July 18, 2013

To our stakeholders:

I am pleased to confirm that Hilton Worldwide reaffirms its support of the Ten Principles of the United Nations Global Compact in the areas of Human Rights, Labour, Environment and Anti-Corruption.

In this annual Communication on Progress, we describe our actions to continually improve the integration of the Global Compact and its principles into our business strategy, culture and daily operations. We also commit to share this information with our stakeholders using our primary channels of communication.

Sincerely yours,

Chris Nassetta
President & CEO
Hilton Worldwide

Ensuring human rights is a global responsibility—with around-the-clock accountability—in which we all play an important role, and at Hilton Worldwide, we believe that protecting and ensuring human rights enables communities to be stronger and safer. Hilton Worldwide complies with the employment and labor laws in every country in which we operate, and we support fundamental Human Rights for all people.

Our global Code of Conduct condemns all forms of human trafficking and commercial exploitation. We are fully committed, in each and every one of the markets in which we operate, to protecting individuals from all forms of abuse and exploitation, and we expect our Team Members, as well as our business partners, to help us meet this commitment.

Hilton Worldwide takes an aggressive stance on the issue of child trafficking and has begun conversations with external organizations to identify ways we can actively work to combat child trafficking in our hotels. We developed an action plan with ECPAT-USA, a network of organizations working to eliminate child trafficking. In early 2011, we further solidified our commitment by becoming the second U.S.-based hotel company to sign the Tourism Child-Protection Code of Conduct and launched a Team Member training program designed to help identify and prevent child trafficking.

As a subscriber to the ECPAT Code of Conduct, Hilton Worldwide implements policies that condemn child trafficking and exploitation and provides training to help Team Members identify and report illicit activities. After signing the code in 2011, we hosted six pilot trainings at hotels in Seattle, Washington, D.C., and Indianapolis. In 2012 we expanded our
efforts, hosting trainings before the Olympics in London and Miami, Orlando, Anaheim, Los Angeles, Dallas, Houston, Chicago and Portland, Oregon in the United States.

We have also joined forces with Vital Voices to develop the Global Freedom Exchange which provides a group of 26 women leaders from 13 countries with the resources they need to continue their battle to abolish human trafficking. This unique program provides these leaders with specific knowledge, skills and relationships that will benefit their professional development, their respective NGOs, and the communities they serve. Training and mentoring opportunities offered to participants will foster an international network of activists working together to prevent and respond to child sex trafficking. Program participants are established or emerging leaders recognized for their passion and commitment to ending human trafficking and their innovative approach to this global issue. They include founders, advisors, legal counsels and program managers from non-governmental organizations

Signing the ECPAT Code of Conduct; in 2011, Hilton Worldwide became the second U.S. based multi-brand hospitality company to sign the Code. Hilton Worldwide has worked extensively to develop training modules for team members throughout the United States – both through compliance training channels and our internal learning and development network, also, Hilton University is expanding training in select international markets.

Once the proper Team Member staff has been identified, the training is customized to educate and empower hotel staff to effectively identify and report unlawful behavior. The training modules seek to provide information to team members on the issue of child trafficking through various internal team member communication and engagement channels.

Annual training for executives and team members determined to be in "key" positions on the Company's Code of Conduct is administered to educate and inform staff on human rights issues. Programs for periodic training on subjects related to compliance and ethics; in addition to the Code of Conduct training, in 2011 team members in certain positions were required to take a training course on the Foreign Corrupt Practices Act and Anti-Corruption.

Hilton Worldwide provides a number of outlets by which our Team Members can reduce and report Human Rights violations which start at the supervisor level and escalate up to the corporate Assistant General Counsel and Compliance officer. To empower Team Members to report on or to address suspected abuses of labor policies, Hilton Worldwide hotline has been made available to all Team Members for such inquiries with complete anonymity.

Hilton also offers its U.S.-based properties with a Hilton Ethics Hotline that provides an anonymous outlet by which to report abuses. Through our partnership with ECPAT, Hilton has opened another outlet for Team Members to use to report any suspected child-trafficking activity. In partnership with ECPAT and the Polaris Project, has enabled Hilton Worldwide to produce training modules for team members throughout the United States – both through compliance training channels and our internal learning and development network, Hilton University; expanding training in select international markets. Hilton is able to provide information to team members on the issue of child trafficking through various internal team member communication and engagement channels. Finally, this partnership allows us to Participate as a member of the International Tourism Partnership and helping to create the Human Trafficking Working Group. Activities include
 Developing a united industry position;
 Partnering with the U.S. Department of State, Office to Monitor and Combat Trafficking in Persons to support youth apprentice programs at hotels in Mexico, Brazil and Vietnam; and
 Networking and building dialogue with other stakeholders / NGOs.

In general, adherence with our company Code of Conduct, Hilton Worldwide monitors and informs Team Members via annual training for executives and team members determined to be in "key" positions on the Company's Code of Conduct. Also, programs for periodic training on subjects related to compliance and ethics are in place for Team Members to refer to; in addition to the Code of Conduct training, in 2011 team members in certain positions were required to take a training course on the Foreign Corrupt Practices Act and Anti-Corruption.

In the early phases of our partnership with the Polaris Project we are measuring the number of team members reached by trafficking trainings and the number of trainings held. However, we are in the process of developing a corporate responsibility index which will allow us to measure team member participation in the training across our portfolio of hotels.

We have a matrix of regional and country policies that cover fair employment and labor relations practices. In all cases, they comply with all local labor law and regulations and cover topics such as harassment, workplace safety and respect for individuals. Our Code of Conduct and corporate values provide an over-arching framework to guide these policies. It is the Code of Conduct that describes our posture as an employer and defines the employer-employee relationship and will address the following: lawful right of free association, forced labor, abuse and physical punishment, right to choose collective bargaining representation, child labor and discrimination.

Hilton is committed to the health and safety of our guests, Team Members and business colleagues, and our record reflect this commitment. Safety requires a commitment from everyone. Each Team Member is responsible for understanding and complying with all applicable safety and health laws and guidelines, and for immediately reporting workplace accidents, injuries and unsafe conditions or practices.

On diversity, as stated in our Code of Conduct: We encourage and value a diverse work environment and will achieve success by valuing and leveraging the diversity of our workforce, our guests, our suppliers and our partners. Respecting the diverse cultures throughout our global organization, as corporate citizens, we will address the local needs of the communities in which we serve, live and work around the world. Therefore, we will not tolerate any discrimination, harassment or retaliation against any individual or group on the basis of ethnic, gender, racial, religious or cultural factors or any other characteristic protected by applicable law. We will seek and employ the most qualified Team Members, and provide equal opportunities to all Team Members based on merit, skills, qualifications, experience, efforts and ability to perform job responsibilities.

Implementation of labor policies are covered in new hire training, as well as on an ad hoc basis via Hilton Worldwide University covering most aspects of Hilton Worldwide’s corporate Code of Conduct. The Code provides guidance and holds all team members to the highest of ethical standards, particularly during challenging situations. Training topics include: ethics and business; solving ethical dilemmas; dealing with others; and complying with laws and policies. Compliance with Hilton Worldwide’s ethics and labor policies are handled within the company’s legal department under the Senior Vice President & Associate General Counsel Governance and Compliance at the corporate headquarters.

To empower Team Members to report on or to address suspected abuses of labor policies, Hilton Worldwide hotline has been made available to all Team Members for such inquiries with complete anonymity.

We also work to promote diversity within our marketplace by supporting women and minority suppliers through our Supplier Diversity Program and by providing property ownership opportunities for women and minority groups.

We also have dedicated full-time staff who provides a range of educational and mentoring opportunities to help our suppliers grow their businesses. For instance, each year Hilton Worldwide awards one supplier with a full scholarship to participate in the Kellogg School of Management’s Advanced Management Education Program to sharpen their business skills.

In 2004, we became the first major hotel company to launch an outreach program to provide development assistance and further educate minority and female entrepreneurs on becoming owners of our properties. We also partner with a number of organizations, including National Association of Black Hotel Owners, Operators & Developers, the Latino Hotel & Restaurant Association and the Asian American Hotel Owners Association, to educate owners on the lodging business through development seminars and other activities.

Lastly, in 2012, Hilton Worldwide formed an Executive Diversity Council, comprised of the Executive Committee and chaired by our President & Chief Executive Officer, Christopher Nassetta, to provide oversight and direction to our overall strategy and to highlight our ongoing support and commitment to diversity. Building on a pilot Diversity Council at Hilton Grand Vacations, the Executive Diversity Council focuses on fostering respect among all Team Members, building trust across the organization and promoting diversity. Further, it aims to strengthen the business through growth of target markets, product marketing and community outreach programs, as well as to increase Team Member engagement and recruiting outreach efforts.

Hilton Worldwide is committed to forging long-term relationships with, and the development of, diverse suppliers. Through our award-winning Supplier Diversity Program, we have cultivated relationships with more than 4,400 women- and minority-owned businesses. In 2011, we spent 14.2 percent of our U.S. spend with diverse suppliers above our goal of 13 percent.

Hilton Worldwide works to meet the needs of our business today while positively influencing tomorrow through measurement, analysis and improvement of our use of natural resources. Water, energy, food, commodities and waste requirements impact the economics of everything we do as a global hospitality company. Given this increasing demand, as a global business, it is imperative we manage these challenges and opportunities as an integrated part of our overall business model.

Across our owned hotels and directionally across the portfolio, we are committed to the following five-year reductions by 2014:

- Reduce our energy consumption by 20 percent
- Reduce our CO2 emissions by 20 percent
- Reduce our waste output by 20 percent
- Reduce our water consumption by 10 percent

LightStay™, our proprietary sustainability measurement system and framework, helps us respond to the challenges and opportunities that managing natural resource constraints present to our business on multiple levels. Launched in 2008, LightStay™ was developed to calculate, analyze and report on our performance across our global portfolio of hotels.

Sustainability measurement and corrective action are global brand standards for all our brands and hotels. Therefore, hotels are required to comply as a condition of branding the property with one of our Hilton Worldwide brands. Establishing sustainability as a brand standard makes Hilton Worldwide the first major multi-brand company in the industry to require performance against sustainability goals.

In 2012, Hilton Worldwide launched the Center for Sustainable Procurement in partnership with BSR to help global business procurement managers integrate sustainability into their purchasing decisions-providing a unique set of research and information that will help make sense of the increasingly available product sustainability data.

LightStay™ enables our properties to work towards global corporate sustainability goals by providing a consistent tracking system for every property manager. Launched in 2008, LightStay™ was developed to calculate, analyze and report on our performance across our global portfolio of hotels.

Sustainability measurement and corrective action are global brand standards for all our brands and hotels. Therefore, hotels are required to comply as a condition of branding the property with one of our Hilton Worldwide brands. Trainings and overviews of LightStay™ are available to all Team Members through Hilton Worldwide University.

In 2011 Hilton Worldwide identified waste reduction and recycling as a main priority for our global pipeline. Beginning with waste and recycling programs and partnerships with the Global Soap Project, Good360, The Global Foodbanking Network and Feeding America and later rebranding this priority as a global corporate responsibility initiative.

Hilton Worldwide launched the Center for Sustainable Procurement in partnership with BSR to help global business procurement managers integrate sustainability into their purchasing decisions-providing a unique set of research and information that will help make sense of the increasingly available product sustainability data.

Allocation of responsibilities for environment protection within Hilton Worldwide is divided between the team in charge of LightStay™ and the Vice President of Corporate Responsibility.

Since the introduction of LightStay™, we continue to improve sustainability and economic performance and have saved more than $147 million in utility costs. Through LightStay, properties enter data on over 200 metrics related to operations and sustainability. Since launching LightStay™, Hilton Worldwide has decreased its waste output by 23%, reduced carbon output by 10.9%, reduced energy usage by 9.7% and decreased water usage by 75%.

As a Global Company, Hilton Worldwide has focused its efforts on demonstrating leadership against ISO 14001. ISO 14001 is a management system that provides a platform for properties to identify and control their impacts with an ongoing focus towards continuous improvement. It can be implemented in any business, from manufacturing to service and education and provides a comprehensive approach to managing environmental impact over time.

By leveraging the LightStay™ system, in 2011, Hilton Worldwide and all our properties earned ISO 14001 certification and ISO 9001, an indicator of quality. As part of our certification process, DEKRA Certification, Inc. performed a series of audits and will continue ongoing assessments to monitor compliance. With these certifications, Hilton Worldwide has achieved one of the largest volume certifications of commercial buildings in history.

Hilton Worldwide also participates in the Hotel Carbon Measurement Initiative. The aim of HCMI is to align the hotel sector in how it reports carbon emissions, and develop a common language which will provide clarity to customers who would like to understand their carbon footprint. 23 global leading hotel companies, at the instigation of WTTC and the International Tourism Partnership, and with the technical expertise of KPMG, have developed a common methodology: ‘HCMI’ for measuring and communicating carbon emissions. HCMI 1.0 was launched in June 2012, and HCMI 1.1, which includes refinements based on user feedback and developments in academic research, was released in June 2013.

In 2012 Hilton Worldwide was honored to receive the Green Power Leadership Award from the U.S. Environmental Protection Agency (EPA). The annual awards recognize the country’s leading renewable power purchasers for their commitment and contribution to helping advance the development of the nation’s voluntary green power market. Hilton Worldwide was one of only four organizations nationwide to be chosen as a Green Power Partner of the Year. The award recognizes EPA Green Power Partners who distinguish themselves through their purchase, leadership, overall strategy and impact on the green power market. Hilton Worldwide is currently purchasing 315 million kilowatt-hours (kWh) of green power annually, which is enough green power to meet 94 percent of the organization’s purchased electricity use. In addition, Hilton Worldwide is buying renewable energy certificates (RECs) from Renewable Choice Energy.

As stated in Hilton Worldwide’s Code of Conduct: Our reputation has been built on fair business practices. This means that no Team Member may engage in concealment, abuse of confidential or proprietary information, misrepresentation of material facts, or any other unfair practices.

This policy covers a number of areas, superficially:

Purchasing: We strive to be fair and impartial in our dealings with suppliers and outside contractors. Qualified and interested suppliers must be given an opportunity to participate in the submission of quotes or proposals for goods and services. We honor the terms and conditions of contracts, pay in a timely manner and protect the confidentiality of the proprietary information of suppliers and outside contractors. Purchasing decisions must be based on legitimate, defined criteria, including quality, service levels and price.

Business Courtesies: With respect to the handling of gifts, favors and entertainment, business courtesies will not be used to gain an unfair advantage or to improperly influence business decisions. Even where business courtesies may be legally and ethically permitted, gifts and entertainment can create the appearance of misconduct.

Hilton Worldwide CEO, Chris Nassetta regularly discusses our Hilton Values, one of which is integrity. Hilton Values guide our actions as team members and are detailed in review during team member orientation, and are regularly mentioned during organization-wide quarterly meetings, led by the CEO, and messaging related to corporate responsibility. Targeted communications and/or trainings also go out to specific departments as needed. For example, if a certain department is regularly at risk of an ethical dilemma training is developed to educate the team members in that department and, depending on the degree of risk, they are required to complete the training. Hilton Worldwide also provides posters for hotels to post that cover ethics issues. Additional ethics training directed to Global Sales, Revenue Management and Operations on topics involving anti-corruption, commercial bribery, anti-trust/competition law, and trade secrets has been presented by Hilton Legal at multiple regional and national sales meetings during 2012 and more such presentations are scheduled for 2013.

Hilton Worldwide values and ethics overview are covered in all new hire trainings. We also offer online training courses related to ethics and compliance topics via Hilton Worldwide University, our online learning portal which is available to team members in our corporate offices, owned, and managed hotels. This training supports the areas covered within the Code of Conduct policy. The Code provides guidance and holds all team members to the highest of ethical standards, particularly during challenging situations. Training topics include: ethics and business; solving ethical dilemmas; dealing with others; and complying with laws and policies. As mentioned above, ethics training directed to Global Sales, Revenue Management and Operations has been developed on topics involving anti-corruption, commercial bribery, anti-trust/competition law, and trade secrets, with such sessions being presented by Hilton Legal at multiple regional and national sales meetings during 2012 and more such presentations are scheduled for 2013.

To empower Team Members to report on or to address suspected abuses of ethics policies, Hilton Worldwide hotline has been made available to all Team Members for such inquiries with complete anonymity.

Any instance of misconduct impacting customers or clients will be evaluated based on the specific facts and situation to determine whether and to whom disclosure may be warranted. The nature and severity of the issue, contractual obligations, applicable privacy laws, regulatory and legal requirements, and confidentiality concerns, among other factors, will be considered in determining whether disclosure takes place.