S2 Workers in the value chain

S2 Workers in the value chain

Impact, risk, and opportunity management

Material value chain WORKERS-related impacts, risks, and opportunities (IRO-1, SBM-3)

PUMA manages its material impacts, risks and opportunities related to workers in the value chain. We followed the same process to identify and assess our material topics as outlined in the General information (IRO-1) section.

Downstream value chain workers are not included in this section because activities like distribution and retail involve different actors and are outside the scope of our report, which addresses labour and sustainability issues in production. Please refer to PUMA Strategy, business model and value chain (SBM-1).

This section covers upstream value chain workers, including farmers, primary producers and factory employees. We define vulnerable workers as those at higher risk of poor conditions or job insecurity, such as those in informal jobs, low-skilled roles, migrants, women, young people, and minorities.

Workers in Tier 1 and 2 factories may face challenges like unstable jobs, long hours, low pay, health and safety risks, unequal pay, harassment, and limited bargaining power. Raw material workers often deal with job insecurity, low wages, long hours, hazardous conditions, child or forced labour, and little legal protection. Migrant workers are especially vulnerable to job insecurity, long hours, low pay, health and safety risks, unequal pay, harassment, forced labour, and face extra challenges such as language barriers and limited legal support. Women are more likely to have insecure or lower-paid jobs and may experience discrimination, health and safety risks, unequal pay, and harassment. Young workers can be exposed to job insecurity, long hours, low wages, health and safety issues, child labour, and harassment, and may lack access to education or support. Informal workers often lack job security, fair wages, regulated hours, health and safety protections, and opportunities for advancement, making them more vulnerable to exploitation and unsafe conditions.

We identify and assess risks through annual risk assessments, social audits, worker interviews (including vulnerable groups), workers surveys, media and NGO reports, and ongoing stakeholder engagement. PUMA addresses material issues for upstream value chain workers by evaluating risks such as human rights violations, child and forced labour, excessive overtime, unsafe conditions, low income, lack of representation, and insufficient training.

PUMA engaged with stakeholders as part of its DMA process and to inform the development of its material sustainability topics. Further information on stakeholder engagement is provided in the Interest and views of stakeholders (SBM-2) section.

The material negative impacts are broad in nature, as they represent issues that are prevalent across the industry rather than isolated incidents.

Risk assessment

PUMA conducts annual risk assessments including country, factory, and material-specific risks. These are then prioritised based on severity, likelihood, influence, and potential impact on people and the environment. The findings guide preventive and remedial actions. PUMA uses LRQA’s EiQ platform to evaluate upstream value chain risks and EiQ Sentinel, which provides real-time alerts from media and Civil Society Organisations (CSO).

Factory risk assessment

In 2025, 33 alerts were raised concerning four potential new factories. Following the verification of remediation, three of these factories were approved for production, while one was rejected due to unresolved severance payment issues. In 2025, 683 PUMA audit reports were uploaded to EiQ. 12 high-risk factories were identified and subsequently reaudited; they improved within the same year.

Country risk assessment

We assessed human rights risks at sourcing countries in 2025. 23 sourcing countries are high-risk, including our top six countries (China, Vietnam, India, Cambodia, Bangladesh, and Indonesia). Risks involve working hours, wages, freedom of association, child and forced labour, migrant workers, disciplinary practices, discrimination, harassment or abuse, pregnancy testing, health and safety, hygiene, and sanitation.

All factories in high-risk countries are regularly audited and covered by our grievance mechanisms. We have rolled out training programmes such as ethical recruitment, worker representation, and harassment prevention in these countries.

Material risk assessment

In 2025, we assessed social risks for the key materials cotton, polyester, leather, and rubber. While polyester is classified as having a medium level of social risk, all other materials are considered to have a high social risk. Social risks include child and forced labour, occupational safety, migrant workers, wages, and working hours, and they primarily affect workers involved in farming and raw material production processes.

To address human rights risks in material sourcing, PUMA requires suppliers to have material certification, and upstream traceability.

Strategy

PUMA’s strategy for upstream value chain workers includes efforts both at the manufacturing and farm levels. PUMA monitors factories’ working conditions through audits and social risk assessments, focusing on issues such as wages, health and safety, and freedom of association. At the farm level, particularly in cotton sourcing, PUMA supports initiatives like Better Cotton to promote better farming practices and improve livelihoods. These partnerships aim to reduce environmental impact and support decent work.

Policies related to value chain workers (S2-1)

Human Rights Policy

Our Human Rights Policy, which addresses material topics identified in our DMA, commits to respecting human rights across our operations, suppliers, and business partners. This covers the right to an adequate standard of living, freedom of association, and a safe working environment without discrimination, forced labour, or child labour. The policy applies to our entire value chain, including sourcing, production, procurement, logistics, sales, and other business activities.

The Management Board is responsible for the approval and implementation of the Human Rights Policy. Various departments manage implementation of the policy and regularly report on progress to the Management Board and leadership team. Our policy applies international standards such as the UN Guiding Principles on Business and Human Rights, the International Bill of Human Rights, which consists of the Universal Declaration of Human Rights and the two Covenants that implement it, the ILO’s Declaration on Fundamental Rights and Principles at Work, the Ten Principles of the UN Global Compact, and OECD Due Diligence Guidance for Responsible Supply Chains in the Garment and Footwear Sector. The policy is accessible to stakeholders via our website and other communication channels. In 2025, we updated our Human Rights Policy. The policy now more clearly demonstrates compliance with the German Supply Chain Due Diligence Act (LkSG) and reflects our updated Code of Conduct.

We conduct due diligence to identify and mitigate human rights risks, including audits and assessments. Suppliers receive training on human rights principles, and there are grievance mechanisms in place to allow confidential reporting of human rights concerns, helping to facilitate timely and effective resolution.

Code of Conduct and Social Standards Handbook

PUMA’s Code of Conduct is a binding part of all supplier contracts. Our updated Code of Conduct, published in 2025, now applies to all business partners and includes new provisions on child labour, slavery, traceability, security forces, chemical management, and land rights. It also reinforces grievance mechanisms and remediation expectations.

The Social Standards Handbook has been updated to reflect the new Code of Conduct and provides guidance on areas such as foreign migrant worker recruitment and measures to support vulnerable workers.

Our Code of Conduct addresses key issues, in line with ILO standards:

• Prohibition of child labour, forced labour, and human trafficking, with special protections for young workers
• Fair wages and reasonable working hours, in compliance with legal and international standards
• Safe and healthy working environments, with a focus on both physical and mental well-being
• Respect for freedom of association and the right to collective bargaining, without fear of retaliation
• Equal opportunities and strict prohibition of discrimination based on religion, beliefs, age, gender, pregnancy, marital status, disability, nationality, race, ethnic origin, political views, or sexual orientation
• Access to effective grievance mechanisms, including confidential channels for reporting concerns without fear of retaliation.

All suppliers must display our Code of Conduct, which includes contact details of our hotline. Cases of non-adherence to the UN Guiding Principles on Business and Human Rights, the ILO Declaration on Fundamental Principles and Rights at Work, or OECD Guidelines for Multinational Enterprises involving upstream value chain workers are disclosed under Remediation of negative impacts for value chain workers who raise concerns (S2-3) and Social monitoring programme. Other issues related to the PUMA Code of Ethics are monitored by our Compliance team.

Civil Society Organisation Engagement Policy

PUMA set up a CSOs Engagement Policy, approved by the Fair Labour Association (FLA), which formalises PUMA’s commitment to engage with CSOs for information sharing, consultation, and potential collaboration on specific challenges or remediation. Criteria for engagement are based on high-risk and high-production volume countries, severity and likelihood of violations or risks, knowledge gaps regarding new or upcoming risks, persistent issues identified through factory monitoring or risk assessment, and concerns raised through PUMA grievance mechanisms and third-party reports. This policy, which is to be implemented in the coming years, aims to ensure that PUMA remains transparent and responsive to the concerns of stakeholders.

Engagement with value chain workers about impacts (S2-2)

PUMA takes value chain workers’ perspectives into account in its decision-making processes to help address actual and potential impacts. Feedback from value chain workers is collected through annual surveys, grievance mechanism interviews, and dialogue sessions. This helps us to assess the effectiveness of PUMA’s initiatives, programmes, and targets and make necessary adjustments. PUMA’s due diligence processes include evaluating the working conditions and rights of value chain workers every 6-24 months, based on the level of risk. Insights gained from these evaluations are used to mitigate risks and enhance worker welfare.

By incorporating input from value chain workers, PUMA aims to make decisions and carry out activities that better reflect the needs and expectations of those directly impacted by sourcing operations.

The operational responsibility for ensuring that this engagement with upstream value chain workers takes place, and that the results inform PUMA’s approach, lies with the social sustainability team. The most senior role accountable for this process is the Vice President Operations & Sustainability, who ensures that feedback is integrated into PUMA’s sustainability strategy and actions.

Engaging with workers’ legitimate representatives

In 2025, we organised stakeholder engagements in our top five sourcing countries of 2024, Bangladesh, Cambodia, China, Indonesia, and Vietnam. The purpose was to engage with the legitimate representative (such as trade unions) and credible proxies (local human rights NGOs) of upstream value chain workers to review the material, positive, and negative impacts in our upstream value chain (as reported in our Annual Report 2024), as well as the financial risks and opportunities. The details of this engagement can be found in the Process to identify material impacts, risks and opportunities (IRO-1) section.

Worker survey

PUMA collects workers feedback via a mobile app to understand their satisfaction level with the

factory work environment (last survey conducted in 2024). In 2025, we surveyed workers’ trust in our grievance mechanism in line with UNGP standards. This survey covered 9,537 workers (71.7% women), including representatives of vulnerable groups (people with disabilities, migrants, and young workers), at 26 core Tier 1 factories located in China, Cambodia, and Indonesia. Results show:

• Legitimacy (trust of the hotline users): 92.7% of workers agreed they can trust the PUMA hotline
• Accessibility (no barrier to access for users): 81.6% of workers know where to find the PUMA hotline
• Predictability (users are clear on the procedure): 81.6% of workers responded that they know what the complaint procedure is
• Transparency (keeping parties informed about progress on the issue): 97.1% confirmed that their grievance had been resolved through the PUMA Hotline.

¹ We use the Gallup’s methodology to define the sample of production workers at each factory, based on a 95% confidence interval and a margin of error of plus or minus 5%.

² The 2025 data is from 26 PUMA core Tier 1 factories located in Cambodia, China, and Indonesia.

³ The workers' feedback against PUMA’s grievance system as per the criteria of the UN Guiding Principles on Business and Human Rights.

Remediation of negative impacts for value chain workers who raise concerns (S2-3)

PUMA is working towards providing access to functioning grievance channels throughout its upstream value chain. Where we do not have direct operations, we seek partners who can run such complaints mechanisms, in accordance with the UN Guiding Principles. At the cotton farm level, the Better Cotton Grievance procedure provides a system for anyone engaged with its activities, people, or programmes to raise a complaint relating to any aspect of Better Cotton, including third parties.

PUMA and its suppliers offer different grievance channels to all workers and third parties, including CSOs, for raising their concerns regarding human rights, environmental protection, and violations of PUMA’s policies. Such concerns can be raised through workers’ voice platforms, the PUMA hotline, and FLA third-party complaints.

We operate multiple workers’ voice channels to reach more than half a million workers at our Tier 1 and core Tier 2 factories. Third-party engagement platforms (industry hotline or a mobile app) cover 91 factories and over 234,000 workers, representing 77.8% of Tier 1 production. To evaluate whether our worker hotline is known, trusted, and effective, we conduct worker surveys. This approach measures if the PUMA grievance mechanism is functioning and is explained in Engagement with value chain workers about impacts (S2-2).

PUMA has published its Rules for the Complaints Procedure, explaining how PUMA’s employees and the employees of PUMA’s business partners, as well as external stakeholders, can submit complaints related to human rights, environmental risks and violations, or breaches of PUMA’s policies. It explains the complaint submission process, confidentiality, non-retaliation, remedial actions, and how we assess the procedure's effectiveness. PUMA aims for a safe environment that is free from harassment, intimidation, discrimination, and retaliation for those who submit complaints. PUMA collaborates with its business partners to help safeguard the confidentiality of complainants and to minimise the risk of any adverse treatment, such as violence, threats, or harassment.

Grievances

In 2025, PUMA received 4,129 feedback messages via third-party platforms such as MicroBenefits, WOVO, Amader Kotha (Bangladesh), Hamari Awaz (Pakistan), RSC (Bangladesh) and MUDEM (Türkiye). Workers can submit grievances anonymously through these third-party mobile apps or hotlines. Factory management is required to acknowledge receipt of the cases within an agreed timeline; if they fail to do so, the issue is escalated to PUMA through the system or by email. Furthermore, if factory management does not cooperate in resolving the issue, these platforms will also escalate the case to PUMA. Third-party grievance platforms submit monthly reports summarising the total number and categories of grievances received and resolved, including those escalated to PUMA. By monitoring these reports on a monthly basis, we can monitor whether workers are utilising these grievance mechanisms and whether factories are responding to grievances in a timely and effective manner.

• 63 cases were escalated to PUMA due to the lack of a response from the factory or the need for intervention
• 98 cases were submitted through PUMA’s hotline across 10 countries
• 95% of the 161 total cases were resolved collaboratively with suppliers. Outstanding cases, mostly from December, will be followed up in early 2026.

PUMA shares investigation outcomes with complainants. In 2025, 5.2% of resolved cases were unsatisfactory to workers, mainly due to delayed factory responses over weekends or expectations beyond legal entitlements (like severance for resigned workers).

¹ If the follow-up investigation does not find any evidence to support the complaint, and the complainant cannot provide more evidence or is no longer reachable, the case will be considered unaccepted.

PUMA tracks and monitors issues raised through its complaint channels by promptly acknowledging receipt of all complaints, conducting an initial review to assess plausibility, and, where necessary, carrying out impartial investigations. Throughout the process, complainants are kept informed of the status and outcome, and their feedback on the resolution is requested to ensure satisfaction. The effectiveness of these channels is supported by documentation and regular evaluation of preventive and remedial actions, such as risk analysis, audits, and corrective plans. Further details on how we measure the effectiveness of our hotline can be found in the Engagement with value chain workers about impacts (S2-2) section.

The most frequent issues reported by workers in 2025 included concerns regarding labour dialogue management, wage calculations, and verbal abuse. Many grievances centred on inadequate internal communication and training within factories, prompting PUMA to encourage open dialogue between management and workers, conduct training on wage policies, and enhance communication skills to foster a more respectful workplace.

Third-party complaints

In 2025, we continued to address nine outstanding third-party cases from 2024 and a further 16 new cases received during 2025. The majority of these cases concerned recruitment fees, breaches of freedom of association, and resignation payments. Of these, 13 were successfully resolved within 2025, while 12 cases remain under active follow-up.

Actions on material impacts on value chain workers (S2-4, MDR-A)

Safeguarding human rights is central, with zero tolerance for violations as outlined in our Code of Ethics, Code of Conduct, and Human Rights Policy. We monitor factories for compliance, provide channels for workers to raise concerns, and report on audits, grievances, training, and mitigation efforts. Our hotline is also accessible to CSOs and vulnerable groups. We ask our partners to conduct due diligence and report on key indicators such as audit findings, grievances, training, and mitigation efforts.

PUMA has established internal teams to manage impacts and support positive outcomes. The sustainability teams lead strategy, audits, and stakeholder engagement; the Human Rights Officer oversees upstream value chain due diligence and compliance; risk management regularly reviews key risks, including human rights; and the internal control system maintains effective processes through internal audits and reporting.

PUMA aims to address violations or potential risks by applying measures that are appropriate to the situation and proportional to the severity. PUMA expects full collaboration from its business partners throughout the remediation process. In the case of unresolved violations due to a lack of collaboration, PUMA reserves the right to terminate the business relationship with the business partner involved.

PUMA has established processes to identify and address negative impacts on workers in its value chain. Regular audits and assessments help pinpoint risks related to labour practices and working conditions. When issues arise, PUMA conducts root cause analyses and engages with stakeholders including workers, suppliers, and NGOs to gather feedback and develop targeted action plans with suppliers. To ensure effective resolution, PUMA monitors corrective actions through follow-up audits, seeks stakeholder input on remedies, and provides training to suppliers and workers to build capacity and raise awareness of rights and grievance mechanisms. The effectiveness of these measures is evaluated based on compliance and progress. PUMA’s social monitoring programme, which is accredited by the FLA, is designed to promote fair labour standards and address identified violations through remediation processes.

PUMA undertakes initiatives that aim to enhance opportunities for workers in its upstream value chain like fair wage assessment, training programmes, health and safety improvements in factories, responsible sourcing practices to enhance working conditions, and ongoing engagement with workers, suppliers, and NGOs to inform and improve practices.

The expected outcomes of PUMA's actions on human rights include improved working conditions, fair wages, and enhanced safety for workers throughout their upstream value chain.

Social monitoring programme

PUMA’s audit procedure for Tier 1, core Tier 2 factories, and selected warehouses verifies compliance with the PUMA Code of Conduct, which covers ILO Core Conventions. Each year, 500-600 audits or assessment reports are collected. All issues identified need to be remedied as part of a CAP. We have experts in all our major sourcing regions. We work with external compliance auditors and with the ILO’s Better Work Programme.

Audits begin with briefings for management and worker representatives. In 2025, 97% of audits included workers or union representatives. On-site interviews are conducted with the intention of supporting worker protection. Audit frequency is based on factory performance:

• A: every 24 months
• B+: every 18 months
• B-: every 12 months
• C: every 6 months
• D: must resolve zero tolerance issues within 2-6 months

New factories must be rated A or B before production. In 2025, we reminded factories that undeclared subcontracting is a zero-tolerance issue. 141 subcontractors were declared; 89 had valid audits, 35 will be followed up on in 2026, and 17 were deactivated.

To avoid duplication and audit fatigue at factories, we increased shared assessments to 82.1% in 2025 (70.9% in 2024). We encourage our manufacturing partners to use the Social & Labor Convergence Program (SLCP), an industry social assessment tool aimed at reducing the burden of redundant social audits. PUMA uses Better Work assessment reports and FLA-accredited brand reports in lieu of our compliance audit programme. Our Sustainability Handbook for Social Standards details our supplier compliance programme, including grievance mechanisms. In 2024, 601 participants from 587 factories completed e-learning training based on our Social Standards Handbook, and in 2025, 589 participants from 720 factories passed the refresher course, covering 81.8% of PUMA’s active factories.

We do not make estimations or assumptions regarding audit-related KPIs, including any limitations. The audit findings are identified by external third-party organisations. Each audit finding is classified and defined with precise names and descriptions.

PUMA’s commitment to transparency includes public reporting on its human rights initiatives. This transparency allows value chain workers and their representatives to hold PUMA accountable and provide feedback on its programmes.

Audit results

In 2025, 83 factories that had previously been identified as low performing improved their ratings to A or B+ after participating in corrective action plan follow-ups and training sessions. Out of the 600 factories audited, 23 did not pass (including 17 Tier 1 factories, two subcontractors, and four Tier 2 factories). Of these, six factories were deactivated due to poor performance. The remaining 17 stayed active; nine of them passed re-audits, while eight are scheduled for reassessment in 2026.

Throughout the year, we carried out audits at 184 new factories (28.6% of the total number of audits in 2025), which encompassed non-core Tier 2 sites. Of these, four factories were not onboarded due to unsatisfactory performance. The pass rate for new factories improved to 94.6% (81.9% in 2024).

In 2025, we updated our factory onboarding process, placing greater emphasis on risk mitigation. This process involves, prior to any order placement, conducting human rights and environmental risk assessments when entering new sourcing countries, obtaining a commitment to join selected programmes to mitigate human rights risks from factories located in high-risk countries, even if the factory passes the first audit. Factories employing foreign migrant workers must undergo recruitment fee-focused assessments and commit to reimbursing any recruitment fees paid by these workers before PUMA production starts.

Audit findings

The table on most frequent findings shows the 10 most frequent audit findings from PUMA’s audit programme, including both own and external converted reports of 233 active factories (Tier 1 and Tier 2 excluding new factories).

¹ The 2025 findings cover 233 audited factories. Comparative information for 2024 is not provided, as the reporting and assurance scope in 2025 differs from the previous year, preventing full comparability.

Key audit findings and remedial actions in 2025:

• Systemic excessive overtime and working hours management: We have collaborated closely with factories to remediate working hours-related violations and provided training on working hours management and root cause analysis.
• Social insurance: Non-compliance with social insurance in China continues to be a challenge, caused by complex factors such as employee resistance, as some workers prefer receiving higher take-home pay, as well as inconsistent enforcement across all provinces. The average coverage for Chinese core Tier 1 reached 82.3% and factories are implementing plans to achieve 100% coverage between 2027 and 2030.
• Transparency: Six issues identified. Two factories were not onboard and four were remediated.
• Freedom of Association: Two out of three cases were closed, one factory reinstated union leaders, another formed a worker management committee as per the law. One factory remains under remediation with Better Factories Cambodia to resolve interference in union activities by the management. A similar case is also under remediation.
• Women’s rights: Of 42 findings, 19 have been closed, 10 are from factories which have been deactivated since then, and the other 13 are still under follow-up. In 2025, 62 new findings were identified; 14 have been resolved, 40 are still under follow-up, and eight pertain to deactivated factories. Most findings concern child day care operations in Cambodia, and maternity benefits and menstruation leave in Vietnam. In 2026, we will work with Better Work to strengthen factory management’s understanding of legal requirements with respect to women-related topics.
• Freedom of movement: In 2025, two cases involving restricted toilet access were resolved. No instances of passport retention were identified.
• Wage payments: Of nine, six have been resolved and three are from factories which have been deactivated since then.

Zero tolerance issues are severe breaches of PUMA’s Code of Conduct that result in the immediate failure of an audit. These issues include child labour, forced labour and all modern forms of slavery, non-compliance with basic government licensing regulations, payment below the legal minimum wage, falsified records, unauthorised subcontracting, imminent danger to life, and the illegal discharge of wastewater and hazardous waste. Details of 2025 zero tolerance breaches are provided in the Metrics and targets (MDR-M, MDR-T) section.

Supplier training

To support supplier understanding of PUMA’s standards and due diligence requirements, we delivered a range of training sessions in 2025:

• Supplier meeting: In-person/virtual sessions on PUMA standards, EU regulations, and 2030 targets
• E-learning: Social Standards Handbook, and sexual harassment prevention
• Social KPI and root cause analysis: For core Tier 1 and Tier 2 suppliers to improve data accuracy and corrective actions
• Code of Ethics: Training on PUMA’s expectations regarding our Code of Ethics
• Specialised training: Related to migrant workers in South Korea, Mauritius, and Japan, training on the IOM toolkit and the “employer pays” principle
• Occupational Health & Safety training: In 2025, PUMA provided electrical safety and PPE training to 158 factory managers across 55 core Tier 1 factories. These trained managers cascaded the training to 114,220 workers, reaching approximately 87.8% of the overall workforce on average.

Remediation

Job security

Workers may face job insecurity due to weak labour protections and informal employment. PUMA’s Purchasing Practice Policy aims to minimise negative impacts on workers, promote fair labour practices, and secure jobs by avoiding drastic order reductions or irresponsible business relationship terminations.

We track permanent employee percentages of core Tier 1 and Tier 2 factories to develop improvement plans. In 2025, the percentage of permanent supervisors and production workers at PUMA and stichd core factories was 75.4%.

Freedom of association and social dialogue

PUMA encourages constructive social dialogue and positive industrial relations. We encourage suppliers to join the ILO Better Work Programme, which supports factories in setting up participating committees to facilitate communication and building trust between workers and management. PUMA asks suppliers to join the Better Work Programme in Bangladesh, Cambodia, Indonesia, Pakistan, Egypt, and Vietnam. We have partnered with a China-based consultancy to train our sustainability team in promoting Worker Representative Committees in factories not enrolled in the Better Work Programme.

Between 2022 to 2025, 25 factories (19 in China, two in Pakistan, one each in Vietnam, Brazil, Indonesia, and the Philippines) have established a Worker Representative Committee through the PUMA Worker Representation Programme. These committees are made up with 619 elected representatives, 53% of whom are female. The result of a post-project survey conducted at 21 factories that had held elections before 2025, indicated increased social dialogue on wage topics (+38%), improved awareness among management (+12%) and workers (+26%), and increased trust in elected representatives (4-21%). 15 out of 21 factories reported productivity gains (0.4%-6.3%), and 19 out of 21 factories reported with quality improvements (0.1%-5%).

95% of PUMA’s core Tier 1 factories have elected worker representation, up from 91% in 2024. Three factories in Vietnam were unable to hold a democratic election due to some misalignment between the programme and local regulations.

To help support workers’ voices, PUMA has signed the Indonesia Freedom of Association (FoA) Protocol. This initiative is intended to discourage union busting, encourage constructive industrial relationships, and establish fair guidelines on freedom of association. By the end of 2025, eight Tier 1 factories had agreed to apply the protocol with 13 unions, one new factory is in the progress of signing the Protocol with four unions. All FoA cases in 2025 have been resolved without escalation to the FoA national committee.

The Americas Group is a multi-stakeholder forum promoting socially responsible apparel and footwear industries in the Americas. The Mexico Committee focuses on FoA and collective bargaining, hosting webinars, and developing guidance for compliance with labour laws. Representatives from one Tier 1 and one Tier 2 PUMA factory attended both webinars. In June 2024, the Mexico Committee approved the Employer Guidance on FoA and collective bargaining. In 2025, PUMA reviewed the actions of its two factories in Mexico. Both facilities have established FoA policies and provided worker training in accordance with the Employer Guidance.

As we observed several allegations related to freedom of association breaches in Cambodia, in 2024, we partnered with Better Factories Cambodia to host training for 204 participants from 32 factories, covering topics like freedom of association and labour dispute resolution. These factories reviewed their Freedom of Association and Labour Dispute Resolution Policies in consultation with trade unions and worker representatives and provided training to workers on the respective roles and responsibilities of employers, unions, and shop stewards. In addition, we observed that trained management teams at all factories held regular meetings with trade unions and worker representatives to discuss and address workplace concerns.

In 2025, the percentage of employees covered by collective bargaining agreements at PUMA core Tier 1 factories was 33.9%.

Fair wages

PUMA expects its suppliers to comply with local wage regulations, including payment of at least the minimum wage, as a condition of becoming or remaining a business partner.

All core factories paid 212,347 employees digitally, achieving our 10FOR25 target. Paying factory workers digitally increases transparency, reduces wage theft, and ensures workers receive their full and timely wages safely. We have expanded this to include non-core factories in Pakistan, where all workers receive their wages digitally.

PUMA defines fair wages according to the FLA Code of Conduct, which requires compensation to meet or exceed the legal minimum wage or appropriate prevailing wage, covering basic needs and some discretionary income. PUMA collects wage data annually from core factories and uploads them to the FLA’s Fair Compensation Dashboard, comparing them with living wage estimates from the Global Living Wage Coalition (GLWC), developed by the Anker Research Institute, to analyse workers’ income.

Based on our analysis, we work with the Fair Wage Network (FWN) to assess and improve wage practices at factories with payment gaps. The FWN evaluates wage structures, helps factories develop remediation plans, and identifies areas for improvement such as adjusting wages for inflation and involving worker representatives. Positive results include timely wage payments, legal compliance, and non-discriminatory practices.

In 2025, we conducted fair wage assessments for one factory in China. Two factories (one in the Philippines and one in Vietnam) started fair wage remediation due to gaps in meeting the living wage benchmark.

In 2025, we analysed 2024 wage data from 55 core Tier 1 factories using the FLA’s Fair Compensation Dashboard, covering 128,806 workers and 63.3% of PUMA’s global production volume. 28 factories paid a living wage to 61,610 workers in Cambodia, China, Indonesia, Türkiye, and Vietnam. These workers represent 40.2% of production volume and 10.2% of our total upstream value chain workforce. The slight decrease in workers receiving living wages this year may be due to the FLA’s updated Wage Data Collection Tool 2.0, which now uses 12 months of payroll data and excludes supervisor benefits, resulting in more comprehensive but sometimes lower reported averages.

Below is a more in-depth analysis of the 27 factories below the GLWC benchmark:

• Brazil: In 2024, one factory had wages below the living wage benchmark; management held worker elections in 2025 to encourage dialogue on wage levels
• China: Six factories had living wage gaps; four have undergone or are undergoing FWN assessment or remediation, and two with minor gaps will develop action plans in 2026
• Vietnam: Eight factories reported living wage gaps; four have completed or are undergoing fair wage assessments or remediation, with another planned for 2026. The province restructuring raised living wage benchmarks, leaving three factories slightly below the GLWC estimate; an action plan is planned for 2026
• Philippines: One factory was below the GLWC benchmark, had a Fair Wage assessment in 2024, and started remediation in 2025
• Indonesia: One factory is 11.3% below the GLWC estimate and will be reassessed in 2026; another is 1.1% below, reflecting the impact of the FLA’s updated methodology
• Bangladesh: Seven factories averaged 76.8% of the GLWC benchmark in 2024 (up from 69.3% in 2023), due to a minimum wage increase and remediation efforts
• Pakistan: The average wage at two factories declined; in 2025, we revised our methodology to align with the FLA lump-sum approach.

¹ 2024 wage data from 55 PUMA core Tier 1 factories.

² Net legal minimum wage refers to the gross minimum wage minus mandatory taxes and legal deductions.

³ Net GLWC benchmark represents the net living wage required for a worker to maintain a decent standard of living for themselves and their family in a particular location. Calculated as basic (contracted) wage plus cash benefits and in-kind benefits, minus mandatory taxes and legal deductions.

Health and safety

In 2025, PUMA provided Electrical Safety and PPE training to 158 factory managers across 55 core Tier 1 factories. These trained managers subsequently cascaded the training to 114,220 workers, reaching approximately 87.8% of the workforce on average.

Bangladesh Employment Injury Scheme Pilot

Although working conditions in Bangladesh’s garment sector have improved, a full Employment Injury Scheme (EIS) is still lacking. To address this, the government launched a pilot programme with ILO and GIZ to provide income support for permanently disabled workers and families of deceased workers, aiming for a permanent scheme in 2027. PUMA joined the pilot in early 2023, offering financial support and feedback. As of the end of 2025, the EIS Pilot covers all 4 million workers in Bangladesh’s export-oriented garment sector. For work-related injuries, monthly pensions are provided to permanently disabled workers and dependents of deceased workers, supplementing lump-sum compensation from the national Central Fund. Funded by voluntary contributions from international brands, these pensions are based on the worker’s age and last wage, ensuring income replacement in line with ILO Convention No. 121.

Building safety

PUMA prioritises safe workplaces, focusing on high-risk countries identified via the Building Safety Index.

PUMA conducts occupational health and safety (OHS) assessments and building safety inspections in high-risk countries, such as Bangladesh, India, Indonesia, and Pakistan.

PUMA signed the ACCORD agreement for Bangladesh and Pakistan, a legally binding programme with brands and trade unions to improve garment factory safety. The ACCORD covers all PUMA in-scope factories in these countries, focusing on building, electrical, and fire safety through independent inspections, remediation, worker training, and a complaints mechanism. The mechanism empowers workers to report OHS concerns safely. A few cases of delayed payments and inappropriate managerial behaviour were reported and have since been resolved. In 2025, our Bangladesh ACCORD factories achieved a 91% completion rate for initial findings, exceeding the country average of 85%. In Pakistan, five out of seven factories under ACCORD have been inspected; the remaining two are scheduled for assessment in 2026.

In 2024, we used the EiQ risk assessment tool to assess building safety risks in key sourcing countries. Consequently, four factories in India and one in Indonesia have been classified as high-risk. Between June and July 2024, building, electrical, and fire safety assessments were conducted at these facilities. These evaluations uncovered 389 issues, ranging from major to minor concerns. In 2025, 79.7% of these issues had been addressed, up from 46% in 2024. Most of the improvements focused on building and fire safety measures, particularly the repair of structural issues such as cracks and the installation of hydrants and fire detection systems. The issues remaining unresolved include modifications to building structures which require landlord cooperation and management of capital expenditure limitations.

Earthquake risk

In 2024, 26 factories were reviewed for compliance with the 2018 Turkish Earthquake Regulation. 10 submitted valid permits and 16 underwent inspections. 25 of these facilities have been confirmed safe, while one requires reinforcement, which is to be completed by early 2026. In 2025, five newly onboarded factories were asked to undergo the assessments; we will monitor the results in 2026.

Gender equity and measures against violence and harassment

At PUMA core factories, 53.3% of workers are women and 8% of core Tier 1 suppliers are owned by women.

Training women on their rights and empowering them is crucial to gender equality. Since 2021, 358,128 participants have completed sexual harassment prevention training.

Since 2023, we have collaborated with the China National Textile and Apparel Council to launch the Family-Friendly Factories project in six core factories in China, benefiting 8,629 workers (70% women). The project trained 341 workers (78% women) on gender equality, family-friendly policies, and work-life balance, and implemented initiatives like maternity protection, caregiving support, and flexible work arrangements. All factories established Family-Friendly Committees, with 75% worker representation and 66% being female, to foster a supportive workplace. Three out of six factories, where 77-97% of workers are domestic migrants, two factories partnered with local government to offer free education for migrant children and affordable dormitories, benefiting 374 families. One factory offered educational incentives and a summer camp to help left-behind children reunite with their parents.

The ready-made garment sector has driven Bangladesh’s economic growth, with women making up 60% of the workforce but only 5% of line supervisors. The Gender Equality and Returns programme, a collaboration between the IFC and ILO, aims to improve this by promoting women’s career progression in the garment industry through training in soft and technical skills. In June 2024, PUMA launched the Gender Equality and Returns programme in a Bangladesh factory, selecting 10 female workers for training. Of these workers, seven were promoted to supervisor, resulting in a 31% wage increase and a 12% boost in efficiency on those production lines.

As part of our focus on gender equity, we track gender-disaggregated metrics for production workers such as the percentage of women who were promoted or participated in career development training, and the gender pay gap.

¹ 2025 data is from 108 core factories from PUMA, Cobra, and stichd. Data covers production workers, and includes the top four departments with the largest employee population.

² Promotion calculation: production workers promoted to higher skill grade, supervisory, or managerial roles in the reporting period.

³ Skill development training calculation: production workers who have participated in skill development training programmes in the reporting period.

⁴ Gender pay gap calculation: difference in average pay between genders among production workers, a negative value indicates that females are paid less than males. These metrics are compared for base salary only.

Forced labour

Since signing the FLA/American Apparel and Footwear Association Commitment to Responsible Recruitment, PUMA has worked with suppliers, industry peers, and the UN’s International Organisation for Migration (IOM) to protect foreign and migrant workers’ rights by annually checking for recruitment fee payments, which can lead to debt bondage. When fees are found, we coordinate with suppliers and other brands to arrange repayment with timelines. From 2020 to 2025, 18 factories producing for PUMA have reimbursed around USD 590,000 to 755 workers in Taiwan, Japan, South Korea, Thailand, and Mauritius.

IOM has trained PUMA’s team in ethical recruitment tools (2023-2024). Supplier guidelines were developed and integrated into PUMA’s Social Standards Handbook. In 2024, 68 factory and agent representatives in China-Taiwan, Japan, and Mauritius were trained. In 2025, PUMA began a three-year partnership with IOM to eliminate recruitment fees and sustain progress. This initiative includes capacity building for upstream value chain partners and the PUMA team, the development of a standardised remediation framework, and the provision of a transparent pathway for remediation. In 2025, 66 members of PUMA’s sourcing and sustainability teams, and representatives from factories, agents, and a third-party auditing firm, participated in ethical recruitment training regarding foreign migrant workers issues in Japan, South Korea, and Mauritius.

In China-Taiwan, Transparentem flagged nine factories to 50 brands in 2024 for recruitment fees and worker mistreatment. PUMA sourced from six of these and assigned a third party to investigate at four; most allegations were confirmed. PUMA co-leads remediation at three factories and supports efforts at three others. In September 2024, PUMA joined more than 50 brands in urging the Taiwanese government to protect migrant workers. Through joint efforts with brands and stakeholders, one of the six factories from which PUMA sources has fully repaid workers in 2025, while the remaining factories are scheduled to complete reimbursement or finalise their plan by 2026. In December 2025, the Taiwan Textile Federation announced a new policy endorsing the Employer Pays Principle, effective from January 2026.

Metrics and targets (MDR-M, MDR-T, S2-5)

PUMA’s upstream sustainability targets are aligned with its Human Rights Policy and business strategy, aiming to ensure ethical practices throughout the upstream value chain. All targets are global, set for five years, and were developed through analysis of impact areas, industry trends, internal data, and peer benchmarks, with input from stakeholders and approval from management and employee representatives.

PUMA engages with stakeholders, including NGOs, labour unions, and industry experts, to gather feedback and refine its sustainability targets, ensuring they are measurable and comprehensive. Stakeholder dialogues, such as those held to review PUMA’s Vision 2030, include input from trade unions, multi-stakeholder organisations, NGOs, and human rights experts.

PUMA also publishes detailed reports on its sustainability targets and progress, inviting stakeholder feedback and accountability. PUMA’s performance is reviewed through annual monitoring by the FLA, which assesses compliance with FLA principles and progress as part of PUMA’s accreditation obligations. PUMA reviews year-on-year results from human rights benchmarking and incorporates feedback. We also incorporate suggestions for improvement gathered during our engagement with CSOs.

In 2025, we updated our methodology for gender pay gap-related metrics to focus on the top four departments with the largest employee populations. These groups account for about 70% of the total workforce at our core factories. By concentrating on these key segments, our reporting is more precise, better aligned with the FLA’s Fair Compensation dashboard, and less prone to human error.

¹ All data used is primary data with no extrapolation. All targets are absolute and voluntary. All targets apply from January 2020 to December 2025, except for the target on training indirect staff members, which applies from January 2021.

² Targets apply to all locations of the entities listed under scope.

³ PUMA Group includes all PUMA entities including stichd, Cobra Golf, and PUMA United.

⁴ Core factories include core Tier 1 and core Tier 2 factories.

⁵ Cobra products sourced by PUMA Group Sourcing (PGS). Golf club parts sourced by Cobra PUMA Golf are excluded.

⁶ 2025 data is from 257 factories at PUMA and Cobra.

⁷ 2025 data is from 55 core Tier 1 factories at PUMA and Cobra.

⁸ Achieved in 2024.

⁹ Accumulated data between 2021 to 2025 from 95 PUMA Tier 1 factories.

¹ All data used is primary data with no extrapolation. All targets are voluntary and absolute, apply from January 2026 to December 2030.

² Targets apply to all locations of the entities listed under scope.

³ PUMA Group includes all PUMA entities including stichd, Cobra Golf, and PUMA United.

⁴ Core factories include core Tier 1 and core Tier 2 factories.

⁵ Cobra products sourced by PGS. Golf club parts sourced by Cobra PUMA Golf are excluded.

⁶ Based on 2024 wage data because the GLWC published its 2024 living wage estimates in June 2025. Data is from 55 PUMA core Tier 1 factories. Data covers production workers only.

⁷ 2025 data is derived from 38 non-core as well as core Tier 1 and Tier 2 factories, covering 1,447 workers, located in sourcing countries where foreign migrants may be employed, including China-Taiwan, Japan, Mauritius, South Korea, and Thailand.

⁸ 2025 data is from 108 core factories of PUMA, Cobra, and stichd. A negative value indicates that females are paid less than males. Data covers only production workers and includes the top four departments with the largest employee populations.

⁹ 2025 data is from 75 core Tier 1 factories of PUMA, Cobra, and stichd.

Most of the 10FOR25 targets were achieved, including a reduction in injury rates, contributing to a safer work environment, paying workers digitally, ensuring they receive wages safely and in a timely manner, enhanced worker awareness on sexual harassment prevention, and improved comprehension of fair wage practices within core Tier 1 factories. However, we did not achieve zero fatal accidents or ensure that 100% of core Tier 1 factories have effective, freely elected worker representation. In 2025, despite continuous workplace monitoring and OHS training, two workers in China tragically died due to health-related issues at work. These incidents are legally classified as work-related fatalities. In one case the family has received both legal and factory humanitarian compensation, while another is currently undergoing a legal process, as it occurred in late December 2025. Additionally, the implementation of freely elected worker representation at core Tier 1 factories has only been partially achieved, as the process has been paused at three factories in Vietnam because the programme does not align with local regulations. The outcomes underscore the importance of reinforcing workplace OHS monitoring and preventive measures and maintaining continuous engagement with stakeholders to ensure compliance and broader programme adoption. These findings will guide future refinements to our workplace safety protocols and strategies for stakeholder engagement.

The resolution of zero tolerance issues prevailing at year-end is a bonus target for all sourcing leaders. Zero-tolerance issues are based on primary data from 395 core and non-core PUMA Tier 1 factories, 82 Tier 1 subcontractors, 114 core and non-core Tier 2 factories, two warehouses, and seven non-commercial goods factories, covering the 12 months of January to December 2025 with no extrapolation. In 2025, we identified 15 zero-tolerance breaches, of which 12 were resolved. These violations concerned issues such as payment below the legal minimum wage, falsified records, unauthorised subcontracting, and illegal wastewater disposal. Three factories were not approved for onboarding as they failed to address zero tolerance issues regarding falsified records and pay the below minimum wage.

2025 performance serves as a baseline for all Vision 2030 targets; no specific progress was planned for 2025. Whether progress is in line with the planned target will be analysed from 2026 onwards.