As Delivery Hero heads into its 18 June AGM today, investors face a pressing question: is the company’s business model sustainable, or is it a ticking ESG time bomb?
With operations in 70 countries, under an umbrella of 298 companies, and nearly 850,000 riders in its value chain, Delivery Hero is one of the world’s largest food delivery groups by revenue and active users.
But behind the convenience of app-based meal delivery lies an industry increasingly defined by legal uncertainty, algorithmic control, and worker exploitation. That is no longer just a social issue, it’s an investor risk. Questions must be urgently addressed to understand how the current business model affects workers and whether this model is actually sustainable.
Misclassification is a ticking time bomb
For years, unions have been flagging that online platforms regularly misclassify workers as “independent contractors” to deny them rights and benefits, despite controlling the work that they are doing. Why does this matter to investors? Because the company’s business model depends on classifying riders as self-employed contractors, a strategy that cuts costs but exposes Delivery Hero to mounting legal, regulatory, and reputational risk.
Delivery Hero admits in its own 2024 Corporate Report that "a key challenge of the delivery industry is the legal status of riders." It lists this as its top strategic risk. And with good reason: the group has already lost misclassification cases in Spain and Italy, and more litigation is likely.
Investors in Europe should also take note: the newly passed EU Platform Work Directive and the upcoming Corporate Sustainability Due Diligence Directive (CSDDD) create a legal landscape in which worker classification – and how companies treat those in their supply chain if there are already clear indications of labour rights risks – will become core compliance and reporting requirements. And for the first time on the 4 June, countries at the International Labour Organization voted overwhelmingly in favour of a strong international Convention on platform work, during its first year of discussions.
The algorithm is boss
Across Delivery Hero brands – from Glovo in Spain to Baedal Minjok in South Korea – platform workers report being penalised or deactivated by algorithms without clear explanation or appeal. Riders who reject dangerous jobs in bad weather risk being downgraded or cut off entirely. Their livelihoods can disappear in a click. Any human rights due diligence approach needs to include a ban on unfair deactivations – with written explanations, human review, and access to appeal.
This isn’t just a labour issue, it’s a transparency problem and a governance red flag. Algorithmic management needs proper oversight. If Delivery Hero can’t demonstrate fair and explainable use of data and AI, it risks backlash not only from regulators but also from consumers and ESG benchmarks.
Transparency, consultation, and bargaining rights should be in place before algorithms are deployed. Given that these platforms collect massive amounts of personal data, the workers generating it should have full data rights – including access, correction, portability of personal data, and protection from misuse or profiling.
Are workers safe, and what is the company doing to protect riders?
In 2024, Delivery Hero set a shockingly low target: reduce rider accident rates by just 7% compared to 2023. For a company whose frontline workforce numbers nearly a million people, this is not a serious safety goal – it’s hard for unions not to be deeply cynical about such a KPI. On one hand, it concerns the daily risk of injury, disability, or death for riders constantly exposed to traffic, pollution, extreme heat, and dangerous weather. On the other, it unlocks fat bonus packages for top executives.
Framing such a marginal improvement as progress is not just unambitious, i reveals a staggering disconnect between the lived realities of riders and the priorities of those in the boardroom. Investors must demand far more credible and ambitious targets.
Turkish and Argentine unions have already documented rising accident rates. Riders in Uganda have flagged up how the self-employed model leaves them without sick or holiday pay, while most of the money they do make goes on expenses like maintenance, equipment and fuel. These are the ‘hidden costs’ of platform work.
Transparency starts with recognition
Brand is key in this fast-moving consumer market. But the reality is that Delivery Hero has a fragmented brand structure – Glovo, Foodora, PedidosYa, Talabat, and more – that hides the true scale and structure of its workforce.
This opacity shields the group from accountability and complicates oversight. Customers may not be aware that all of these brands are in fact owned by the same group. The same is true of the riders and delivery drivers who may not know who is ultimately benefitting from their work.
Across all of its 11 Delivery Hero brands, riders are united behind one message: deliver #Rights4Riders everywhere the company operates. From South Korea to Spain, they are calling for safe conditions, a living wage, fair algorithms, and the right to organise. Delivery Hero must meet them at the table.
The bottom line - Investors cannot look away
If Delivery Hero wants to maintain its leadership in a sector facing global regulatory pressure, it needs to change. And shareholders – pension funds, asset managers and other institutional investors – have the power and responsibility to push it there. If investors are serious about ESG and meeting their own human rights due diligence commitments, now is the time to act. That means:
- Demanding full disclosure of rider classification and labour conditions across all brands.
- Demanding full social protections for all riders regardless of their classification and across all brands.
- Requiring transparent algorithms with safeguards against unfair deactivation.
- Calling for union engagement and collective bargaining in every market.
- Insisting on meaningful safety targets and real investment in risk prevention.
Investors must also push for stronger KPIs that tie executive remuneration to real-world outcomes, not just marginal improvements. The company has said it wants to "Raise the Bar." It's time to prove it.
Rider’s demands
Riders around the world have united behind four clear, non-negotiable demands that Delivery Hero must meet to guarantee safe, fair and dignified work for everyone on its platforms.
- Fair pay: Pay us a living wage – including pay for every minute we work, including waiting time.
- Safer work: Take responsibility for workplace injuries and protecting us from violence and harassment.
- Algorithmic transparency: Consult and negotiate with us on how algorithms assign work, evaluate performance and set pay.
- Right’s at work: Respect our fundamental rights to join a union and collectively bargain.
