Letter from the Chair

Dear Reader

Last year, I began my letter by asking the question: Who could have imagined the changes 2020 would bring? The same question is equally relevant now. Not because of the pandemic, which is still with us despite most restrictions being lifted, but rather the challenges we are facing that were unthinkable just a short while ago. Russia's invasion of Ukraine has created war in Europe, and we can already see that 2022 will be a year marked by major upheavals in security policy priorities, global financial markets, international trade, politics, global value chains and economic growth.

In recent years, the Board of Directors in Telenor has focused strongly on sustainable development. It is becoming increasingly important for companies like Telenor to place high demands on responsible business operations and contribute to positive development in the societies where we operate. This is a prerequisite for creating value for customers and shareholders, and it also meets the expectations of Telenor’s stakeholders. This is the only way we can ensure our ability to deliver long-term value for shareholders.

In 2021 Telenor's Board of Directors and management spent a lot of time dealing with the very difficult situation deriving from the military coup in Myanmar. Since the entry into Myanmar in 2014, Telenor has provided communication services and critical infrastructure to the country's citizens. Telenor – strongly supported by Norwegian politicians – was an important contributor to the opening up of the society of Myanmar by providing affordable and accessible communication services. When the military took power in February 2021, the situation suddenly changed. It quickly became clear that it was no longer possible to continue operations while at the same time complying with Norwegian and international laws, sanctions regulations and Telenor's own responsible business commitments. Combined with concerns about human rights and employee safety, this formed the reason for Telenor's decision to sell.

Despite the sad end, Telenor's years in Myanmar were proof of the opportunities inherent in connecting people and things using communication services. Telenor will keep providing such opportunities across all our markets. The telecommunications industry is in the midst of a rapid development with the establishment of 5G networks, opportunities beyond connectivity and the emergence of new value chains and services. At the heart of Telenor’s priorities are the customer’s need. Every innovation is meant to ultimately add value to customers.

New opportunities in the business-to-business market and the use of 5G will renew both our service offering and the way we work. The services offered to the consumer market will also be affected. Building partnerships will be important in the effort to gather the best expertise and technology needed to win the battle for customers.

We believe that benefits of scale and strong market positions will be even more important going forward. This was the reason why Telenor announced new types of partnerships during 2021 by merging its operations in Malaysia and Thailand with Celcom and True, respectively. We have high expectations of the benefits this will bring and believe that the two new companies will put Telenor in an even better position to manage market opportunities and risks within each market and across the region. The ambition is to create two leading players that will provide value for customers and shareholders, and drive digitalisation by becoming an even stronger digital partner for consumers, businesses and the broader society.

The pandemic has created changes in how companies are run and how organisations work. Our employees work differently, our customers use us in a different way – and we all have to adapt. The Board has had most board meetings on video also in 2021. Drawing on good experiences with video meetings, we will continue to hold board meetings digitally going forward however ensuring there is a healthy and good balance between digital and physical meetings. There are several advantages that physical meetings provide for relationship building and delving deep into specific topics.

I will conclude my letter by thanking all Telenor employees who have worked hard to keep our operations running and making sure that the infrastructure we all depend so heavily on in our daily work is available. That's our most important task. You are the reason why we can look back on 2021 as a year in which Telenor stood firm and handled very demanding challenges in a way we can be proud of. And at the same time created the best possible foundation for further development of Telenor as a customer-oriented company with the most sought-after services.

Thank you to employees, thank you to customers and thank you to shareholders.

Gunn Wærsted, Chair of the Board