SUSTAINABLE DEVELOPMENT REPORT 2017-2018 - Guerlain

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SUSTAINABLE DEVELOPMENT REPORT 2017-2018 - Guerlain
SUSTAINABLE
DEVELOPMENT
REPORT
2017-2018
SUSTAINABLE DEVELOPMENT REPORT 2017-2018 - Guerlain
WELCOME ELYX !

Through his illustrations, in his hand or from behind his camera, Elyx is a social
networks character full of enthusiasm and drive, and the official digital
ambassador of the UN. He will be popping up throughout our fourth
Sustainable Development report to bring a touch of fun to proceedings,
thanks to his creator, artist Yacine Ait Kaci.
Guerlain was delighted to invite Yacine to our Inspirations Durables event in
2015, and we are proud that he has brought these pages to life with his
wonderful illustrations.
SUSTAINABLE DEVELOPMENT REPORT 2017-2018 - Guerlain
ÉDITO

              JOINT INTERVIEW
              LAURENT BOILLOT
              Chief Executive Officer

              & SANDRINE SOMMER
              Head of Sustainable Development

              Laurent Boillot - We are celebrating the fantastic commitment that Guerlain
              made ten years ago now, to reinvent the luxury of tomorrow through eco-
              design, work to protect the climate by striving to be carbon neutral by 2028,
              promote self-esteem for all women and protect biodiversity, bees in particular.
              I believe that we are now arriving at a turning point in our sustainable
              development strategy. We are proud of what we have done, but we're well
              aware that we have achieved only "the easy bit". From now on, we are going
              to have to face genuinely "challenging" issues, especially in terms of the
              climate. It's a massive part of sustainable development, but it's so complicated
              to tackle in an industry like ours. For example, as transportation is still one of
              our main sources of CO2 emissions, we have implemented a rail alternative
              to carry our products to China, an excellent compromise between slow
              shipping by sea, and air freight which creates massive pollution.

              Sandrine Sommer - I have noticed some real determination over the last ten
              years from all our employees, as we work together to reduce our impact on
              climate change. In 2011, we decided to find support in the shape of the
              ISO standard 14 001 to measure our efforts, raise awareness and set up
              teams who were given environmental challenges. Little by little, first France,
              then several European affiliates, Italy and Portugal were certified in 2017.
              By 2021, the objective is that all our affiliates will be certified.

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SUSTAINABLE DEVELOPMENT REPORT 2017-2018 - Guerlain
E D I T O                                                                                 E D I T O

Laurent Boillot - The second key challenge is eco-design, creating our                      We have met many people who are totally devoted to the cause, and that
products while making no compromises on Guerlain's quality and luxury                       encourages us to bring together more diverse players, and take the issue to
standards. Because while luxury products must be innovative, creative and                   the highest level, ensuring everyone knows what we are doing.
excellently crafted, environmental performance is also an essential factor. In              In terms of solidarity, social and societal commitment are one and the same
2017 we accomplished great things with one of our key products, Orchidée                    at Guerlain, with generosity and sharing being key values for our employees.
Impériale Cream. We had to "break with convention" and completely                           We intend to continue this drive by promoting self-esteem through our support
redesign the packaging. With a more organic design, we reduced the                          for the associations Belle & Bien, Restos du Cœur and Laurette Fugain.
weight of the jar by 60%, and this alleviated over half of the product's carbon             I’m proud of all the initiatives undertaken, and the programme's emulation by
footprint. With this successful step forward in eco-design, we became one                   others is continually more and more inspiring.
of the key players in the luxury market, an innovative pioneer.
                                                                                            Laurent Boillot - « Au Nom de la Beauté » la Maison Guerlain est engagée
Sandrine Sommer - We have also focused our efforts on the transparency                      et continue à se tourner vers l’avenir, avec la détermination et la créativité
and traceability of our products. We have set up a digital platform, Bee                    qui sont les siennes. Et notre mission est plus que jamais de contribuer à la
Respect, which is a hub for all the information about the origins of our ingre-             beauté de nos clientes, à la beauté de nos produits et à la beauté de notre
dients, where they come from and how they are made and distributed, right                   planète.
through the end of their lives. This platform is a precious tool that is constantly
being improved internally, from meadow to boutique.

Laurent Boillot - Bees feature heavily in biodiversity, and are the symbol of
Guerlain, connecting us with nature and the exceptional raw materials that                                             LAST MINUTE
we use. Bees are one of the environment's greatest treasures, and they are
now under serious threat. We have created several programmes and
partnerships to protect and conserve the bees, including the Sustainable                                    A STRONG SYMBOL FOR THE HOUSE
Development sponsorship programme and the Brittany Black Bee Conserva-
tory Association on the island of Ushant. We have also been helping the
OFA (French Apidology Observatory) to develop the stock of hives in Europe,                                                           In June 2018 Sandrine Som-
and to promote the rare and precious occupation of bee-keeping. A new mi-                                                             mer was appointed to the
lestone was put into place when Guerlain organised and hosted the first edi-
                                                                                                                                      Executive    Committee      by
tion of the Bee Seminars at 68 Champs Elysées, which brought together the
greatest French specialists on the issue, and was a first for a private player.                                                       Laurent Boillot. A promotion
                                                                                                                                      that reflects the President’s
Sandrine Sommer - Indeed, we wanted to create the Bee Seminars so that                                                                determination to even more
we could bring together the best experts in the field, determine a context and                                                        place environmental and
work on how to resolve the major challenges. Given the success of the first
                                                                                                                                      societal commitment at the
edition, we decided to continue with the project and make it an ongoing
event, with a real purpose and an international reach.                                                                                heart of our strategy.

                                                                                      -4-                                                                                    -5-
SUSTAINABLE DEVELOPMENT REPORT 2017-2018 - Guerlain
C L I M A T E                                                                                                               E C O - D E S I G N

                   PROJECTS            AC HIEVED                                                  AMBITIONS                                       PROJ ECTS          AC HIEVED                                             AM B ITIO NS

                                                                                                                                          60% LIGHTER                            PERFUME                                       By 2020

                                                                                                    50%
            TRANSPORTS                                  LA RUCHE
                                                                                                                                                                                FOUNTAINS
          1st 100% electric
           innovative lorry
                                                 An ambassador                                                                        The new eco-designed
                                                                                                                                         packaging for the                   Our iconic Bees
                                                                                                                                                                                                                           100%
                                                                                                                                                                                                                      NEW GUERLAIN PRODUCTS
         to supply our Paris                           site and                        REDUCTION IN OUR CO2 EMISSIONS               4th generation of Orchidée                bottles can be                           WILL BE ECO-DESIGNED
                stores                                                                   BY 2020 COMPARED WITH 2007
   Air-Sea ratio: maritime freight
                                                   a testament to                                                                    Impériale Cream had its
                                                                                                                                                                           refurbished for life
       is constantly growing                     our commitment
                                                                                              CARBON
                                                                                                                                       jar lightened by 60%.
                                                                                                                                                                                                                           100%
          THE 1ST FRAGRANCE AND COSMETICS HOUSE                                               NEUTRAL                                                          1ST HOUSE

                                                                                                                                            to offer clients to return their empty packagings
                                                                                                                                                                                                                       TRACEABILITY
                                                                                                                                                                                                               FOR ALL OUR PRODUCTS, THROUGH BEE
                                                                                        by 2028 for Guerlain's 200th anniversary.
 to be certified "Engagement Biodiversité et Climat" (biodiversity                                                                           to CEDRE, the sorting and recycling platform                      RESPECT, OUR DIGITAL PLATFORM FOR
                                                                                                    (scopes 1 – 2 – 3)                                                                                          TRACEABILITY AND TRANSPARENCY
   and climate commitment) by ECOCERT ENVIRONNEMENT                                                                                                          created by LVMH

                                                                                                                                    10 Y E A R S O F C O M M I T M E N T , 10 Y E A R S O F P R O J E C T S
SUSTAINABLE DEVELOPMENT                                                                                                                                AND NEW AMBITIONS

                   PROJ ECTS           AC HIEVED                                                    AMBITIONS                                     PROJ ECTS          AC HIEVED                                             AM B ITIO NS

                                                                                                  100%
               SINCE 2011                            SUSTAINABLE
                                                      INDUSTRIES
                                                                                                                                                              SINCE 2004
    A sustainable research and
 sponsorship partnership contract
  has been signed with the Black
                                                     To protect
                                                   our iconic raw
                                                                                             OF OUR ICONIC RAW
                                                                                           MATERIALS DERIVE FROM
                                                                                                                                                     Partnership with the                                                 100%
  Bee Conservatory Association                                                             SUSTAINABLE INDUSTRIES                          Belle & Bien association, the French                                        GUERLAIN AFFILIATES
      on the island of Ushant.                       materials                                                                                                                                                            WORKING WITH
                                                                                                                                            affiliate of Look Good Feel Better,
                                                                                                                                                                                                                      LOOK GOOD FEEL BETTER
                                    BEES                                                            BEES                                     which helps women with cancer                                            ALL AROUND THE WORLD

 Partnership with OFA (the French Apidology Observatory) to protect bees.                  BECOME THE LEADING HOUSE                              to recover their self-esteem                                          (or a similar NGO) By 2020
 Creation and organization of the Bee Universities in order to find solutions         IN BEE PROTETION AROUND THE WORLD
 to protect bees and pollinate best practices

                                                               B I O D I V E R S I T Y                                                                                                      S O L I D A R I T Y
                                                                                -6-
SUSTAINABLE DEVELOPMENT REPORT 2017-2018 - Guerlain
B I O D I V E R S I T Y

                           PROTECT THE BEAUT Y
                                    OF THE WORLD

Achieving our objective is essential to ensure that our exceptional raw materials and creations are of
high quality and sustainable. It's about having a sense of purpose. Devoting ourselves to preserving and
protecting the world's beauty gives real meaning to our ambitions. What's behind our commitment to
biodiversity? Guerlain strives to enhance the beauty of its customers, the beauty of its products, and the
beauty of the planet.

Protecting the bees may seem a natural decision, because this imperial symbol has been our identity since
1853, when Pierre-François-Pascal Guerlain created a citrus-scented Eau de Cologne for the Empress
Eugénie (on the occasion of her marriage to Napoleon III). The bottle was engraved with her majesty's
coat of arms and displayed the Bee, which is the symbol of the Emperor. Since then, bees have been
inspiring Guerlain creations and adorning its most precious bottles. This sentinel of the environment is now
under serious threat, it is a guiding light for our sustainable development work, because it is the source of
our exceptional raw materials. We have created several programmes based on bees.
We set up the Sustainable Development sponsorships for several of our iconic raw materials channels, and
we are committed to continuing this approach with each new creation. Our commitment is ongoing and                      THE FIGURES

built to last. Our vision of the future drives us to reach our most ambitious objectives, such as obtaining global
certification for our "Biodiversity and Climate" initiative in 2021, an "accolade" that was won by a French                  1 st
                                                                                                                     Become the leading house
Fragrance and Cosmetics House for the first time in 2016.
                                                                                                                         in bee protection

                                                      -8-
SUSTAINABLE DEVELOPMENT REPORT 2017-2018 - Guerlain
B I O D I V E R S I T Y

                                                                                  «
                    It takes more than 15 years to be able to extract the best quality essence from inside the tree. San-
                                         dalwood is undoubtedly in no hurry, luxury takes its own time... »

                    Just like the generations of perfumers before                                       Indian people have harvested so much of it that
                    him, Thierry Wasser travels the world finding                                       there is almost none left, and yet its consumption
                    exclusive materials of exceptional and consis-                                      is still growing.
                    tent quality.
  AT GUERL AIN ,                                                                                          UNIQUE CULTIVATION
                    INTERVIEW WITH OUR PERFUMER                                                           Four years ago at a trade fair, I came across a
 OUR PERFUMER       THIERRY WASSER                                                                        small booth manned by the government of
                    "At Guerlain we use around 900 raw mate-                                              Western Australia. I contacted the company in
IS A BIODIVERSITY   rials, and whether they are natural or synthetic                                      Perth, and spoke to its director, a Frenchman who
                    it is vital that we have complete control over them. Sourcing       used to work in perfumery. The first samples he sent me did not
   "EXPLORER"
                    these materials is a demanding task, because we must always         live up to my expectations, but I decided to make the journey to
                    make sure that they are of high quality, as well as being avai-     visit him. I analysed the quality of the branches, trunks and roots,
                    lable. We must also make sure we are very careful about how         and studied the essences around the trees, because sandalwood
                    they are harvested and distilled.                                   needs to be "well supported" in order to develop.
                    I spend about a third of my time travelling, sourcing materials.    After a week of discussions, recommendations and sharing expe-
                    Knowing the field is essential if you want to be a responsible      riences, we worked together to create a Santal Album essential
                    buyer, and create new human experiences that will give rise         oil that would meet the quality standards required by perfumery.
                    to meaningful partnerships.                                         We were the first to believe in their project, and together we es-
                                                                                        tablished a new ethical, sustainable and high quality channel for
                    For Guerlain, creation can only come with social development        this exceptional raw material which features in our fragrance for
                    and respect for the environment. Nature provides perfumers with     women, Mon Guerlain.
                    a precious heritage that they must preserve and hand down. The      It takes more than 15 years to be able to extract the best quality
                    procurement of sandalwood is still a big challenge. For a long      essence from inside the tree. Sandalwood is undoubtedly in no
                    time, the "mother" of all sandalwood sources was India, but         hurry, luxury takes its own time... »

                                                                                   - 11 -
SUSTAINABLE DEVELOPMENT REPORT 2017-2018 - Guerlain
B I O D I V E R S I T É                                                                                                                                B I O D I V E R S I T É

                                                                                                                                                                                                                             BEE SEMINARS:
             INTERVIEW WITH THIERRY DUFRESNE                                                                                                                                LATEST                                           A MOUTHPIECE FOR "OUR BEAUTY QUEENS »
                C HAIRMAN AND FOUNDER OF THE FREN C H APIDOLOGY OBSERVATORY
                                                                                                                                                The "Bee School" has had its official launch: it is a programme to           To share its commitment and find ways to help save both
                                                                                                                                                raise awareness in children about protecting bees, and is driven
                                                                                                                                                                                                                             domestic and wild species, Guerlain launched the first edition
                                                                                                                                                by Guerlain employees. Training for volunteers will begin in France
                                                                                                                                                                                                                             of the Bee Seminars in June 2017, and the event now attracts
                                                                                                                                                from September 2018, and will then be extended to all countries
                                                                                                                                                where Guerlain is active. By 2020: our objective is that all our             the top specialists on the issue every year.
                                                                                                                                                teams around the world will become bee and biodiversity ambas-
                                                                                                                                                sadors for young people in primary schools, so that children un-             The first edition shone a light on how fragile bees and ecosy-
Since 2015, Guerlain has been a patron of                                                SCIENTIFIC RESEARCH                                    derstand the importance of bees and how vital it is to protect them,         tems are, while the second, held in June 2018, highlighted the
the OFA (French Apidology Observatory),                                                  AND THE REALITY IN THE FIELD                           and how to identify the simple and effective actions they can take.
                                                                                                                                                                                                                             positive solutions that have been put forward by scientists,
and has pledged to support founder Thierry                                               In terms of research we are making progress, but                                                                                    public authorities and businesses.
Dufresne in his ambition to train 30,000 new                                             what we have learnt needs to be confirmed over

                                                                                                                                                         «
beekeepers in Europe and create 10 million                                               time, and we must remain humble and cautious.
new bee colonies by 2025.                                                                We are currently selecting strains of larva that are                                                                                                                               «
From its base in the Sainte-Baume mountain                                               resistant to varroa, which would mean breeding
                                                                                                                                                                           "We must always remember that pollination is an agreement
ridge in the Var, the OFA develops scientific                                            more resistant colonies, and reducing bee morta-                                            with nature, and must be preserved at all costs...
research programmes and breeding and selection techniques.             lity, which affects around 30% of the population, sometimes more
It also manages a professional training programme that offers          depending on the region.
graduates the chance to obtain a state-approved certificate,
in partnership with the Agricultural Training and Promotion
Centre in Hyères, which is connected with the French Ministry
                                                                       GUERLAIN, A LONG-TERM COMMITMENT
                                                                       Guerlain's commitment, while still an exception in the Luxury world,
                                                                                                                                                                                                                       Sowing seeds for bees !
for Agriculture.                                                       involves an investment from the highest echelons of the House. In
                                                                       addition to the undeniable cosmetic properties of hive products,                                                                The 1,300 employees at Guerlain in France made a pledge to the
                                                                       Guerlain supports the OFA in its scientific research and with raising                                                           "Des Fleurs pour les Abeilles" (flowers for bees) campaign, initiated by the
« PROTECTING BEES MEANS PROTECTING PEOPLE                              awareness about the issue: in France, we are still a long way from                                                              OFA. On 20 June 2017, they sowed honey plants that produce the nectar
As such, the OFA carries out studies on how bee behaviour is           understanding all the potential health benefits of hive and bee                                                                 and pollen that the bees require, to contribute to a replanting programme
changing with the impact of pesticides and parasites on their          products. The commitment shown by Guerlain and all its em-                                                                      involving a billion flowers for bees. Sachets of seeds were donated by
health. These analyses will create opportunities to evaluate how       ployees is a wonderful source of hope that we can protect our                                                                   Guerlain so that everyone could take part in the event.
similar diseases may have an impact on humans.                         precious bees. »

                                                              - 12 -                                                                                                                                                    - 13 -
SUSTAINABLE DEVELOPMENT REPORT 2017-2018 - Guerlain
É C O - D E S I G N

                                    REINVENTING
                                       THE LUXURY
                                  OF TOMORROW

Thinking differently, changing industrial approaches and simultaneously initiating more value creation:
eco-design meets all these objectives. It also helps to continue with Guerlain's transformation into one of
the most responsible Houses by 2028, when we will celebrate its bicentenary and in doing so, must
reinvent the luxury of tomorrow.

As a source of innovation and creativity for our teams, eco-design illustrates our commitment to Sustainable
Development with an ambitious goal: 100% of our new products will be eco-designed by 2020. For several
years, we have been developing products in a way that limits their impact on the environment at each stage of
their life cycle, from the design stage through to the end of the product's life. With a view to continuous impro-
vement, we must be able to quantify our progress, and that is why each new development is scored using an
EPI (Environmental Performance Index calculated using Edibox software, managed by the LVMH Group).

The index is then shared and discussed with the Sustainable Innova-
tion Committee, which meets quarterly with Guerlain's Marketing,                      THE FIGURE

Merchandising and Packaging Development Departments - which
was set up to accelerate and multiply eco-design projects. As such,
developments regarding the "Bees" bottle, which has always been
                                                                                    100%
                                                                                All of our "Bee" bottles can
refillable, and can now also be refurbished, have been huge suc-             be refurbished for life in Guerlain
cesses in our Paris-based Guerlain Parfumeur stores, which are set                   Parfumeur stores
to be rolled out internationally.

                                                      - 14 -
SUSTAINABLE DEVELOPMENT REPORT 2017-2018 - Guerlain
É C O - D E S I G N

                          NEW ECO - DESIGNED BOTTLE,
                                              A HUGE SUCCESS

The main challenge for 2017 was the creation                                              main goals is that all our fragrances should be pre-
of a new eco-designed bottle, as presented                                                sented in eco-designed glass bottles with screw
by Ann-Caroline Prazan, Fragrance Marketing                                               caps by 2020. It is a major challenge, and we
Director for Guerlain, and Artistic Director at                                           are pouring all our energy and daring into shoul-
68, Champs Elysées.                                                                       dering this environmental responsibility.

« In 2017, we 'repackaged' some of our fragrances for women,              COMING SOON: A NEW FRAGRANCE
both for greater clarity and to improve our sales, it can't be denied,    AND A NEW COMMITTED SPOKESPERSON
but also as part of a Sustainable Development initiative that began       La Petite Robe Noire will also be given a new eco-designed bottle
11 years ago at Guerlain. Because being socially and environ-             in 2020.
mentally responsible is also a market opportunity. It's a risky busi-
ness, but it's vital, and we're staying on course. We have many           Finally, our forthcoming launch is perfectly in line with this
loyal customers, and there was never any question that we would           approach, because it is a completely eco-designed fragrance,
disappoint or lose them. We're now seeing that we succeeded in            developed hand-in-hand with Sandrine Sommer, Sustainable
rising to the challenge. The screw-cap "Bees" bottle and our per-         Development Director, and her team. It will be represented by a
fume fountains used to fill them illustrate this approach. We are a       new spokesperson who is also known for her commitment, as is
luxury house, which aims to reduce its environmental impact while         the case with Angelina Jolie for Mon Guerlain. Angelina is the
staying faithful to its traditions. In addition, the bottle is more       perfect embodiment of an inspiring woman who is able to talk to
"eco-friendly", it is lighter and has no lacquer or tinted glass.         women about her disease, her failures, and her humanitarian
"As for Samsara fragrances or the Insolence range. One of our             commitments around the world. "

                                                                     - 17 -
C L I M A T E

              COMMITTED TO THE CLIMATE

Reducing its carbon footprint will be the biggest challenge that Guerlain has to face in the years to
come. For a high-performance company in an industry like ours, the design and transportation of products
is a major challenge. Setting ourselves the objective of halving our carbon footprint by 2020, while
aiming to be carbon neutral by 2028 is a difficult and engaging challenge.

Transportation is the main source of our greenhouse gas emissions, which makes it a key focus for our
climate-conscious House.
We are working with our affiliates to prioritise maritime transport over road and air transport, as it pollutes
less. As a result, the percentage of our shipments exported by sea has been increasing steadily for three
years. In 2017 unfortunately, we only achieved 55% of our shipments by maritime freight, due to the fast
resupply to satisfy significant demand for our new fragrance Mon Guerlain.

In addition, to reduce our CO2 emissions in France, we are still supplying our Paris-based stores with a
zero-emissions road network using Bourdon, our electric lorry.

                                                                                     THE FIGURES

                                                                                        0%
                                                                                    We are aiming to be
                                                                                  carbon neutral by 2028

                                                                                                                  Le Bourdon, notre camion éléctrique

                                                    - 18 -
C L I M A T E

                                          INTERVIEW WITH PATRICE BROS, DIRECTOR OF L A RUC HE

              Since its creation, Guerlain has produced all its
              fragrance, skincare and cosmetics in France.                                           so when I arrived at the plant in Chartres it was
              As a major player in Cosmetic Valley, Guerlain                                         quite a shock, in the positive sense of the word,
              has two production sites, including La Ruche,                                          obviously! Not only had La Ruche been
              which has produced our ranges of skincare                                              designed to reap the benefits of daylight, which
              and make-up since 2015 in Chartres. In terms                                           helps to save electricity, but with the earth-to-air
              of Guerlain's large-scale carbon plan, the                                             heat exchanger, there is no need for air conditio-
              21,000 m2 building known as "La Ruche"                                                 ning, which is a big CO2 generator. This
              among the teams themselves, plays an essential                                         exchanger takes air from the ground where it is
              role. This recent design is set to be extended,                                        cooler, and diffuses it through the office space.
              while continuing current efforts to reduce its carbon footprint        The plant is also a tool that encourages its 350 employees to
              without veering from Guerlain's golden rule: "Make excellent           make a commitment to the Restos du Cœur, or the Belle & Bien
              products, never compromise on quality". Patrice Bros, the new          association who support women with cancer.
              Director of La Ruche, explains what appealed to him about
              Guerlain's approach, and gives a brief overview of its                 Gas consumption is still one our most significant sources of emis-
 LA RUCHE     successes.                                                             sions. We are currently working on this issue, with our equipment
                                                                                     configured to be as efficient as possible, with settings fine-tuned
THE CENTRAL   « Factories are both the cornerstone and the spearhead of Guer-        for optimum production, in terms of heat or cooling cycles for
  FOCUS       lain's environmental and social strategy. "Sustainable develop-        example.
              ment" at Guerlain can be seen and experienced, and we act on           Information about the work we do is shared regularly with our
  OF OUR      it, it's very tangible. Some genuine decisions have been made,         employees and various events are organised, such as the Solar
              and that's down to a Chairman with vision, I'm completely "on          Impulse race, which was held in our car park, so that their
  CLIMATE     board" and I wholeheartedly support and follow his decisions,          solar-powered cars could be recharged. All of this helps to nurture
              and the organisation he has put into place. It's reassuring to work    the brand's culture and values, the beauty of its products, and
 S TRATEGY
              in this environment, where there is real concern for humanity and      general well-being, alongside a genuine social and environmental
              commitment. I'd worked in the United States before,                    responsibility. »

                                                                                - 21 -
S O C I E T A L   R E S P O N S I B I L I T Y   A N D   S O L I D A R I T Y
                                                                                                                                                                         3 INSPIRIN G WOMEN

                                                                                                                   DELPHINE HOFFMANN                              mother smiling and beautiful as she comes         is a responsible and exemplary business part-
                                                                                                                   Development and Partnerships                   into the room, "just like before" said a little   ner. Well done and thank you to all the
                                                                                                                   Director for the association                   boy! We came together and helped"                 teams for their unswerving support. »
                                                                                                                   Laurette Fugain                                recharge the batteries" of these women
                                                                                                                                                                  who cope with anything and everything             SARAH LAMOUREUX
                                                                                                                   « Every year, the Laurette Fugain associa-     while they are also dealing with disease.         Sponsorship and Partnerships Manager
                                                                                                                   tion carries out many different projects wi-   A big thank you to Guerlain! »                    for the Restos du Cœur association
                                                                                                                   thin haematology departments to support
                                                                                                                   patients and their loved ones as they go       RÓISÍN DOCKERY                                    « The beauty workshops we have organi-
                  SOCIETAL                                     COMMITMENT                                          through the long healing process. Right        Director of the association Belle & Bien          sed for the last four years with Guerlain are
                                                                                                                   from the start when we met the Guerlain                                                          an extraordinary experience for almost
                                                                                                                   teams, the idea of coming together to pro-     « "In the name of beauty, Guerlain has joined     1,000 women who come to our centres in
                                                                                                                   vide patients with an opportunity to be        forces with the Belle & Bien association to       Paris and around France, and for our volun-
                                                                                                                   pampered made perfect sense. It quickly        give meaning to beauty. "                         teers as well.
                                                                                                                   became a wonderful project, designed to        For 14 years now, our common goal has
                                                                                                                   provide a bubble of relaxation and             been to allow women undergoing treatment          It is an opportunity to talk, relax and enjoy
                                                                                                                   beauty for the mums of children in hospital    for cancer to recover confidence and self-es-     the company of friendly, motivated and ef-
Our Company considers social responsibility as being key; this means looking beyond its interests and              and caregivers.                                teem through free skincare and beauty works-      ficient Guerlain employees... it's a refres-
supporting associations whose projects reflect the Company's values.                                                                                              hops.                                             hing break and something to enjoy during
This interest in going further is evident throughout the world through many different initiatives, including the   In a warm and caring atmosphere, with a                                                          a challenging daily routine. These beauty
"Journée Engagée" (commitment day) which began in 2015. Guerlain set aside this day, which was on a                listening ear lent by Laurette Fugain volun-   This support goes beyond the frontiers of our     workshops help boost self-esteem; they en-
                                                                                                                   teers and the Guerlain teams, all the          business, because Guerlain is also involved       courage the women who come to them to
volunteer basis, and teams committed to it in terms of an environmental or social challenge that needs to be
                                                                                                                   women enjoyed their experiences. The           with several branches of the international net-   regain confidence, which is important for
resolved.
                                                                                                                   natural complicity between the Guerlain        work "Look Good Feel Better", of which            social and professional integration.
In France, we are strengthening our support for three associations: Belle & Bien, Restos du Cœur and the           teams and Laurette Fugain made the at-         "Belle & Bien" is the French branch. Guerlain     Other Guerlain employees get involved to
Laurette Fugain association. Guerlain believes in the magic of an encounter, the strength of joint projects,       mosphere on these days                                                                                            repaint centres and make
and the wonderful stories that spur us on to innovate, think differently or give rise to partnerships.             even more magical. The                                                                                            the welcome more plea-
                                                                                                                   funniest one of the won-                                                                                          sant and friendly. Every
                                              A FEW FIGURES                                                        derful outcomes of this                                                                                           year, this partnership is
                                                                                                                   project is the dazzling                                                                                           a wonderful example of
                                                                                                                   smile on the face of a                                                                                            solidarity. »
                           14 years of support for Belle & Bien                                                    child who sees his or her
                    1 year of partnership with the Laurette Fugain association
                       5 years of commitment to the Restos du Cœur                                                         Guerlain was fortunate to be able to meet and talk to Véronique Colucci, who passed away earlier this year.
                                                                                                                                          We would like to thank this incredibly inspiring woman for everything she did.

                                                      - 22 -
S O C I E T A L   R E S P O N S I B I L I T Y   A N D   S O L I D A R I T Y

                                                               INTERVIEW WITH ANGÉLIQUE CLEZARDIN
                                                                                                          CRS PROJECTS MANAGER

                                                                            Social and societal commitment are one and the same at Guerlain,
                                                                        and intrinsic to its employees' values, along with generosity and sharing.

                                                       "Guerlain's dedication to boosting self-esteem                                           have organised beauty breaks for Mother’s Day.
                                                       and providing support for those who need it                                              For two weeks, in two centres both in Paris and on
                                                       shows that the brand wants to give something                                             its outskirts, as well as in other regions of France,
                                                       back to society, and our ambition in terms of so-                                        our employees attend centres to hold make-up
                                                       cial and societal responsibility is based on a                                           sessions for women and treat them to a little pam-
                                                       deep-seated respect for people and for the com-                                          pering. We also decorate the premises and
                                                       mitment of our employees. I am so lucky to be-                                           every year we repaint a centre in Restos du Cœur
                                                       long to an organisation that holds this issue in                                         colours. To finish, this year we set up a partnership
                                                       such high regard, and pours such energy into it,                                         with the Laurette Fugain association and we hold
                                                       without being afraid of breaking convention. In its base notes is in-    make-up and massage workshops for the mothers of children in
                                                       novation, and in its heart notes, people. My daily occupation in-        hospital and for caregivers in the haematology and oncology
                                                       volves managing all our "support" partnerships, especially the           department of the Trousseau hospital.
                                                       beauty workshops, which come under the umbrella of Guerlain's
                                                       "Journée Engagée" initiative: a day off from work offered by             Guerlain employees sometimes feel uneasy about going outside
                                                       Guerlain to its employees so they can volunteer to support one of        their emotional comfort zones, but once they have the experience,
               A FEW FIGURES                           the causes it supports.                                                  they are amazed by its intensity, and by the pride they feel when
                                                       For the last 13 years, I have been working with the association          they see the smiles on the faces of the women, and the comfort
More than 1000 women                received make-up
                                                       Belle & Bien to provide beauty workshops, which provide women            they are providing. I’m proud of all the initiatives undertaken, and
       sessions in 2017 in the Restos du Coeur
      and Laurette Fugain beauty workshops             undergoing treatment for cancer with skincare and make-up ses-           the program's emulation internally has been inspiring. Beauty takes
                                                       sions. Our volunteer make-up artists and beauticians first receive       on its full meaning, and has an important and useful role! Indivi-
    145 employees                                      psychological training, organised by the association, before they        dually, it's so wonderful to be able to contribute, even in a small
were involved in the two initiatives                   hold beauty workshops throughout the year in Paris hospitals. We         way, to such amazing and ambitious projects. My aim is to get
                                                       have been supporting Restos du Cœur for the last four years, and         every single one of our employees involved in our support work! "

                                                                                                                           - 25 -
C O M M U N I C A T I O N     A N D   S H A R I N G

                        68         C H A M P S - E LYS É E S ,
    THE SYMBOL OF OUR COMMITMENT

Guerlain at 68, Champs-Élysées embodies a dream as much as an ambition. Exclusive creations and the
Institut (which provides unprecedented bespoke treatments) truly embody the French 'Art de Vivre' thanks to
our passionate and dedicated teams who ensure that our guests experience rare emotions. Jacques Guerlain
used to come down from his office at 68, Champs-Élysées to listen to his customers' comments, to encourage
them to try new products and note down their impressions. This Store is a testament to Art, and to the artists
and artisans who showcase our unique Company all over the world.

For summer 2017, we decided to lend 68 to the imagination of a committed visual artist. Célia Pardini
occupied the space with her awesome decoration created from our packaging materials that she recycled
with enormous skill and transformed into Californian poppies. Her decorations used only cardboard, and
required more than 3,000 hours of painstaking work, involving cutting, painting and sculpting this raw
material, over which she applied non-polluting paints and varnishes.

            Through her hyper-realistic cardboard sculptures,
             the artist questions how we consume packaging
                                                  «
                                                    - 26 -
C O M M U N I C A T I O N      A N D    S H A R I N G

                                                                                                                                                    PROTECTING THE BEES HAS GENERATED                                    one felt like they were doing their own small part to promote bio-
                                                                                                                                                    ENORMOUS ENTHUSIASM                                                  diversity.
                                                                                                                                                    The 'sowing seeds for bees' campaign was a great success. In         Through Sustainable Development, we are sharing, and sharing
                                      STORE COMMITMENT:
                                                                                                                                                    June we handed out sachets of seeds for honey plants so that         is the very essence (regardless of the pun) of Guerlain.
                 TRANSPARENCY AND TRACEABILIT Y                                                                                                     our beauty advisors could help "feed" the bees. We received          "Develop, protect and share" is the powerful motto that is our
                                                                                                                                                    lots of photos of the resulting plants from our advisors, and each   cornerstone. »

Beauty Advisors in our stores strive to highlight the sustainable       its content, and the explanation given about our eco-design initia-
development initiatives undertaken by Guerlain and to provide           tive was appreciated by the small revolution it could have gene-
answers to customers' concerns as they become better infor-             rated among very loyal consumers.
med. Sandra Kanawati, Retail Director France, and Delphine
d’Eramo, Retail Manager for the network of Paris stores.                BEAUTY ADVISORS REQUEST
                                                                        INFORMATION AND TRAINING
"Our customers are understanding more and more, whether by              ON OUR PROJECTS
educating themselves or by reading articles in the press. They are      Our advisors are very keen for more information and events that
seeking out transparency and it's a major recent trend. For several     could bring them together and help them to promote Guerlain's
years, annual training courses have been organised with a pre-          commitments. This is a positive sign!
sentation from our Sustainable Development department, on all           They want to be proactive on Sustainable Development and re-
the issues that our customers value, from packaging to traceability.    quest that these commitments be given even more visibility, with
The eco-designed Orchidée Impériale packaging, that was laun-           films, displays and exhibitions for our customers. They particularly
ched in 2017 and involves a lighter                                                                   love the decision to take on Angelina
and smaller jar, was very well recei-                                                                 Jolie for the Mon Guerlain fragrance,
ved by our customers because it                                                                       who donated all her earnings from
was excellently presented by our                                                                      the project to her charitable founda-
beauty advisors, who were them-                                                                       tion. Others have requested that we
selves supported by the Sustainable                                                                   share more information about the be-
Development department ahead of                                                                       nefits of our "Perfume Fountains" to refill
time. As the jar appears to be smal-                                                                  the "Bees" bottles, explaining that not
ler, the only questions were about                                                                    enough customers know about them.

                                                                   - 28 -
C O M M U N I C A T I O N        A N D    S H A R I N G

                                                                                                                                                                      One of our loyal Parisian customers, Chrystelle Trani,
                                                                                                                                                                           shares her thoughts on Guerlain's commitment
                                   SOCIAL COMMITMENT
          A W O N D E R F U L WAY T O C O M M U N I C AT E
                                                                                                                                                 « Guerlain is all about sharing ». I have "followed" Guerlain ever since I was a child. My great-grandmother and grand-
                                                                                                                                                 mother both wore the House's fragrances. My great-grandmother used to say: "There is only one place we can go
                                                                                                                                                 together", and that was Guerlain. She used to wear Shalimar, and I wear it myself sometimes too, then l'Heure Bleue
                    « Sharing our sustainable development initiatives is not a constraint,
                                                                                                                                                 became one of my favourites.
                             but a way of building on our communication channels »
                                                                                                                                                 I have kept all my grandmother's bottles. They remind me of the strong values of sharing, luxury, and obviously have
                                                                                                                                                 huge sentimental value. I am continuing this unique relationship with my daughters. They've actually been able to take
                                                                                                                                                 part in a perfumer workshop held in the Champs-Elysées store. They loved it! Their father let them choose their favourite
                                                                                                                                                 fragrance and treated them to a bottle of it. The issues of commitment and sustainability have been important to me for
                                                                                                                                                 a long time, and I experienced what Guerlain is doing first hand when I took part in my first Odyssea race in aid of the
                                                                                                                                                 association Belle & Bien, which is supported by Guerlain.

Interview with Isabelle ARTUS,                                                            vironmental and social challenges must be ad-
Guerlain's Editorial Director                                                             dressed in a rational manner within the Company                                          Its commitment to sustainable development is sincere and long-lasting. I remember that
                                                                                          (measurements, indicators, roadmaps, etc.), how                                          I could refill my mascara tubes as far back as ten years ago. A beauty advisor told
Sustainable Development is a unique issue that                                            we choose to talk about these topics and asso-                                           me about the service quite spontaneously.
produces original ideas and thoughts, and it's                                            ciated initiatives can be more emotional.                                                Similarly, I was recently able to refill a refurbishable Bees bottle and was delighted to
one of Guerlain's main communication priorities.                                                                                                                                   be able to share this incredibly elegant and ecological experience with my husband
It's great to take action, but we need to know how to share what          TAKING ACTION WITH AN EVEN GREATER                                                                       by giving him a bottle as well.
we do!                                                                    AMBITION AND INITIATING A VIRTUOUS CIRCLE
For the last two years, with each product launch and design, press        This is especially true for a historic Beauty Company like Guerlain.                                     We no longer have any choice in the matter; we must all consume more intelligently,
relation "guidelines" are automatically associated with correspon-        The press loves stories about sustainable industry and our iconic                                        and it must be a bigger and more visible part of our daily lives. Even at Guerlain,
ding environmental commitments with regards to how the perfume,           materials. There are many different angles for them to take,                                             which I believe to be a pioneering and inspirational luxury player.
skincare or make-up product has been designed to protect the              because from France to Asia and Australia, we support various
environment. And our communication teams, both in France and              approaches to cultivation with many different advantages, for the                                        A bottle is precious, like a jewel, that's why it's essential to refill it. Because it is an
internationally, couldn't be more enthusiastic about this. While en-      raw materials which go into our products.                                                                object to be treasured. »

                                                                 - 30 -
C O M M U N I C A T E             A N D    S H A R E

                                                                                                    GUERLAIN & WOMEN

                                                              A LOOK BACK ON THE HISTORY OF PHOTOGRAPHY:                             for her various series tackling the issue of the feminine archetype
                                                              WORKS BY WOMEN AS SEEN BY WOMEN                                        through her images of models, Valérie Belin created an enigmatic
                                                              Ann-Caroline Prazan, Artistic Director at 68 Champs Elysées, ex-       work entitled Liberty, which echoes Delacroix's Liberty Leading the
                                                              plains that one of the highlights of 2017 was "a unique exhibition     People, as well as making reference to Italian Art Nouveau, rich
                                                              in partnership with the MEP (Maison Européenne de la Photogra-         in floral motifs which recall the world of Guerlain.
                                                              phie), an accelerated potted history of photography over the last
                                                              five decades, in 24 images created by 15 women photographers:          A CYCLE OF CONFERENCES FOR WOMEN
                                                              works by women, as seen by women." From the activist Gisèle            Alongside this exhibition, we have decided to give women a
                                                              Freund to the reporter Christine Spengler, including fashion pho-      mouthpiece to talk about women, through a series of conferences
                                                              tographer Dominique Issermann and legendary authors such as            held at '68'", explains Ann-Caroline Prazan. "Five conferences
                                                              Sarah Moon, the series of images is a response to an original          were organised for 2017, designed both for customers and
                                                              creation for Guerlain by artist Valérie Belin. The exhibition ap-      women who are interested and curious in what we are doing.
                                                              proaches feminism through a portrait of Simone de Beauvoir by          This generates lots of opportunities for debate and questions, and
                                                              Gisèle Freund; social issues with prostitutes from the Goutte d'Or     my impression is that we are forging some strong bonds. 'Gene-
                                                              area of Paris with Martine Barrat; femmes fatales with Irina Io-       rosity' is a word often used by the women who attend these
                                                              nesco, beautiful strangers with Dolorès Marat, and a series of por-    events, and that's perfectly in line with Guerlain's ethos, which is
                                                              traits featuring the young generation with K-Pop.                      first and foremost about creating emotion. The sessions include
                                                                                                                                     "How to succeed as a woman in the art world", led by Parisian
                                                              In a counterpoint to this look back on women through history by        gallery owner Magda Danysz. Given the popularity of this se-
                                                              women, Guerlain commissioned the artist Valérie Belin to produce       ries, other conferences have been organised for the years to
                                                              an original work that would continue its momentum. Recognised          come, with more committed and inspiring women."».

Valérie Belin, Liberty, a work produced for Guerlain, 2017.                                                                     - 33 -
C O M M U N I C A T I O N    A N D      T R A N S M I S S I O N                                                                                 C O M M U N I C A T I O N        A N D   T R A N S M I S S I O N

                                GUERLAIN’S CSR POLICY
                                                                                                                                                                                     We hope to increase these initiatives in the future
                                   AROUND THE WORLD
                                                                                                                                                                                    as they are a source of pride and cohesion in-house.

                                Three General Managers of our subsidiaries give us
                                                                                                                                                                                                                               «
                     a quick overview of how they communicate Guerlain’s commitment

                                                                                                                                              Enrico Sorenti                                                          Sandra Vogeler
                                                                                                                                              Brand General Manager Guerlain Italy                                    Brand General Manager
Wherever Guerlain is present around the world, our subsidia-            For the past five years, Belgian employees have also supported        « Guerlain Italy has been certified ISO 14001 and “Commitment           Guerlain Espagne
ries enthusiastically implement our environmental and social            the MCE association (Missing Children Europe) with an annual          to Biodiversity & Climate” since 2017.
strategy. Our priorities are to achieve ISO 14001 certification         solidarity run.                                                       Our involvement has continued to grow. In particular, over the          « Guerlain Spain was certified
in all markets by 2021 and to form regional partnerships with           The subsidiary’s new offices were designed with sustainability in     past few years we have trained our Beauty Advisors in Sustaina-         ISO 14001 and “Commitment to
the Look Good Feel Better association and organisations wor-            mind, with a number of new initiatives welcomed by the team with      ble Development using e-learning modules. In 2017, we celebra-          Biodiversity & Climate” in 2016.
king to protect bees.                                                   open arms: the well-being and ecology survey, weekly organic          ted Bee Day for the very first time and in October we signed a          We formed a local partnership
                                                                        fruit baskets, and free tram tickets to encourage our employees to    partnership with Seba&Vale, a local beekeeper. We also sup-             with Ponte Guapá te Sentir
As well as local initiatives!                                           adopt environmentally friendly forms of travel.                       ported CBM Onlus, the largest international humanitarian orga-          Mejor (the Spanish branch of Look Good Feel Better) by dona-
                                                                                                                                                                              nisation working to prevent and         ting products and volunteering our time.
Guy de Beaugrenier                                                                     To help to protecting the bees, we formed a part-                                      treat blindness and disabilities in
Brand General Manager Guerlain Benelux                                                 nership with the Beeodiversity Association in 2017,                                    southern Europe, by selling co-         The launch of the Bee Day celebrations was a great success.
« Guerlain Benelux was the first subsidiary to be                                      which we launched with an in-house awareness                                           branded Guerlain products over
certified ISO 14001 in May 2013 and has conti-                                         session that took the form of two breakfasts. The                                      one week in November to raise           To help in the fight against climate change, we acquired a
nued to roll out numerous environmental and so-                                        first was organised “without bees” and the second                                      funds.                                  fleet of hybrid vehicles. We hope to increase these initiatives
cial actions ever since. The subsidiary is                                             “with bees”. This also provided the opportunity to                                     We have sown the first few seeds        in the future. They are a source of pride and cohesion
implementing the partnership with the Look                                             celebrate Bee Day for the first time, as well as the                                   of actions that we wish to develop      in-house, and provide an extra touch of soul when communicated
Good Feel Better Association on a local level.                                         “Sowing Seeds for the Planet”                                                          further. »                              to our clients! »

                                                               - 34 -                                                                                                                                           - 35 -
S T E E R I N G        C O M M I T T E E

                                              DARE TO COMMIT

WORKING TOGETHER TO MAKE A DIFFERENCE                                                A DEDICATED STRUCTURE
Guerlain's sustainable development policy, supported and                             TO INVOLVE ALL EMPLOYEES
implemented on all levels by our CEO, involves our employees,                        We decided to structure our environmental and social approach
clients, suppliers and society more generally.                                       by creating a Sustainable Development Department and a Steering
                                                                                     Committee comprising 18 people from each department in the
From the outset, Sustainable Development became a common                             Company. Each person is responsible for drafting and deploying
project in which all teams were involved, and the entire company                     an action plan for their site or their department according to their
has rallied around this common cause.                                                area of expertise and a specific objective, which is defined annually.
                                                                                     This type of organisational approach ensures that we cover all the
The House was identified as a pilot in the LVMH Group's envi-                        Company's activities in a coherent manner and come up with
ronmental strategy from the inception of the LIFE Programme.                         effective global programmatic responses. In the Name of Beauty!

                                           TOOL S FOR THE S TEERIN G C OMMITTEE

                                                                                                                                                                                     THE GUERLAIN SUSTAINABLE DEVELOPMENT STEERING COMMITTEE
                 LIFE                            ISO 14001                                The Bilan Carbone®                         Certification body
    LVMH Initiative For the Environment.         International standard                     To further reduce its carbon       Biodiversity and Climate       First row, seated, from left to right: Philippe Bernard, Cécile Vatan, Sandrine Sommer, Marion Oudin. Second row, from left
  Launched in 2011, the LVMH Group's       for reducing our environmental              footprint, Guerlain has been carrying
                                                                                                                                     Commitment
 LIFE Programme was designed to further        impact and continuously                out a Bilan Carbone® (carbon footprint
                                                                                                                                      developed by
                                                                                                                                                              to right: Angélique Clézardin, Delphine Chorenslup, Ann-Caroline Prazan, Elise Levan, Anne-France Cavarec, Marie-Charlotte
   incorporate environmental issues into        improving our process.                  assessment) every year since 2007
          managerial processes.                                                                 for Scopes 1, 2 and 3.             Ecocert Environnement      Héliot, Gwendoline Perrotin, Laetitia Corbet. Third row, from left to right: Sandrine Bécaud, Nicolas Faure, Aline Valentin,
                                                                                                                                                              Cécile Koenig, Delphine d’Eramo, Stéphanie Roy, Frédéric Gode, Daniel Ponsy.

                                                                            - 36 -
Employee turnover                  2014    2015   2016     2017
                                                                                                                                                                                                                                    Resignation                    30       35     41       49

CORPORATE, ENVIRONMENTAL                                                                                                                                                                                                            Individual redundancy
                                                                                                                                                                                                                                    Internal/group mobility
                                                                                                                                                                                                                                                                    14
                                                                                                                                                                                                                                                                   20
                                                                                                                                                                                                                                                                            18
                                                                                                                                                                                                                                                                            17
                                                                                                                                                                                                                                                                                   23
                                                                                                                                                                                                                                                                                   20
                                                                                                                                                                                                                                                                                            26
                                                                                                                                                                                                                                                                                            17

AND SOCIAL DATA                                                                                                                                                                                                                     Retirement or pre-retirement
                                                                                                                                                                                                                                    Termination of trial period
                                                                                                                                                                                                                                                                    13
                                                                                                                                                                                                                                                                    3
                                                                                                                                                                                                                                                                            14
                                                                                                                                                                                                                                                                            2
                                                                                                                                                                                                                                                                                   16
                                                                                                                                                                                                                                                                                    2
                                                                                                                                                                                                                                                                                            17
                                                                                                                                                                                                                                                                                             8

G U E R L A I N 2 017                                                                                                                                                                                                               TOTAL                          80       88     102      118

                                                                                                                                                                                                                                The number of new recruits increased dramatically in 2017 and can be
                                                                                                                                                                                                                                explained by the creation of some 30 positions, the transition from temporary
                                                                                                                                        1° COMPANY INFORMATION                                                                  work in the plants, the recruitment of some 20 Sunday contracts in-store, and
                                                                                                                                                                                                                                a higher number of staff replacements.

                                                                                                                                        TOTAL STAFF, BREAKDOWN OF STAFF BY GENDER,                                              GROSS ANNUAL PAY
                                                                                                                                        AGE AND GEOGRAPHICAL ZONE ON 31/12/2017                                                 (BASE + VARIABLE, MINUS INCENTIVES
                                                                                                                                                                                                                                AND PROFIT SHARING) AND RELATIVE CHANGE
                                                                                                                                        In France, Guerlain has 1,077 permanent employees and 41 employees on
                                                                                                                                        fixed-term contracts, making a total of 1,118 employees. Out of these employees         Remuneration                              2014    2015    2016      2017
                                                                                                                                        on permanent employment contracts, 70% are women and 30% are men.                           €1500 to €2250                        27%     26%     22%       20,3%
                                                                                                                                                                                                                                    €2250 to €3000                        30%     30%     32%       31,8%
                                                                                                                                                                                                                                    €3000 to €3750
                                                                                                                                        Breakdown of permanent employees by age
                                                                                                                                                                                                                                                                          18%     17%      18%      19,3%

                                                                                                                                                                   2014           2015          2016           2017                 €3750 to €4500                        9%      10%      11%      10,7%
                                                                                                                                                                                                                                    More than €4500 4500€                 16%     17%      17%      17,9%
                                                                                                                                         201760 ans                   2,7%           2,5%            2%           2,5%
                                                                                                                                                                                                                                out of 266 compared to 137 out of 143 employees in 2016). Shift work
• To promote solidarity and self-esteem in particular by supporting associations focusing on this issue                                                                                                                         and night work is practised by all workers, far behind the TAMs (93 out of
                                                                                                                                        HIRING AND REDUNDANCY
                                                                                                                                                                                                                                266 compared to 75 out of 243 in 2016).
Guerlain is not a listed company and as such, only criteria applicable to non-listed companies are shared. Furthermore, the scope       Hire type                          2015     2016   2016(no)     2017    2017(no)        This is then followed by workers and executives, who are least involved (6
covered in this report is limited to Guerlain SA, which corresponds to Guerlain France. It should also be noted that the Company's      Transition from a fixed-term                                                            out of 93, compared to 7 out of 122 in 2016, and 0 executives out of 346
                                                                                                                                        to a permanent                                                                          compared to 1 out of 420 in 2016). In France, workers can perform a
products are manufactured in France (in Chartres and Orphin) and that is why the environmental data mainly refers to these two sites.   employment contract                17%      22%      21         17%       31
It should be noted that food waste is not a material piece of information in our sector.                                                                                                                                        portion of their functions remotely. Currently some forty employees do so.
                                                                                                                                         External recruitment              55%      58%      55         77%       137
                                                                                                                                                                                                                                This is either a temporary solution often linked to maternity leave or a weekly
                                                                                                                                         Internal/group mobility           28%      19%      18         6%        10            practice characterised by a good understanding of the role, which is

                                                                - 38 -                                                                                                                                                     - 39 -
validated by the manager.                                                           ple in 2016 (in 2015 there were 428 out of 1079 and 496 out of 1071 in            needs of our employees
ORGANISATION OF SOCIAL DIALOGUE                                                     2014). The highest on-the-job or commuting accident severity rate was not         Health & Safety:                                                                    - Conference cycle open to everyone: four conferences, one of which is
AND NOTABLY INFORMATION AND                                                         higher than 0.05, compared to 0.27 in 2016, 0.46 in 2015 and 0.36 in              1- Headquarters security access rules have been tightened                           held at the Chartres production sites
STAFF CONSULTATION PROCEDURES                                                       2014. No employees were disabled following a reported workplace acci-             2- Assisted by a body responsible for carrying out evacuation exercises for         - Training: a significant personal development component with modules
AND NEGOTIATIONS                                                                    dent. CHSCT managed the safety budget, for the following amounts:                                                                                                     concerning emotion management and relaxation (with the involvement of a
                                                                                    €168,443 in 2017, compared to €350,000 in 2016, €446,000 in 2015
                                                                                                                                                                      headquarters and the boutiques and creation of a dedicated action plan
                                                                                                                                                                                                                                                          relaxation therapist) and a significant communication component with spea-
                                                                                    and €556,572 in 2014.
                                                                                                                                                                      3- Revision of lighting levels in administrative offices in all boutiques
Guerlain believes in open and constructive social dialogue. Our social part-                                                                                                                                                                              king and non-violent communication training
ners like our employees are committed to the brand and want to see it grow                                                                                            In our new Chartres plant, we have                                                  - A pilot programme focusing on professional fulfilment: the Bloom at Work
and prosper. The agreements that they sign with us reflect this. We regularly       In particular, training on movements and postures was held for all those invol-                                                                                       project at three of the Company’s departments in France
provide information to the works council and central works council on the           ved in stocking stores. First aid in the workplace courses are offered every      Ergonomics/safety/security:                                                         - Youngtalents: essential support for young people in the Company (part-
company's strategic topics: digital affairs, e-commerce, marketing plan, social     year and 47 people were involved in these in 2017. Finally, fire extinguisher                                                                                         time interns, international corporate volunteers): induction, training, farewell
and environmental issues, future restructuring operations, etc.                     and evacuation training was held, and safety training for Executive Committee     - Ergonomics: considered straight from the construction of the site, e.g. fully     party and regular monitoring throughout their internship/apprenticeship
All employees were also involved in the decision to restructure the Levallois       members was held in 2016.                                                         ergonomic production zones, simplified and optimised workflows, improved            - School partnership: this year we are sponsoring the Master’s in Innovation,
headquarters in anticipation for a future move – 10 consultations were held                                                                                           ventilation for machines producing powders, new machines for manufactu-             Design and Luxury run by IAE Gustave Eiffel.
and all employees were able to present their ideas for the restructuring project    OVERVIEW OF OCCUPATIONAL HEALTH AND SAFETY                                        ring emulsions (implementing raw materials using automatic suction, cleaning
and how they could work differently in the way that motivates them the most.        AGREEMENTS SIGNED WITH TRADE UNION                                                and disinfection; controlled operation of process parameters)                       TOTAL NUMBER OF TRAINING HOURS
                                                                                    ORGANISATIONS OR STAFF REPRESENTATIVES
In 2017, staff representatives attended 55 meetings (broken down as follows):                                                                                         - Safety: a dedicated weighing area for hazardous materials and safety              16695 training hours were performed in 2017, versus 11728 in 2016 and
                                                                                    In France, an occupational health and safety agreement was signed in 2017.                                                                                            12757 in 2015.
                                                                                                                                                                      systems that shut off machinery in the event of a malfunction
                                                                                    As well-being is known to promote health and safety in the workplace, it has
                                      2014      2015      2016       2017           always been a very important aspect at Guerlain, and this took the form of                                                                                            792 permanent staff members were trained in 2017, compared to 600 in
                                                                                                                                                                      - Security: improved controls of pedestrian/vehicle access at the various en-
 Total number of meetings              67        71        65         55            a well-being agreement signed in 2013.                                                                                                                                2016 and 814 in 2015. In 2015, preparation for an FDA inspection took
                                                                                                                                                                      trances, controlled access to the site's key locations, cameras and alarms
 Works council                          32        38        47        41                                                                                              installed around the industrial perimeter; all the equipment is optimised and       place in Chartres, which required 1678 hours of training.
                                                                                    We are taking steps to promote the well-being of our employees, allowing
 Staff representatives                  13        15         1         0                                                                                              technically managed from the building.
                                                                                    them to find a good work-life balance.                                                                                                                                MEASURES TAKEN
 C.H.S.C.T.                             16        13        17        14                                                                                                                                                                                  TO PROMOTE GENDER EQUALITY
 Other                                  6          5         0         0
                                                                                                                                                                      Teams' well-being was central to the development and taken into account
                                                                                    1- Regular increase in organic and vegetarian products at the company
                                                                                                                                                                      at the design stage: two central patios let light into all the areas and notably
                                                                                    restaurant                                                                                                                                                            We are still very vigilant in terms of this issue and we aim to maintain diversity
                                                                                                                                                                      the workshops/well-tended grounds: trees planted, living roof, etc. / relaxa-
                                                                                    2- Yoga: every Monday and Thursday lunchtimes, employees can attend a                                                                                                 at the highest levels and for all careers.
COLLECTIVE BARGAINING AGREEMENT REPORT                                                                                                                                tion areas, gym, staff canteen with a terrace, auditorium, etc. / ventilation in
                                                                                    relaxing one-hour yoga session. Guerlain also makes meeting rooms avai-
                                                                                                                                                                      offices and air-conditioning in all production areas, etc.
                                                                                    lable; the costs are covered by the employee. Twenty employees have par-                                                                                              In France, a gender equality and diversity agreement was signed in 2011
Five agreements were signed this year: Incentives, Well-Being and Quality
                                                                                    ticipated                                                                                                                                                             and then renewed in 2014 and 2017. ‘Female leadership’ are not just empty
of Life at Work, Amendment to Flat Daily Rates, Gender Equality Agreement,                                                                                            TRAINING POLICIES
                                                                                    3- Sports coaching: every Monday at 6.30 p.m. employees can take part                                                                                                 words at Guerlain, as 50% of the Executive Board is female and 60% of
and mandatory annual negotiations.
                                                                                    in a one-hour fitness class (legs, bums and tums). Guerlain makes meeting         In 2017, Guerlain invested more than 2.71% of payroll in employee                   BGMs (Business General Managers) are female (heads of subsidiaries
OCCUPATIONAL HEALTH AND SAFETY                                                      rooms available for this as well; costs are covered by the employee. Twenty       training: this figure is a testament to Guerlain's commitment to professional       around the world).
IN THE WORKPLACE IN FRANCE                                                          employees have participated                                                       development and enhancing skills. In terms of skill development, our priorities
                                                                                    4- Beautiful hands: every Friday between 11.30 a.m. and 2.30 p.m. em-             in 2017 focused on:                                                                 Currently, 73% of permanent staff members are women, broken down as
                                                                                    ployees can arrange to have a manicure in their office. Around 15 em-                                                                                                 follows. We want to promote diversity and to incorporate more men into our
 Number of fatal accidents              0          0         0         0
                                                                                    ployees have participated                                                         Creativity:                                                                         teams.
 Accidents resulting in absence         21         7        14         3
                                                                                    5- Rearrangement of shared spaces in consultation with employees to pro-
 No. of working days lost              463       180        94        44                                                                                              Facstory : A new experience involving creativity and group intelligence
                                                                                    vide a better working environment at Levallois                                                                                                                        Proportion of Women                    2014      2015       2016      2017
 Occurrence rate                      12.40      4.13      7,86      1,68           6- Organisation of cleaning days to tidy up offices and social spaces: once       begun in 2015, expanded in 2016 and developed further in 2017: more
                                                                                                                                                                                                                                                          Employees                              95%       94%        95%       93%
 Severity rate                          15                 0,05      0,02           or twice per year                                                                 than 200 employees from different departments took part.
                                                                                                                                                                      - Healthy & Safety focus: Training on movements and postures for all those          Technicians/supervisors/managers       75%       75%        73%       71%
                                                                                    7- Massages offered once a month at manufacturing sites 8- A “Bloom at
                                                                                                                                                                      involved in stocking stores, first aid in the workplace training: 47 people         Workers                                62%       60%        59%       59%
384 out of 1118 received safety training compared to 284 out of 1070 peo-           Work” pilot project has been launched to record the perceptions and real
                                                                                                                                                                      involved, extinguisher training, evacuation training                                Executives                             72%       74%        73%       74%

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