LOREAL_Registration_Document_2017

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

Reduce: systematic optimisation of the resources used for packaging Weight and volume reduction in packaging, an integral part of design, is a major driver for improvement in the environmental profile of products. Every year, L’Oréal launches new initiatives aimed at reducing the quantity of materials used in packaging. They are then recorded through indicators. 5,092 tonnes of packaging materials were saved between 2008 and the end of 2017 due to actions to reduce them at source. In 2017, 389 tonnes of virgin materials were saved. To illustrate, the following initiatives were implemented by the packaging teams in 2017 to lighten the weight or reduce the volume of packaging: 13% in the weight of aluminium deodorant cans for the s Mens Expert and Narta brands in the Europe zone, representing aluminium savings of 10.4 tonnes; 10% in the weight of the glass pots of the Lancôme brand in s Europe, representing glass savings of 7.4 tonnes; 22% in the weight of body lotion bottles of the Nice & Lovely s brand in the Africa zone, representing PE plastic savings of 5.1 tonnes. In addition, to improve the use of resources used for packaging, L’Oréal is introducing ever more refillable products into the market. For example, in 2017, for the Luxe Division, the Group put 45% more refillable products on the market compared with 2016. The Consumer Products Division has also launched a L’Oréal Paris brand refillable pot in Asia. To limit packaging volumes for its finished products, L’Oréal has defined its own procedures in the absence of harmonised international regulations. To optimise the flows of components, L’Oréal has developed wall-to-wall (1) production enabling the environmental impact to be reduced as a result. To evaluate the impact of its finished products, L’Oréal makes the following tools available in its design centres: SPOT ( Sustainable Product Optimisation Tool ) a new tool to s meet Sharing Beauty With All commitments (see paragraph 3.2.3 “Living Sustainably”). This tool takes into account a comprehensive set of impact indicators that facilitate a robust assessment both of the environmental and social impacts of the products. It has been deployed for all of the Group's brands (except for recent acquisitions); a tool to help in reducing the environmental impacts of s transport packaging for packing items from the suppliers to the plants and finished products from the plants to the Group’s distribution centres.

These pillars are applied well ahead of each launch, right from the Marketing brief and are orchestrated via a global, systematic eco-design process for the Group's packaging. This process is continuously enriched with documents and tools. Conscious of the fact that Sustainability is a consumer expectation and a source of innovation, the Packaging & Development teams are fully involved in the Sharing Beauty With All programme. This approach has been extended to POS (Point-of-Sale) advertising display stands. An eco-design process based on detailed best practices and key performance indicators has been defined. A pilot process was launched in 2015, then rolled out to 7 operational entities in 2016. Enhanced by this experience, the eco-design process was reworked in 2017 in order to allow a worldwide deployment from 2018 onwards. Respect: materials vigilance and respect for resources L’Oréal requires food quality level for all the materials used in packaging in contact with its products so as to ensure a very high level of quality and safety. The Group also takes a proactive approach with its suppliers in order to ensure that packaging does not contain any sensitive substances. Audits are conducted regularly in order to ensure the conformity of the packaging items delivered. L’Oréal has undertaken not to produce finished products containing PVC from 1 January 2018. In 2017, except for recent acquisitions, PVC now only represents 0.007% of the plastic used by the Group. Control of the source of the materials used in the packaging is a major issue which requires responsible sourcing. L’Oréal has set itself the target of using, for its paper, cardboard or wooden packaging, materials from responsibly managed forests, exploited with respect for populations and forest ecosystems. The paper and cardboard used for packaging come from forests that are preferably FSC or PEFC certified (or have obtained any other certification recognised by PEFC International). In 2017, more than 97% of the paper used for product leaflets and 100% of the cardboard used for boxes was certified as being from sustainably managed forests. This certification process is also used for POS advertising (cardboard stands, graphic printing): in 2017, 89% of the paper/cardboard used in POS advertising was certified (this figure covers 98% of the expenses in this category). Since 2010, L’Oréal has been a member of the Forest Stewardship Council (FSC) in France and the FSC branding is the only one claimed on packaging for L’Oréal products. Finally, with the objective of improving the recycling of its products on the market, several Group brands have undertaken to provide consumers with detailed information on sorting instructions (Mennen, Ushuaïa, L’Oréal Professionnel).

Since 2010, the Group has implemented wall-to-wall production, which consists in setting up, within its plants, a production unit for packaging operated (1) by a supplier. This partnership makes it possible to develop reactivity and industrial flexibility, while reducing the transportation of packaging and generation of waste related to their packing.

REGISTRATION DOCUMENT / L'ORÉAL 2017

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