The Group’s organisation responds to a dual challenge: pursuing the strategy which has enabled L’Oréal to be successful over the last 110 years and at the same time inventing the new L’Oréal of the future, perfectly matched to an ever-changing world.
From an organisational and managerial perspective, L’Oréal is strategically centralised and operationally decentralised with a strong entrepreneurial spirit. This unique model empowers its in country teams and guarantees flexibility and excellence on the ground. This organisational structure is perfectly suited to the current environment, with Zones aligned more closely with consumers. During the 2020 crisis, it was a considerable asset in terms of putting in place measures that were tailored to the specific circumstances in each country. The Group completed in 2021 the reorganisation of Zones it had announced in November 2020, aligning them more closely with consumers.
L’Oréal S.A. is a French company, with its head office in France. It acts as a holding company and provides strategic coordination, particularly for brands, as well as research, innovation and technical coordination for the L’Oréal Group throughout the world. At the same time, it performed a sales activity until this activity was subsidiarised on 1 July 2023 to the companies L’Oréal France and L’Oréal International Distribution, as approved by the Annual General Meeting of 21 April 2023 in its 19th and 20th resolutions. The subsidiaries operate the Group’s business activities in the countries or region(s) in which they are located, on the domestic or the export markets. To do so, they define the development strategy specific to their market(s), make the most suitable choices in terms of consumer targets and distribution channels, and manufacture, directly or indirectly, and market the brands they decide to sell on their market(s). Almost all of the subsidiaries are owned by L’Oréal S.A., which has a holding or control percentage equal or close to 100%(1). The detailed list of these subsidiaries is set out in the notes to the consolidated and parent company financial statements.
The Group’s business activities are organised into four Operational Divisions. In the markets, each of these Divisions develops and enhances its brand portfolio with consumers (see below). By establishing the Group-wide Travel Retail governance subsidiary, the Group has given itself the resources to grow this influential segment using a global shopper strategy: a bespoke approach designed, at the destinations favoured by each nationality, to personalise the experience on the basis of the language, culture and beauty rituals of travellers.
The Group’s international development led L’Oréal, from 1 January 2021, to change its organisation to give more coherence to each Zone, particularly in terms of consumer behaviour and market maturity, in order to create the conditions for a cross-functional transformation of the organisation and maximise growth. The geographic zones, each of which has operational responsibility for the subsidiaries in their market, are as follows:
Several specialist corporate departments provide their expertise and support to the Operational Divisions, to subsidiaries in their markets and to the other business activities (see subsection 1.3.2.).
(1) Furthermore, it should be noted, that pursuant to Article L. 232-1 of the French Commercial Code, L’Oréal S. A. has branches.
