LOREAL_Registration_Document_2017

L'Oréal’s corporate social, environmental and societal responsibility* THE SHARING BEAUTY WITH ALL PROGRAMME

Malaysia: supporting small-scale palm growers Small-scale independent palm grows represent approximately 40% of the world’s palm oil production. With poor knowledge of agricultural practices, they are sometimes forced, in order to increase their low output, to extend their palm plantations illegally. In Malaysia, L’Oréal has launched a project called SPOTS ( Sustainable Palm Oil & Traceability with Sabah small producers ), a completely new initiative on the palm derivatives market, in which traceability of production up to the plantation does not exist. In partnership with three of its suppliers, all committed to the project on a long-term basis, and with the support of Wild Asia, a social enterprise, L’Oréal has agreed to purchase the RSPO-certified production of 500 small-scale palm growers for 5 years. These growers are thus given fairer, long-term access to the international market, which enables them to improve their agricultural practices and their living conditions and thereby avoid deforestation. By the end of 2017, 347 farmers have been audited and RSPO-certified. Reduction of the environmental 3.2.1.3. footprint particularly with regard to water L’Oréal opened its first research laboratory as early as 1995 to anticipate and reduce its environmental footprint. Through this initiative, the Group has developed expertise with regard to the potential impacts of its cosmetic products on aquatic environments. It assesses the raw materials included in the formulation of its products right from the design phase, thus making a strict selection of ingredients. In 2013, an index was developed making it possible to quantify the environmental performance of a cosmetic formula. To do this, a calculation method for the Water Footprint specific to cosmetic products was also applied (performance index for a formula based on the environmental profile of its ingredients in terms of biodegradability and aquatic eco-toxicity) to the entire portfolio of formulas. 100% of the existing formulas in the product portfolio and the new formulas designed in 2017 are assessed on the basis of the foregoing criteria. Measuring the environmental impact of formulas and improving their biodegradability For several years, L’Oréal has carried out life cycle assessments of its products in order to identify and evaluate their impacts on the environment. These studies show that for rinsed-off products, one of the main environmental impacts is related to the quantity of water withdrawn and the quality of wastewater discharged, during the phase of use. In order to minimise this impact, the Group makes efforts to measure and increase the biodegradability of its formulas and reduce their water footprint.

Formula eco-conception tool To classify the products according to the benefits offered to the consumer, all 19 product types manufactured by the Group (shampoos, hair care products, shower gels, skin care products, cleansers, hair colours, styling products, deodorants, sun care products, make-up, perfumes, etc. ) were analysed. After having defined 143 product categories and screened more than 40,000 formulas between 2014 and 2015, an eco-design tool was created at the end of 2015 to guarantee that all new formulas are developed with the goal of an improved environmental profile with identical benefits for the consumer. In 2016, a formula creation tool was rolled out. It is used by all the teams of product formulators to assess the biodegradability and water footprint at the time of creation of all new formulas, and is incorporated as one of the improvement drivers in the SPOT tool. Among the new products launched in 2017, the products below have formulas with biodegradability levels of over 98% across L’Oréal’s Divisions. In 2017, L’Oréal has maintained the average biodegradability rate of shampoos at 91% and has increased the biodegradability rate of shower gels to 87%.

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Vichy Densi-Solutions Hair mass recreating concentrate Yves Saint Laurent top secret illuminating Water-based foam cleanser Garnier SkinActive soothing botanical honey flower toner

VICHY

YVES SAINT-LAURENT

GARNIER GARNIER

Fructis Hair Food banana hair mask

L’Oréal Paris Smooth Sugars Purifying exfoliant

L’ORÉAL PARIS

Improving the environmental profile 3.2.1.4. of packaging Packaging represents a significant part of the environmental impact of cosmetic products. The reduction in the environmental footprint of packaging is therefore naturally part of the “Innovating sustainably” commitment under the Sharing Beauty With All programme. In 2007, L’Oréal launched a Packaging and the Environment policy based on three pillars, called the “3Rs”: Respect: respecting consumers, the environment and s biodiversity; Reduce: designing packaging articles and finished s products with an optimised weight and size; Replace: substituting for non-renewably sourced materials, s alternative materials such as recycled materials or bio-sourced materials.

REGISTRATION DOCUMENT / L'ORÉAL 2017

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