1 This 2017 Social Responsibility Report describes the LVMH group’s corporate social responsibility (CSR) policy, approach and initiatives. For additional information on the LVMH group’s social responsibility data, please refer to the cross-reference tables on pages 94 to 97. Cover photo: Justine Le Dortz This document is a free translation into English of the original French “Rapport responsabilité sociale 2017”, hereafter referred to as the “2017 Social Responsibility Report”. It is not a binding document. In the event of a conflict in interpretation, reference should be made to the French version, which is the authentic text. 2 CONTENTS KEY WORKFORCE-RELATED INDICATORS FOR 2017 ............................................................................................................ 4 HIGHLIGHTS OF THE YEAR ......................................................................................................................................................... 6 THE LVMH GROUP ......................................................................................................................................................................... 8 Diverse business lines ........................................................................................................................................................................ 8 THE LVMH GROUP’S INTERNATIONAL VALUES AND COMMITMENTS............................................................................ 9 The LVMH spirit ................................................................................................................................................................................ 9 LVMH’s international commitments................................................................................................................................................ 10 CSR ISSUES AND STRATEGY ..................................................................................................................................................... 12 Main social responsibility issues ...................................................................................................................................................... 12 Identification of the main workforce-related and societal risks and opportunities ........................................................................... 13 The four pillars of the Group’s social responsibility strategy ........................................................................................................... 13 STRUCTURING OUR APPROACH .............................................................................................................................................. 14 Defining and monitoring our strategy .............................................................................................................................................. 14 Monitoring by the Ethics and Sustainable Development Committee ............................................................................................... 14 Operational implementation ............................................................................................................................................................. 15 Process and project momentum ........................................................................................................................................................ 16 RELATIONSHIPS WITH STAKEHOLDERS ................................................................................................................................ 17 Types of stakeholder relationships (excluding partnerships) ............................................................................................................ 18 The LVMH group’s main partnerships ............................................................................................................................................ 19 RATINGS AND RECOGNITION OF LVMH’S COMMITMENT ................................................................................................ 21 1. DEVELOPING TALENT AND SKILLS .................................................................................................................................... 23 Recruitment – a key moment ............................................................................................................................................................ 23 Employee professional development ................................................................................................................................................ 29 Preserving expertise ......................................................................................................................................................................... 37 Compensation ................................................................................................................................................................................... 42 2. CONTINUOUSLY IMPROVING QUALITY OF LIFE IN THE WORKPLACE ...................................................................... 45 Health and safety issues ................................................................................................................................................................... 45 Group company programs and initiatives for well-being at work .................................................................................................... 51 Organization of working time .......................................................................................................................................................... 55 Labor-management relations ............................................................................................................................................................ 57 3. PREVENTING DISCRIMINATION AND RESPECTING INDIVIDUALITY ......................................................................... 63 Developing shared prevention practices ........................................................................................................................................... 63 Promoting gender equality in the workplace .................................................................................................................................... 65 Promoting employment for people with disabilities ......................................................................................................................... 69 Providing career support for older workers ...................................................................................................................................... 74 4. SUPPORTING LOCAL COMMUNITIES AND REGIONAL DEVELOPMENT .................................................................... 77 Jobs and regional development ........................................................................................................................................................ 77 Supporting SMEs and entrepreneurs ................................................................................................................................................ 81 Supporting integration through employment .................................................................................................................................... 84 Supporting vulnerable, marginalized or underserved populations .................................................................................................... 89 REPORTING METHODOLOGY .................................................................................................................................................... 93 SUMMARY REPORT OF SOCIAL RESPONSIBILITY DATA ................................................................................................... 94 Indicators according to GRI Standards ............................................................................................................................................. 94 Topics and indicators from the French Decree of April 24, 2012 (Grenelle II) ................................................................................ 96 3 KEY WORKFORCE-RELATED INDICATORS FOR 2017 Steady increase in the number of employees Strong hiring data 2017 2017 33,191 145,247 Robust net job creation Attractive compensation Personnel costs for permanent positions 2017 2017 €7,446.9m 3,551 An international Employees by group business group As % of total workforce on permanent and fixed-term As % of total workforce on permanent and fixed-term contracts as of 12/31/2017 contracts as of 12/31/2017 Other Wines & activities Spirits Other markets 4.9% 3.2% 7.7% France 6% 20.4% Fashion & Asia (excluding 28.4% Leather Goods Japan) 21.4% Selective 39.5% Retailing 4.4% 23.5% Japan Europe 18.4% (excluding 22.5% France) 5.6% Perfumes & Cosmetics United States Watches & Jewelry A high proportion of women Women increasingly moving % by business group into positions of responsibility % by professional category 4 People with disabilities taken into A Group that gives pride of place consideration to employees aged 50 and over France Worldwide (official standards) France Worldwide 4.7% 1% 23.6% 13.5% Amount of services entrusted to companies that specifically employ Up 7.6% people with disabilities in France Corresponding external jobs Up 18% Training investment in 2017 R&D investment tailored to specific market conditions to drive innovation (€ millions) Other €130m Up 17.1%