L'Oreal sustainability chief: Transparency is no stunt
L'Oreal sustainability chief: Transparency is no stunt
If you think companies have a tough time proving their commitment to ethical and sustainable practices where you live, try going to France, where, according to L'Oreal's chief sustainability officer Alexandra Palt, all corporations are considered guilty until proven innocent.
The world's largest cosmetics company has seen more than its fair share of controversies over the years, but there are also cultural reasons why French firms traditionally have been tight-lipped about their sustainability policies, said Palt.
"There's a saying in France: 'Less hidden, less happiness,'" she told BusinessGreen, suggesting a political climate that can be hostile towards big businesses means firms sometimes conclude there is little upside in touting their environmental credentials.
French businesses kept their ethical behavior on the down low, for fear of being accused of using it as a PR stunt, she reckoned. "Very large companies said we'll do these things but we're not going to talk about it because when you're not talking about it, people are not going to criticize us," she said. "Even worse than Anglo-Saxon countries, there was always a big distrust to everything related to money, economy and companies."
Breaking the silence
Now, however, L'Oreal is keen to start talking publicly about an environmental record that has delivered significant improvements in recent years. Palt, CSO at the company for the past three years, helped launch a series of climate change targets at the firm in 2013 covering innovation, production, changing consumer and employee behavior. The last perhaps was the most challenging to deliver on."[Transparency] is completely contradictory to French culture because in France people say, 'We communicate it when we prove it,' but that's not sufficient today on sustainability because if you do not commit and set the bar quite high and stretch it, then we will not go fast enough," she explained. "Now, at least at L'Oreal, everyone understands that communicating and being transparent is a responsibility in order to be more collectively bold on sustainability."
Her efforts appear to be paying off — earlier this year the company announced it had halved its carbon footprint in absolute terms from a 2005 baseline while growing production 22 percent over the same period. The decoupling of emissions and revenue has been achieved through the introduction of a range of green technologies at its operations around the world, including projects to power a plant in Yichang, China with hydroelectricity, invest in water filtration in Montreal, Canada, and install a biomass plant in Burgos, Spain.
But despite L'Oreal's public commitment to tackle climate change, all robustly backed by chief executive Jean-Paul Agon, Palt won't emulate IKEA and say how much L'Oreal is investing in the program.
"In France, it's a big complexity to talk about money and it's even worse when you talk about money related to things that are right, correct to do," she told BusinessGreen.
L'Oreal's silence on financial matters is somewhat at odds with the growing number of companies keen to highlight the financial business case for tackling climate change. During a major summit at the Unesco headquarters in Paris last month, chief executives lined up to highlight how investing in energy saving or renewable energy technology was good for their bottom line as well as the planet. Even French President François Hollande told delegates that the right actions would have "extremely positive consequences on economic actors, on future technologies, on employment and on growth."
Cultural sensitivity is common sense
But for Palt, the focus on financial issues can serve to ignore the cultural differences between countries and their attitudes towards sustainability. She is also concerned that many global companies are still failing to grasp how those cultural differences could affect their sustainability messaging to customers. "For a long time, global companies thought the way they were going to engage consumers on sustainability would be the same everywhere," she noted. "But of course that's not true."
For example, people who regularly experience drought will be much more open to the idea of saving water, while other countries, such as Germany, appear to have recycling ingrained in their societies already. "So if we want to involve the consumers, which is absolutely necessary, we also have to understand the cultural differences in sustainability that apply to consumers," Palt added.
Given L'Oreal's track record as one of the world's premier marketing organizations, capable of tailoring messages for a wide range of target audiences, it seems like sage advice.
However, despite her concerns about the tenor of some corporate sustainability programs, Palt said she remains an optimist with regards businesses' ability to tackle climate change and the upcoming Paris Summit at the end of this year, where world leaders are expected to sign a global deal to tackle climate change.
"I have a feeling we're at a tipping point both for businesses and in general," she said, recalling the pre-Paris Summit business meeting last month in the same city. "When would you be able to gather 100 CEOs from around the world, all coming to talk about climate change and carbon pricing?"
But with the dust settled after the Business and Climate Summit in May, she is keen to see corporates continuing to put pressure on world leaders in the run-up to the Conference of the Parties (COP21) summit in Paris.
L'Oreal will launch an "open innovation" program in September, she revealed, although she wouldn't be drawn on what it will entail. She does, however, reveal the new tool will be shared with other businesses to help them also make the carbon reductions needed to limit global temperature rises.
"Companies should be aware of their fields and what they are competing for," she argued. "In fighting climate change, we are not competing."