Sustainability at L’Oreal: a colourful bouquet of concrete measures
Jan Brecht, Chief Information Officer of Daimler and Mercedes-Benz, wants to make Daimler IT CO₂-neutral by 2025. At least that’s what he announced in July when the CIOmove stopped by his company. His colleague Frank Hoe responded (mutatis mutandis) at the beginning of November: “Hold my beer!”
The Senior IT Executive and CIO DACH at L’Oréal is already much closer to this goal: Since 2005, the world’s largest cosmetics manufacturer has already saved 81 percent of its total CO₂ – and that with permanent growth.
The French group, which builds its business on brands such as Garnier and Maybelline Jade as well as luxury products such as Lancôme, Helena Rubinstein and Giorgio Armani, knows that this is not possible without transformation – and disruption.
Irene Binder, who as Sustainability Transformation Director & Human Rights Ambassador at L’Oréal is responsible for the company’s commitment to sustainability, would, for example, like her German management to restrain even more flights from Düsseldorf to the company headquarters in Clichy near Paris – and replace them with journeys on the much more environmentally friendly train Thalys. Practically no big deal, since the TGV-based high-speed train also makes a stop in the North Rhine-Westphalian capital on its nearly four-hour journey to Paris.
But L’Oreal’s program is more ambitious. In fact, during their visit to the Düsseldorf German headquarters, it was fascinating for the CIOs to experience how diverse the sustainability commitment actually is, right down to the smallest detail.
The sustainable company is based on three pillars
“L’Oreal for the future” is based on three pillars: The first, as described, concerns the transformation of the company’s operations itself – and the company’s own employees. It is about transforming the company and it is based on the United Nations’ Science Based Targets. This concerns CO2 consumption as well as sustainable management of resources such as water and packaging materials and the preservation of biodiversity. One example lies in the sourcing of the ingredients: L’Oréal sources all its Shea Butter, for example, from a specific project in Burkina Faso, Africa. The aim is to optimize trade in shea butter, a raw material that is so important in cosmetics production, in the interests of local women producers. To this end, L’Oreal does business directly with local producers. The project is flanked by training measures on harvesting and processing in order to make the processes more efficient – and more sustainable. Finally, L’Oreal is also investing in the drying ovens for the shea nut, which also helps to reduce CO2 emissions.
With the second pillar, L’Oreal wants to reach one billion people – its customers. In view of this large base, the company feels it has a duty to advocate for more sustainability not only on its own doorstep, but also in the outside world. The aim is to transform its own value chain and to encourage customers to change their behaviour in the interests of sustainability and to take suppliers and clients on this sustainability journey too.
And the third pillar is based on financial instruments: L’Oreal has set up three funds of each 50 million euros. 50 million are for women in vulnerable situations, 50 million are for impact investing in ocean cleansing projects and re-forestation projects. The last 50 million are set for investments in innovation in regards to circular economy.
But even this is only a part of the very detailed programme that L’Oreal has set itself for its ambitious climate targets. Energy consumption in production facilities and data centers, savings in packaging and repackaging, and logistics are further items on the ambitious agenda.
The IT paradox: More devices, more consumption and still ambitious goals
And ambitious it really is, because IT under CIO Frank Hoe, for example, has to deal with the paradox that “his” IT is consuming more and more energy because the company is producing ever greater volumes of data in networked value creation, using more and more devices for mobile and hybrid working, and thus consuming valuable resources in no small measure. In contrast to the CO2 pollution in the factory halls and logistics centers, which is decreasing by ten percent year after year, it is increasing annually at his company. Nevertheless, Frank Hoe is also pursuing the goal of CO2-neutral operation of data, applications and devices by 2030 – among other things via sustainable technologies “by design” with keywords such as “frugal coding”, a consistent migration to the cloud and the equally consistent replacement of legacy in the system: “No Rise of New Tech without sunsetting of legacy”.
“Progressing digitalization is a contribution to more sustainability!”
Questions for Frank Hoe, Senior IT Executive and CIO DACH at L’Oréal.
CIOmove: Frank, isn’t IT, with its ever-increasing number of devices and data and its rising energy consumption, much more part of the problem than the solution?
Frank Hoe: We definitely need to address the growing number of end devices, data and data centers critically and thus create transparency about the increasing consumption of resources. That’s why, as a first step, it’s enormously important to know how much IT actually consumes. To do that, we need to measure it.
But that is only one side…
True, because IT is definitely also part of the solution in the increasing digitization. GreenTech initiatives in particular offer concrete starting points here, because they give us the chance to focus on sustainability in the development of IT-based solutions.
How should this be done?
There are several approaches. We need to transform the linear economy of a “take-make-waste” into a life-cycle model, in which we recycle as many components as possible and bring them back into the cycle. Another option is upcycling, where we reuse components in other ways.
Avoiding resources is one thing, but how do you deal with the huge energy requirements of IT?
Here we follow guidelines for sustainable design, for example, to constantly improve or reduce the energy requirements of IT components. When we introduce new solutions, we have committed ourselves to shutting down old ones at the same time. This saves a lot of energy and is also a contribution to greater sustainability.
What specific contribution does your IT make at L’Oreal?
We have already taken the first important step I outlined: We know exactly what the energy requirements and CO2 footprint of our IT are. All L’Oreal sites in Germany and Austria are already CO2-neutral. My IT department is and always has been a member of committees that develop and help implement ideas on sustainability.
Sustainability continues. Next stop of the CIOmove: Hamburg IT Strategy Days
Sustainability will continue to occupy us at the CIOmove: The next stop of the move will be the Hamburg IT Strategy Days from 16 to 18 February 2022. At the hybrid congress, the international CIO community will be discussing the likewise hybrid working world of tomorrow, closer cooperation between IT and specialist departments, but also, and this is the only reason we mention it here, the topic of sustainability: “What strategies can IT use to reduce its own CO 2footprint as well as that of the entire company? “
We would be very happy to welcome you there as well!