Pursuant to the criterion related to operating profit, a certain level of growth, defined by the Board, but not made public for confidentiality reasons, must be met or exceeded in order for all free shares granted to fully vest to the beneficiaries at the end of the vesting period. Below this level, the number of shares that fully vest is reduced. If the operating profit does not increase in absolute value over the period, no shares will fully vest in relation to this criterion.
With regard to the criterion of fulfilling commitments made under the L'Oréal for the Future programme, in order for all the free shares granted to fully vest to the beneficiaries at the end of the vesting period, a certain average level of achievement of the L'Oréal for the Future Commitments, defined by the Board and made public, must be reached over the vesting period. If this is not achieved, the grant is reduced. No shares will fully vest if the average of the results for the L'Oréal for the Future Commitments fall below the minimum level defined by the Board and made public.
Pursuant to the criterion relating to gender balance in strategic positions, including the Executive Committee, in order for all the free shares granted to fully vest to the beneficiaries at the end of the vesting period, the average gender quota in strategic positions must be a minimum of 40% of members that are the same gender. Below this level, the number of shares that fully vest is reduced. No shares will vest in relation to this criterion if the average representation of one of the genders is below 35% over the vesting period.
These performance conditions will apply, for all individual grants greater than 100 free shares per plan, to all shares above the hundredth share, with the exception of grants to corporate officers and members of the Executive Committee, for which they will apply to all shares. The free grant of shares may be carried out for all Group employees without performance conditions, or for shares allocated on the basis of cash subscriptions carried out as part of an increase in share capital reserved for Group employees.
The Board of Directors will be able to settle vesting and holding periods which are longer than the minimum periods set above. This mechanism for the conditional grant of shares complies with the AFEP-MEDEF Code.
Any allocations of shares to the corporate officers will be decided by the Board of Directors on the basis of the proposals of the Human Resources and Remuneration Committee after assessment of their performance. The corporate officers of L’Oréal will be required to hold 50% of their fully vested shares in registered form until they cease to hold office.
On the basis of the proposals made by General Management and examined by the Human Resources and Remuneration Committee, the Board of Directors decided, at its meeting on 10 October 2025, to make a conditional share grant within the scope of the authorisation granted by the Annual General Meeting on 23 April 2024.
The share capital at 10 October 2025 comprised 533,752,563 shares, and 3,202,515 shares could therefore be issued.
The Board of Directors used this authorisation at its meeting of 10 October 2025 by granting 703,500 shares to 2,648 beneficiaries. This is a free grant of shares to be issued. Vesting of the shares is subject to a dual condition:
performance, evaluated as follows:
Financial criteria represent 80% of the performance conditions, split evenly between:
The calculation will be made on the basis of the arithmetic average of the performances for financial years 2026, 2027 and 2028.
Pursuant to the criterion relating to sales, in order for all the free shares granted to beneficiaries to fully vest at the end of the vesting period, L’Oréal must outperform the average growth in sales of the panel of competitors. Below this level, the grant is reduced. If L’Oréal’s comparable growth in sales is lower than the average growth in sales of the panel of competitors, no shares will be fully vested under this criterion. The Board of Directors defines a threshold, not made public for confidentiality reasons, below which no shares will fully vest in relation to this criterion.
