John (1996, p. 46). Communication problems arising out of different business traditions, lack of communication, cultural differences, growth of external stakeholders might occur and result in unfavorable litigation, negative publicity, and unfavorable regulatory policies. Therefore, supplier assignment and integration into the L'Oreal community are based on the key values: mutual respect, transparency, sharing of information, strong communication and high business standards. To integrate a new supplier or subcontractor, a specialized team follows a structured process called "Welcome on Board" with several formal stages, starting with an analysis of information related to the supplier's financial and technical capacity, structure and geographic location (L'Oreal Sustainable Development Report 2007 ibid). Question 5: The company's commitment to act in an ethical and responsible manner is summarized in a document called "The L'Oreal Spirit" and can be accessed on the company's website. Ethics is at the heart of L'Oreal's commitment towards sustainable growth and consumption. The "L'Oreal Spirit" forms the framework for L'Oreal's policies with regard to corporate governance, environmental stewardship, health and safety, social affairs and diversity, supplier relations, sustainable innovation, corporate consumer responsibility and philanthropy. In addition, there exists a Code of Business Ethics that is available in 43 languages and serves as the reference document for ethics within L'Oreal. It applies to all employees, officers and directors of the group and subsidiaries worldwide. All employees receive their own personal copy. The initial 2007 Code of Business Ethics was updated in 2010 with the help of employees from 22 countries via international working groups in Asia, Europe, North America and Latin America....
The Code was then validated by each Country Manager, Human Resources Manager and local counsel to make sure it was applicable locally (L'Oreal Sustainable Development Report 2010: Ethics). It is in the company's best interest to follow its code of conduct when operating in foreign countries because various studies have shown that companies practice good corporate citizenship by spreading best practice among customers and employees, suppliers and business associates -- in areas such as labor, the environment and human rights -- in foreign countries where they operate provide the managerial, technical and financial resources needed to meet social and environmental challenges in these countries and thereby manage to stay competitive (International Chamber of Commerce 1, 5). Question 6: L'Oreal has been a signatory to the United Nations Global Compact since 2003 and is a member of the French network of the Global Compact (Forum des Amis du Pacte Mondial). L'Oreal is committed to supporting and implementing, within its sphere of influence, the ten fundamental principles relating to human rights, labor standards, the environment and the fight against corruption. The company works closely with the following major associations and institutes to advance practices and exchange learning: Anti-Corruption Commission of the International Chamber of Commerce; Global Council on Business Conduct, The Conference Board; Ethics and Compliance Officers Association; International Business Ethics Institute; Institute of Business Ethics; Cercle d'Ethique des Affaires (L'Oreal Sustainable Development Report 2010: UN Compact). Question 7: There are manifold key indicators the company monitors to guide their investment and actions in the future in the following main areas: "Business": Total shareholder return over 20 years, consolidated sales, net profit. "Innovation": Cosmetic and dermatological research. "Production": CO2 emissions, energy, water use, waste and recycling, atmospheric emissions, L'Oreal Buy & Care programme, collaboration with suppliers, health and safety, international standards."Consumption": Responsible advertising, consumer advice. "Talent": Professional training, diversity training, female representation, worldwide profit sharing. "Communities": L'Oreal foundation, L'Oreal-UNESCO 'For Women in Science (see L'Oreal Sustainable Development Report 2010: Performance Summary: Key Indicators).
Case Study: L'Oreal. 23 December 2010. 1-3. Accessed 18 October 2011.
Foreign National Environments: Legal Environments. 1-4. Accessed 18 October 2011.
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