QUESTIONS & ANSWERS
At the Annual General Meeting, shareholders had an opportunity to take the floor and put questions to Jean-Paul Agon and Nicolas Hieronimus. Here are a few extracts from that fruitful discussion between L’Oréal and its shareholders.
Our people are the secret to our success, along with our incredibly strong corporate culture, underpinned by values spanning solidarity, engagement and passion.
What is L’Oréal’s employee turnover rate? Have you encountered any difficulties in hiring?
L’Oréal’s turnover rate stood at 12.4% in 2022, lower than the 14% seen in 2021. We received 1.3 million job applications last year, an increase of 7%, proving that L’Oréal remains a very attractive company. We also took fifth place in the Universum global ranking of business students’ favourite firms, and are the number-one company in France and Europe. L’Oréal’s 80% employee engagement rate(1) is also one of its strengths. Our people are the secret to our success, along with our incredibly strong corporate culture, underpinned by values spanning solidarity, engagement and passion.
With regard to L’Oréal’s share price, might you consider a stock split?
The past few years have shown that premium, high-quality equities are very attractive. So we currently have no plans for a stock split.
Is it really possible in today’s world to combine strong growth with a reduced impact on the environment in line with planetary boundaries?
That requires having everyone on board and transforming our business model on every level. Internally, we have shown that we are able to decouple our CO2 emissions from our growth; compared with 2005, the Group’s CO2 emissions have dropped by -91% while production volume has increased by +45%. Today, 65% of our plants are “carbon neutral”(2). Our upstream value chain is also key, with all suppliers required to pursue their own sustainability transformation. Downstream, it concerns consumers, which is why we are constantly seeking to innovate to launch products with a smaller carbon footprint. 97% of new products launched in 2022 had an improved environmental profile.
97% of new products launched in 2022 had an improved environmental profile.
What were the results of your recent acquisitions? Do you plan to focus on internal growth or external growth?
Among L’Oréal’s 36 global brands, only three were created by the Group: L’Oréal, L’Oréal Professionnel and Kérastase. The other brands in our portfolio are acquisitions made over time, always with the same strategy: buy brands when they are starting out or seeing initial success to “seize new opportunities” and then roll them out worldwide. That is what we did recently with Takami, Youth To The People, Skinbetter Science and CeraVe. This last example is quite impressive in that we have increased CeraVe sales tenfold in five years to over one billion euros. So our acquisitions are developing and our goal is to make them grow in order to offer personalised, inclusive beauty solutions that meet the specific aspirations of each and every consumer.
(1) Korn Ferry 2022 internal pulse survey.
(2) A site can claim «carbon neutral» status if it meets the following requirements: • Direct CO2 (Scope 1) = 0, except for gas used for catering, fuel oil used for sprinkler tests, fossil energy consumption during maintenance of on-site renewable facilities and cooling gas leaks if they are lower than 130 tonnes CO2 eq./year; and • Indirect CO2 Market Based (Scope 2) = 0. The renewable energy sources must be located on site or less than 500 kilometres from the site, and be connected to the same distribution network. The «carbon-neutral» status, as defined above, is achieved without carbon offsetting.