Workers in the Value Chain (S2)

Material impacts, risks and opportunities (IROs) and their interaction with strategy and business model (ESRS 2, SBM-3)

The table below provides an overview of the results of our double materiality assessment in relation to material impacts, risks and opportunities for matters relating to workers in the value chain. These findings are increasingly incorporated in TUI’s strategic alignment, e.g. by developing measures to improve working conditions and promote social standards among partners and suppliers. Taking account of these impacts is strategically relevant for TUI as it forms the basis for a responsible and future-proof business development.

Numerous external employees work in TUI’s value chain, delivering activities required to perform tourism services. Potential impacts relate, among others, to employees in partner hotels, airlines, cleaning companies, transport companies, IT service providers, local travel agencies and restaurants and catering establishments, e.g. supplying food for hotels and cruise ships. Working conditions for these groups vary substantially, depending on the region and industry. Anyone in a contractual working relationship with our suppliers falls under the term ‘workers in the value chain’. Due to TUI’s business model, most of these people work in the upstream value chain.

Employees in an employment relationship with TUI are covered in Chapter Own workforce (S1). As a rule, the workers covered here work at the premises of the supplier in question. In some instances, however, such as staff employed by cleaning companies or other service providers, they work on TUI premises.

TUI recognises that its business activities may affect the human rights of workers in the value chain. The annual analysis of risks relating to the supply chain identified hotels, restaurants, transportation and local agencies as particularly relevant segments making key contributions to the delivery of tourism services. Main risks related to child and forced labour exist particularly in regions with limited social and labour law frameworks. These include, among others, parts of North Africa, the Middle East, as well as selected Asian destinations where tourism services are provided or procured. These risks primarily affect workers in hospitality, food service, transportation, and local agencies and are often structurally driven. They are closely linked to sector-specific challenges in the tourism industry and the respective regional circumstances. TUI responds to these challenges with targeted measures such as capacity-building for suppliers, training in employment rights, and partnerships with local stakeholders to promote human rights standards and minimise structural risks.

Managing impacts, risks and opportunities (S2-1)

TUI has a Group-wide management approach in place to implement human rights and environmental due diligence obligations in the supply chain. This approach also serves the corporate due diligence process, with structured procedures for analysing risk, assessing suppliers and deriving appropriate measures. TUI is committed to respecting internationally recognised human rights, including workers’ rights, and environmental standards within its supply chain throughout its global operations. This integrated approach systematically identifies, prevents, and mitigates potential negative impacts. The approach aligns with the requirements of, among others, the UN Guiding Principles on Business and Human Rights, the ILO Declaration on Fundamental Principles and Rights at Work and the OECD Guidelines for Multinational Enterprises. In addition, TUI has signed the UNWTO Global Code of Ethics for Tourism. TUI’s concept of human rights explicitly addresses human trafficking, forced labour and child labour. These aspects are firmly anchored in Group-wide risk analysis and due diligence.

The management approach also takes account of the requirements of the German Supply Chain Due Diligence Act (LkSG). The Chief Sustainability Officer officially acts as TUI Group’s Human Rights Officer and oversees all related processes and actions. Implementation is supported by the central Supply Chain Due Diligence Committee and by a coordination unit within the Group Sustainability department. If necessary, additional internal stakeholders are involved, while external stakeholders’ views are considered indirectly through multi-stakeholder initiatives.

TUI’s Human Rights Statement serves as a central reference for the Group-wide management approach in implementing the duties of due diligence with regard to human rights. In the Statement, TUI commits to respect human rights both internally and along its value chain. The Statement refers, inter alia, to the principles of the UN Global Compact, the ILO standards and the requirements of the TUI Code of Conduct for Suppliers (The Code). The Statement sets out expectations relating to human rights-related behaviour in the supply chain and explains the underlying concept of due diligence. It applies both to TUI’s own operations and to the Group’s supply chain. It is reviewed on an annual basis, adjusted if necessary, and adopted by the Executive Board.

TUI does not maintain any direct contractual relationships with value chain workers. Instead, all suppliers must undertake to comply with the standards defined in TUI’s Code of Conduct for Suppliers and also to ensure that their own business partners comply with these requirements. The Code sets out the binding framework for TUI’s ecological, social and ethical expectations for the entire supply chain. Among other things, it prohibits child labour, forced labour and human trafficking, observes environmental and health and safety standards, calls for employees to be treated with respect and complies with data privacy and health and safety requirements. Responsibility for the Supplier Code of Conduct lies with Group Purchasing, and it was approved by the Executive Board.

TUI has, moreover, adopted a Group Policy on Diverse, Sustainable and Ethical Sourcing. This defines criteria for the purchasing process considering diversity, ethics, and sustainability in supplier selection. The Policy defines objectives in various fields, including lower energy consumption, fair and socially acceptable working conditions and diversity in the supplier base. In this way it supports implementation of human rights and sustainability-related requirements in sourcing activities. Responsibility for the Policy lies with Group Purchasing, and it was approved by the Executive Board.

Based on these, a list of questions has been drawn up for the purchasing system, and these must be answered by all suppliers in the selection process. It was revised in the financial year under review and includes questions relating to compliance with ethical standards as well as labour and human rights.

In addition to these actions in relation to sourcing practices and internal processes, TUI places importance on cooperating with other stakeholders in industry initiatives and building supplier competence. This is outlined in greater detail in section S2-4.

In the period under review, a total of four cases were reported in which value chain workers had been affected by potential non-compliance with the UN Guiding Principles on Business and Human Rights, the ILO Declaration on Fundamental Principles and Rights at Work or the OECD Guidelines for Multinational Enterprises. In the financial year under review, no severe problems or incidents occurred in relation to human rights.

Processes for engaging with value chain workers about impacts (S2-2)

The processes for engaging with value chain workers about impacts are part and parcel of the Group-wide due diligence process, which falls under the responsibility of the Human Rights Officer.

As part of its risk management procedure, TUI performs structured risk analyses to identify any risks to human rights or the environment in its own business operations and along its supply chain. These analyses are carried out annually and ad hoc in the event of material changes to the risk profile.

Working conditions and potential impacts on the human rights of value chain workers are central to this analysis. Risks for workers – e.g. relating to fair wages, working hours, freedom of association or health and safety – are systematically taken into account in the identification and assessment of human rights-related risks.

An IT-supported risk management tool plays a key role in this respect. It facilitates holistic assessments along the value chain, taking account of direct and – wherever information is available – indirect suppliers. Based on recognised indices and external sources, an abstract human rights and environmental risk is determined for each company. This risk is subsequently rated “low”, “medium” or “high”. In a second step, the risk is specified in greater detail based on self-assessments, audit results or further insights from the supplier relationship. This process provides indirect insights into impacts on value chain workers. Through direct dialogue with suppliers – such as requests for evidence or self-disclosure – it also incorporates the perspective of those working for suppliers. This process serves simultaneously to analyse suppliers with a view to obligations of due diligence in relation to human rights and the environment.

In order to engage with value chain workers indirectly, TUI requires all business partners to comply with a Supplier Code of Conduct which defines fundamental criteria regarding human rights, working conditions and environmental protection. The inclusion of appropriate clauses in contracts allows TUI or third parties mandated by TUI to conduct compliance audits.

The whistleblower system – publicly accessible via the Company’s website, enables structured engagement with value chain workers. The option to report incidents – even anonymously – permits direct exchange with the individuals concerned. This helps to detect impacts on workers early and to derive targeted measures to improve working conditions.

TUI also engages in multi-stakeholder initiatives to incorporate the perspectives of potentially affected groups – in particular value chain workers – when updating measures and standards. Examples include TUI’s membership in Futouris e. V., a sustainability initiative for the tourism sector, as well as in ECPAT Deutschland, an organisation for the protection of children against sexual exploitation in tourism.

Processes to remediate negative impacts and channels for value chain workers to raise concerns (S2-3)

TUI Group commits to identifying, remediating and preventing human rights and environmental risks along the value chain. Workers who are affected by or aware of any incidents can raise their concerns at any time, even anonymously. Access to the electronic whistleblower system and information for third parties is published on the website at https://www.tuigroup.com/en/compliance and therefore accessible regardless of where the person is directly employed. Providing an anonymous reporting option is intended to strengthen trust in the whistleblower system. In addition, suppliers receive information on the whistleblower system along with their contract documents and are requested to pass that information on to their workers. Currently, no additional structural measures ore processes are implemented to actively promote awareness of the whistleblower system. Nevertheless, the system is considered to be generally accessible as it is used by value chain workers.

For more detailed information about the whistleblower system, please refer to the section Management approach 2: Whistleblower protection in the chapter on Governance (G1).

If any material negative impacts on value chain workers are identified, the cases are followed up in close cooperation with the relevant suppliers. The goal is to identify the root causes and implement appropriate measures to remedy the grievances. If the supplier is not prepared to cooperate, contractually agreed measures are initiated. If these measures do not lead to any substantial progress, the business relationship may be suspended or even terminated.

Taking action on material impacts on value chain workers (S2-4)

TUI has introduced a range of measures to promote humane working conditions along the entire value chain, aiming to prevent, avoid or appropriately reduce any material risks identified. The effectiveness of these measures is regularly reviewed in order to ensure that the targeted positive effects for value chain workers are actually delivered. The assessment includes monitoring training participation and analysing reports and complaints. The results are incorporated in the further development of the actions. Unless otherwise specified, all measures are implemented on an ongoing basis.

In order to strengthen people’s awareness for human rights and labour standards and build capacity, suppliers can access a Human Rights Toolkit designed to help identify human rights risks and implement appropriate mitigation measures. This toolkit includes information on working conditions, discrimination as well as child labour and forced labour. It offers assistance in implementing preventative measures within the undertaking in order to improve labour standards for value chain workers. The toolkit is publicly accessible on the TUIPartner website and is reviewed annually.

In addition, the industry initiative Futouris offers an e-learning programme on Human Rights in Tourism. This programme has been available free of charge to direct partner companies or tourism providers since January 2025. It provides fundamental information on legal requirements governing human rights and presents practical examples of ways to prevent risks such as precarious working conditions, unequal treatment at the workplace as well as child and forced labour. Suppliers will find information on the programme and a link to the e-learning scheme on the TUIPartner website and can share this content with their workforce. TUI is planning to implement a communication campaign for its direct suppliers in the new financial year. The programme will contribute to implementing measures against material negative impacts on value chain workers, e.g. by means of capacity-building for suppliers and cooperation with industry peers.

Training programmes on protecting children, human rights, health and safety, and integrity are available across the Group via TUI’s People Learning platform. The offering is complemented by specific training programmes, e.g. on children’s well-being for entertainment and childcare staff or on the Modern Slavery Act for purchasing and procurement teams. The goal of these training programmes is to raise people’s awareness for human rights risks and provide practical skills for handling relevant situations. Based on specific case studies, employees learn how to recognise potential grievances – including grievances affecting value chain workers – and report and follow up on corresponding incidents in a responsible manner.

Human rights and environmental requirements have been systematically incorporated in contracts with suppliers. These contractual clauses create a binding basis for responsible action along the supply chain. TUI regularly reviews these requirements, at least once a year, and updates them as needed to reflect new insights or regulatory changes.

Recognised, credible sustainability certifications are used to assess compliance with sustainability standards. A certified standard in line with the criteria of the Global Sustainable Tourism Council (GSTC) was developed for providers of activities and excursions. It obliges the providers to disclose information on fair wages, working hours, child protection and local employment.

TUI also actively engages with industry initiatives and partnership schemes to tackle systemic supply chain challenges jointly with other stakeholders, ensuring lasting improvements for workers.

TUI draws on risk analysis and current developments in the tourism sector to identify any measures required. The measures are selected and prioritised based on the materiality of the identified risks and the possibility of exerting influence. In the event of material negative impacts, TUI ensures the availability of processes to implement or facilitate remedies.

For a more detailed description of these processes, please refer to section Processes to remediate negative impacts and channels for value chain workers to raise concerns (S2-3).

In order to ensure the effectiveness of these processes, feedback mechanisms, such as the whistleblower channel, are regularly evaluated. The implementation and outcome of the remedies are documented and incorporated in the further development of the processes.

Human and financial resources are available to manage material impacts. Responsibility lies with the Group Sustainability department, working in close cooperation with Purchasing, Compliance and other relevant functions. Provision of these resources allows the systematic implementation and further development of the measures to respect human rights in the supply chain.

Targets related to value chain workers (S2–5)

A key concern is to comply consistently with the due diligence obligations in the supply chain and all relevant legal requirements. In this context, the working conditions of value chain workers have shifted increasingly into focus. The effectiveness of the concepts and measures is reviewed annually in the framework of the due diligence process and adjusted as necessary.

To date, no formal quantitative targets have been defined for this stakeholder group. TUI is currently examining whether corresponding targets can be formulated for future reporting cycles in the framework of the further development of the human rights-related risk management system.