Final 1

The way we work Telstra Business Principles The way we work - Telstra Business Principles is a key component of our corporate governance framework. It sets out the practices, principles and standards of behaviour Telstra expects you to adopt in carrying out your work. It contains the base level of information you need to know about any area of Telstra's operations, and has been designed to drive business success.

Telstra Vision To do for customers what no one else has done: create a world of 1 click, 1 touch, 1 button, 1 screen, 1 step solutions that are simple, easy and valued by individuals, businesses, enterprises and government.

Telstra Values The way we work Telstra Business Principles is underpinned by the Telstras Values, and provides further guidance on the standards of personal and corporate behaviour required of you. The Telstra Values are: Service: I will be caring and responsive in the way I provide service to my customers and colleagues. Respect for the Individual: I will treat all people with dignity and respect. Integrity: I will be honest and ethical in all my dealings with others. Compliance with the law is my minimum standard. Commitment and Accountability: I will do as I say and accept accountability for my actions. Trust: I will trust my colleagues and rely on them in order to achieve business success. Leadership and Teamwork: I will strive to be a member of a champion team. Being competitive demands my leadership, teamwork and collaboration.

Final 2

Overview of the Telstra Business Principles Telstra Business Principles

1. Employment & Work Practices 1.1 Bribes, pay-offs and kick-backs 1.2 Confidential information

1.3 Conflicts of interest and outside activities 1.4 Drugs, alcohol and smoking

1.5 EEO and diversity

1.6 Employment

1.7 Gifts, prizes and hospitality

1.8 Health and safety

1.9 Internal resolution 1.10 Whistleblowing

2. Compliance and Legal Obligations 2.1 Communication of information

2.2 Company records

2.3 Competition law

2.4 Compliance 2.5 Continuous disclosure

2.6 Insider trading

2.7 Intellectual property 2.8 Legal advice

2.9 Privacy 2.10 Regulatory

3. Sales and marketing 3.1 Customers

3.2 Marketing

3.3 Pricing 3.4 Product management

4. Infrastructure 4.1 Information Technology

4.2 Network service management

5. Finance & Administration 5.1 Finance & administration

5.2 Procurement 5.3 Treasury

6. Risk Management & Security 6.1 Business resilience 6.2 Protecting Telstras property

6.3 Risk management and internal controls

6.4 Security

7. Corporate Social Responsibility 7.1 Corporate social responsibility

7.2 Our people

7.3 Political activities 7.4 Shareholders

7.5 The community 7.6 The environment

Final 3

Definitions Telstra Business Principles define the practices, principles and standards of behaviour Telstra expects you to adopt in carrying out your work in accordance with Telstras Values. The principles are the reference point from which to map proper business practices and conduct in a given situation. They are complemented and supported by Company Policies, including the Code of Conduct, which expand on expected behaviours. Unless otherwise stated in the Application Section of each Policy Company Policies apply to:

all employees and contractors and to any other person who is notified that a Company Policy applies to them.

subject to TBP and Company Policies Policy, each of Telstra's 100% owned Australian subsidiaries and their employees and contractors.

Company Policies provide specific guidance to give effect to the Telstra Business Principles. They define Telstras philosophy and rules about how we manage the company and, if there is any inconsistency, prevail over Business Unit policy. The Company Secretary maintains a register of approved Company Policies. The Code of Conduct is the Company Policy that provides specific guidance on personal behaviour and is supported by additional guidance material. Business Unit policies (for example, Rules of the Road) are specific to each Business Unit. They are subject to the Telstra Business Principles and Company Policies, and are developed to enable each member of the CEO LT to ensure the appropriate management of their Business Unit. If there is any inconsistency, Company Policy prevails over Business Unit policy. Business Unit policies are available on the relevant BUs intranet site.

Ownership and Responsibilities CEO Leadership Team (CEO LT) Each Telstra Business Principle has a responsible CEO LT member who is accountable for: regularly reviewing that principle (or principles) to ensure they meet the ongoing needs of

Telstra

developing, approving, reviewing, updating and administering Company Policies to give effect to their Telstra Business Principles

implementing, providing training in, ensuring awareness of, and monitoring compliance with their Telstra Business Principles and Company Policies.

The CEO LT members may appoint owners of their principles to assist them in discharging their responsibilities. General Managing Director, Finance & Administration The GMD, Finance & Administration is responsible for the administration of the Telstra Business Principles, and reports on that administration annually to the CEO and the Audit Committee. Chief Executive Officer CEO approval is required to remove or amend a Telstra Business Principle, for any specific variation to or waiver of a Telstra Business Principle and to introduce a new Telstra Business Principle.

Final 4

Compliance structure The way we work Telstra Business Principles is a key component of Telstras compliance program. The GMD, Finance & Administration, together with the CEO LT members, administers the compliance program. This responsibility includes:

assigning roles and responsibilities for the compliance program

overseeing compliance training and communications

overseeing compliance monitoring and auditing.

Who should follow the Telstra Business Principles? Personal responsibility Everyone who works on behalf of Telstra including employees, contractors and consultants is responsible for acting in accordance with the Telstra Business Principles that apply to their work, together with the Company Policies that support them. As all these might change from time to time, you are responsible for knowing and complying with the current versions and the laws, rules, regulations and industry codes of practice that govern your work. You are required to act in accordance with the Telstra Values, the Telstra Business Principles and the Company Policies, including the Code of Conduct, at all times. The Telstra Business Principles represent a commitment to doing what is right. By working for Telstra you are agreeing to uphold this commitment. Telstra will encourage its controlled entities and other subsidiaries to adopt the Telstra Business Principles or a similar set of Business Principles. Managers responsibility As a manager or supervisor you must take all reasonable steps to ensure that employees and contractors under your supervision have access to, are aware of, and comply with, all relevant Telstra Business Principles and Company Policies. Telstra expects you to foster a work environment that encourages ethical behaviour and compliance. In the interests of this you are expected to maintain open communication with your direct reports and be available to respond to questions or concerns. As a manager or supervisor you are an example to other employees. In that role you are expected to reinforce and demonstrate Telstra's commitment to the highest standards of quality and service, and of business and professional behaviour.

Violation of the Telstra Business Principles If you do not comply with a Telstra Business Principle or Company Policy, you may face disciplinary action under Telstras Performance Improvement and Conduct Management (PICM) process. This disciplinary action may involve a verbal or written warning or, in serious cases, termination of your employment or engagement with Telstra. If you break the law you may also be personally liable.

Final 5

Employment and Work Practices

Bribes, Pay-Offs and Kick-Backs You must be honest in all your dealings with others. You must not make or accept bribes, pay-offs or kick-backs. Bribes, pay-offs and kick-backs occur when a person offers, makes, authorises, requests or accepts payment of money or anything of value, either directly or indirectly, to:

influence the judgement or conduct of a customer, supplier or competitor ensure a desired outcome from a customer, supplier or competitor influence a decision of, or gain a benefit from, any government official, government agency,

political party or candidate for political office gain an improper advantage.

Telstra conducts business in countries with many different laws, customs and business practices. You must abide by the laws of host countries and must not engage in corrupt business practices. Responsible CEO LT member: GMD Human Resources

Confidential Information Confidential information is a valuable business asset and includes opinions, knowledge and facts about Telstra, its employees, its business and its customers that have not been disclosed to the public. It also includes information derived from the performance of your work with Telstra. You should treat all Telstra information, including information contained in Telstra documents, files, records, emails or on the intranet, as confidential unless it has been expressly approved for public release. If you have access to confidential information, you are responsible for ensuring that it is used only for authorised purposes and is protected from theft, unauthorised disclosure or inappropriate use. Confidential information must not be voluntarily disclosed to anyone except where: you are acting in the best interests of Telstra; and

either:

o the disclosure is in the course of the proper discharge of your duties; or

o you have approval from a member of the Telstra Executive Team. In some cases it will be appropriate to require the recipient of the information to enter into a confidentiality agreement.

The disclosure of confidential information outside Telstra must only be made in accordance with Company Policy. Where you believe that you or Telstra is under a legal obligation to disclose confidential information, you must seek immediate advice from your BU legal representative(s) before making any disclosure. Your confidentiality obligations continue after your employment or contract with Telstra ends. Responsible CEO LT member: Group General Counsel

Final 6

Conflicts of Interest and Outside Activities We all have interests and activities outside our work with Telstra. However, when this results in divided loyalties that is, when personal interests or activities influence, or could appear to influence, someones ability to act in the best interests of Telstra a conflict of interest exists. You must avoid actual and apparent conflicts of interest. Examples of situations where a conflict of interest could arise are: employment outside of Telstra serving as a director of another business holding interests or investments in, or having a personal or professional relationship with, a

competitor, customer or supplier with whom you deal giving or receiving gifts, prizes and hospitality. Outside employment or serving as a director of another business You must not undertake outside employment or serve as a director of another business without first obtaining written approval from your one up manager. If approval is obtained, you must ensure that: there is no conflict between the outside employment or directorship and your duty to Telstra

commitments relating to the outside employment or directorship do not prevent you from properly performing your functions with Telstra

the outside employment or directorship

o activities are kept separate from Telstra work

o does not involve the use of Telstra property, information, money, facilities or time, or the services of co-workers

o does not adversely affect your work or discredit you or Telstra

in the outside employment on directorship, you are not perceived as a nominee or representative of Telstra.

Telstra will endorse and support your involvement in public or community service wherever possible. Holding interests or investments in a competitor, customer or supplier If your position in Telstra allows you to influence transactions between Telstra and another business, it is essential that you fully disclose to your 1-up manager any interests, investments or relationships you have with that other person or business. Responsible CEO LT member: GMD Human Resources

Drugs, Alcohol and Smoking Drugs and alcohol use can impair work performance, pose health and safety risks and adversely affect efficiency and productivity. You must attend work free from the influence of illegal drugs or alcohol and in a condition to perform your duties. Do not use, possess or sell illegal drugs on Telstra premises, in Telstra vehicles, in conjunction with Telstra business or at Telstra functions. Smoking in Telstra premises and Telstra vehicles is prohibited. Responsible CEO LT member: GMD Human Resources

Final 7

EEO and Diversity Telstra embraces diversity and is an equal opportunity employer. Telstra aims to build an inclusive, supportive and flexible work environment where individual differences are respected and harnessed. Telstra recruits, develops, promotes and rewards based on merit. Merit relates to a persons ability to perform the job and is independent of membership of any group. Employment decisions based on attributes unrelated to the inherent requirements of the job or job performance (for example, attributes such as sex, disability, family responsibilities) may constitute unlawful discrimination and are prohibited. Telstra does not tolerate verbal, physical or visual harassment or any other behaviour where the purpose or effect is to create an offensive, hostile or intimidating work environment or which disrupts another persons ability to work. This includes:

sexual, sexist, racial or ethnic comments

offensive jokes or gestures

sexually suggestive pictures, email or voice messages

sexual advances or comments

bullying.

In the course of your work you must conduct yourself in accordance with all applicable equal employment opportunity laws and Company Policy. Responsible CEO LT member: GMD Human Resources

Employment Telstra offers a number of employment instruments to meet the divergent needs of its employees and the business. Telstra places great value on the relationship between you and your 1-up manager. It is expected that you will be open and honest in your dealings with your 1-up manager and that you will approach him/her as a first resort with any of your questions or concerns. Telstra is committed to ensuring that you develop skills and career aspirations while maximising both your career possibilities and Telstras continued growth. To ensure you have the capability to meet current and future business needs, you will receive the necessary development and training and participate in performance reviews. Telstra will encourage you and support you in the course of your duties. If you are acting in good faith, in compliance with the law and with Telstra Business Principles and Company Policies, Telstra will normally grant you an indemnity from any civil liability you may incur. (This TBP only applies to Telstra employees) Responsible CEO LT member: GMD Human Resources

Final 8

Gifts, Prizes and Hospitality Giving and receiving gifts, prizes or hospitality can be an acceptable business practice. However, it can be difficult to be objective about the person providing them. You must ensure that neither you nor Telstra are in any way compromised by a gift, prize or hospitality. Equally, you must ensure there is no suggestion of an improper connection between the gift, prize or hospitality and a business opportunity or transaction. Gifts and prizes means anything of value including direct payment (eg. money) and payments in kind (eg. discounts, loans, favourable terms on any product or service, shares or other securities, vouchers and gift certificates.) Hospitality includes meals, travel and invitations to sporting or entertainment events. Company Policy, legal requirements, the monetary value of the gift and local custom should all be considered when deciding whether you should accept the gift, forward it to the Office of the Company Secretary, or return it. As a general rule, do not give or accept a gift, prize or hospitality in circumstances that could be reasonably regarded as: compromising your judgement

unduly influencing the recipient or creating a business obligation on their part

giving rise to a conflict of interest

damaging to relationships with others

indicating favouritism or prejudice towards a particular person or group

conflicting with any of the Telstra Business Principles. Responsible CEO LT member: GMD Human Resources

Health and Safety Telstra is committed to providing a healthy and safe work environment, and conducts its business in accordance with all applicable health and safety laws, regulations and requirements. You must understand and follow the health and safety requirements of your job, applicable health and safety laws, and Company Policy. You must always work in a way that assures your own safety and the safety of others around you. You must be alert to health and safety risks as you go about your work and strive to prevent accidents, injuries and occupational illnesses. Responsible CEO LT member: GMD Human Resources

Internal resolution As a Telstra employee, you have the right to be treated fairly and to understand the reasons for the decisions and actions that impact you and your employment. Fairness goes to the heart of how you conduct yourself and is something Telstra demands of all its employees. Telstras Internal Resolution process aims to achieve the fair resolution of issues jointly between an employee and the decision maker at the earliest possible opportunity. You must attempt to resolve any concerns informally and directly with your 1-up manager prior to formally initiating the Internal Resolution process.

(This TBP applies only Telstra employees).

Responsible CEO LT member: GMD Human Resources

Final 9

Whistleblowing You are encouraged to take action if you are concerned about any unethical, illegal or improper behaviour within Telstra. Such behaviour can occur at an individual level or may involve the actions of several people or a business group. Examples of unethical, illegal or improper behaviour might be: taking bribes in return for business favours

the unauthorised distribution or sale of customers private details

theft

fraud

improper use of email, intranet or Internet services

price fixing or financial misreporting

other breaches of the TBPs or Company Policies In the first instance, you should raise any concerns you might have with your 1-up manager, 2-up manager or the person concerned. If you prefer not to do this, or if you wish to raise an issue anonymously, you may disclose your concerns through the Whistleblowing service. The Whistleblowing service is confidential and is part of a suite of services designed to address staff concerns and complaints. Responsible CEO LT member: GMD Finance & Administration

Final 10

Compliance and Legal Obligations

Communication of information A consistent and coordinated approach to the release of company information, whether as employee communications or externally to the public, government and regulatory agencies, or law enforcement and national security agencies, assists Telstra to: maximise opportunities for full and fair coverage of messages and achievements minimise adverse publicity and the use of incorrect or misleading information comply with all relevant laws and regulations. All Telstra information prepared for specific release or with the potential for use in the public domain for example, media announcements, position statements, articles, speeches, marketing material, advertisements, online information, Telstra News and other cross-company staff news stories etc must: be timely, accurate and fairly represent Telstras position comply with company objectives be consistent with other Telstra communications be commercially correct be free from ambiguity appropriately use trademarks and trade names comply with Company Policies comply with relevant laws and regulations be specifically approved for release You must not publish or release company information unless you are specifically authorised to do so. Responsible CEO LT member: GMD Public Policy & Communications.

Company Records Telstra has commercial, legal and management obligations to keep complete, reliable and accurate records of its business operations and financial condition. It is essential that all Telstra records and recorded information be managed consistently and efficiently and in accordance with Telstras legal obligations. When performing your job role, you must: use good judgement and common sense when preparing or generating information/records ensure that records are accurate, complete, honest, objective and timely not knowingly create a false, misleading or unsupported entry in a record or an information

system only approve records that are accurate and complete not knowingly withhold relevant information disclose records only as authorised by Company Policy or in response to legal processes follow all laws, external accounting requirements, Company Policies and process for

identifying, retaining, storing and disposing of records. Responsible CEO LT member: GMD Finance & Administration.

Final 11

Competition Law The objective of the Trade Practices Act is to promote competition and fair dealing in business and to protect the interests of consumers. In response to our legal compliance obligations, the Telstra Values and the expectations of our customers and the community require we strive continuously to conduct our activities in ways that are competitive, fair and honest. A breach of the Trade Practices Act carries potentially serious consequences for you personally and for Telstra, including criminal prosecution, substantial fines and unwanted negative publicity. This in turn jeopardises our valuable reputation and the good will of the market. Do not engage in behaviour, or allow or ignore behaviour by others, that violates the principles and laws of fair competition. Responsible CEO LT member: Group General Counsel

Compliance Telstra is committed to conducting its business in accordance with its legal and regulatory obligations including relevant codes of practice. Compliance is integral to Telstras commitment to its employees, customers, shareholders and the community. It is also good business. Telstra expects you to know, understand and comply with the laws that apply to you as an ordinary person, as a Telstra employee (including privacy, equal employment opportunity, and occupational health and safety), to your specific job and in the location in which you work. If you do business outside Australia you might also be subject to the laws and regulations of different countries. Ignorance of the law does not excuse you from these obligations. It is also important to be aware that no one can be directed to carry out an unlawful act and no one can justify an unlawful act by claiming to be acting under the direction of a manager. Compliance must be integrated seamlessly into the way we all do business. The Telstra Business Principles and Company Policies and Business Unit Policies provide the framework for you to meet many of the relevant legal obligations. Managers are required to adopt a rigorous approach to identifying compliance risks, designing and implementing controls and enhancing the existing compliance culture. To protect Telstra and yourself it is expected that at all times you will carry out your duties in good faith and in accordance with legal and regulatory obligations, the TBPs and Company policies. Responsible CEO LT member: GMD Finance & Administration

Continuous Disclosure Telstra is listed on the Australian Stock Exchange (ASX) and is required to act in accordance with the ASX Listing Rules and the Corporations Act. The Listing Rules govern a number of matters, including the disclosure of information to the market and some aspects of a listed entitys conduct. Telstra must also comply with the disclosure of information obligations of overseas stock exchanges on which our debt and equity securities are listed. Telstra is generally required to disclose to the ASX information that is considered material from a market perspective. Information is considered material if it would influence an investor to buy or sell securities. If Telstra contravenes its continuous disclosure obligations, it (and its officers, employees and advisors) may face civil or criminal liability. This may also lead to the suspension of trading in or delisting of Telstras shares or unwanted negative publicity for Telstra.

Responsible CEO LT member: GMD Finance and Administration

Final 12

Insider Trading It is illegal for you to deal in Telstra shares while in the possession of price-sensitive information not generally available to the public. It is also illegal for you to pass the information on to someone else who may use the information to deal in Telstra shares. Price-sensitive information is information that, if publicly known, would be likely to have a material effect on the price or value of the shares, or to influence investors in deciding whether to buy or sell the shares. You may possess price-sensitive information and/or be subject to specific additional requirements in relation to your share transactions as a result of your position in the company. If you violate insider trading laws it could result in your criminal prosecution. Responsible CEO LT member: GMD Finance & Administration

Intellectual Property Intellectual Property (IP) is a collection of intangible rights that allow the IP owner to do certain things to the exclusion of others. IP includes copyright, designs, patents and trade marks. Telstra recognises IP as a key contributor to the value of Telstra's products and services and as an asset in its own right. Telstra encourages innovation. In particular, Telstra will: identify, manage, protect and as appropriate, exploit its IP assets respect the IP rights of others defend IP claims against Telstra comply with IP laws monitor and where appropriate, engage in public debate on IP laws and policy. Responsible CEO LT member: Group General Counsel

Legal advice Telstra has an in-house legal group, Legal Services, which is solely responsible for sourcing and providing legal services to each of the Business Units and to Telstra as a whole. If you are unclear of the legal requirements applying to your work you should seek advice from your Business Unit legal counsel. Telstra's legal counsel have ethical and professional obligations, including giving independent legal advice, that Telstra considers of paramount importance. Each legal counsel and all other Telstra staff must not compromise the independence of the legal counsel or impede the fulfilment of their ethical and professional responsibilities. Responsible CEO LT member: Group General Counsel

Final 13

Privacy Privacy matters at Telstra! Telstra is committed to handling the personal information of customers in a way that ensures that its customers can be confident that the privacy of their personal information is protected. Everyone at Telstra is responsible for protecting the privacy of the personal information of its customers. Telstra maintains a Privacy Compliance Program to ensure that everyone at Telstra knows their responsibilities in handling personal information. Every customer has access to Telstras Privacy Statement and Telstras Privacy Policy. Responsible CEO LT member: GMD Finance and Administration

Regulatory You must comply with the regulatory environment that applies wherever you work. Telstras Regulatory Group manages Telstras involvement with industry regulators. This involvement includes influencing the development of, and facilitating compliance with, industry and competition policy, technical regulation and consumer protection. Telstras products, services and networks and associated activities including marketing, sales, service delivery and customer service must comply with relevant regulatory obligations, including self-regulatory industry codes. When developing or changing existing products, services, networks or associated activities, regulatory issues and risks must be identified and managed. Responsible CEO LT member: GMD Public Policy & Communications

Final 14

Sales and marketing

Customers Customer satisfaction is fundamental to Telstras business success. Every job ultimately affects our customers. At Telstra, everyones first priority must be our customers - both to exceed their expectations and to make sure the experience in dealing with Telstra is professional and courteous. Telstras aim is to give customers a powerful and seamless experience across all devices and all platforms in a one click, one touch, one screen way - whether the customer is an individual consumer, small business, large business or government agency. To achieve this, we must all: ensure Telstras customers receive fair and respectful treatment. make every customers experience a valuable one where:

o the interaction is simple and efficient o the information provided is correct and relevant

deliver innovative, customer-focused services which suit customers individual needs by ensuring: o Telstras products, services and offers are clear and easy to understand o Telstras services add value to the customers personal life and/or business

supply all Telstra services in a timely manner that meets the customers expectations make commitments to customers that Telstra can deliver and deliver to those commitments provide access to telecommunications for every Australian and deliver excellent customer

service whilst complying with relevant laws and regulations Responsible CEO LT member: Each CEO LT member is responsible for the Customer Business Principle within their Business Unit.

Marketing Telstras reputation for desirable, innovative and quality products and services, as well as for integrity and honesty, is of critical importance. All Telstra marketing must be clear, effective and timely, enhance its image and support its commercial objectives. Marketing, advertising and sales activities must describe products and services fairly, honestly and accurately, and must not create false or misleading impressions. All information seen by Telstras customers must be factual and correct, comply with relevant Telstra Business Principles, Company Policies and legal and regulatory requirements and reflect the Telstra brand strategy. Responsible CEO LT member: GMD Strategic Marketing

Pricing Prices must be developed to meet the needs of the market place, reflect the value proposition of the product being sold, support Telstras business strategies to maximise its commercial position and shareholder value and optimise product positioning. Proposals to establish or vary prices must comply with Company Policies, pricing guidelines and legal and regulatory requirements. Responsible CEO LT member: GMD Strategic Marketing

Final 15

Product Management Telstra seeks to provide all customers with a high quality customer experience across all platforms and devices. Telstra Product Management is responsible for leveraging new and existing platforms and technology to deliver innovative and profitable products which meet the needs of individual customers. All Telstras product activities must be managed by Telstra Product Management. Responsible CEO LT member: GMD Telstra Product Management

Final 16

Infrastructure Information Technology Information Technology is accountable for all technology activities necessary to support Telstra internally. These activities must not be carried out elsewhere in Telstra without the prior written consent of the Chief Information Officer and GMD Information Technology. Technology activities include the setting and implementation of the strategic direction for internal technology, as well as the planning, development, implementation, operation and support of all technology infrastructure, systems and applications, incorporating the requirements of associated Telstra standards and controls. Responsible CEO LT member: Chief Information Officer and GMD, Information Technology

Network Service Management Telstra Networks and Services is responsible for the design, activation, operation, maintenance and evolution of Telstras network infrastructure and all associated interactions with Telstras customers. This function must not be carried out elsewhere in Telstra without the prior written consent of the GMD Telstra Networks and Services. Responsible CEO LT member: GMD Telstra Networks and Services

Final 17

Finance and Administration

Finance & Administration Telstra seeks to produce and maintain complete, reliable and accurate reports and records, be forthright in measuring and reporting financial performance, and be proactive in identifying and managing risk. All Telstra finance operations are carried out by Finance & Administration. They may not be carried out elsewhere in Telstra without the consent of the GMD Finance & Administration. Finance operations include: Policy and advice provision of corporate financial advice

setting finance policy and standards

management and oversight of compliance with the Company Delegations and the Internal Management Delegations

Planning and reporting preparation of the corporate plan

development of forward financial targets and parameters

reporting and monitoring financial and operational information in evaluating business performance

Accounting and financial management preparation of all internal financial management and statutory reports

compliance with all accounting standards and pronouncements

managing accounting and taxation ledgers

overseeing the treatment of cash receipts, including cheques, funds transfers and currency from initial receipt to reconciliation of bank accounts

performance of the payroll function

credit management

paying for goods and services

investing Telstras finite resources to support its business objectives

providing financial and taxation advice to the Business Units

providing the conduit to external markets on strategy and financial performance Administration storing, retrieving and disposing of records Responsible CEO LT member: GMD Finance & Administration

Final 18

Procurement Products and services must be acquired in a way that achieves the most advantageous terms for Telstra, its shareholders and customers. All business units and employees must source products and services only in accordance with Company Policy and associated processes and legal and regulatory requirements. Procurement is responsible for:

developing and enforcing a standardised approach to sourcing, purchasing, vendor management, warehousing and distribution activities across Telstra

managing Telstras fleet

property portfolio management. Procurement activities must not be carried out elsewhere in Telstra without the written consent of the GMD Finance & Administration. Responsible CEO LT member: GMD Finance & Administration.

Treasury All treasury transactions for Telstra and its subsidiaries are carried out by Corporate Treasury. They may not be carried out elsewhere in Telstra without the consent of the Corporate Treasurer. Treasury transactions include:

conducting all types of funding, borrowing, lending and hedging activities, including bank and corporate guarantees (both externally and internally)

managing foreign currency and interest rate exposure managing the credit risks associated with all Treasury transactions controlling the total daily inflow and outflow of funds managing Telstras overall liquidity position arranging and coordinating Telstras corporate banking relationships, including opening and

closing all bank accounts, to achieve the best outcome for Telstra establishing and managing insurance arrangements

Responsible CEO LT member: GMD Finance & Administration

Final 19

Risk Management & Security

Business Resilience

Business Resilience focuses on building a companys readiness and capability to respond and recover from severe disruptions, regardless of the cause or origin of the event. Corporate Security & Investigations (CSI) drives activities to manage a Business Resilience program for Telstra that integrates the principles of Business Continuity Management, Crisis Management, Emergency Planning, Service Continuity, Risk Management, Critical Infrastructure Protection and Recovery Planning under a single cohesive strategy. The Business Resilience Team in CSI has the responsibility to manage three key focus areas, supported by all areas of Telstra's business: Business Continuity Management - this includes developing business continuity plans in

accordance with a Telstra Business Continuity Management methodology, and operational resilience measures such as remediation, redundancy, back-up and fail-over initiatives.

Crisis Management this includes establishment and capability development of a corporate Crisis Management Team to focus on pre-event prevention and preparedness, response during and immediately following events, and post event restoration.

Critical Infrastructure Protection this includes activities aimed at effectively protecting Telstras National Critical Infrastructure under the National Counter-Terrorism Plan and working with other Infrastructure owners and operators on interdependencies so that there is a cohesive approach to incidents that may impact other sectors .

Responsible CEO LT member: GMD Finance & Administration

Protecting Telstra's Property Telstras assets must be appropriately protected and used for the benefit of the company in the conduct of its business. You share the responsibility of securing Telstras assets, especially when those assets are under your control. You must make proper and efficient use of Telstras assets, including its networks, network products, systems, applications and information and must follow policy and procedures to prevent their loss, theft, unauthorised use or damage. Company assets must not be removed without authorisation and must not be used for personal benefit or improper or criminal purposes. Responsible CEO LT member: GMD Finance and Administration

Risk Management and Internal Controls Telstra is committed to the management of risk throughout its operations. Managers have primary responsibility for risk management and the operation and enhancement of internal controls. Managers must: regularly review and update their significant business risks and their overall internal control

environment

implement remedial actions recommended as a result of RM&A reviews. Risk Management & Assurance (RM&A) uses a risk based approach to prepare an annual Assurance Plan of risk and control reviews. RM&As findings include an evaluation of the adequacy and effective operation of the controls the Business Units have implemented to manage risk.

Final 20

RM&A also develops and promotes a common language and approach to be used by Business Units to enable them to identify, manage and control their risks. Responsible CEO LT member: GMD Finance & Administration

Security

Telstra takes the security of its people, property and information very seriously. Security in Telstra is focused on providing a secure workplace for employees, contractors and other people on its premises, the protection of sensitive business and customer information, the safeguarding of plant, equipment and other assets, and the integrity of its networks, products, information technology systems and applications. Telstra adopts a risk based and commercial approach to securing all aspects of its business.

Corporate Security and Investigations drives activities and develops appropriate policies and processes that focus on:

protection of Telstra's employees, assets and sensitive information security of Telstra's critical infrastructure including liaising with government on national

security issues internal investigations of fraud, criminal and corrupt conduct and other serious misconduct liaison with law enforcement agencies provision of Telstra data in response to lawful requests under legal and regulatory

frameworks operational security support for Telstra special events, overseas business travel and response

to any significant security related incidents management of security risks that have the potential to negatively impact on Telstra's

business

Security is the responsibility of all people in Telstra. This means that all employees, contractors and other people who work for or on behalf of Telstra, must comply with Telstras requirements and policies in relation to security. Responsible CEO LT member: GMD Finance & Administration

Final 21

Corporate Social Responsibility

Corporate Social Responsibility At Telstra, our commitment to corporate responsibility begins with a simple and straight-forward commitment to principled decision-making, in all that we do.

From a principled perspective, our primary corporate responsibilities are to: provide good jobs at good wages serve the needs of our customers increase shareholder value and protect shareholder interests provide good stewardship of the environment - first and foremost by conservation (i.e., by

increasing efficiency in the way we use resources), reducing operating costs, and minimising our environmental footprint

contribute resources - people, money, technology, products and services - to support the communities in which we operate and the needs of the larger society

advance the national interest by strengthening the capacity of the nation's telecommunications nerve centre, operated by Telstra, and providing the nation a foundation for economic growth, productivity improvement, sustainable prosperity, and global competitive advantage.

Responsible CEO LT member: GMD, Public Policy & Communications

Our People Telstra is one of Australias largest employers. For Telstra to succeed, it is essential that we: have a skilled workforce

have a robust succession management and planning process

have a safe work environment where diversity of thought and capability is encouraged

have fair processes

have programs in place to recognise and reward high performance and the efforts of our people

provide opportunities for all to learn and develop

provide our people with the opportunity to express their views on Telstra and their job and working environment through regular employee engagement surveys.

Responsible CEO LT member: GMD Human Resources

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Political Activities Telstra communicates regularly with governments on a range of commercial, policy, regulatory and other matters in the interests of its shareholders, customers and employees. Telstras dealings with governments are conducted openly and honestly. Employees authorised by Telstra to provide communications to governments must do so in compliance with all relevant laws, regulations and Company Policies. Telstra supports the right of all employees to hold political opinions and affiliations and to pursue these in their own time as private citizens and with their own resources. However, employees are not permitted to use company time, property or resources for personal political activities. You must not use your position within Telstra or Telstras name to advance your political causes or to support a political party, a member of a party or an independent politician either in Australia or overseas. You should always make it clear that your views and actions are your own and not Telstras. Telstra does not make financial contributions to political candidates or parties. Responsible CEO LT member: GMD Public Policy & Communications

Shareholders Telstras shareholder communications are founded on the principle that Telstra is owned by its shareholders and must protect and advance their best interests. Telstra is committed to:

open, clear, accurate and timely communications with our shareholders about matters affecting the value of their investment in the company;

making appropriate use of technology and emerging new media tools to inform and engage our shareholders; and

ensuring all communications are consistent with Telstras continuous disclosure and other applicable legal obligations.

Telstra values a direct, two-way dialogue with shareholders and believes it is important not only to provide relevant information as quickly and efficiently as possible, but also to listen, understand shareholders perspectives and respond to their feedback. Responsible CEO LT member: GMD Finance & Administration

The Community Telstras community involvement and contributions are organised at a corporate, business unit and local level. Telstra is active in the community in many ways including: the Telstra Foundation - Telstras philanthropic entity supporting children and young people Disaster Relief for customers and communities in times of natural and civil disaster Community Business Partnerships where Telstras products, services, infrastructure and

peoples capabilities are used to address social needs especially in the areas of health and education

Telstras Telstra Connected Seniors, a program supporting training for seniors in new technologies

Telstras sponsorships, awards and grants Telstras Access for Everyone program which helps people on low incomes to access

affordable products and services.

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Responsible CEO LT member: GMD Public Policy & Communications

The Environment Telstra is committed to minimising any adverse impact on and injury to the environment and preserving the beneficial qualities of the environment, while providing quality products and services. Telstra therefore seeks to conduct its business in a way that is compatible with the environmental needs of the communities in which we operate and in accordance with all applicable environmental laws, regulations, codes of practice and Company Policies. Telstra supports programs for waste management, control of greenhouse emissions, recycling initiatives and improvements in the uses of resources. It also encourages vendors to actively pursue environmental improvements. Responsible CEO LT member: GMD Human Resources

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Seeking Assistance, Questions or Concerns The way we work Telstra Business Principles will not address every situation you encounter during the course of your work. In such circumstances, use your common sense and good judgement, review the additional resources referred to in this document, and consult with your co-workers, managers or supervisors, legal counsel or HR contacts. If you have any questions or concerns about any of the TBPs or any doubt about whether your actions, or those of a fellow employee or contractor, comply with a Telstra Business Principle, Company Policy or Telstra Business Process, you should discuss this with your 1-up manager. If you are unable to or do not wish to do this, you can alternatively contact any of the following: your 2-up manager the HR or legal representative for your Business Unit the owner of the Telstra Business Principle a member of Governance & Compliance the Company Secretary. If you are uncomfortable about approaching any of the contacts listed above, or wish to raise an issue anonymously, you can contact Telstras Whistleblowing service. The Whistleblowing service is operated by an independent external provider. You will not be disciplined for reporting, in good faith, a possible breach of a Telstra Business Principle, Company Policy, Telstra Business Process, law or regulation. Any Telstra employee who engages in retribution against you will be subject to disciplinary action. Useful contacts are listed below. Key Contacts and Links Employee Assistance Program: 1300 361 123 Whistleblowers Service: Telstra C/- STOPline Pty Ltd Locked Bag 8, Hawthorn, Vic 3122 Phone 1300 30 45 50 Email:Telstra@stopline.com.au Office of the Company Secretary: 03 9634 6400 Governance & Compliance Business Unit Compliance Managers Health & Safety home page Regulatory group HR Connecting homepage