HERMÈS - 2018 Registration document

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Corporate social responsibility

communities: suppliers & partners

d’ailleurs respectively). Exploration of the virtuoso savoir-faire of hand-painting is continuing; s s high-end woodworking: a partnership of almost 20 years. This workshop, located in Indonesia, is the home of rare savoir-faire in the crafting of solid wood. An exceptional piece in the collection, a straight-grain stained wooden sewing box, was also made by these artisans; s s wicker: this savoir-faire was developed as part of a partnership in France. Wickerwork objects in the collection include trays and vases. These collections consist of small volumes, however they are monitored particularly closely and a third-party audit is carried out regularly (at least every three years). Silk For over 10 years, themétier has been collaborating with an India-based supplier that uses ancient techniques such as embroidery, indigo dying, and regional handcrafted woven fabrics. Hermès supervises these relations carefully with the dual purpose of creating conditions to perpetuate this savoir-faire and ensuring these suppliers apply best practices (protecting the environment, social and ethics rules, etc.). Hermès carries out regular visits (at least once a year) and organises the monitoring of key points by senior purchasers when necessary. Societal responsibility and using socially supported For 10 years, the Leather Goods division has been partnering with Adapted Companies (EAs) and Sheltered Work Establishments (ESATs): in particular, it has established close relationships with seven of them. Working, health and safety conditions are formally assessed in these partner institutions to ensure the continuous improvement of these aspects. A personal contact person provides these EAs and ESATs with technical andquality support on aday-to-day basis, but also over the long term, as part of development projects. These projects may involve the development of future premises, the acquisition of new equipment, or savoir-faire training to entrust them with tasks with greater added value. The Leather Goods division thus aims to build a local network of partner EAs or ESATs for each of its regional clusters as they are established. Integration in our own workshops remains a priority, and Hermès is wor- king in this direction with EAs and ESATs. Accordingly, the Vesoul ADAPEI (organisation of friends and parents of disabled children) proposed the integration of a young, disabled person. Through a three-way agreement with the ESAT and the labour department, this person was seconded to the cutting workshop of the Héricourt production unit on 1 March 2018. In light of their successful integration within an independent team in the workshop, and after this person successfully completed training, a per- manent contract was offered (which started on 1 December). organisations Leather Goods The Group’s overall purchases from socially supported organisations almost doubled year on year, compared with the target increase of more than 20% per year in the Group Disability Agreement.

2.6.1.2 Measures implemented and results The definition of the main strategic principles, policies, tools and control systems is the responsibility of two central departments (the Direct Purchasing and Indirect Purchasing Departments), which reports to two Group Executive Vice Presidents. Secondly, each métier has a pur- chasing manager who is a member of the Executive Committee of the métier and reports to the Executive Vice President of the métier. These functional and operational departments work with shared objectives to strengthen the quality of relationships with our partners and suppliers, both in terms of quality and compliance with major CSR issues. Our suppliers are partners The Group’s ability to grow is linked to the development of its suppliers and subcontractors, most of which have been our partners for many years. The Group’s achievements with respect to these main challenges are driven by the métiers . For the Company’s 50 largest direct suppliers, the average length of trading relationships break down as follows: 17% go back more than 30 years (over 40 years for two suppliers and over 60 years for one of them); 27% go back 20 to 30 years; 29% go back 10 to 20 years and 27% go back less than 10 years. Leather Goods The Leather Goods division carries out most of its production in-house. It nurtures a very close relationship with its supplier partners: hides, metal parts, etc. Most of them have been supporting Hermès for a long time - relationships are built over time. The teams visit them frequently to initiate and then follow improvement measures, which may relate to the development of new products, or the quality or optimisation of raw materials. Regular audits consolidate these approaches. Hermès Maison In itswide range of activities, HermèsMaison collaborateswith suppliers with unique savoir-faire . Themétier has set itself the objective of bringing together and facilitating a “whole family of savoirs-faire excellence”. We therefore work to find the best artisans, then encourage and develop excellence in savoirs-faire wherever they are in the world, and in France if they exist. When a unique savoir-faire is discovered and identified, a partnership is created and the relationship is developed and established over the years. The creative teams of Hermes work directly with the artisans. This relationship reveals these savoirs-faire and encourages the artisans towards increased excellence, quality, and uniqueness. These partnerships are created in ways such as the following: s s cashmere spun and hand-woven in Nepal: Hermès’s “quasi-exclu- sive” partner for almost 20 years. Itswork is present in the collections of blankets in particular. The exploration of the savoir-faire of hand dyeing is continuing, with successive dyeing baths, as found in the “Tangram” blanket, for example; s s lacquer workshop in Vietnam: this collaboration has existed for over 15 years. This hand-painting savoir-faire is featured in collections of boxes, for example. Boxes and tea boxes have been designed to revi- sit drawings that are emblematic of the House (Tangram and Bleus

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2018 REGISTRATION DOCUMENT HERMÈS INTERNATIONAL