2025 Universal Registration Document

3. Risk factors and risk management

This programme is aligned with the recommendations of renowned expert bodies such as the International Labour Organization (ILO) and the IDH Sustainable Trade Initiative, and is supported by specialist partners such as the Fair Wage Network and the Wage Indicator Foundation. The Living Wage programme consists of a series of structured actions. L'Oréal actively shares content about living wages (definitions, methodology, testimonials, etc.) with its strategic Suppliers on a special platform, rounded out by a series of webinars. The purpose of these sessions is to discuss the Group's methodology and expectations, and for Suppliers who have already adopted the approach, to give feedback on their experiences. This encourages the sharing of best practices, and helps anticipate potential difficulties between companies.

Strategic Suppliers are encouraged to make a formal pledge and actively work towards a living wage for their employees. At the end of 2025, all L'Oréal's strategic Suppliers were invited to take part in training sessions on this subject. Out of these Suppliers, 25% (in terms of expenditure) said that they pay their employees a living wage or have defined an action plan with a timeframe for achieving this objective(1).

Inclusive Sourcing programme

Launched in 2010, the Global Inclusive Sourcing programme harnesses the Group's purchasing power to promote social inclusion. The programme is fully aligned with the Group’s Sustainable Sourcing policy, promoting diversity and inclusion within its supplier network. L’Oréal allocates a portion of its overall purchasing volume to suppliers who provide employment to people from socio-economically vulnerable communities and to suppliers recognised as diverse, such as businesses which have traditionally faced challenges accessing large corporations (see chapter 4.9.2.2 of this document).

The Inclusive Sourcing programme contributes to L'Oréal's goal of empowering 100,000 people who face social and economic hindrances in accessing employment by 2030(2).

Since 2020, 109,674 people were supported in accessing employment, notably through the Inclusive Sourcing programme.

Measures to improve the working conditions of beauty advisors

L'Oréal works with beauty advisors to promote its products at points of sale. Depending on the markets, they may be L'Oréal employees, distributor employees or employees hired through temporary employment agencies. Predominantly women, these advisors are in direct contact with consumers and may sometimes be faced with consumer or management behaviour that does not reflect L'Oréal's values. To improve their access to reporting tools, the Group has launched pilot projects in three markets.

In this context, a mobile phone survey tool has been rolled out for all beauty advisors employed by a temporary employment agency in a Group country. This revealed Human Rights issues, concerning working conditions, employment contracts and harassment, in particular. These topics were addressed in a dedicated action plan that included measures to improve contracts and to train beauty advisors, distributors and employers of these advisors on violence against women.

Other similar feedback tool projects are being considered, as the ultimate goal is to increase the coverage of this at-risk population. An e-learning course for beauty advisors was developed in 2025 and slated for roll-out in 2026.

Human rights actions – the rose sector in Turkey

In response to a Human Rights risk identified in relation to the rose sector in Turkey, L'Oréal joined the Harvesting the Future initiative launched by the Fair Labor Association (FLA), aimed at improving working conditions and respect for human rights in various agricultural sectors, focusing on empowering seasonal workers and their families. Running up to end 2026, the project brings together various stakeholders, including the Turkish government, local civil society organisations, processors, growers and companies in the beauty and perfume industry, in order to support and strengthen the introduction of systems for monitoring human rights in their supply chains.

In 2025, with the support of the Harvesting the Future initiative, local producers organized in an association deployed risk prevention and remediation efforts, contributing to the transition towards local self-sufficiency.

For further information about the results of the project to date, see the FLA website(3).

Human rights actions – the jasmine-growing sector in Egypt

Following an alert and a series of Human Rights impact assessments carried out by independent specialists in 2023 in various regions worldwide, the Group identified risks of Human Rights violations in relation to jasmine harvesting in Egypt, and in particular a problem regarding child labour.

In response to this situation, the FLA, together with the Egyptian office of the International Labour Organization and more than 15 national and international producers and buyers of jasmine derivatives and products are working together to promote better child protection and decent working conditions in the jasmine sector in Egypt. The Egyptian government and several civil society organisations are also active partners in the project, which forms part of FLA's Harvesting the Future initiative.

Joint efforts to improve labour rights and local working conditions in the jasmine supply chain include strategies to promote fair pay and build the economic resilience of families; strengthen child protection measures and improve (i) children's access to education and (ii) parents' access to childcare; improve processors' Human Rights due diligence systems; and generate governmental support for legal and policy initiatives, including social protection measures.

The FLA and ILO are actioning these measures on a local, on-the-ground basis in seven jasmine producing villages in the Gharbia region in Egypt, in collaboration with several local civil society organisations and jasmine suppliers.

In 2025, the Egyptian Labour Code evolved to incorporate improvements supported by the coalition.

Raw material sourcing

As part of a voluntary approach, L'Oréal launched a global analysis of the risks inherent in its raw material sourcing, looking beyond the Suppliers with whom it has an “established business relationship”.