73
163
189
(4)
185
2020
100
29
129
(62)
(75)
(137)
(8)
(107)
150
62
97
(8)
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Balance sheet
In CHF million
Assets
Cash and cash equivalents
Financial assets
Participations
Other assets
Total assets
Liabilities and equity
Interest-bearing liabilities
Other liabilities
Total liabilities
Share capital
Legal capital reserves/capital surplus reserves
Voluntary retained earnings
Own equity interest
Total equity
Total liabilities and equity
Further information
31 .12 .2021
31 .12 .2020
337
4,217
8,222
56
217
6,080
8,196
82
12,832
14,575
7,944
135
8,079
52
21
4,680
–
4,753
12,832
8,693
175
8,868
52
21
5,635
(1)
5,707
14,575
Information on the participation rights held by the members of the Board of Directors and the Group Executive
Board is also disclosed in the Remuneration Report (sections 2.5 and 3.5).
As at 31 December 2021, guarantee obligations exist for Group companies in favour of third parties totalling CHF 275
million (prior year: CHF 253 million), and financial assets totalling CHF 155 million (prior year: CHF 149 million) were
not freely available. These assets serve to secure commitments arising from bank loans.
Swisscom Ltd carried out the equal pay analysis in accordance with the Gender Equality Act using the standard
analysis tool Logib and this was reviewed by PwC. PwC states in its report that during the formal review of the
equal pay analysis, it did not come across any facts from which it would have to conclude that the equal pay
analysis does not comply with the legal requirements in all respects.
Proposed appropriation of retained earnings
The Board of Directors proposes to the Annual General Meeting of Shareholders to be held on 30 March 2022 that
the available retained earnings of CHF 4,680 million for the financial year ending on 31 December 2021 be appro-
priated as follows:
In CHF million
Appropriation of retained earnings
Retained earnings from previous year
Ordinary dividend
Balance carried forward from prior year
Net income for the year
Changes in treasury shares
Retained earnings available to the Annual General Meeting
Ordinary dividend of CHF 22 .00 per share
Balance to be carried forward
31 .12 .2021
5,634
(1,140)
4,494
185
1
4,680
(1,140)
3,540
In the event that the proposal is approved, a dividend of CHF 22 per share will be paid to shareholders on 5 April 2022.
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Glossary
Technical terms
4G/LTE (Long-Term Evolution): 4G/LTE is the fourth gen-
eration of mobile technology. At present, LTE enables
mobile broadband data speeds of up to 150 Mbps.
4G+/LTE Advanced: 4G+/LTE enables theoretical broad-
band data speeds of up to 700 Mbps via the mobile net-
work. To do so, it bundles 4G/LTE frequencies to achieve
the required capacity.
dynamically via the Internet as needed. The data c entres,
along with the resources and databases, are distributed
via the cloud. The term ^’cloud’ refers to such hardware
which is not precisely locatable.
Connectivity: Connectivity is the generic term used to
denote IP services or the connection to the Internet and the
ability to exchange data with any partner on the network.
Convergence (bonding technology): In the telecommu-
nications sector, ‘convergence’ normally refers to an
interaction of mobile communication and fixed-net-
work technologies or to products that encompass both
mobile communication and fixed-network services.
FTTH (Fibre to the Home): FTTH refers to the end-to-end
connection of homes and businesses using fibre-optic
cables instead of traditional copper cables.
FTTH topologies (P2P and P2MP): There are two differ-
ent common topologies in a fibre-optic network: point-
to-point (P2P) or point-to-multipoint (P2MP). With P2P, a
separate optical fibre is laid between each apartment
and the nearest node (usually a local exchange) – if ten
apartments in a neighbourhood are connected, ten opti-
cal fibres are also available at the node. By contrast, with
P2MP there is only a single optical fibre running from the
node to the vicinity of the apartments. From there, a
‘splitter’ breaks up the light signal and distributes it to
several optical fibres, which then lead to the apartments.
FTTS (Fibre to the Street)/FTTB (Fibre to the Building)/
FTTC (Fibre to the Curb): FTTS, FTTB and FTTC refer to
hybrid broadband connection technologies (optical fibre
and copper). With these technologies, optical fibre is
brought as near as possible to buildings and in the case
of FTTB right to the building’s basement; the existing
copper cables are used for the remaining stretch.
5G: 5G is the latest generation in mobile network tech-
nology. 5G brings with it even more capacity, very short
response times and higher bandwidths, and supports
the digitisation of Swiss business and industry. There are
two types: 5G (also known as 5G-wide) and 5G+ (also
known as 5G-fast). Both types are more efficient than
predecessor technologies in terms of both energy con-
sumption and the use of electromagnetic fields.
5G (5G-wide): This type has been using existing mobile
frequencies and antennas for a long time – in simplified
terms it is a software update. It enables widespread cov-
erage and up to 1Gbit/s of data throughput.
5G+ (5G-fast): This type uses newly acquired frequencies.
It offers very high capacities and speeds but shorter
ranges. This type is required to fully exploit all the oppor-
tunities offered by 5G, and also calls for next-generation
antennas.
All IP: All IP means that all services such as television, the
Internet and fixed-line phone run over the same IT net-
work. Swisscom switched all existing communication
networks to Internet Protocol (IP) by the end of 2019.
The IP services within Switzerland thus operate on
Swisscom’s own network, thereby enhancing security
and availability in comparison with other voice services
on the World Wide Web.
Bandwidth: Bandwidth refers to the transmission capac-
ity of a medium, also known as the data transmission
rate. The higher the bandwidth, the more information
units (bits) can be transmitted per unit of time (second).
It is defined in bps, kbps or Mbps.
Cloud: Cloud computing makes it possible for IT infra-
structures such as computing capacity, data storage,
ready-to-use software and platforms to be accessed
ICT (Information and Communication Technology): The
terms ‘information technology’ and ‘communication
technology’ were first combined in the 1980s to denote
the convergence of information technology (informa-
tion and data processing and the related hardware) and
communication technology (technically aided commu-
nications).
IoT (Internet of Things): The connecting of things,
devices and machines to enable recording of status and
environmental data. These data provide the basis for
optimising processes, such as early identification of fail-
ing machine components. IoT facilitates new business
models based on these data or opens up new opportuni-
ties for interacting with customers.
IoT NB (IoT Narrowband): IoT NB is a connection technol-
ogy for the Internet of Things (IoT). It is designed for
maximum range, minimum energy consumption and a
high density of devices, but dispenses with some of the
features of LTE. IoT NB is mainly used for mass market
applications such as electricity and water meters or
monitoring sensors (massive IoT applications).
LAN (Local Area Network): A LAN is a local network for
interconnecting computers, usually based on Ethernet.
LTE-M: LTE-M is a connection technology for the Internet
of Things (IoT). It dispenses with some of the features of
LTE to increase efficiency and reduce complexity and
costs. It enables all conventional IoT applications and – in
contrast to IoT Narrowband (IoT NB) – allows voice trans-
mission (e.g. in lift telephones). LTE-M is particularly suit-
able for quality-sensitive applications such as security
and monitoring solutions (Critical IoT applications).
MVNO (Mobile Virtual Network Operator): MVNO
denotes a business model for mobile communications.
In this case, the corresponding business (the MVNO) has
either a limited network infrastructure or no network
infrastructure at all. It therefore accesses the infrastruc-
ture of other mobile communication providers.
Network convergence: Network convergence refers to
the dissolution and reconstitution of previously separate
networks into one large convergent network, such as in
the case of the fixed and mobile networks of Swisscom.
Optical fibre: Optical fibre is a transport medium for
optical data transmission – in contrast to copper cables,
which transmit data through electrical signals.
OTT (Over the Top): OTT refers to content distributed by
service providers over an existing network infrastructure
that they do not themselves operate. OTT companies
offer proprietary services on the basis of the infrastruc-
tures of other companies in order to reach a broad range
of users quickly and cost-efficiently.
Petabyte: Unit of measurement for data size. 1 peta-
byte is equivalent to approximately 1,000 terabytes,
1,000,000 gigabytes or 1,000,000,000 megabytes.
Roaming: Roaming is when a mobile user makes calls,
uses other mobile services or participates in data traffic
outside his or her home network, i.e. usually abroad. This
requires that the mobile device in question is compati-
ble with the roaming network.
Router: A router is a device for connecting or separating
several computer networks. The router analyses incoming
data packets according to their destination address and
either blocks them or forwards them accordingly (routing).
Routers come in different types, ranging from large
machines in a network to the small devices used by resi-
dential customers.
Streaming: Streaming is the transmission of audio and
video signals over a network or the Internet without the
data having to be stored on a local device.
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TDM (Time Division Multiplexing): Multiplexing is a
method that allows the simultaneous transmission of
multiple signals over a single communications medium
(line, cable or radio link), for example, by means of classic
telephony (using an ISDN or analogue line). Multiplexing
methods are often combined to achieve even higher uti-
lisation. The signals are multiplexed once the user data
have been modulated on a carrier signal. At the receiver
end the information signal is first demultiplexed and
then demodulated. TDM methods are now at the end of
their life cycle.
Terabyte: Unit of measurement for data size. 1 terabyte
is equivalent to approximately 1,000 gigabytes or
1,000,000 megabytes.
Ultra-fast broadband: Ultra-fast broadband denotes
broadband speeds of more than 50 Mbps – on both the
fixed-line and mobile networks.
Other terms
ComCo (Competition Commission): ComCo enforces the
Federal Cartel Act, the aim of which is to safeguard
against the harmful economic or social impact of cartels
and other constraints on competition in order to foster
competition. ComCo combats harmful cartels and mon-
itors market-dominant companies for signs of anti-
competitive conduct. It is responsible for monitoring
mergers and also provides opinions on official decrees
that affect competition.
ComCom (Federal Communications Commission): Com-
Com is the decision-making authority for telecommuni-
cations. Its primary responsibilities include issuing con-
cessions for use of the radio frequency spectrum as well
as basic service licences. It also provides access (un -
bundling, interconnection, leased lines, etc.), approves
national numbering plans and regulates the conditions
governing number portability and freedom of choice of
service provider.
Federal Office of Communications (OFCOM): OFCOM
deals with issues related to telecommunications and
broadcasting (radio and television) and performs official
and regulatory tasks in these areas. It prepares the
decisions of the Swiss Federal Council, the Federal
Department of the Environment, Transport, Energy and
Communications (DETEC) and the Federal Communica-
tions Commission (ComCom).
FTE (full-time equivalent): Throughout this report, FTE
is used to denote the number of full-time equivalent
positions.
Interconnection: Interconnection means linking up the
systems and services of two TSPs so as to enable the logical
interaction of the connected telecoms components and
services and to provide access to third-party services.
Interconnection allows the customer of one provider to
communicate with the subscribers of another provider.
Under the terms of the Federal Telecommunications Act,
market-dominant telecommunications service providers
are required to allow their competitors interconnection at
cost-based prices.
Unbundling: Unbundling of the last mile (Unbundling of
the Local Loop, ULL) enables fixed-line-network compet-
itors without their own access infrastructure to access
customers directly at non-discriminatory conditions
based on original cost. The prerequisite for ULL is the
presence of a market-dominant provider. There are two
forms of unbundling: unbundling at the level of the tele-
phone exchange (Unbundling of the Local Loop (ULL) or
Local Loop Unbundling (LLU), known as TAL in Switzer-
land) with currently around 600 unbundled locations;
and unbundling at distribution box level (sub-loop unbun-
dling, known as T-TAL in Switzerland), in which no com-
petitor has yet shown any interest.
Five-year review
In CHF million, except where indicated
2017
2018
1
2019
2
2020
2021
Net revenue and results
Net revenue
11,662
11,714
11,453
11,100
11,183
Operating income before depreciation and amortisation (EBITDA)
4,295
4,213
4,358
4,382
EBITDA as % of net revenue
Operating income (EBIT)
Net income
Earnings per share
Balance sheet and cash flows
Equity
Equity ratio
Cash flow from operating activities
Capital expenditure
Net debt
Employees
36 .8
2,131
1,568
30 .31
36 .0
2,069
1,521
29 .48
38 .1
1,910
1,669
32 .28
39 .5
1,947
1,528
29 .54
4,478
40 .0
2,066
1,833
35 .37
7,645
8,208
8,875
9,491
10,813
34 .7
4,091
2,378
7,447
36 .3
3,720
2,404
7,393
36 .6
4,019
2,438
6,758
39 .1
4,169
2,229
6,218
43 .6
4,044
2,286
5,689
Full-time equivalent employees
20,506
19,845
19,317
19,062
18,905
Average number of full-time equivalent employees
20,836
20,083
19,561
19,095
19,099
Operational data
Fixed telephony access lines in Switzerland
Broadband access lines retail in Switzerland
Mobile access lines in Switzerland
TV access lines in Switzerland
2,047
2,014
6,637
1,467
1,788
2,033
6,370
1,519
1,594
2,058
6,333
1,555
1,523
2,043
6,224
1,588
1,424
2,037
6,177
1,592
Revenue generating units (RGU) in Switzerland
12,165
11,710
11,540
11,378
11,230
Unbundled fixed access lines in Switzerland
Broadband access lines wholesale in Switzerland
Broadband access lines in Italy
Mobile access lines in Italy
Swisscom share
Number of issued shares
Market capitalisation
Closing price at end of period
Closing price highest
Closing price lowest
Ordinary dividend per share
Ratio payout/earnings per share
Information Switzerland
Net revenue
Operating income before depreciation and amortisation (EBITDA)
Capital expenditure
Full-time equivalent employees
1 Swisscom has been applying IFRS 15 ‘Revenue from Contracts with Custom-
ers’ since 1 January 2018. The prior year’s figures have not been adjusted.
2 Swisscom has been applying IFRS 16 ‘Leases’ since 1 January 2019.
The prior year’s figures have not been adjusted.
107
435
2,451
1,065
87
481
2,547
1,432
70
515
2,637
1,746
56
555
2,747
1,961
41
596
2,750
2,472
51 .802
51 .802
51 .802
51 .802
51 .802
26,859
24,331
26,554
24,715
26,657
518 .50
469 .70
512 .60
477 .10
514 .60
527 .00
530 .60
523 .40
577 .80
562 .40
429 .80
427 .00
441 .10
446 .70
456 .30
22 .00
72 .59
22 .00
74 .63
22 .00
68 .16
22 .00
74 .48
22 .00
3
62 .20
9,476
3,451
1,678
9,274
3,419
1,645
8,969
3,508
1,770
8,614
3,522
1,596
8,579
3,569
1,634
17,688
17,147
16,628
16,048
15,882
3 In accordance with the proposal of the Board of Directors to the Annual
General Meeting.
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Forward-looking statements
This Annual Report contains forward-looking statements. In this Annual Report, such forward-looking
statements include, without limitation, statements relating to our financial condition, results of operations and
business and certain of our strategic plans and objectives.
Because these forward-looking statements are subject to risks and uncertainties, actual future results may
differ materially from those expressed in or implied by the statements. Many of these risks and uncertainties
relate to factors which are beyond Swisscom’s ability to control or estimate precisely, such as future market
conditions, currency fluctuations, the behaviour of other market participants, the actions of governmental
regulators and other risk factors detailed in Swisscom’s and Fastweb’s past and future filings and reports, including
those filed with the U.S. Securities and Exchange Commission and in past and future filings, press releases,
reports and other information posted on Swisscom Group Companies’ websites.
Readers are cautioned not to put undue reliance on forward-looking statements, which speak only of the date
of this communication.
Swisscom disclaims any intention or obligation to update and revise any forward-looking statements, whether
as a result of new information, future events or otherwise.
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Publishing details
Key dates
3 February 2022
Publication of 2021 Annual Results and
Annual Report
30 March 2022
Annual General Meeting
1 April 2022
Ex dividend date
5 April 2022
Dividend payment
28 April 2022
2022 First-Quarter Results
4 August 2022
2022 Second-Quarter Results
27 October 2022
2022 Third-Quarter Results
9 February 2023
Publication of 2022 Annual Results and
Annual Report
Published and produced by
Swisscom Ltd, Berne
Translation
Lionbridge Switzerland AG, Glattbrugg
Production
MDD Management Digital Data AG, Lenzburg
Printing
Stämpfli AG, Berne
Photographer
Manuel Rickenbacher, Zurich
Johannes Diboky, Zurich
Printed on chlorine-free bleached paper
© Swisscom AG, Berne
The Annual Report is published in English,
French and German.
Online versions of the Annual Report
German: www.swisscom.ch/bericht2021
English: www.swisscom.ch/report2021
French: www.swisscom.ch/rapport2021
A condensed version of the 2021 Annual Report
is also available in English, French, German and Italian
at www.swisscom.ch/ataglance2021.
The Sustainability Report 2021 is published online
at www.swisscom.ch/cr-report2021.
General information
Swisscom Ltd
Head Office
CH-3050 Berne
Phone:
+ 41 58 221 99 11
Financial information
Swisscom Ltd
Investor Relations
CH-3050 Berne
Phone:
E-mail:
Internet: www.swisscom.ch/investor
+ 41 58 221 99 11
investor.relations@swisscom.com
Social and environmental information
Swisscom Ltd
Group Communications & Responsibility
CH-3050 Berne
E-mail:
Internet: www.swisscom.ch/responsibility
corporate.responsibility@swisscom.com
For the latest information, visit our website
www.swisscom.ch
Printed Matter
myclimate.org/01-22-797764
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