L’Oréal

Beauty for everyone

Tuesday 25 October 2011, by Cameron Christine, Hu Josephine, Liu Mingcan (ming), Nsri Sarah

5 inspired

L’Oreal

Beauty for everyone

Industry/products: leader in cosmetics and beauty products
Founded: July 30th, 1909
Location/Origin: Paris, France
Website: www.loreal.com and www.loreal.fr
a) For more than a century, L?Oreal has been in the beauty business. It is today the world?s largest cosmetics and beauty listed company (hair color, skincare, sun protection, make-up, perfumes and hair care) with 23 different brands spread into five divisions according to their distribution channel: Professional products (products like shampoos sold at the hairdresser?s salon), Luxury cosmetics products (perfume, makeup and skincare sold in selective stores like Sephora or Douglas), Consumer products (the shampoos, makeup and creams you can find at Tesco, Carrefour or convenience stores), Cosmetic active (more medical like products mainly sold in pharmacies) and The Body Shop (brand-owned store that only sells its own Body Shop brand known for its ethical implications).

b)
From a legal point of view, cosmetics are defined as products "intended to be applied to the human body for cleansing, beautifying, promoting attractiveness, or altering the appearance without affecting the body’s structure or functions" (Definition of the FDA, U.S. Food and Drug Administration).
However, the FDA doesn’t have to approve or review the cosmetics before their release and cosmetic companies are accused of lobbying against this regulation. The recent scandal of Paraben also shed the light on the health and safety issues, two major challenges that L’Oreal is addressing. L’Oreal has indeed implemented high quality standards on the products as they are based on scientific research and ethical manufacturing (no animal testing, no children labor...).
Furthermore, L’Oreal also needs to deal with environmental and social challenges. As a global organization with large sourcing and impact around the world, it needs to be mindful of its impact on the environment, including recycling and protecting biodiversity.
The group’s major social challenge is to be as respectful of countries and communities as possible. L’Oreal tries to do so by providing locally-adapted and affordable cosmetic products as everyone of us aspires to beauty. It should moreover do it by educating the customer and not by resorting to biased marketing of its products. Respecting this social challenge implies that L’Oreal should show an important commitment in terms of human rights and labor: fair-trade with suppliers, promotion of diversity in recruitment and various opportunities, women promotion, prohibition of discrimination among consumers and employees.

L’Oreal has acknowledged these challenges and has been implementing strong standards and policies to address them. The core values leading the L’Oreal spirit are integrity, respect and excellence and they are respected across the company and its activities.

c)
The beauty of ethics, the ethics of beauty’ reflects nicely the group’s ethic program which includes voluntary actions (such as the Citizen Day during which employees of all the divisions around the world can help numerous associations on June 30th) and practices (investing in Women Of Science, the biggest foundation of the group), policy and guidance (management of ethical decision making), communication (an ethic intranet site is opened to all employees; local communications campaigns on various ethical issues are organized with Emmanuel Lulin, Director of Ethics), training (on corruption, Supply Chain Management, ethical competencies including high level of personal integrity or reasoning), open talk process and monitoring (country reporting ethics, auditing of suppliers).
This program relies on a specific Code of Ethics and aims at respecting the following concerns
- Child and Forced labor
- Health & safety
- Freedom of association
- Non-discrimination
- Disciplinary practices
- Sexual and moral harassment
- Remuneration
- Working time
- Relations with sub-contractors and suppliers

- strong Sustainable Development and Diversity policies but they are also integrated into less visible aspects such as our Purchasing Department?s responsible sourcing policy and our high standards with regards product quality and safety?, Emmanuel Lulin, Director of Ethics

Not only has the group taken serious written engagements regarding ethical issues, it has and is also making real efforts by promoting and encouraging corporation social responsibility practices that give it a full and concrete ethical meaning.

d)
L’Oreal’s goal is to win the trust and confidence of one new billion consumers by 2015. This objective is challenging from more than just a marketing and financial point of view. Indeed in emerging markets, the increasing aspiration for Western lifestyle and the economic and social benefits associated with it lead to asking ourselves: ?Are we destroying local cultures in emerging nations by transferring/imposing Western model??
The answer to this question implies the need for a responsible approach and sustainable consumption (after all consuming a lot more means more waste and bigger environmental concerns) through sustainable innovation and development and a responsible management of production. This ethical dilemma will not be easy for L?Oreal. It will therefore be very interesting to see how our dream company deals with it in the upcoming years and of course if it lives to its promises?

Bibliography

www.loreal.com
www.loreal.fr
www.loreal-finance.com/
fr.wikipedia.org/wiki/L’Or?al
http://en.wikipedia.org/wiki/Cosmetics

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1 Discussion / 1 Message

  • L’Oréal, promise of win the confidence of consumers 23 February 2013 at 14:07 , by Giuliannam

    Nowadays, all women wake up and, first thing they do is put their face cream and make-up... This fact is like a routine in the occidental world, but this fact happens in emerging countries?

    L’Oreal is a company leader in cosmetics and beauty products especially in occidental countries where it is in most homes. However, there is a part of countries which even haven’t the habit to care their appearance; these are the countries where L’Oreal wants to get consumers. The factor to will help L’Oreal will be the develop of these countries where the European companies are implanting, this is, the occidental dreams are arriving to women in countries like Brazil, Turkey, China...
    But this strategy will depend the way of L’Oreal enters to this small worlds because women of emerging countries have a different culture very rooted. I think that the best is always respect their habits, and find the way to implementing their customs into L’Oreal products, knowing that this people is total different of occidental world.

Location: Shanghai (China)

Sector: Accommodation and food service activities

Official website: http://www.loreal.com

Key figures:

Company Figures:

Annual Revenue: ?19.5 billion (2010)
Annual Profit: ? 3 billion
Net Earnings Per Share: ? 4,01
Dividend: ? 1,80
Number of Employees: 66,600 employees
Countries of Operations: 130 countries
38 factories around the world
5.7 billion units manufactured in 2010
QUALITY 92 % Manufacturing Facilities ISO 9001 (2000 version) or FDA certified
SAFETY 92% Manufacturing Facilities OHSAS 18000 or VPP certified
ENVIRONMENT 92% Manufacturing Facilities ISO 14000 certified

Nbr. visits: 1754

Nbr. inspires: 5