2024 universal registration document

To replace Danone, Reckitt Benckiser and Kimberley Clark by Essilor Luxotica, Novartis and PepsiCo

The current panel, which has remained the same since 2019, has gradually become less suitable for benchmarking the growth and development of L'Oréal's business. In September 2024, L'Oréal was positioned between the median and the 3

quartile of the panel in terms of sales and number of employees, and above the 3rd quartile in terms of market capitalisation.

In addition, this panel is heavily weighted towards fast-moving consumer goods companies, which means that a rebalancing is required in view of the changes in the Group’s sales and their breakdown between the Divisions (in particular the Dermatological Beauty Division and the L'Oréal Luxe Division).

The recommended changes to the benchmark panel put forward by the Human Resources and Remuneration Committee to the Board were based on proposals by the consultancy firm, Mercer, with a view to making the comparative analysis more consistent and relevant. In its search for new members of the benchmark panel, the Committee focused on companies with large brand portfolios in the pharmaceutical or luxury retail sectors, or with a strong brand identity. At the same time, it decided to keep the same number of companies in the panel as before, as well as the same geographic coverage as it considers this to be representative of the Group's international footprint.

To raise the Chief Executive Officer’s annual fixed remuneration to €2.3 million, i.e., an increase of 15%.

The Board particularly took into account the fact that:

• the Chief Executive Officer's skills and experience in his role have increased and been strengthened over the past four successful years of his leadership, as reflected in (i) the findings of the Board of Directors’ 2024 self-assessment (see section 2.3.5), (ii) the growth percentages (on a reported basis) between 2021 and 2024 for sales (34.7%), operating profit (41%) and EPS (43.5%), and (iii) the Group’s top-class financial and ESG ratings (see section 1.1.6);
• the responsibilities of the Chief Executive Officer have become wider in an ever-more complex and highly competitive environment which demands constant change and adaptation for the Group;
• L'Oréal is exploring adjacencies to its position as a pure beauty player, in line with the Group's mantra of "seize what is starting""(saisir ce qui commence) ;
• the Chief Executive Officer’s fixed remuneration has remained the same since he was first appointed in 2021, and by principle, the new amount of his fixed remuneration will remain unchanged for the next four years;
• there has been an overall upward trend for fixed remuneration within L'Oréal in view of the inflationary environment (a 13.7% increase in France since 2021 according to INSEE):
  • fixed remuneration for the members of the Executive Committee based in France increased by an average of 14.5% between 2022 and 2025⁽¹⁾ ;
  • fixed salaries for employees based in France rose by an average of 17% over the same period⁽²⁾.