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L'Oreal and the road to carbon-neutral cosmetics

The beauty brand has cut carbon emissions 56 percent, even during a period of growth, and plans to give executives bonuses based on environmental performance. Read More

(Updated on July 24, 2024)
lipstick L'Oreal beauty cosmetics carbon-neutral

Multinational firms can decouple carbon emissions from economic growth, L’Oreal has claimed in its new sustainability report.

The French beauty brand revealed last week that it has cut its carbon dioxide emissions 56 percent against a 2005 baseline — even while increasing production by 26 percent during the same period.

The achievement is the latest step in L’Oreal’s plan to become a “carbon-balanced” company by 2020, announced by the brand’s chief executive Jean-Paul Agnon last year.

“We have continued to dissociate our growth from our environmental impact, proving that economic performance is clearly compatible with a commitment to protecting the climate,” said Agnon in his introduction to the update, which was released last week.

“There can no longer be any doubt: Companies have to change. They can no longer see their success and long-term outlook in terms of economic performance alone. Sustainability has become the new norm, the new license to do business and even the key to survival.”

To hit its carbon-neutral target, L’Oreal aims to slash emissions 60 percent by 2020, increasing its use of renewable energy and boosting the energy efficiency of its sites, the company said.

The rest of the group’s emissions will be offset by generating “carbon gains” through the sustainable sourcing of raw materials in its supply chain, L’Oreal added.

The firm also reported that 74 percent of its new or revamped products have a positive environmental or social impact, up from 67 percent a year earlier. This impact can be delivered through an improved environmental footprint, greater use of renewable or responsibly sourced raw materials or greener packaging, the company explained.

However, Agnon admitted there are areas where the brand still needs to make more environmental progress.

Over the course of 2016 he said L’Oreal will focus on rolling out more sustainable packaging and encouraging consumers to adopt greener lifestyle habits. A product assessment tool — due to be launched in 2017 — will help consumers better understand and track the environmental and social profile of all its products, the report said.

Meanwhile, Agnon said that from 2016 performance targets related to L’Oreal’s sustainability program will be integrated into the brand’s bonus system for all L’Oreal executives.

“This will allow their individual contributions to be acknowledged and will make the success of the program a new key performance indicator,” he said.

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