Socially responsible purchasing

Social responsibility is a major dimension of the L’Oréal Buy & Care Program, which among other things makes use of two focal activities: social audits and "solidarity sourcing".

Argan
Argan

When it comes to social matters, the group does not limit itself to its own divisions. It also includes its network of suppliers all over the world. For L'Oréal, a priority is adherence to fundamental human rights and diversity, which inspires its entire Buy & Care program. Among others, two activities illustrate this: social audits are carried out among suppliers and a joint purchasing program is developed.

Social audit policy


As a signatory of the United Nations Global Compact, L'Oréal expects its suppliers to adhere to the basic conventions of the International Labor Organization and to local legislation, especially in matters concerning minimum wage, work time and occupational health and safety. Social audits are carried out by independent external companies on the suppliers' premises, thus making close monitoring of their adherence possible. Audits are also systematically carried out on subcontractors, wherever in the world they may be based, as well as for suppliers of raw materials, packaging and POS*/advertising in sensitive countries. Social and safety/health audits are frequently conducted along the entire logistics chain, with the aim of validating the selection of new suppliers and contributing to the development of good business practices among existing suppliers.

* POS : point of sale advertising.

Since 2006, more than 3,300 supplier sites have been audited, with 567 audits taking place in 2010 and 793 audits in 2011.


Solidarity Sourcing: sourcing that fights against exclusion
Text transcription of the video

Des achats solidaires pour lutter contre l’exclusion

A joint program at the heart of the business


The high volume of purchases made by L'Oréal gives the group considerable economic and social leverage. The group has thus decided to use its purchasing program as a way to promote inclusion, through its « Solidarity Sourcing » program, which was launched in 2010. This program is neither a sponsorship program nor a charity; it covers all the geographical regions and purchasing divisions and is completely integrated into the company's business model. It makes it possible to open up the purchasing process to include new types of suppliers: those with better access to major customers and those who employ persons generally excluded from employment (handicapped or socially disadvantaged persons, people in rural communities). This approach is also followed by the existing L'Oréal suppliers when it comes to their own purchasing policies.

Projects integrated into the purchasing strategy


The proposal of joint sourcing projects in partnership with economic and social experts (NGOs, associations, public stakeholders) thus becomes a major element in the tender decision-making process. Projects are selected and monitored on the basis of a certain number of criteria, including the following: purchasing value, competitiveness in the market, number of jobs created or maintained, reproducibility and sustainability of the project. « Solidarity Sourcing » projects are thus long-term projects that are essential to the activities of the group and aligned with its purchasing strategy (with regard to quality, competitiveness, lead times, adherence to ethical, environmental and social principles). Within two years, 120 initiatives were started in 47 countries, providing access to long-term employment and a better income to 14,000 people.