HERMÈS - 2018 Registration document

2

Corporate social responsibility

planet: environment

At the end of 2018, the Carbon Assessment was estimated at 42.2 k tonnes equivalent of CO 2

for scopes 1 and 2, and at 542.2 k tonnes equivalent

of CO 2 for scope 3. Hermès details its Scope 1 & 2 greenhouse gas emissions in this report and on its Hermès Finance website for the scope required by law (Article L. 229-25 of the French Environmental Code). Scope 1 & 2 emissions are as follows:

2016

2017

2017 adjusted 1

2018

kTeq CO 2

Scopes 1 & 2

32.0

32.6

42.3

42.2

Amount of Livelihoods offsets

(21.4)

(21.5)

(21.5)

(35.7)

€M revenue) not taking into

Carbon intensity Scope 1 & 2 (Teq. CO 2

account offset

6.2

7.6

7.1

Change in intensity (%)

(6.6)

(1) Change in scope (scope 1,2 and 3).

Regarding scopes 1 and 2, because the Group’s activities are very diverse and the areas responsible for the highest emissions vary widely fromone activity to another, each métier has drawn up a plan addressing its own challenges. The energy consumption figures published above provide a picture of the main contributing metiers. Special attention is paid to the energy consumption of stores, which account for 15%. Consumption reduction measures are presented above. Since 1 November 2015, Hermès has decided to participate actively in the energy transition process. All the French sites (production, services, stores) are now supplied with green electricity, mainly hydro, produced in France. This means that at Group level, 80% of the electricity consump- tion is supplied from green sources. The GreenHouse Gas Protocol (GHG Protocol) proposes to determine the greenhouse gas emissions of scope 3 from 15 categories. Using the significant categories of the group’s activity as described in Chapter 2.1, the calculation of the emissions of scope 3 was carried out with the help of a specialised consultant. It takes into account the most recent emis- sion factors and technical definitions that are best adapted to our speci- fic needs. This approach will be refined as progress is made in this area. For Hermès, these categories are as follows: s s rawmaterials used: all leathers, silk, cashmere, other textiles, metals and precious stones, perfume ingredients (category[1]); s s packaging: logistics and products (category[1]); s s transport of goods and products upstream of factories, inter-site transport and downstream transport of products to the stores (cate- gories[4] and[9]); s s employee travel: commuting to and from work for artisans, national and international business travel (categories[6] and[7]). In 2018, the total emissions of scope 3 thus defined is estimated at 542.2 kTeq CO 2 . On the basis of this perimeter (Scope 1, 2 and 3), the carbon intensity of the group (excluding compensation) is 98 tonnes equivalent CO 2 per euro million of turnover. Construction The sustainable construction framework addresses carbon challenges related to new construction, renovation and dismantling projects.

In 2017, a full Bilan Carbone ® (Carbon Assessment) was conducted on the project to develop a Hermès store in Asia. This assessment made it possible, on the one hand, to assess the environmental impact of the construction of a store and, on the other hand, to establish a standard layout benchmark to guide our ambition to reduce CO 2 emissions on future projects through a Hermès sustainable construction framework. In order to improve the Bilan Carbone ® assessment of new stores and new buildings, special attention must be paid to the choice of building materials, the reduction of their weight, efforts to source supplies locally, and modes of transport with low carbon emissions. Transportation The commercial department is working on projects to improve our logistics footprint. The main projects concern local transport services, favouring electric or hybrid vehicles, for example: where longer-distance transport is necessary, sea or rail are made to replace air transport. Furthermore, optimised deliveries are a recurring subject. The House’s various métiers are aware of the role they have to play in reducing greenhouse gas emissions. As a result, the biennial magazine Le Monde d’Hermès is sent by sea to far-flung destinations (Asia, United States). The communications department sends items related to events by sea whenever possible. Transport providers are also involved in the process and deliveries in city centres are made, where possible, using electric vehicles. The Group is developing the corporate vehicle policy and no longer includes any diesel vehicles in its fleet, preferring to foster the develop- ment of electric vehicles in France. The Group operates mainly ‘human- scale’ sites; only two sites have more than 500 employees, where Company Travel Plans are being studied (under French PDE legislation). Purchasing The indirect purchasing department and logistics are working to opti- mise the carbon footprint of packaging and parcels in order to reduce transported volumes. Actions to reduce the carbon impact of rawmaterials concern, on the one hand, the optimisation of purchased volumes and, on the other hand, procedures for transporting these materials (for example, the maritime transport of exotic leather).

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2018 REGISTRATION DOCUMENT HERMÈS INTERNATIONAL