LOREAL_Registration_Document_2017

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

The Group’s suppliers associated with the FOREST Disclosure Project L’Oréal is committed to the Zero Deforestation policy: Zero deforestation commitment, traceability of products related to deforestation (palm oil and derivatives, paper, soya, replanting projects, etc. ) and has also been a participant in CDP Forest since 2012. In 2017, for the second time, L’Oréal received an A score for this CDP Forest element. With the new CDP Forest programme devoted to the supply chain, which was launched in 2017, L’Oréal has been encouraging its 10 main suppliers of paper, palm oil and soya to take part. As of the end of 2017, 100% of suppliers selected to part in the first year. All L’Oréal’s strategic suppliers will carry out a self-assessment with regard to their sustainability policy L’Oréal has initiated a programme for assessment of strategic suppliers and their Sustainability policy. In addition to its own assessment, L’Oréal has an evaluation carried out of the Sustainable Development policies of its suppliers. The purpose of these evaluations carried out by Ecovadis is to refine the analysis of supplier performances and to help them to improve by identifying their areas for progress. In addition to the Social Audits and CDP Supply Chain programme, L’Oréal encourages its suppliers to develop their ethics policies with a focus on combating corruption, monitoring the health and safety of their employees and their sustainable purchasing deployment policies. 2017 results More than 480 suppliers had their social, environmental and ethical policies evaluated by Ecovadis as well as the deployment of such policies at their own suppliers in 2017. 153 of them represent 87% of the Group’s strategic suppliers. Associating 20% of the Group’s strategic suppliers with the Group’s Solidarity Sourcing programme Using L’Oréal’s Purchases as a driver for the promotion of social inclusion is the objective of the Solidarity Sourcing programme . The Group is pursuing this global Solidarity Sourcing and responsible purchasing programme initiative created in 2010, which aims to help to give people from economically vulnerable communities durable access to employment and income. In the same way as it shares its environmental commitments with its suppliers, the Group has set a target within the framework of the Sharing Beauty With All programme of associating 20% of its strategic suppliers with the Solidarity Sourcing programme . 2017 results 9% of the Group’s strategic suppliers were associated with the Group’s Solidarity Sourcing programme in 2017.

led online conferences for suppliers wishing to know more; s continued to develop online toolboxes to help suppliers to s gain an understanding of these subjects. The average of 2017 supplier scores is “C” since 2016 (with a change in the rating by CDP for the second year running). In 2017, 64 additional suppliers agreed to participate for the first time in the CDP Supply Chain (local American suppliers and transportation companies). The total number of suppliers who have thus worked on climate change is 355 (out of the 376 suppliers invited to participate this year); from this number 209 suppliers allocated their emissions to L’Oréal. THE GROUP'S SUPPLIERS ASSOCIATED WITH THE WATER DISCLOSURE PROJECT Within the framework of the Sharing Beauty With All programme, L’Oréal has pledged to reduce its water footprint, which very naturally led the Group to join the Water Disclosure Project, as soon as it was launched in 2013. This project is aimed at measuring and reducing the water footprint of suppliers who form part of L’Oréal's global footprint. L’Oréal has selected 97 suppliers principally of raw materials, packaging items and subcontracting services on the basis of three selection criteria: the supplier delivers significant volumes of purchases s to L’Oréal; it has at least one production site in a water stressed s area; and/or its production technology uses high amounts s of water; In 2017, 84 of purchases suppliers agreed to take part. In addition to their participation, L’Oréal encourages its suppliers to commit to: measuring and reporting water consumption for all of s its production sites, developing and implementing a management s system for water consumption risk, and a clear policy on reducing water consumption; s At the end of 2017, suppliers fulfilling this commitment represented 57% of costs in relation to all suppliers selected (raw materials, packaging items and subcontracting). Their average score is B-.

REGISTRATION DOCUMENT / L'ORÉAL 2017

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