HERMÈS - 2019 Universal Registration Document

1

OVERVIEW OF THE GROUP RISK FACTORS

BUSINESS DISRUPTION ●

1.11.2.2

DESCRIPTION OF THE RISK s

RISK MANAGEMENT s

The control of industrial risks is built on a joint approach developed by the sustainable development department and the Group industrial affairs department. It relies on a specific “HSE” network and the local Sustainable Development Committees as described in chapter 2. Most of Hermès’ production takes place in various sites spread across France, hence reducing the risk of a shutdown of operations. Hermès implements initiatives designed to protect our manufacturing assets, our employees and the environment on all of the house’s production sites. The Group industrial affairs department relies on the métiers ’ industrial departments and Site Managers to make internal diagnostics, audits conducted by external specialists and establish operational improvement plans. The recommendations resulting from these analyses in the areas of organisation, procedures, training or investment are subject to careful follow-up. Safety-related expenditures and investments are considered to be a priority when making budget choices. Monitoring by in-house experts, plus regular visits, are conducted by the Group Security Department. They give rise to dedicated action plans, the implementation of which is monitored at the operational level by the sites in question.

Hermès’ production model is France-based and highly integrated. Indeed, the vast majority of our objects (80%) are made in France in exclusive in-house workshops (over 60%). The Group’s ability to deal with a major industrial accident at one of its production, distribution or logistics sites (fire, flood), a natural disaster (tsunami, earthquake), a disruption in the supply of key materials or a major failure of information systems is a key issue for Hermès. POTENTIAL IMPACTS ON THE GROUP s An industrial accident at a Hermès site could impact the continuity of operations as well as its image and reputation.

2019 UNIVERSAL REGISTRATION DOCUMENT HERMÈS INTERNATIONAL

48