Country Managers (or for Corporate or Zone staff, the members of the Group’s Executive Committee to whom they report) are responsible for ensuring compliance with the Code of Ethics. The Chief Ethics, Risk and Compliance Officer systematically meets each new Country Manager and the Group’s senior managers to provide guidance about their role. Senior managers also benefit from a tool to help develop their ethics leadership as well as specific training courses.
The 80 Ethics Correspondents throughout the world assist members of the Executive Committee and Country Managers to implement the ethics programme. Led by the Group Ethics team, they act as a local point of contact for all employees. They promote the normal routes for handling concerns by Management and Human Relations.
The Chief Corporate Responsibility Officer, who is also a member of the Executive Committee, oversees the respect of Human Rights and Fundamental Freedoms in the Group.
Human Rights risks are mapped and regularly updated, including for suppliers and subcontractors ( see section 3.5.3). In 2024, the Group upgraded its system for local-level assessments of ethics risks, and the new system will be gradually rolled out to all of its entities.
An annual reporting system is used to monitor the implementation of the Ethics and Human Rights programme. The Ethics, Risk and Compliance Department informs subsidiaries of any areas for improvement. Ethics risks are systematically reviewed during audit assignments, through individual interviews conducted separately with the Country Manager and the finance director.
For prospective acquisitions, the Ethics and Human Rights questionnaire is used to help determine whether the target company takes account of risks, particularly those related to business ethics.
A specific and compulsory e-learning course on ethics is available in all subsidiaries. It was updated in 2023 following publication of the new Code of Ethics. As at 31 December 2024, 83% of the relevant employees had completed it. The Ethics, Risk and Compliance Department also provides face- to-face training as part of ongoing training for managers and certain business functions (Buyers and Human Relations).
The evaluation of the overall performance of employees, and more specifically managers, takes into account compliance with the Code of Ethics and Ethical Principles. Regular communication with stakeholders and the setting up of internal working groups help to incorporate Ethics into new policies and strategic decisions.
Speak Up, the Group’s whistleblowing system (www.lorealspeakup.com) is available to all Group stakeholders, as well as a procedure for collecting and processing reports, which are used to manage any violations.
In 2024, 780 potential ethical violations were identified either via the secure website, or via the Ethics Correspondents and local or international management. Reported cases are thoroughly examined, followed by appropriate measures where applicable. The global number of reports of discrimination, harassment (including sexual harassment) and corruption received at Group level worldwide is notified to employees on a regular basis, as is the number of fully or partially substantiated cases and the corrective measures taken. These elements are also included in the presentation of the Group's Ethics Policy to the Board of Directors.
The Group has held an Ethics Day since 2009. During this online event hosted by the Chief Executive Officer, Group employees can ask questions and discuss the day-to-day application of the Ethical Principles. Each member of the Executive Committee and each Country Manager organises local ethics discussions. In 2024, with over 35,000 people logging on and more than 5,000 questions, employees showed that they were heavily engaged with this subject. Furthermore, they receive regular information about the Group’s Ethical policy and have access to a dedicated Intranet site.
L’Oréal has led an ambitious Corporate Social Responsibility (CSR) policy for many years now, in particular through its sustainability programme – L’Oréal for the Future – and its associated objectives.
In this context, the Group has developed a strong governance structure ( see section 4.1), which notably includes worldwide Sustainability Leaders. They are tasked with helping the Country, Zone, Division and Brand Managers to implement the sustainability programme within their entities. The progress of local implementation of the Group’s commitments is monitored by means of an annual reporting system.
Internal Audit regularly reviews sustainability risks, as well as the extent to which any policies adopted to address such risks have progressed. The results are then reported to the Audit Committee.
Since 2019, in collaboration with the Ethics, Risk and Compliance Department, L’Oréal’s Corporate Responsibility Department has conducted a deeper assessment of the risks associated with climate change related to the Group’s operations, referencing in particular the scenario analysis method. This was with a view to the departments improving their ability to anticipate and mitigate the impact of these risks. The financial risks related to the effects of climate change and the Group’s measures to reduce them are described in chapter 4.
