Türk Hava Yollari Anonim Ortakligi : 2021 Statement of Compliance with Sustainability Principles

STATEMENT OF COMPLIANCE WITH SUSTAINABILITY PRINCIPLES

As the National Flag Carrier airline, our Incorporation which carries out all its activities considering social prosperity, social contribution and environmental awareness, pursuant to the Capital Markets Board (CMB) Communiqué on the Amendment of the "Corporate Governance Communiqué (II-17.1)" numbered II- 17.1.a, has announced its Environmental, Social and Corporate Governance activities within the scope of the Sustainability Principles Compliance Framework which is attached to the communiqué in ways that the Information Form and Compliance Report format including the year 2021 data. The articles that are partially complied with by our Incorporation are Articles 47 and 48, and their justifications are given in the relevant parts of the report.

In line with the mission, vision and core values of our Incorporation; We evaluate our long-term goals and the risks and opportunities in achieving these goals within the framework of the priority issues we have determined by taking into account the legal regulations, global trends, the views and concerns of our stakeholders, broad-framed social expectations and our impact on the supply chain, and we create the roadmap of our sustainability strategy. With this roadmap, we aim to create value in the future by going beyond today's achievements in line with the four focal points we have determined as human, world, development and management functions. With our flexible and dynamic structure, our understanding based on honesty, transparency and accountability, we publicly share our performance in environmental, social, economic and corporate governance with all our stakeholders. We continue to be included in the BIST Sustainability Index since 2015, with our efforts and policies on sustainability. We will continue to pursue our activities with determination in accordance with the Sustainable Development Goals, appointed by the United Nations with its mission to ensure that all people live in peace and prosperity and to protect our world.

SUSTAINABILITY APPROACH AND INCORPORATION'S SUSTAINABILITY MANAGEMENT

Turkish Airlines, which has one of the youngest fleets in Europe with an average fleet age of 8.5 and a total of 370 aircraft, carries out its operations with a sense of responsibility towards the environment and society, while flying to the most countries in the world.

While the responsibility for their impact on the economy, environment and society rests with the Board of Directors and the Executive Committee, a Sustainability Committee was established in 2021, the members of which are Turkish Airlines Senior Executives. The Sustainability Committee carries out its activities in order to determine, review and continuously improve the sustainability management strategy, sustainability policy, short, medium and long-term sustainability targets, and to decide on improvement projects that will increase the sustainability performance of Turkish Airlines. Within the framework of the decisions taken at the Sustainability Committee meetings chaired by the General Manager, all of our relevant units plan their necessary work and carry out sustainability studies in that vein.

Adopting the principle of "continuous improvement", we aim to go beyond compliance with the requirements while carrying out our activities. Accordingly, we participated in the IATA Environmental Assessment Management System Program (IATA Environmental Assesment - IEnvA) specially designed for airline companies by the International Air Transport Association (IATA), with a management model specific to airline companies in order to strengthen the ISO 14001 Environmental Management System which we have been implementing since 2013. We have successfully completed the audit conducted by an independent third party organization authorized by IATA. Turkish Airlines has become the first airline to

directly obtain the "Stage 2 Certificate", which is the highest level certificate in the IEnvA System and represents the highest level of IEnvA compliance.

With Turkey's ratification of the Paris Agreement and its commitment to net zero in carbon emissions until 2053, we are reconsidering our strategies, taking into account the global requirements and the expectations of our stakeholders. With the awareness that Sustainable Aviation Fuel (SAF) plays a key role in reducing carbon emissions caused by the aviation industry, we have started using SAF in our Istanbul Airport - Paris Charles De Gaulle route. We will be using the blend of this fuel, once a week in the first stage, to increasing frequencies and different destinations in the following processes. Thanks to the clean combustion realized with the use of sustainable aviation fuel; A reduction of up to 87% in greenhouse gas emissions will be achieved compared to the same amount of traditional kerosene fuel and it will contribute to the reduction of global greenhouse gas emissions.

With the awareness that the climate change is a global problem which can only be solved with global cooperation, so that we carry out our work in cooperation with many national and international organizations. In this context; We support sustainable aviation fuel research and development studies in order to reduce and eliminate the factors that may have an impact on climate change. Together with Boğaziçi University, we are running the "Microalgae Based Sustainable Bio-Jet Fuel Project (MICRO- JET)" supported by TUBITAK. Within the scope of the project, it is aimed to pilot production of synthetic bio-kerosene from microalgae using hydrotreated fatty acids and hydrothermal liquefaction methods. We will use this biofuel, which will be obtained from sustainable sources in 2022, in our flights after the engine tests to be carried out by Turkish Technic. With the biofuel to be obtained in this project, our Incorporation will be one of the rare global companies that use the cleanest type of biofuel accepted by IATA. The refinery, where the biojet fuel to be obtained for this project, will be the first carbon-negative integrated bio-refinery in Turkey and Europe when it starts operating at full capacity.

In addition to the emissions we aim to prevent with the projects we have developed and implemented, the management of emissions resulting from our activities is also important. In this direction; We report our greenhouse gas emissions in line with the requirements of the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), European Union Emissions Trading System (EU_ETS), UK Emissions Trading Scheme (UK-ETS) and TS EN ISO 14064-1 "Specification with guidance at the organization level for quantification and reporting of greenhouse gas emissions and removals". Our greenhouse gas calculations are verified annually by third-party independent verifiers.

Alongside the greenhouse gas emissions prevented by the studies we have conducted within the scope of fuel efficiency; We aim to implement the Voluntary Carbon Balancing Project in 2022, which we carry out to reduce our emissions. With this project, the emissions caused by our employees' mission flights will be neutralized by Turkish Airlines. Our passengers, on the other hand, will have the opportunity to neutralize the emissions from their flights with various offset projects on our website.

We transparently report our metrics regarding our governance structure, strategy, risk and opportunity management methods, budget and carbon emissions related to climate change, to institutional investors and the public. In this context; In 2021, we participated in the Carbon Disclosure Project (CDP) Climate Change Program, the world's most respected reporting platform on climate change which is a very important priority for our company and the sector in we operate. We transparently report our metrics related to our governance structure, strategy, risk and opportunity management methods, budget and carbon emissions related to climate change, to institutional investors and the public, and we are happy to receive a "B-" rating for our performance. We aim to continue our work in a way that will carry it forward in the future.

We aim to increase the scores we achieve by ensuring the continuity of participation in the performance evaluations of national and international indices and sustainability rating agencies, such as DJSI, FTSE4Good, MSCI, EcoVadis, Sustainalytics, TPI and Borsa Istanbul Sustainability Index, to which we participated voluntarily in previous years. As a result of these evaluations made by the world's leading rating agencies, our Incorporation succeeded in raising its scores, both on company basis and sector average, in 2021 compared to 2020. With the Sustainalytics ESG (environmental, social and governance) Risk Rating score, Our Incorporation; Ranked 1st in the lowest risk ranking, among 69 participants in the airline sub-sector, it achieved a sectoral success rate of 1%, which represents the lowest risk segment. Our Incorporation was deemed worthy of an award in the "Bronze" category by Ecovadis in 2021, aims to raise its scores to higher levels in the coming years with the works it plans to carry out.

We develop projects to prevent and reduce waste generation both at our campuses and inside the aircraft. We continue to carry out our in-cabin segregation practices at airports where technical means are available and on routes where flight times are sufficient; We aim to expand the scope of the in-cabin segregation application and we continue our feasibility studies in this direction.

With all travel and toy sets being offered without any plastic packaging, we prevent the use of millions of plastics on our flights. We offer headphones and blankets that our passengers may need on flights, in packages made of corn starch in accordance with the "TS EN 13432 Packaging-Recyclable packaging properties by biodegradation and composting" Standard. Although it has higher production costs compared to traditional plastic packaging; We prefer these packaging as it is a product that will contribute to the prevention of plastic waste generation at all points of our flight and increase the awareness of stakeholders on sustainability issues.

In addition to the use of biodegradable packaging; we aim to reduce the use of plastic in the products we offer. In this direction; Instead of plastic toys, we offer our child passengers wooden toys with the concept of "Play Natural", which are made of forest products certified by the "Forest Stewardship Council (FSC)". While the concept was being designed, opinions were received from psychiatrists and leading companies in the sector on the concept of wooden toy production. Kindergartens were also visited by us and the preferences of the children were taken into consideration. We carried out this project in cooperation with WWF (World Nature Conservation Foundation), in which we aimed to raise awareness in children from an early age in order to protect nature.

Our projects, consisting of biodegradable packaging and environmentally friendly toys, were awarded the "Gold" status in the "Sustainable Packaging Initiative" and "Children Wellness Initiative" categories in the Travel Plus "2021 Amenities Initiatives" competition; Our eco-friendly packaging received the "Best of Onboard Sustainability" award at the "2021 Onboard Hospitality" awards.

In order to reduce the amount of plastic waste, we evaluate the changes in the content of the products we offer to our passengers that will not adversely affect the satisfaction and comfort of our passengers, and we reduce the products containing plastic. In the last two years, we have prevented the use of 17,935,026 plastic bags with this method. The electronic headphones we offer to our passengers are sterilized and reused. Those that are broken and cannot be repaired are delivered to our licensed recycling company and iron, plastic and copper raw materials are recycled.

In our contracts, we include the Environmental Requirements that our Incorporation expects from its suppliers, and we expect our suppliers to fulfill these requirements. Thus, we aim to have our environmental policy impact our entire supply chain through our commercial partners.

Our partnership; It has been selected as the "Five Star Global Airline of the Year 2021" by APEX (Airline Passenger Experience Association), which is considered one of the most reliable and respected aviation organizations in the world. In addition to this award; We were also entitled to receive the "APEX World Class" award, which was presented for the first time, by evaluating sustainability, health safety, service quality and customer experience.

Turkish Cargo, on the other hand, took a very active role in the transportation of vaccines by preparing the necessary infrastructure for the transportation of Covid 19 vaccines without disrupting their cold chain. We became the first airline company to have IATA CEIV certificate in three different branches: health products, live animals and perishable products.

As Turkey's global air cargo brand, Turkish Cargo, in addition to our #MissionRescue project, which we have implemented for the protection of endangered species in cargo transportation; As the signatory of the "United for Wildlife Buckingham Palace Declaration (UFW)", which aims to prevent the illegal trade of wild animals supported by IATA and to increase sectoral awareness on this issue, we support the delivery of species that are in danger of extinction in the wild to their natural habitats.

Ensuring the female-male employee balance and the empowerment of women and in all areas is critical to accelerating sustainable development. In this context; We support the '25 by 2025' Women's Empowerment Project, which is a voluntary commitment initiated by the International Air Transport Association (IATA) and participated by IATA member airlines, to improve the representation of women in the aviation industry, and we are in the DGCA Gender Balance Development Commission. In the evaluation of candidates for technical job fields in the sector, we focus on individual competencies and qualifications, not gender, and increase the number of our female employees in these fields from year to year. With our 25% female manager ratio, we support the increase of representation of our female employees in management and technical roles, and we aim to increase our female representative ratio.

As the flag carrier of the Republic of Turkey and a global value, we go beyond our responsibility to respect human rights where applicable, by integrating our responsibility to respect human rights in all our activities, including passenger transportation, cargo transportation and education in all countries where we operate. In this context; We act within the framework of the international principles set forth in the Universal Declaration of Human Rights, the International Labor Organization's (ILO) Declaration of Fundamental Principles and Rights at Work, and the United Nations Guiding Principles on Business and Human Rights, and national legislation regulating human rights and working life.

Conscious of the importance of stakeholder participation in improving our sustainability performance; evaluates the suggestions submitted through the Individual Suggestion System, which allows employees to share their suggestions; We implement projects that are feasible. And also; In order to activate the creative potential of our employees, which is the greatest value of our partnership, in sustainability issues and to increase their participation in innovation activities, we launched the "Innovative Ideas Focused on Sustainability" solution competition in January 2022. In this way, we aim to give our employees the opportunity to present, project and implement their valuable ideas.

"Platinum Award" in the sustainability report category with a total score of 99 out of 100 in 2020 in the LACP Spotlight Awards-Global Communications Competition, which is organized by the League of American Communications Professionals (LACP) and is considered one of the most outstanding global communication competitions in the world. Our Incorporation won three separate awards: the "Best Visual Design" award and the "Golden Award" in the corporate social responsibility report category; In 2021, it was awarded the "Golden Award" in the categories of sustainability report and corporate social responsibility report with a total of 98 points.

For a more livable World, we will continue to work non-stop to support social development in our country and at all our other flight destinations, while reducing our environmental impacts arising from our activities.