In addition to these common measures, L’Oréal and its Subsidiaries voluntarily conduct additional actions on these same issues. These initiatives are described in other chapters, in particular chapter 4. Suppliers voluntarily conduct additional actions on these issues and L’Oréal encourages them to do so.
As part of a continuous improvement process, the Plan is regularly reviewed by a committee composed of the Ethics, Risk and Compliance Department, the Operations Division (EHS, Purchasing), the Human Resources Department, the Corporate Social Responsibility Department and the Legal Department. It meets three times a year. Each of these representatives leads a local network (Ethics Correspondents, Environmental, Health and Safety, Purchasing, and Human Resource teams, managers from Internal Control, and Sustainability Leaders) around the world, making it possible to take into account feedback from the field when improving the Plan.
The Vigilance Plan was presented to internal stakeholders (such as the employee representatives in the context of the European Works Council) and qualified outside stakeholders (NGOs and members of civil society). Its updated contents are presented every year to the Audit Committee and to the Board of Directors.
The risks of serious impacts on Human Rights, the environment, health and safety, have been analysed on the basis of the business of L’Oréal, its Subsidiaries and its Suppliers. The risk analysis was used, first, in the definition of the applicable Rules and, second, to the measures for effective application and monitoring of these Rules.
L’Oréal’s activity consists of production of cosmetic products and distribution of these products to the Group’s clients.
L’Oréal manufactures the vast majority of the finished products that it sells in its own factories, with a presence in the major growth markets. Its network of 38 factories is equipped with the very latest technologies and advances in automation and adapts constantly, and with agility, to incorporate acquisitions and embrace external innovations.
This network is completed by production subcontracting, to meet temporary demand peaks in the case of specific technologies (make-up pencils, soaps, etc.). L’Oréal’s contracts prohibit cascade subcontracting. L’Oréal’s consent must be obtained by subcontractors, who need, as result of manufacturing constraints, to subcontract a portion of their L’Oréal production. When, in certain cases, the subcontractor is authorised to subcontract a portion of its production, the same rules as those defined in this Plan are applied to the subcontractors of the subcontractors. The same types of controls and sanctions are in place in the event of non–compliance.
In order to execute their production, L’Oréal’s factories purchase different raw materials, filling and packing components and equipment from third-party suppliers. These suppliers have specific expertise, develop their products and have the infrastructures necessary for their production. They act with complete independence from L’Oréal, without depending on L’Oréal’s instructions or expertise.
The manufacture of filling and packing components is not part of L’Oréal’s activity(1). The filling and packing components used are purchased from companies specialising in this area. The same is true for the production equipment.
Products are distributed by the Subsidiaries and independent third-party distributors in the countries or regions where the Subsidiaries are not present.
In order to ensure this distribution, warehouses are operated by the Subsidiaries directly, or these services are entrusted to third-party logistics service providers that render services on the same type of activity: storage and preparation of orders in warehouses that they lease or own.
The Subsidiaries and Suppliers must comply with the applicable local legislation and the minimum common core of the rules listed below (the “Applicable Rules”) in order to prevent the risk of serious adverse impacts on Human Rights and fundamental freedoms, health and safety of people and the environment. When local laws and/or the internal rules of Subsidiaries and Suppliers provide more stringent standards than the Applicable Rules, such standards must take precedence. If, however, the Applicable Rules provide for stricter standards, the Applicable Rules take precedence unless they result in an unlawful activity. In the event of contradictions between local laws and internationally recognised Human Rights, L’Oréal works to comply with these international standards.
(1) With the exception of one production unit in the Turkey factory
