How beauty brand L’Oréal stays earth-friendly and profitable

By Cathy Rose A. Garcia, Associate Editor
L’Oréal is proving that businesses can make a serious and conscious effort to reduce their environmental footprint, and be financially successful at the same time.
The world’s biggest beauty products maker, whose brands include Maybelline, L’Oréal Paris and Kiehl’s, outlined its commitments in its sustainability program Sharing Beauty with All.
Launched in 2013, the program has set goals to push sustainable practices in all aspects — from product design to distribution, including production and sourcing of raw materials.
“We believe beauty is not just about visual beauty, but also beauty that can work for a better life, even transform the world,” L’Oréal Philippines Managing Director Thibault de Saint Victor told ����ý in a recent interview. “We consider our corporate social responsibility a fundamental pillar and a strategic priority.”
Under Sharing Beauty With All, the global company’s commitments are organized into four pillars: innovating sustainably, producing sustainably, living sustainably and developing sustainability with communities, suppliers and employees.
One of its goals is to have 100% of its products have an improved environmental or social profile, such as having a new formula reducing its eco footprint or using renewable raw materials that are sustainably sourced.
According to its 2017 Sustainability Report, L’Oréal said 76% of new or renovated products have an improved environmental or social profile.
“One thing that L’Oréal does is to act first on things that we can control, which is making sure every time we innovate, we try to have enhanced sustainability components,” Mr. De Saint Victor said.
Another goal is to cut carbon dioxide (CO2) emissions generated by its plants and distribution centers by 60% in absolute terms, compared to 2005.
As of 2017, L’Oréal reduced its CO2 emissions by 73% since 2005, while increasing its production volume by 33%.
While there are challenges to implementing these directives in the Philippines, L’Oréal has found a way to make it work by applying the entrepreneurial spirit the company is known for.
“Today in the Philippines, in terms of waste management, we are zero landfill on what we can control… In terms of point-of-sale materials, what is coming from our warehouse, products that are discontinued, stocks,” Mr. De Saint Victor said.
For instance, the L’Oréal group requires that paper used for offices and products have the Forest Stewardship Council (FSC) certification. The certification assures customers that paper and wood “have been sourced in an environmentally-friendly, socially responsible and economically viable manner.”
But in the Philippines, Mr. de Saint Victor said none of its Philippine suppliers were able to provide FSC-certified paper.
“One solution could be importing from China but that would be ’greenwashing’, just tick the box . . . So our purchasing department worked hard with our suppliers to make them improve, innovate, and make sure they can certify what they produce and comply with the FSC standard. It was not easy, but we need to start this journey together,” he said.
Now, L’Oréal Philippines uses 100% FSC-certified paper for office use and 95% for retail.
EMPOWERING WOMEN
In the Philippines, the L’Oréal Foundation introduced programs such as Beauty for a Better Life and For Women in Science (FWIS), in line with the company’s commitment to empower and support women.
“Beauty for a Better Life is about providing sustainable living in some barangays where there is high unemployment,” Mr. de Saint Victor said.
L’Oréal Philippines partnered with Philippine Business for Social Progress for the project, which aims to help underprivileged women by training them in hairdressing.
Women from Barangay Sto. Niño in Marikina City were selected for the program. They receive 300 hours of training from L’Oréal Philippines salon educators, and have the chance to be employed by the company’s partner-salons.
“Our partner-salons are always looking for new stylists. The employment rate for (the trainees) is around 70%… We can see an immediate result and some people are alleviated from poverty in just a few months. That’s an additional motivation to do the job. It’s a good start,” Mr. de Saint Victor said.
By end of October, L’Oréal will have trained 108, 95% of which are women.
At the same time, L’Oréal Philippines is hoping to encourage more women to venture in the sciences field through the foundation’s FWIS program.
“We’re quite a scientific corporation in the sense that we have a lot of innovation, over 4,000 researchers . . . We also realize that it can’t just be men dictating what should be innovation, women should be a part of it. We have a lot of female scientists and researchers in L’Oreal, and there is tremendous impact,” Mr. de Saint Victor said.
“We believe women are important not just in the industry but also in science as well. By doing this, it helps in the long term to reduce the gender gap,” he added.
The program was restarted in the Philippines in June this year, with Dr. Charissa Ferrera being named the FWIS Philippines National Fellow 2018. With the P400,000 research grant, Dr. Ferrera will conduct research on the water quality in coastal areas and fishing communities in Bolinao and Anda.
MORE IMPACT
The cosmetics giant has shown that “economic performance and environmental, social and societal performance go hand in hand and are mutually reinforcing.”
In 2017, L’Oréal reported sales rose 4.8% like-for-like to 26 billion euros, while operating profit grew 3% to 4.7 billion euros.
“Good sustainability is good business as well,” Mr. de Saint Victor said, noting that companies that can create good social impact can also help redistribute wealth and boost the value of the overall market.
“Also long-term sustainability, if we are going to have a huge climate catastrophe, it’s not good for business as well. If we don’t solve this climate issue, I don’t know in tens of years, will there be businesses anymore?. . . We have to do something,” he added.
While it may be easier and more cost-effective to do business as usual, Mr. de Saint Victor said the same energy can be dedicated to find creative solutions.
“I’m proud to work for a company where sustainability is one of the core pillars of our strategy. It’s more difficult, there are changes but there is a kind of a joy in finding solutions and doing good,” he said.
This commitment to making a social impact is taken very seriously by L’Oreal’s employees. Every year, L’Oreal holds a Citizen Day around the world, where its employees volunteer to work with groups involved in different causes such as environment and fighting exclusion.
In the Philippines, L’Oreal gives its employees a chance to do volunteer activities for an equivalent of six days a year.
“We are not forcing employees. We have this model of unleashing energies and entrepreneurial spirit. We believe when people are motivated, and people want to do something, they find a way of doing it on their own. It has a great impact,” Mr. de Saint Victor said.