The L'Oréal for the Future objective of achieving 100% renewable energy is calculated on the basis of its operated sites, excluding estimates for stores and administrative sites with fewer than 50 employees.
The base year (2019) for the climate targets was determined in accordance with the recommendations of the SBTi. This choice corresponds both to the year in which the L'Oréal for the Future programme was launched and to the last fully representative year of activity before the Covid-19 pandemic.
Methodological principles and estimates
The methodology used is that of the GHG Protocol. Emissions from the vehicle fleet are estimated based on fuel consumption; where this is not available, emissions can be estimated on the basis of mileage. Energy consumption for stores is estimated as follows: consumption for surface areas is taken from the property database (Portfolio), and the estimates used in the calculation are taken from a study carried out by DEEPKI, a partner, in 2023.
Scope 1
Emission factors (EF) for Scope 1 are taken from the databases of the French Environment and Energy Management Agency (ADEME) for fossil fuels (natural gas, fuel oil, etc.), as well as from the Sixth Assessment Report of the IPCC (IPCC AR6), the International Energy Agency (IEA) and the UK’s Department for Environment, Food and Rural Affairs (DEFRA), and are updated by the Operations Department in its GRAAL internal reporting tool.
Scope 2
Market-based method: EFs for the electricity, heat, steam and cooling networks are based on data from utility companies, the IEA, DEFRA and ADEME, and are input manually for each site in the GRAAL internal reporting platform or in the store and vehicle fleet calculation tools.
Location-based method: the location-based EF for electricity is a national EF, based on the country's electricity mix as published by the IEA. Exceptions may be granted for regional or sub-national EFs. They must be published by a competent authority (e.g., the total output emission rates published by eGRID in the US).
Level of uncertainty: for Scopes 1 & 2, the level of uncertainty at Group level is approximately 1% for manufacturing facilities and distribution centres, and 5% for administrative sites and research centres.
Scope 3
This is the sum of the categories relevant to L'Oréal identified by the GHG Protocol and detailed in the GHG Protocol’s Corporate Value Chain (Scope 3) accounting and reporting standard.
76% of Scope 3 emissions are calculated on the basis of primary data.
For Scope 3, the level of uncertainty is higher given the volume of data required to calculate it, such as the emission factors of the energy used to heat the water necessary for the usage phase of L’Oréal's rinse-off products all over the world, the quantity of water necessary for rinsing, the carbon emissions of raw materials and packaging suppliers, distances travelled for transportation, etc.
The overall carbon impact of the Group's business activities is an essential measurement. In light of its commitments to combating climate change, L'Oréal strives each year to improve the reliability of these data. The level of uncertainty of the Group's Scope 3 emissions is estimated at between 20% and 30%.
| Scope 3 categories | Scopes, calculation methods and tools |
|---|---|
| 1. Products and services purchased | 1. Products and services purchased Scopes, calculation methods and tools Carbon emissions related to the preparation of all materials used for the products manufactured by the Group, and their promotion at points of sale. These emissions include the extraction of materials, their transport to suppliers, and their processing before delivery. The calculation is based on tonnages of packaging and raw materials, emission factors from the ADEME Carbon Base and ecoinvent, and specific life cycle assessments. The carbon emissions for this item also include carbon emissions related to:
|
| 2. Capital goods | 2. Capital goods Scopes, calculation methods and tools Carbon emissions related to the manufacture of capital goods acquired or leased by L'Oréal (property, industrial equipment, packaging moulds, IT equipment, leased car fleet). Specific emission factors from the ADEME Carbon Base are used (in kgCO2eq/€k for investments in industrial equipment, in kgCO2eq/sq.m. for property acquisitions, and in kgCO2eq/tonne for the manufacture of packaging moulds and cars for the leased vehicle fleet), as well as emission factors from the EIME database for ICT (information and communication technologies) equipment. |
| 3. Fuel- or energy-related activities (not included in Scopes 1 & 2 emissions) | 3. Fuel- or energy-relatedactivities (not included in Scopes 1 & 2 emissions) Scopes, calculation methods and tools Carbon emissions related to the extraction, production and transportation of the fuel and energy purchased by L'Oréal and its subcontractors. It also includes losses through electricity distribution. Electricity-related emissions are calculated using the country-specific emission factor (source: IEA). By taking line losses into account, it is possible to calculate emissions related to the total electricity produced: these are estimated using country-specific loss factors (source: World Bank). Emissions related to upstream emissions from L'Oréal's vehicle fleet are also included in this category, calculated using the emission factor database created by the United Kingdom's Department for Energy Security and Net Zero (DESNZ) and its Department for Business, Energy & Industrial Strategy (DBEIS, formerly DEFRA). |
| 4. Upstream transportation and distribution | 4. Upstream transportation and distribution Scopes, calculation methods and tools CO2 emissions resulting from the transport of purchased items (raw materials, subcontracted finished products, packaging components and electronic equipment) between suppliers and L'Oréal manufacturing facilities. The emissions calculation uses the amount spent for each category of item and for each mode of transport. This expenditure is then multiplied by the corresponding emission factor (kgCO2eq/k) from the ADEME Carbon Base. This category also includes emissions related to the transport and distribution of products sold, taking into account transport flows of finished products and promotional items from the production sites to delivery at the customer's first delivery site. Verified data from the Department for Transport is used. |
| 5. Waste generated by sites | 5. Waste generated by sites Scopes, calculation methods and tools This category covers emissions related to the processing by third parties of production waste and wastewater from facilities operated or owned by L'Oréal. Emissions are calculated using a specific emission factor associated with the material (plastic, metal, glass, etc.) and the treatment process (source: ecoinvent). For wastewater, the rates at which our sites are connected to municipal wastewater treatment plants (WWTPs) are taken into account, as are the greenhouse gas emissions from the deterioration of wastewater and the emissions related to the energy used by wastewater treatment plants. |
| 6. Business travel | 6. Business travel Scopes, calculation methods and tools This category covers carbon emissions from business travel for all Group employees. These emissions take into account the different modes of transport used (plane, train, car, etc.). The calculation is based on data collected by travel agencies (mileage, country, mode of transport) and on employees' expense accounts. The emission factors used depend on the mode of transport (kgCO2e/passenger km) and are taken from the UK DESNZ and DBEIS databases. |
| 7. Employee commuting | 7. Employee commuting Scopes, calculation methods and tools This category includes carbon emissions related to employee commuting from home to the workplace. Emissions are estimated for each country based on the number of employees and statistics from national transport bodies (car, bus, train, underground, bicycle, motorbike, etc.). The emission factors used depend on the mode of transport and the zone (Europe, North America, South America, Asia, Africa) and are taken from the ADEME Carbon Base and the ecoinvent database. |
| 8. Upstream leased assets | 8. Upstream leased assets Scopes, calculation methods and tools Not applicable: L'Oréal does not operate any assets that are owned by other entities. |
| 9. Downstream transportation and distribution | 9. Downstream transportation and distribution Scopes, calculation methods and tools This category includes carbon emissions related to transport and distribution of distributor customers (internal estimation method). |
| 10. Processing of sold products | 10. Processing of sold products Scopes, calculation methods and tools Not applicable: production is used directly by the end customer. There is no transformation of intermediate products. |
| 11. Use of sold products | 11. Use of sold products Scopes, calculation methods and tools This category includes carbon emissions related to the use of L'Oréal products by consumers. The direct use phase corresponds to emissions related to the use of aerosols (mainly hairsprays and deodorants containing propellant gas). The total quantity of propellant gas in the products L'Oréal sells is multiplied by the associated emission factors (source: IPCC). This category also includes emissions related to the use of the appliances sold (such as the SteamPod straightener). Optional emissions: the indirect use phase corresponds to emissions due to the hot water used to rinse off certain products, such as for example shampoos, shower gels and hair dyes. For each type of product that uses water, the quantity of hot water required to rinse it off is defined (source: Afnor French standards agency), internal studies and L'Oréal publications. Then, for each country where the products are sold, the residential water heating mix and the associated emission factors (source: IEA, ADEME Carbon Base) are used to estimate the amount of CO2 generated per litre of water used. |
| 12. End-of-life treatment of sold products | 12. End-of-life treatment of sold products Scopes, calculation methods and tools Carbon emissions linked to this category correspond to the processing of sold products after use: packaging processed in existing waste treatment channels and wastewater treated in water treatment plants. The calculation of carbon emissions mainly relates to the type and method of production of the energy used in each type of treatment process. This calculation incorporates internal data from the SPOT tool to determine the percentage of materials used in packaging that are treated, as well as emission factors from the ecoinvent database by type of material and process. The calculation of carbon emissions for effluents is based on the chemical oxygen demand (COD) of the different products and on statistics regarding treatment in the different countries. The primary data are collected from internal databases (raw materials and packaging materials), for which the carbon emissions relating to their end-of-life treatment are then calculated. |
| 13.Downstream leased assets | 13.Downstream leased assets Scopes, calculation methods and tools Not applicable: L'Oréal does not operate any assets that are owned by other entities. |
| 14.Franchises | 14.Franchises Scopes, calculation methods and tools Not applicable: as L'Oréal's model of franchised stores is very limited, emissions related to the energy used by these stores are not taken into account. |
| 15.Investments | 15.Investments Scopes, calculation methods and tools This category includes carbon emissions relating to L'Oréal's investments in 2024, accounted for via the share of L'Oréal's investments in the company or companies in question. The companies concerned are Sanofi, which is equity-accounted, and companies in which L'Oréal invests through the BOLD (Business Opportunities for L'Oréal Development) venture capital fund. |
