HERMÈS - 2020 Universal registration document

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CORPORATE SOCIAL RESPONSIBILITY COMMUNITIES: SUPPLIERS & PARTNERS

In addition, supplier payment terms were optimised with payment on presentation of delivery notes and not on physical receipt of the goods. Production schedules were adapted to the constraints and capacities of suppliers. Lastly, certain vulnerable suppliers received specific support: accompanying letter for state-guaranteed loan (PGE) requests, advance orders for cash flow support. Puiforcat Over the March/May period, supplier invoices were paid as soon as notification was received that the goods had been shipped, and not upon reception on site, for the most vulnerable suppliers. No orders were cancelled, of course. Cate/Beyrand Delivery schedules were reviewed based on supplier openings and deliveries were staggered upon reopening. Volumes in the porcelain sector were increased both for components and for subcontracting, demonstrating real support for the ceramic sector in Limoges. Among the customer markets affected by a decline in activity, no orders were cancelled, although a non significant number of orders were postponed to 2021. Lastly, suppliers benefited from the Hermès Group’s support during the lockdown and production shutdown period, with payment of invoices on presentation of delivery notes despite the absence of physical delivery. This helped support partners’ cash flow. Hermès Bijouterie-Joaillerie In a particularly unstable context, support for French partners was stepped up, either remotely or on site, with all the necessary precautions. Particular vigilance was also paid to international suppliers to whom visits were postponed. The métier did not cancel any orders in connection with the health crisis. Hermès Horloger division Close attention is paid to the financial situation of partners, particularly due to the Covid-19 pandemic, which has put all players in the watch industry in a situation that could be potentially difficult. Financial monitoring measures have been taken throughout the year to support partners if necessary and thus avoid possible failures.

Moreover, these actions were praised by the partners in a letter of thanks sent to the Group’s Management. Women’s Ready-To-Wear The Women’s Ready-to-Wear métier provided full support to suppliers in difficulty, in particular to small-scale manufacturers who are highly specialised in their production activities, by repositioning order volumes to provide them with stable workloads despite the health crisis. Cash advances were granted to certain manufacturers, and contact was maintained with all suppliers and partners via updates at least monthly throughout the crisis period, including during lockdown periods. Textile donations were also made to produce masks. This made it possible to maintain a high level of trust and good continuity of commercial relations despite the significant uncertainties of this crisis. Footwear The Footwear métier worked throughout the year to support its partners in the context of a general decline in partners’ revenue. Regular contact was made with subcontractors during and following lockdowns to ensure they were all managing to survive. Cash advances were made to the most vulnerable manufacturers. In addition, orders were allocated in a homogeneous manner in order to ensure balanced workloads until the resumption of growth. Belts The Belts métier paid particular attention in 2020 to maintaining its business volumes with its suppliers and manufacturers. Cash facilities and order smoothing have made it possible to maintain a stable and regular level of production with the métier ’s suppliers and partners. Accessories-Jewellery The Accessories-Jewellery métier has supported its suppliers and manufacturers in several ways since the start of the pandemic: links and communication were maintained with all suppliers, s through regular calls and updates on activity; the communication of order forecasts was strengthened, in s order to smooth out the activity and ensure a flow of activity, which made it possible to maintain a level of orders almost identical to 2019 in terms of revenue. Hermès Maison In this delicate context linked to the Covid-19 crisis, Hermès Maison wished to be particularly vigilant about the health of its suppliers and thus supported, whenever possible, the cash flow of its suppliers through advance payments or orders.

164 2020 UNIVERSAL REGISTRATION DOCUMENT HERMÈS INTERNATIONAL