LOREAL_Registration_Document_2017

Presentation of the Group Integrated report A CLEAR STRATEGY : BEAUTY FOR ALL

A purchasing programme combining economic and social value

The Internet of Things (IoT) and Big Data usher in exciting prospects for traceability and productivity by improving supply chains, creating smoother flows in stores, managing the omni-channel experience and providing increased interaction with consumers. At the centre of design and development, innovation of packaging The packaging of a product is the first identifying link between a brand and its consumers. Beyond its technical performance and its function, packaging is a key differentiating factor for the product and therefore for the value perceived by the consumer. Every year, L’Oréal’s teams of design and development specialists provide cutting-edge innovations with 3 centres of expertise: Europe, Asia and the Americas. L’Oréal filed 91 patents for packaging and processes in 2017. L’Oréal increasingly uses digital technologies more and more in the design and development of its packaging, to offer consumers connected, smart beauty products and services that meet their specific needs. Since 2007, eco-design has been part of L'Oréal's innovation approach: Respect consumers and the environment; Reduce packaging volume and weight; Replace high-impact materials with recycled materials or materials from renewable resources. By the end of 2017, the social or environmental profile of 76% of new or redesigned products had been improved. The Group currently includes up to 100%-recycled plastic in some of its packaging.

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To accompany the Group’s growth – both from a geographical and technological standpoint – the Purchasing teams select the most efficient and cost-effective suppliers in accordance with the L’Oréal Buy and Care responsible purchasing programme. They manage their performance, with suppliers, by monitoring precise indicators relating to social, environmental and ethical criteria and through their ability to innovate and to meet the Group’s requirements in terms of quality, service and competitiveness. L’Oréal builds solid relationships with its suppliers and this makes it possible to work with them on their supply chains and thus ensure the agility, reliability and traceability of sourcing (for raw materials and packaging). In 2017, the Group conducted 1,231 social audits, making a total of more than 9,400 since 2006. Furthermore, by creating the responsible purchasing programme called Solidarity Sourcing, L’Oréal chose as from 2010 to enable sourcing from suppliers with a solidarity model. In other words, companies that offer employment to vulnerable workers and people in deprived communities, such as disabled workers, people from underprivileged backgrounds or fair trade suppliers (see 3.2.4.3. Solidarity Sourcing ).

REGISTRATION DOCUMENT / L'ORÉAL 2017

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