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Give preference to certified supplies To develop its responsible purchasing, LVMH relies on certification, which is a guarantee that practices comply with the highest environmental standards in its supply chains. Since 2018, for example, nearly 80% of the palm oil by-products purchased by the Group are RSPO (Roundtable on Sustainable Palm Oil) certified. Within the framework of LIFE 2020, the Group has set new objectives. By 2020, 100% of the volumes of gold and diamonds purchased by its Houses will have to be certified. In addition, 70% of the leathers will have to come from LWG (Leather Working Group) certified tanneries; 70% of the cot- ton purchased must be certified organic, Better Cotton grown in accordance with the recommen- dation of the BCI (Better Cotton Initiative), recycled or fair trade; 70% of fur farm stock purchased will have to be certified. In 2025, these rates must be raised to 100%. The Group is at the ready to help its Houses achieve these objectives. For example, since 2017, it has conducted a campaign for LWG certification of the tanneries that supply its leathers. Five new tanneries were certified in 2018, which raises the rate of leather volumes purchased by LVMH from LWG certified tanneries to 48%.

Motivated and supported, the Houses are making rapid progress. Today, all the Houses of the Watches & Jewelry business sector are certified RJC. Bvlgari has become the first company in its market to earn the CoC (Chain of Custody) Traceability Chain certification introduced by the RJC. This certifica- tion for the production of gold jewelry guarantees the exclusive use of responsible gold from the point of extraction to the point of sale. At the end of 2018, almost all gold purchased by Bvlgari was certified. The House, which is supplied almost exclusively with responsible silver, is now actively working with other players in the sector, for the emergence of an ethical, social and environmental standard applicable to colored stones. Sustainable purchases are also increasing in the Group s other business sectors and affect an increasingly wide range of resources. The cotton purchasing policy of LVMH is one illustration. While cotton fiber is highly appreciated around the world, its use has a number of impacts on the environment, which can lead to

heavy water consumption, the use of pesticides and the erosion of soils. Therefore, the Houses are replacing conventional cotton with alternatives, such as Better Cotton or organic cotton.

Make a commitment to animal well-being Wool, leather, fur Several of the raw materials used by LVMH are of animal origin. At the end of 2018, to strengthen the existing approaches, primarily in the context of the LIFE 2020 goals, an in-depth project was undertaken to formalize more ambitious, cross-divisional commitments on animal supply chains. This approach, which will be shared in 2019, includes traceability, animal well-being and respect for populations and the environment.

Fur Fur, a key resource for LVMH. On this sensitive issue, the Group respects each individual s personal choices. The Group s intention is to provide custom- ers who want to wear fur with a product that has been made in the most responsible and ethical manner possible: compliance with all regulations governing the fur trade, no use of fur from endan- gered species, and a supply composed of certified skins. LVMH and its Houses work hand in hand with primarily European and American suppliers. Absolute priority is given to certified skins coming from farms that are audited regularly, with the results verified by independent third parties. These audits are based on recognized quality standards, such as the European WelFur label or the standards

ACTIONS AND EVENTS

Encouraged by initiatives like the training day organized in March 2018 in Portugal to introduce to their suppliers the advantages of Better Cotton, all the Houses have begun transition to more sustainable alternatives. Today, for example, Louis Vuitton is supplied with Better Cotton to manufacture 100% of the protective covers for its items before they are given to the customers. Organic cotton is also used: it now represents 100% of the cotton used at Baby Dior, and Celine Leather Goods and Loewe use it to manufacture all their packaging for leather goods.