L'Oréal - 2018 Registration Document

1 Presentation of the Group Integrated report THE L’ORÉAL GROUP: FUNDAMENTALS

THE L’ORÉAL GROUP: FUNDAMENTALS 1.1.

A CLEAR MISSION AND STRATEGY, 1.1.1. SUPPORTED BY STABLE GOVERNANCE For 110 years, L’Oréal has devoted itself to one business: beauty, in which it is the world’s leading company. It is the essence of the Group’s action, because, far from being futile and superficial, cosmetics are full of meaning. They give everyone self-confidence, enable them to blossom and open up to others and contribute to individual and collective well-being. Boasting an international portfolio of 36 diverse and complementary brands, the Group responds to all beauty expectations worldwide. Present in all distribution channels, L’Oréal has 86,030 employees across the globe. The Group’s governance, the guarantee of stability in a changing world, makes it possible to work towards long-term objectives and to ensure regular growth.

At 31 December 2018, the Board of Directors comprises 15 members: the Chairman and Chief Executive Officer, s Mr. Jean-Paul Agon; three Directors (one of whom is the Board’s Vice-Chairman) s from the Bettencourt Meyers family, which owns 33.14% of the share capital - Ms. Françoise Bettencourt Meyers, Mr. Jean-Pierre Meyers and Mr. Jean-Victor Meyers; two Directors (one of whom is the Board’s Vice-Chairman) s from Nestlé, which owns 23.18% of the share capital - Mr. Paul Bulcke and Ms. Béatrice Guillaume-Grabisch; seven independent Directors: Ms. Sophie Bellon, s Ms. Belén Garijo, Ms. Virginie Morgon, Ms. Eileen Naughton, Mr. Axel Dumas, Mr. Patrice Caine and Mr. Bernard Kasriel. 54% of the Directors are independent (7 out of 13 excluding the Directors representing the employees); two Directors representing the employees, s Ms. Ana Sofia Amaral and Mr. Georges Liarokapis. The Board takes steps to ensure that the Directors are from different backgrounds, and most of them have international experience acquired in groups with a global dimension, and complementary skills: industrial, financial, digital and above all entrepreneurial competencies. The diversity of skills and expertise on the Board (see paragraph 2.2.1.2 “Diversity Policy applied to the Board”) enables it to understand rapidly and in detail the development issues facing L’Oréal, the leader in a highly competitive globalised cosmetics market, in a fast-changing world. L’Oréal is attentive to compliance with the principle of balanced gender representation on the Board: 46% of its members are women (excluding Directors representing employees), and 3 Board Committees out of 4 are chaired by women: the Audit Committee, the Human Resources and Remuneration Committee and the Appointments and Governance Committee. L’Oréal has built up its business on the basis of strong Ethical Principles that guide its development and contribute to establishing its reputation: Integrity, Respect, Courage and Transparency. L’Oréal’s commitment to acting ethically and responsibly is summarised in a document called “The L’Oréal Spirit” accessible to everyone. These principles underpin the Group’s culture and business model. They inform our compliance, responsible innovation, environment, corporate social responsibility and philanthropy policies. L’Oréal’s Code of Ethics is available in 45 languages and in Braille (in English and French). It is distributed to all employees around the world. Country Managers (or for Corporate or Zone staff, the members of the Group’s Executive Committee to whom they report) are responsible for ensuring compliance with the code. Ethics, at the heart of Group governance and commitments

Loyal shareholders, stable capital structure THE SHAREHOLDERS AT 31 DECEMBER 2018

33.14% Ms. Françoise

Bettencourt Meyers and her family (1)

23.18% Nestlé S.A. 29.12% International

institutional investors

8.24% French

institutional investors

4.73% Individual shareholders 0.14% Treasury stock

1.45% Employees (2)

Consisting of Ms. Françoise Bettencourt Meyers, (1) Mr. Jean-Pierre Meyers, Mr. Jean-Victor Meyers and Mr. Nicolas Meyers, along with Téthys SAS.

(2) Concerns the employees and former employees of L’Oréal. Pursuant to law no. 2015-990 of 6 August 2015, since 2016, the percentage also includes the bonus shares granted in accordance with Article L. 225-197-1 of the French Commercial Code. Of which 0.84% as part of the L’Oréal Employee Savings Plan and employee investment fund as defined by Article L. 225-102 of the French Commercial Code. A balanced and committed Board of Directors, which plays its role of reflection and strategic impetus to the full The Board of Directors determines L’Oréal’s strategic orientations and ensures their implementation. It oversees the management of both the financial and extra-financial aspects, and ensures the quality of the information provided to the shareholders and to the market. The structure of L’Oréal’s Board makes it possible to take into account the specificities of its shareholding structure while guaranteeing the interests of all its stakeholders.

REGISTRATION DOCUMENT / L'ORÉAL 2018

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