LOREAL_Registration_Document_2017

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

As a result, for flows from our plants to the country distribution centres, multimodal solutions increased in volume from 6% in 2014 to 19% in 2017. In Russia, for example, deliveries to the regional distribution centre in Novosibirsk have been made by train since April 2017, producing a 5% reduction in CO 2 emissions between 2016 and 2017 for the Consumer Products Division. For Turkey, deliveries from European plants are now made by train from Luxembourg to Trieste and then by boat to Turkey. And, in the United Kingdom, following a call for tenders which made the sustainable transportation criteria a priority, 100% of deliveries between European plants and the Trafford Park distribution centre are made by multimodal transportation using railway and/or sea transportation. This initiative produced a 24% reduction in CO 2 emissions between 2016 and 2017 Other initiatives were deployed during 2017: Transportation of products led to 357,770 tonnes of CO 2 emissions in 2017, which represents 0.0228 g CO 2 /sales unit. As compared to 2011, the CO 2 sales unit/km emission indicator has fallen by 18%. Reducing water consumption per 3.2.2.2. finished product by 60% from a 2005 baseline Water is used at each stage of production or use of the products, first of all by the Group’s suppliers for the preparation of raw materials and packaging, then in its plants and finally by consumers at the time of their use. The Group is therefore endeavouring to reduce its water footprint throughout the life cycle of its products, and more particularly during production. L’Oréal implements its industrial programme by systematically applying simple principles aimed at preserving this resource through the prudent use of water, using the minimum for its needs, and taking into account its local availability. Since 2005, L’Oréal has slashed absolute water use by its plants and distribution centres by 31%, while production (excluding raw materials plants) has increased by 33%. This led to a 48% reduction in its water consumption in litres per finished product at the end of 2017. Within the framework of the Sharing Beauty With All programme, the Group has pledged to augment this performance to 60% between now and 2020. The sustainable water management strategy is based, in particular, on the following main principles: mapping and reduction in water consumption; s reuse of industrial water without treatment, for a new s purpose; recycling of the water used, after a specific additional s treatment stage.

MAPPING AND REDUCTION IN WATER CONSUMPTION A standard tool for the exhaustive mapping of water consumption is now deployed in each of the Group’s plants – the Waterscan tool. This tool allows for categorisation of the different water utilisation items (cleaning of production tools, cooling, sanitary facilities, etc. ) and to identify consumption in each of these categories. The best performances for a given use are established as a Group standard, and are then set as a target for each plant. The projects making it possible to achieve these targets are identified and quantified on each site and the completion of such projects scheduled over time. This forms the Group’s “Water roadmap”, performance of which is monitored on a monthly basis. L’Oréal has worked more particularly on reducing consumption of the water used for cleaning production equipment and packaging lines at its plants. An operation required to maintain very strict hygiene standards and which represents 34% of total water use by the industrial sites. Firstly, the quantity of water used for these operations is reduced to a minimum, without affecting product quality (specific optimisation of use of cleaning water, determined on the basis of the formula for each product manufactured and the equipment used). In addition, equipment improvements have made it easier to wash the facilities. Finally, training courses in best cleaning practices are provided to the operational teams all over the world, thanks to the OPTICIP ( OPTimisation Cleaning In Place ). Mapping and reduction in water consumption in industrial processes Reuse of industrial water without treatment, for a new purpose The exhaustive mapping of plant water consumption also enables the identification of opportunities for the direct reuse, without specific treatment of the used water, for another purpose, primarily the direct reuse of unpolluted cooling water for equipment cleaning requirements, or the reuse of water from the on-site treatment planned to dilute the chemical products used in the treatment of industrial wastewater. Recycling and on-site treatment of all of the used water that cannot be avoided or reused in its current state The principle consists in re-treating wastewater when it leaves the site’s wastewater treatment plant using various different technologies (ultra-filtration, reverse osmosis, etc. ). These treatment operations make it possible to obtain very high quality water, that conforms to the Group’s standards for reuse in certain industrial processes. Water treated in this way may be reused to clean or cool production equipment, for example.

REGISTRATION DOCUMENT / L'ORÉAL 2017

192