HERMÈS - 2018 Registration document

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Corporate social responsibility communities: stakeholders and local integration

COMMUNITIES: STAKEHOLDERS AND LOCAL INTEGRATION

2.7

Aware of its responsibility in terms of contribution to regional develop- ment, Hermès develops its production activities in France. With more than 400 human-scale sites (production units, stores, logis- tics sites, offices worldwide), Hermès contributes to regional sustai- nable development by providing employment (3,247 jobs created over the past five years) and promotes the creation of sustainable value (local recruitment, training of employees, etc.). Wherever it operates, Hermès acts as a socially responsible company with a long-term outlook through local economic, social, cultural or other initiatives. Such initiatives enable the Group to express its unique- ness, as well as extend its outreach into numerous regions, and create constructive ties with local economic players. Harmonious relationships with our stakeholders contribute to Hermès’ positive impact and strengthen employee pride in belonging to the Company. The House’s subsidiaries and sites organise local charitable operations. The sustainable development training and awareness-raising initiatives conducted by the Group’s general management and various entities pro- vide better understanding of the challenges. They encourage employees to become more involved in the various issues, each in their own ways. Giving time, giving of one’s self, opening oneself up to others, receiving, and so on. Throughout theworld, Hermès is breathing life into amultitude of projects for local populations. Hermès’ founding values are also expressed through the Fondation d’en- trepriseHermès, founded in2008, which supports sponsorship projects that seek to enhance and pass on savoir-faire , and promote biodiversity. The budget of the third mandate of the Hermès Fondation d’entreprise (April 2018–April 2023) is€35.8million (excluding skills sponsorships). The Livelihoods project, of which Hermès is a shareholder (see section 2.5.3), has also been contributing to the economic development of com- munities, i.e. more than one million people since 2011. Territorial responsibility in France that mobilizes the resources from the regions in which we are located, enhancing their value, regenerating them, transforming and revealing them. Policy Hermès chooses to locate its manufacturing sites mainly in France. This is the case for its Leather Goods and Saddlery activity, where the industrial development approach is that of spin-offs: organic develop- ment that creates human-scale production sites (approximately 250 people), which start with a core group of experienced workers, who train newcomers. 2.7.1.1 2.7.1 CHALLENGE: TERRITORIAL RESPONSIBILITY IN FRANCE

TheambitionofMaisonHermès is to contribute to thedevelopment of the regions by creating direct and indirect jobs, as well as by local initiatives.

Measures implemented and results

2.7.1.2

A site location strategy that includes labour-related, societal and environmental aspects Hermès operates in 12 of the 13 regions of France with close to 80 sites (production units, stores, logistics sites, offices) where 8,846 Group employees work. The craftsmanship model that it employs in France brings with it a regional corporate responsibility. We have never closed a site, and we establish ourselves for the long-term. Since the launch of the first site in 1837, the choice of the locations for production units has been driven by regional expertise. The Silk division, based in the Lyon region (746 jobs), concentrates Hermès’ savoir-faire in this domain. The complementary lines of savoir-faire – such as weaving, engraving, printing, dyeing, finishing and sewing – are grouped together under the holding company Holding Textile Hermès. The CATE porcelain production site is based in the Limousin region (203 jobs), the cradle of porcelain production, with Beyrand, a colour printer since 1926, and which joined the Group in 2013. Finally, the Cristallerie Saint-Louis, based in the heart of the Lorraine forest that has been the source of all its raw materials since the beginning. In addition, leather goods sites are set up in various regions, depending on local opportunities: the pool of manual workers, existing sites refurbished for a change of activity, or establishment of new sites. The sites are voluntarily set up near schools offering leatherwork training programmes. 62% of the Group’s jobs are located in France, bearing witness to our pro-active policy of promoting internal production and management of our upstream sector. Thegeographical locationsofthesitesaredistributedthroughoutFrance, organised by regional divisions, in particular for leather (seeMap of sites in section1.6.2). This division-based organisation promotes synergies in the recruitment of expertise and upskilling. It also offers internal mobility opportunities, ensuring the sustainability of the model. Our site locations are chosen in cooperation with the local authorities in order to integrate societal, environmental and human aspects. The establishment of our sites goes hand-in-hand with growth. Out of the 16 Leather manufacturing sites, all in France, six have opened since 2015 (Maroquineries Iséroise, Tardoire, Héricourt, Normandie, Saint-Junien, Allan). Projects for new sites undergo an environmental study, submitted to the authorities at the same time as the building permit application. This pro- cess covers aspects such as soil surveys and respect for biodiversity. The history of the local architecture and the emblematic materials of the region are also integrated in the thinking and design of new production units.

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2018 REGISTRATION DOCUMENT HERMÈS INTERNATIONAL