Residual importance | ||
---|---|---|
Business risks |
Business risks Sanitary crisis* |
Business risksResidual importance Significant |
Information and cybersecurity systems* |
Residual importance Significant |
|
Geographic presence and economic and political environment* |
Residual importance Significant |
|
Crisis management |
Residual importance Moderate |
|
Data |
Residual importance Moderate |
|
Market and Innovation |
Residual importance Moderate |
|
Business ethics |
Residual importance Moderate |
|
Sales distribution networks |
Residual importance Moderate |
|
Human Resources risk |
Residual importance Limited |
|
Product quality and safety |
Residual importance Limited |
|
Safety of people and property |
Residual importance Limited |
|
Industrial and environmental risks |
Industrial and environmental risks Product availability* |
Industrial and environmental risksResidual importance Significant |
Climate change |
Residual importance Significant |
|
Environment and safety |
Residual importance Limited |
|
Legal and regulatory risks |
Legal and regulatory risks Risk of non-conformity* |
Legal and regulatory risksResidual importance Moderate |
Intellectual property: trademarks, designs & models, domain names, patents |
Residual importance Limited |
|
Product claims |
Residual importance Limited |
|
Financial and market risks |
Financial and market risks Currency risk* |
Financial and market risksResidual importance Limited |
Risk on financial equity interests |
Residual importance Limited |
|
Risk relating to the impairment of intangible assets |
Residual importance Limited |
*Most material risks in each category.
Business risks/Sanitary crisis | |
---|---|
Risk identification | Risk management |
Because of its global presence, L’Oréal is exposed to epidemics or other public sanitary crises in the 80 countries in which it operates. The primary risks identified cover different segments of the Group’s operations:
Thus 2021 was marked by the impacts of the Covid-19 health crisis that has spread around the world and has affected a number of geographic zones in which the Group operates. Depending on its duration, geographic expansion and the result in geconomic and social consequences, a sanitary crisis may have a material impact on the Group’s activities, its performance and its reputation. |
L’Oréal has set up a crisis management process led by a unit at Group level that can prevent and limit the impacts of undesirable events on all its entities. Facing a sanitary crisis, the Group’s priority is to protect the health, safety and security of its employees. The Group responds through compliance with the directives of the authorities in the countries in which it operates, the application and adaptation of its worldwide, high management standards for health and safety at its operational sites and in business travel situations. The Group’s information systems allow large-scale development of flexible and remote work methods and are the subject of adequate safety protection processes (see section 4.3.2.4. “Creating conditions for a stimulating and attractive work environment” of this document). The policies to manage supply chain and inventories, and the business continuity plans of the industrial and logistics sites, allow the Group to anticipate the actions necessary to manage disturbances. The long-term relations with the Group’s strategic suppliers, the policies to diversify sources, and operational continuity plans limit the impacts of these crises. The Group’s presence in all distribution channels, particularly online sales capacities developed with diversified partners (owned sites, e-retailers, pure players), as well as its expertise in digitised consumer relations, help to maximise development opportunities in disturbed contexts. Finally, the Group’s worldwide and balanced presence in terms of geographic areas, product categories and distribution channels, the very high responsiveness and capacity for adaptation of its teams through its strategically concentrated and operationally decentralised organisational model, as well as its robust financial position, contribute to its ability to face the economic consequences of these crises. |