To meet their production needs, L'Oréal's factories purchase various raw materials, packaging components and equipment from third-party Suppliers. These Suppliers have specific expertise, develop their products and have the infrastructure necessary to produce them. They act with complete independence from L'Oréal, without depending on L'Oréal's instructions or expertise.
The manufacture of packaging components is not part of L'Oréal's activity. The packaging components used are purchased from companies specialising in this area. The same is true for production equipment.
2. Product distribution
Products are distributed by the Subsidiaries and independent third-party distributors in the countries or regions where the Subsidiaries are not present. In order to ensure this distribution, warehouses are operated by the Subsidiaries directly, or these services are entrusted to third-party logistics service providers that render services on the same type of activity: storage and preparation of orders in warehouses that they lease or own.
3.6.4 Applicable Rules resulting from the risk analysis
The Subsidiaries and Suppliers must comply with the applicable local legislation and the minimum common core of the rules listed below (the "Applicable Rules") in order to prevent the risk of serious adverse impacts on Human Rights and Fundamental Freedoms, Health and Safety of people and the Environment. When local laws and/or the internal rules of Subsidiaries and Suppliers provide more stringent standards than the Applicable Rules, such standards must take precedence. If, however, the Applicable Rules provide for stricter standards, the Applicable Rules take precedence unless they result in an unlawful activity. In the event of a contradiction between local laws and internationally recognised Human Rights, L'Oréal works to comply with these international standards.
3.6.4.1 Risks and Applicable Rules for the prevention of serious violations of Human Rights and Fundamental Freedoms 
Risk Analysis and risks identified relating to Human Rights and Fundamental Freedoms
The Group expanded its risk mapping by identifying the potential key Human Rights risks worldwide and in all markets(1). L'Oréal referred to the reporting framework of the Guiding Principles on Business and Human Rights (UNGP Reporting Framework). This identification process takes into consideration the severity, scale, remediability and likelihood of its impacts for people throughout its value chain. These analyses were conducted with an NGO specialised in the area, providing independent input, and are regularly reviewed. As a result of the analyses, the following salient risks were identified in the context of the application of the French Law on Duty of Vigilance:
- child labour among the employees of the Group's Suppliers;
- forced labour among the employees of the Group's Suppliers;
- job discrimination because of gender, gender identity, age, disability and sexual orientation of the employees of L'Oréal and the employees of the Group's Suppliers;
- Suppliers' employees not receiving a living wage(2) ; and
- lack of a whistleblowing system for social dialogue, freedom of association and collective bargaining among the employees of the Group's Suppliers.
Other potential risks identified concern respect for the environment (see “Additional actions intended for suppliers” in section 3.6.4.2), the right to access water, consideration of Human Rights in the choice of raw materials and, in particular, respect for free, prior and informed consent of indigenous peoples and local communities.
Applicable Rules on Human Rights
Subsidiaries and Suppliers must comply with the minimum core rules, which consist of the following rules that result from an analysis of the risks related to the business activities of the Group and its Suppliers.
Child labour: L'Oréal's presence in certain regions of the world that are particularly at risk for child labour, including Asia and Latin America, has led the Group to identify this issue as a priority. To take into consideration the vulnerability of young workers, L’Oréal sets the minimum age for employment based on the highest standard among (i) the legal minimum age for recruitment, (ii) the age of compulsory education or (iii) the age of 15 or, for its own employees, the age of 16. L'Oréal prohibits night work and work hazardous to health and safety for employees younger than the age of 18 in its Subsidiaries.
Forced or compulsory labour: L’Oréal refers to the definition of forced labour set out in Convention 29 of the International Labour Organization: “all work or service which is exacted from any person under the threat of any penalty and for which the person has not offered himself voluntarily”. In certain regions of the world where L'Oréal operates, certain practices that violate internationally recognised Human Rights, such as holding the identity papers of migrant workers, are common. Any form of forced labour is prohibited.
As a result:
- unless there is a legal obligation, employees' identity papers, passports or any other personal documents may not be held from them. In the event of a legal obligation, these documents must be returned to employees at their first request;
- employees may not be asked to pay for recruitment costs or to make cash deposits to obtain employment;
- if workers from foreign regions are hired, the employer must pay the costs related to these hires;
- security personnel must only ensure the safety of people and property; and
- any salary withholding or any other financial penalty must be strictly authorised by law. It may not under any circumstances be used for the purpose of confiscation, for the direct or indirect benefit of the employer. L'Oréal does not authorise such penalties for non-managerial-grade employees.