2025 Universal Registration Document

3.5.2 Risk mapping

The Group's risk mapping process is led by the Ethics, Risks and Internal Control Department with the support of all Functional Departments and Businesses. This mapping is reviewed and validated by the Group's Executive Committee.

The risk mapping comprises all of L'Oréal activities and is updated annually. This process to identify, analyse and assess significant risks strengthens Group actions and allows them to be prioritised. The results of this work are presented to the Audit Committee. The main risks to which the Group is exposed are described below.

3.5.3 Risk factors

The Group operates in a changing environment. Like any company, it is necessarily exposed to risks which, if they were to materialise, could have a negative impact on its business activities, its financial position and its assets, particularly in terms of reputation and image.

For taking an informed investment decision, as required by the regulations in force, this section presents the major risks in a limited number of categories (given the probability of their occurrence and the expected magnitude of their negative impact) taking risk management policies into account. In each category, the most material risks are mentioned first. This section specifies the way in which each risk factor could affect L'Oréal as well as the management strategy implemented.

Risk management activities enable the classification of residual risks by level of importance (low, moderate or significant).

However, a wholly risk-free environment cannot be guaranteed. Moreover, the Group could be adversely impacted by other risks of which it is not currently aware or which it does not consider material at the date of this document.

Major risks to which the Group believes it is exposed