2025 Universal Registration Document

To market its products, L'Oréal leverages not only traditional independent distribution channels and the development of direct-to-consumer distribution for certain brands (directly owned stores and e-commerce), but also social media.

For example:

• by developing networks of Group brand ambassadors and communities to be part of the conversation around brands and products (partnerships with relevant influencers, advocacy marketing, etc.); and
• by promoting social commerce to better target the needs and expectations of consumers who are increasingly turning to these channels.

The impact of the risk could be amplified, in particular by the emergence of social beauty, which is connected and shared, and by the role of opinion leaders played by influencers with large follower bases.

Undisclosed advertisements or posts from influencers that clearly mislead consumers or constitute a serious or widespread blow to any of the Group’s brands, or neglecting the importance of new social media sales and marketing strategies, could harm the Group's results and reputation.

See also the "Reputational crisis management" risk.

The presence of the Group’s brands across all distribution channels enables the Group to offer its range of products and services regardless of consumer habits. The departments concerned anticipate trends to adapt to these developments and have, in particular, steadily developed online sales with diverse partners (e-retailers, platforms, and marketplaces). The Way We Compete' policy, rolled out across the Group, sets out the principles to be followed in terms of competition law regarding the coexistence of these different channels.

The Group has set up a solid Internal Control system, including the roll-out of certain guidelines:

• a Code of Good Practice for the Use of Social Media for its employees;
• an Influencer Values Charter and a Social Selling Values Charter that each influencer or social seller with whom L'Oréal collaborates undertakes to respect; and
• the Group's principles and the operational processes to be applied in relation to partnerships with influencers and social sellers, circulated worldwide to all employees involved in advocacy marketing. The Group seeks to work with influencers and social sellers who share its values and Ethical Principles. Depending on the nature of the relationship, the Group reserves the right to pursue due diligence by way of reviewing information already in the public domain. These documents effectively complement the rules of conduct set out in the Group's Code of Ethics.