2023 universal registration document

A process of integrating new sites

The Group regularly acquires new sites. A formal integration process ensures that these sites⁽¹⁾ Excluding operated stores. are provided with extra support and assistance in order for them become compliant with all EHS requirements defined, and to bring potential risks under control.

The purpose of this process is to enable these sites to rapidly achieve the performance level expected by the Group. It comprises:

1. a regulatory compliance audit carried out by an independent third party within six months of the acquisition;
2. deployment of the EHS processes described above (EHS manual, EHS reporting, learning, audit programme); and
3. monitoring of the integration within the Group.

4.3.1.1.2. Managing risks and controlling the impact of operated sites⁽²⁾“Operated” sites include all production sites (factories, distribution centres) as well as administrative sites and research centres. The reporting only includes sites with more than 50 people, as described in chapter 4.5.1.3. Environmental data on their environment

The Group systematically analyses the industrial risks of its activities, specifically their environmental impact on the soils, water or air of the places where they are performed.

Analysing in order to manage and limit risks

Each site has a general environmental analysis to be updated on a regular basis and whenever a significant change occurs.

All employee activities (permanent or temporary) are covered by an environmental analysis⁽³⁾Including routine and maintenance activities.. To avoid all forms of pollution (soil, surface water, groundwater, air etc.), sites must comply with the preventive measures described in the internal procedures. There are also contingency plans in the event of accidents for which the relevant persons are trained. Prevention inspections by insurers and periodic EHS audits verify that these measures are properly implemented.

Depending on the site, if significant risks are identified or if L’Oréal’s standards or regulations impose specific requirements, a more detailed evaluation is carried out for the activities concerned. Appropriate, and sometimes immediate, action plans are implemented to reduce significant risks to an acceptable level.

A risk assessment and action plans aim to reduce the potential impacts of:

• any establishment or renovation of a site;
• any introduction of new equipment or manufacturing processes; and
• any changes in industrial processes.

When purchasing land or buildings, L’Oréal conducts due diligence, which includes, in particular, a review of the environmental aspects.

Biodiversity and land use

L’Oréal’s biodiversity and land use commitments are based on the following principles:

• establishing ecological inventories for sites with the aim of understanding the biodiversity of the site and, through the resulting action plan, to preserve or restore it. A local expert conducts this inventory when a lease is taken out or as part of a construction project, but also for the purposes of achieving the L’Oréal for the Future objective of operated sites;
• reducing the impact of any construction on the environment: This involves keeping the carbon impact of our property business to a minimum. The Group prefers to renew our existing leases or to lease existing buildings to contribute to urban regeneration rather than urban sprawl. Where new buildings or new leases are concerned, particular attention is paid to life cycle analyses (LCA) in order to encourage the use of low carbon construction methods;
• if possible, place the site on land located more than 30 metres from any wetland (sea, ponds, lakes, rivers etc.), outside natural areas, public green spaces, land with endangered or threatened species, or any other unbuilt areas (farmland etc.);
• prevent soil erosion resulting from wind and/or rainwater runoff during construction, including by protecting the stored arable soil layer to enable it to be reused;
• maintain or restore native natural habitats and biodiversity on the built site;
• maximise green or natural spaces on the site (even beyond local legal requirements), and minimise impermeable surfaces;
• focus on cleaning up polluted sites (e.g. brownfield sites) where development is more difficult due to real or perceived environmental contamination. This allows construction on natural or non artificial land to be avoided; and
• for future administrative sites, lease buildings that are certified LEED Gold or Platinum (or equivalent) in mature real estate markets.

Surface water

The Group has adopted rainwater standards to monitor quality and avoid pollution. For instance, sites are equipped with oil separators for parking areas. Similarly, adequate retention capacities must be implemented for any storage and operating area where accidental spills are liable to occur. This retention capacity must allow for fire extinguishing water to be kept at each site.

Industrial effluent

At the end of 2023, 30 L’Oréal factories had their own effluent treatment plant. These plants use a range of technologies, including physical, chemical and biological processes, depending on the characteristics of the wastewater and local discharge conditions. In 2023, L’Oréal continued to increase its wastewater treatment capacity, particularly in Europe.

The sites are responsible for equipment operation and wastewater management, which are subject to specific procedures and instructions. At least once a year, an internal audit or a self assessment of the corresponding facility is organised and documented.

Each factory has a self-monitoring system representative of the wastewater discharged. It serves to monitor regulated and contractual parameters such as chemical oxygen demand (COD), biochemical oxygen demand (BOD), pH, the temperature of wastewater and substances that could disrupt the operation of an internal or external wastewater management facility. This self monitoring is a tool for detecting the risk of overshooting, which helps anticipate any non conformities and initiate corrective actions.