L'Oréal - 2018 Registration Document

L’Oréal’s corporate social, environmental and societal responsibility POLICIES, PERFOR MANCE INDICATORS AND RESULTS

Making increased use of renewable energies

The La Roche Posay plant is supplied exclusively with s biopropane; The Rio de Janeiro research centre is equipped with solar s panels that cover 20% of its power needs.

PROPORTION OF RENEWABLE SOURCED ENERGY CONSUMED BY INDUSTRIAL SITES

Reducing emissions from product transport (Scope 3 as per the GHG Protocol)

Within the scope of the Sharing Beauty With All programme, L’Oréal has initiated the reduction in greenhouse gas (GHG) emissions generated by the transportation of its products and has set itself a target of a reduction of 20% per sales unit per kilometre by 2020 from a 2011 baseline. The scope of consolidation covers the transportation flows of finished products from the production sites up to the first customer delivery point. To achieve this objective, a large number of action plans for transportation are being deployed all over the world. In 2017, the Sharing Beauty With All commitments were shared with the entire internal and external transport ecosystem: sustainable transport now ranks as a priority. 2018 was characterised by a swathe of global initiatives, drawing on tools made available to teams in 2017. In 2018, in support of the sustainable transport strategy, seven priorities were communicated to the country transport teams via a manifesto. The first is reduction at source, especially with the study of the network in order to reduce distances travelled and the number of deliveries, as well as to optimise the fill rate. The resulting economic gains can be invested in sustainable transport solutions. It was also stated that all Group entities must make a contribution. Henceforth, when selecting the Group’s carriers, the criterion of Sustainable Development is to come second after quality. In parallel with the implementation of the strategy and the manifesto, a more in-depth analysis of results put a spotlight on the biggest emissions contributors in transport: the use of air and urban transport. For air transport, the pillar’s first priority, a major change in the management of air transport was initiated in July 2018 through the publication of a standard issued by the Group’s Head of Supply Chain and Operations Finance. The purpose of this standard is to limit the use of air transport to exceptional situations through systematic validation by two hierarchical levels. In parallel, each entity must monitor and report all of its air shipments and analyse the reasons behind the use of air. For urban transport, the second priority, the Top 10 Cities project has been launched to establish decarbonisation plans for cities. Initially, 10 cities worldwide were selected and will be assisted by Corporate teams and external expertise. The project’s aim is to promote the implementation of concrete transfers to sustainable transport solutions adapted to the local specificities and regulations. In a second step, the project will be extended to the main cities in which the Group operates.

66%

34%

2018

59%

41%

2017

3

52%

48%

2016

In % on 100%

Renewable

Non-renewable

L’Oréal has drafted a strategy involving the use of renewable energies, based on the potentialities offered by each local context. In recent years, many projects have been implemented that allow some sites to use locally produced renewable energy, or to directly produce their own renewable energy. In 2018, 66% of the energy consumed by plants and distribution centres was renewable ; , and 57% of the electricity consumed by administrative sites and research centres was renewable. 38 of the Group’s sites were carbon neutral by the end of 2018, including 12 plants, 19 distribution centres, 6 administrative sites and 1 research centre. The French sites of Rambouillet and Roye and those in s Burgos in Spain and Settimo in Italy receive their energy supplies from biomass-fired boilers or plants fuelled exclusively by local resources; The Belgian plant in Libramont covers almost all its energy s needs through biomethanation, also using local resources, which allows for the combined production of heat and power; In China, the United States, Mexico and Spain, several s plants are equipped with photovoltaic panels; The energy mix of the Settimo plant in Italy consists of s several locally produced renewable energies: solar panels installed on the roof of the plant and a biomass plant which supply power, the town’s heating network, and finally the biogas produced from municipal waste; The Yichang plant in China has chosen to cover all of its s energy needs by connecting to the hydroelectricity produced from the nearby dam;

The Statutory Auditors have expressed a reasonable assurance on this indicator. ;

REGISTRATION DOCUMENT / L'ORÉAL 2018

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