LVMH 2011 ANNUAL REPORT

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

07/05/2012

CONTENTS

Introduction

Page 2

Our Approach

Page 3

Human Rights

Page 4

Working Conditions, Health & Safety

Page 8

Social Dialogue

Page 12

Diversity, Equal Opportunities and Non-Discrimination Policy

Page 16

Skills Development

Page 22

Relations with Third Parties and the Local Environment

Page 26

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INTRODUCTION
Delivering part of the dream and pleasure does not exonerate us from any responsibility or lucidity on the contrary it obliges us to maintain irreproachable behaviour and practices. This awareness of our responsibilities, which falls upon us as the worlds leading company for luxury goods, is the basis of our engagement with regard to social responsibility. On an everyday basis, this sense of responsibility is expressed in the measures taken by the firms with regard to their employees and stakeholders, in, for example, providing support for their employees career development, preventing the risk of discrimination and encouraging more ergonomic workstations. This report gives a very clear picture of the way in which the Groups sense of responsibility is put into practice. It presents all the social responsibility initiatives carried out over the year by its firms. These initiatives were identified during the 2011 CSR Report in which 23 firms were invited to participate. It illustrates the Groups ambition, but is not exhaustive with regard to all the projects carried out as a whole. The initiatives focus on six fields: Human Rights Working Conditions/Health & Safety Social Dialogue Diversity, Equal Opportunities and Non-Discrimination Policy Skills Development Relations with Third Parties and the Local Environment

The fields were selected to cover in a way that is relevant, global and exhaustive the various areas usually observed by credit rating agencies, investors and, more generally, all stakeholders involved in the problems of sustainable development and social responsibility. In particular, this report enables us to meet Global Compact requirements. It also aims to identify more clearly best practices in firms and to facilitate their dissemination and reproducibility in-house. Indeed, many of the firms are resolutely committed to CSR measures, which prove to be excellent benchmarks.

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OUR APPROACH
23 of the Groups firms answered a questionnaire sent out in November 2011. They were invited to report on the actions carried out for each of the themes discussed.

SCOPE
Wines and Spirits: The Glenmorangie Company Limited, Hennessy, Mot Hennessy UK (MHUK), Mot Hennessy Asia Pacific (MHAP), Mot Hennessy Diageo France (MHDF), Veuve Clicquot, Mot & Chandon, Louis Vuitton, Fendi, Cline, Givenchy, Kenzo, Loewe, LVMH Fragrance Brands (LVMH FB), Guerlain, Parfums Christian Dior (PCD), Chaumet, De Beers, Hublot, Tag Heuer, Le Bon March, Sephora USA, DFS. 3/29

Fashion and Leather Goods:

Perfumes and Cosmetics:

Watches and Jewellery:

Selective Distribution:

HUMAN RIGHTS

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The Group is committed to acting responsibility in every business sector, and to ensuring that human rights are respected in all of its establishments including in countries where these rights are not sufficiently entrenched. In order to guarantee this engagement, LVMH has established a code of ethics and a code of conduct firmly establishing the primordial place of these concerns.

DEPLOYMENT OF THE CODE OF CONDUCT AND CODE OF ETHICS

The code of conduct has been adopted and established by every company. It puts into practice the Groups requirements with regard to its partners in the fields of social responsibility (discrimination, harassment, child labour, remuneration, working hours, the right to form unions, health & safety, etc.); the environment (the use of technologies that respect the environment, respecting regulations and standards, etc.) and the fight against corruption. Any collaboration thus requires the partners engagement to respect all the ethical principles that make up this code. It also includes the principle and methods of controlling and auditing that these rules are respected. The code of ethics, an element of the code of conduct, was adapted for each firm according to the characteristics particular to its business sector. LVMH Fragrance Brands has laid out its code of ethics within the framework of the Perfumes and Cosmetics sector, and communicated this with a letter from the CEO to its suppliers. Suppliers then sign an agreement before orders are approved. At Louis Vuitton, in the Ukraine and Russia, all new employees are trained in in-house internal policies, including the code of ethics.

OUR SERVICE PROVIDERS RESPECT FOR HUMAN RIGHTS

LVMH pledges to maintain and promote responsible collaborations with its partners (suppliers, sub-contractors etc.). Mot Hennessy Diageo France signs ethical engagements with its sub-contractors. The Glenmorangie Company Limited employs a method to assess its suppliers by establishing an assessment form. A series of questions is put to suppliers to assess their performance in terms of human rights. If suppliers particularly those who are not members of the European Union do not meet assessment criteria, the company reserves the right to conduct an audit and/or refuse their services. Several companies such as Louis Vuitton, Kenzo, Loewe and LVMH Fragrance Brands audit their suppliers with regard to child labour, working hours, employee health and safety, etc. Loewe also requires its suppliers to have ISO9001/14011/OSHAS 18000 certification.

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RESPECTING HUMAN RIGHTS IN-HOUSE

The companies that make up the Group discuss ethical questions with their employees, particularly questions regarding human rights. Hennessy organised a conference for senior managers given by Nicole NOTAT, CEO of VIGEO (European ESG rating agency), on companies social, civil and environmental responsibility. The Glenmorangie, Moet Hennessy Asia Pacific, Mot Hennessy Diageo France, Louis Vuitton, De Beers, and DFS discuss matters concerning human rights, non-discrimination and equality with their employees by means of posters, Intranet sites, in-house media and in new employee guide booklets. Moet Hennessy Asia Pacific and Sephora USA inform their employees of their own business codes, each including a clause concerning discrimination and harassment. At Sephora USA, all new vendors must sign the LVMH Vendor Code of Conduct.

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WORKING CONDITIONS, HEALTH & SAFETY

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LVMH is committed to implementing the appropriate means to prevent occupational hazards, ensure health and safety and improve working conditions for all its employees, based on the hazards present at the company. The LVMH Group companies that answered the questionnaire have set up measures to prevent the various forms of wear at work and reduce hazards, in particular by informing and training employees.

THE PREVENTION OF PSYCHOSOCIAL RISKS

Parfums Christian Dior is committed to significant measures to improve working conditions with two projects: Quality of Life at Work and The Prevention of Psychosocial Hazards. Top management has indicated its commitment and a specialist consultant has been monitoring the measures: two information mornings for Key Managers were held along with meetings for employees to express themselves on the matter, Human Resource Managers have been trained, and the position of Head of Health & Safety was created. Mot & Chandon set up a plan for the prevention of psychosocial hazards. The plan intends to improve communication, training and managing employees, and to set up a system of crisis counselling in emergencies or situations of imminent risk. Louis Vuitton has also committed itself to the prevention of psychosocial hazards. In 2011, the firm set up training courses in stress prevention for all leather goods workshop managerial teams. Hennessy works closely with the CHSW, the members of which have all been trained in the prevention of psychosocial hazards. The measures put in place for employees via the medical observatory for stress, anxiety and depression were submitted to the CHSW and Enterprise Committee.

THE PREVENTION OF ARDUOUS WORKING CONDITIONS

Companies carried out an assessment of arduous working conditions. Louis Vuitton conducted an assessment of arduous working conditions in all its units in France and has set up a programme to prevent occupational hazards in Head Office teams, notably with regard to hazards due to postural constraints. It has set up ergonomics studies for around twenty working situations. Hennessy and LVMH Fragrance Brands have been continuing in-situ studies of arduous working conditions and how to improve them for all the companys positions, working hand-in-hand with the CHSW, occupational physicians, Human Resources and management. Two companies, Veuve Clicquot and Moet & Chandon, signed an agreement on the prevention of arduous working conditions.

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Following the studies and assessments, the companies set up measures to improve their employees working conditions. Listed below are some examples of measures to improve ergonomics: Improving the workstations of a manual production line at Hennessys packaging site after a study carried out by an ergonomics consultancy, management and the employees working at this production line. This resulted in an effective reduction of the risk of musculoskeletal disorders and enabled employees with medical restrictions to work there. For example, improvements include sliding and placing bottles rather than lifting and placing them, lift tables, etc. Louis Vuitton drew up an ergonomics charter to purchase administrative furniture adapted to the core professions and to employees morphology. KENZO has installed new ergonomic seats for pattern designers. Loewe has made improvements to adapt workstations individually. Cline has provided Head Office and boutique staff with ergonomics training in order to prevent arduous working conditions, and is devising action plans so that this commitment becomes long term. At Louis Vuitton, office and quality laboratory layouts have been revised and ergonomics studies are being set up for the design of new workplaces. Guerlain has changed its seats and equipped itself with lighter tools. De Beers is using large screens to prevent eyestrain. At Sephora USA, they have studied the effectiveness of staff rooms in stores and water coolers in staff rooms for employees. Chaumet has made improvements to the ergonomics of its workstations in its production workshop.

RESPECTING HEALTH & SAFETY AT WORK

Every employee should work safely at no risk to his or her health. This issue concerns each and every employee. The companies that make up the Group have understood the importance of health and safety at work, and the firms are developing programmes to prevent and reduce accidents in the workplace and improve health at work. At The Glenmorangie, for example, health and safety matters are the first subjects under discussion during Executive Committee meetings. Communication is an indispensable tool to increase employees awareness and inform them of the issues at stake with regard to health and safety at work. In addition to the taskforces and health & safety committees found regularly in questionnaire answers (The Glenmorangie, MHDF, Fendi, Loewe, Tag Heuer), companies also employ other tools. In October 2011, Sephora USA produced a video on safety for all its stores and organised a forum on safety, to which all the companys employees were invited to learn more about safety in the workplace and at home. Loewe has drawn up a protocol to provide information about occupational hazards with the aim of involving every employee in health and safety issues. 10/29

Hennessy carried out a poster campaign aiming to increase employees awareness of occupational hazards.

The other significant measure the companies have drawn up to promote health and safely is employee training in this field. 8 respondent companies (The Glenmorangie, Hennessy, MHAP, MHDF, Louis Vuitton, Fendi, Loewe and Tag Heuer) offer health and safety training to their employees. Hennessy regularly offers movement and posture training for all its employees and organises specific training on working at heights and in difficult situations. In Japan, Louis Vuitton offers its employees a course in mental health. TAG HEUER has developed a health and safety programme involving a diploma course run by a specialist in safety at work, and has set up a taskforce to examine alternative products to substitute dangerous ones. The company has set up a screening programme for eyesight problems, corrective measures for employees comfort and a safety system for those with heavy workloads. Companies also carry out proactive inspections and audits in order to identify health and safety problems as early as possible. The Glenmorangie established an action plan to prevent accidents in the workplace, and the companys objective was to have zero accidents in the last eighteen months. For this to happen, management was invited to incorporate responsibilities regarding health, and employees were encouraged to report all accidents, including those that were avoided.

QUALITY OF LIFE AT WORK

Improving working conditions is achieved through a better quality of life at work, and the firms are increasingly attentive to this. Hennessy has set up two taskforces (employees and management) to work on serenity and conviviality at work via the company CAPTEN project. Cline employs the Wellbeing at Work training programme launched 3 years ago. All employees in France have now been trained. Guerlain launched Wellbeing and Quality of Life at Work week (packages, concierge service, presentation of ergonomic equipment). The company offers yoga classes at one of its production sites along with systematic warm-up exercises with a sports coach for employees before they begin work. In North America, Louis Vuitton offers yoga classes for employees at the New York office. Cline and Guerlain offer their employees massages. Louis Vuitton is planning to set up a committee to examine working conditions and work-life balance. Louis Vuitton in Japan has already set up overtime controls, including turning off electricity in offices at 8pm.

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SOCIAL DIALOGUE

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The Group ensures that freedom of association is respected and encourages collective negotiation and trade union independence. The Groups companies carry forward this engagement and strive to maintain dialogue with their employees and employee representatives.

INFORMATION AND COMMUNICATION

Companies ensure employee information and communication by means of various dialogue tools. For example, in order to improve discussion and communication with employees, Parfums Christian Dior has set up nine communication screens at the Saint Jean de Braye site. Firms often request opinion polls. 7 of the 23 companies that answered the questionnaire have set up this effective tool to measure employee satisfaction and involvement levels: The Glenmorangie, Mot Hennessy Diageo France, Louis Vuitton, Cline, De Beers, Sephora USA and DFS. Louis Vuitton launched the Listening to You survey in 2011, polling more than 15,000 employees in over 50 countries. 100 questions were grouped together into 16 categories: the quality of managerial action, external image, remuneration, training and development, performance assessment, supervision, accountability, commitment, effectiveness, quality, how change is managed, working conditions, work-life balance, information and customer orientation. In 2011, 15 questions were devoted to CSR (equal opportunities with regard to age, gender and disability, working conditions, etc.). On a global level, an 88% participation was recorded. The results were communicated to all employees by means of a top-down process that involved managers and members of the Executive Committee. Following the survey, the Executive Committee defined 3 priorities for the company: reducing the activitys impact on the environment and providing greater transparency with regard to both remuneration mechanisms and career opportunities. Taskforces were formed and, in parallel, depending on local priorities, associated action plans were set up. Furthermore, Louis Vuitton arranged Getting to Know Each Other lunches with leather goods makers and support services these provide an excellent opportunity for Executive Committee members and employees to talk. Another communications example directly involving top managers can be seen at DFS where managers share financial results with DFS teams 7000 employees are concerned as well as the current issues at stake for the company. Executive breakfasts and managers forums are organised throughout the year. In this way, managers and all departments are aware of the companys strategic decisions.

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CSR COMMUNICATION
Companies communicate their CSR engagements during integration seminars, management conventions and during Sustainable Development or Disability weeks. Louis Vuitton has produced 4 corporate films for all its employees about employment and talent diversity. In Japan, 10 CSR ambassadors were nominated (1 on a corporate level and 9 in stores). The role of these ambassadors is to introduce CSR activities into their establishments and to participate actively in regional social measures.

SOCIAL DIALOGUE WITH STAFF REPRESENTATIVES

In addition to opinion polls, the firms enter into social dialogue with staff representatives. Social dialogue is based on classic issues such as employment as well as CSR issues. 4 companies signed GPEC (jobs and skills management planning) agreements: Mot Hennessy Diageo France, Moet & Chandon, LVMH Fragrance Brands, and Parfums Christian Dior. The LVMH Fragrance Brands agreement includes a significant chapter devoted to communicating information regarding the companys strategy to elected representatives, as defined in the 3-year plan, and its social consequences. Within this framework, LVMH Fragrance Brands has set up core division workshops made up of elected representatives, managers and Human Resources managers to analyse the required skills and set up development procedures, and to classify jobs within each network. Along the same lines, Veuve Clicquot signed an agreement to establish classification of non-managerial administrative staff and an amendment concerning the classification of production staff. Social dialogue with elected representatives also concerns health at work. LVMH Fragrance Brands drew up specifications for a call for tender for a staff providence scheme and medical expenses, with the involvement of elected representatives and union delegates. This work led to the signing of two agreements, accepted unanimously by the organisations represented within the company. Le Bon March carried out an assessment with regard to psychosocial hazards in line with the framework method agreement signed in 2010 with all the trade union organisations. In France, Louis Vuitton set up and employed a Social Relations course for managers in stores with the aim of improving management by making better use of social management levers and relations with staff representatives.

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DIVERSITY, EQUAL OPPORTUNITIES AND NON-DISCRIMINATION POLICY

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Preventing discrimination and encouraging diversity as a source of creativity are an integral part of the Group. The LVMH Group has a presence on every continent and its staff echoes the diversity of its sites. The Group and its firms are setting up measures to promote equal opportunities for any talent that is part of their teams or that would like to join them.

HELPING THE DISABLED

As the first step in our policy to help the disabled, Mot & Chandon and LVMH Fragrance Brands have set up training and awareness-raising programmes. During the Jobs for the Disabled week, Hennessy gave all its employees an information booklet on disability entitled Lets Bring Together our Differences and Parfums Christian Dior organised 2 Live My Disability days. Louis Vuitton France has made a sign language course available that any employee can join, including those who are disabled. With regard to access, The Glenmorangie and De Boers are working on this at their premises and Louis Vuitton has set out to ensure digital accessibility to make its Intranet site accessible. With regard to ensuring that the disabled can keep their jobs, Parfums Christian Dior has retained 53 people in its workshops, having made many adaptations and modifications to workstations after the employees were incapacitated. Mot & Chandon set up MHEA, an adapted company made up of around fifteen employees, ten of whom are definitively incapacitated. Louis Vuitton provides deaf employees with a sign language interpreter for meetings and Hennessy had funded equipment for disabled employees. Professional insertion requires detailed work on sourcing. Louis Vuitton has set up partnerships with organisations in order to boost the sourcing of disabled people. As another lever to encourage professional insertion, companies receive people with disabilities as trainees or interns (Hennessy, Mot Hennessy Diageo France, Moet & Chandon, Louis Vuitton, LVMH Fragrance Brands and Guerlain). In 2011, companies continued their partnerships with establishments in the protected and adapted sector. They bought in ESATs (Preparation and Service Support Through Work organisations) and subcontracted the following activities to them: sending rejection letters to spontaneous job applications, providing staff for private sales at Kenzo, packaging pots of honey at Guerlain, delivering meals at Louis Vuitton and working on subcontractor and availability contracts at Hennessy. Our commitment to help the disabled involves participating in events to rally external partners (ADAPT, Handichat, handi-rencontre) as well as sporting events (sponsoring the ELA organisation mets tes baskets et bats la maladie", Orleans Wheelchair Tennis, and so on). Lastly, with the aim of contributing to the social insertion of people with disabilities, in addition to professional insertion, the firm has built Cascina Biblioteca in Italy, social housing for the disabled and their families. 17/29

HELPING SENIORS
Access to and maintaining jobs for seniors is one of the LVMH Corporations ongoing concerns. In line with legislation passed in France in 2010, all the Groups French firms signed agreements or set up action plans with the aim of increasing the employment of seniors. The planned measures aim to promote active age management in business and to encourage retaining people over the age of 50 in employment. In addition to interviews for the second stage of ones career, used in all the French firms, the following companies have also set up measures to encourage skills transmission to ensure that know-how is passed on: Mot Hennessy Diageo France and Mot & Chandon. At Louis Vuitton, 100% of seniors in stores take at least one course a year and participate in devising training modules for leather goods manufacturing skills. Guerlain provides training for seniors and makes sure that rare skills are passed on, particularly the know-how of the Dames de table who are responsible for filling perfume bottles by hand as well gilding, bearding, brushing and sealing them with wax. A new team of Dames de table has been recruited in Orphin and their more experienced colleagues are training the new recruits. LVMH Fragrance Brands informs its recruitment service providers, especially temporary employment agencies, of its CSR commitments to ensure a rational proportion of senior temporary workers and seniors already working in the establishments. LVMH Fragrance Brands also offers seniors in its production workshops the opportunity to work part time while maintaining full-time pension contributions. Veuve Clicquot signed an agreement to establish flexible working hours for seniors at the VCP/Krug vineyard and has improved degression measures as part of the framework to increase end-of-career flexibility and facilitate the transition from professional life to retirement. At Parfums Christian Dior, furlough leave for employees over 60 has been increased and part time hours for seniors have been set up. 15% of the workforce concerned benefit from this. At the end of their careers, employees are given support to prepare their retirement. Information meetings with the CNAV (National Retirement Fund of Public Social Security) are organised at Bon March, and Parfums Christian Dior runs Passing the Retirement Mark courses.

PROMOTING GENDER EQUALITY AND STRUCTURING WORK-HOME LIFE

4 companies, Hennessy, Mot & Chandon, Guerlain and Le Bon March, have negotiated business agreements on professional equality for men and women to prepare measures regarding working conditions, remuneration, training, career development and a better work-home life balance. 8 companies have taken specific measures to make working hours more flexible. In the UK, for example, Moet Hennessy helps women return to work progressively after their maternity leave, allowing them to return to their jobs 3 day a week for a defined period of up to 2 months. Guerlain offers its employees the opportunity to telecommute from home. 18/29

In its agreement, Hennessy has taken measures to extend paternity leave and set up returning to work interviews after three-year parental leave and maternity leave. Mot Hennessy has also extended paternity leave in France and the UK. Companies such as The Glenmorangie and Fendi have taken action to help employees with childcare expenses. Parfums Christian Dior has set up an "SOS NOUNOU" [nanny]" service and has 15 crche places for employees working at Head Office. Hublot set up a company crche in 2009 that is open to the public. Loewe has set up training to prevent gender inequality in the workplace. Mot & Chandon has increased the flexibility and funding for employees who are obliged to stay at home to look after their terminally ill partners.

PROMOTING SOCIAL, ETHNIC AND CULTURAL DIVERSITY

In order to promote social, ethnic and cultural diversity as a source of creativity, LVMH has set up a partnership with the town of Montfermeil. With this partnership, the Group is contributing to equal opportunities and the prevention of discrimination. The town also enjoys the Groups support in spreading knowledge of its inhabitants wealth of cultures and talent talent that be seen at the Cultures and Creations show for which Guerlain provides logistics support. experience with the CEOs participation. Guerlain received a class of 15-year-old students for their Work
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Experience week and LVMH Fragrance Brands received a class from Aubervilliers 6 Form College for work

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Still in France, the Group has pledged to support the organisation "Nos Quartiers ont des talents" (Our Neighbourhoods have Talent) that helps and supports young graduates to integrate successfully into the world of business. Several of the Groups companies have employees who mentor young jobseekers from underprivileged neighbourhoods who have been identified by the organisation. Firms are planning to develop their relations with the Ministry of Education to increase knowledge of their profession and diversify their recruitment sourcing. For example, Louis Vuitton has set up a partnership with the University of Saint-Quentin for young people interested in careers in Legal, Supply Chain, Quality and Asset Management. In order to encourage social, ethnic and cultural diversity, companies are investing in professional insertion. Veuve Clicquot has signed a partnership charter with Champagne Ardennes Unemployment Office to set up a recruitment simulation method and Parfums Christian Dior has organised 3 professionalization contract sessions for people on income support (7 contracts of indefinite duration and 4 long-term contracts in 2011).

PROMOTING NON-DISCRIMINATION
Preventing any form of discrimination is a priority for LVMH. In 2011, the Group organised a training course for recruiters entitled Recruit without Discrimination, attended by all the staff from the Group and its firms Human Resources Departments - around one hundred participants in total In addition, the Groups companies have their own training programmes to prevent discrimination and promote diversity; Mot Hennessy France, Loewe and LVMH Fragrance Brands have made this type of training part of their Managers Training Programmes in 2012. At Sephora USA, managers are required to attend two hours of training on harassment and diversity every year. To prevent any form of discrimination, DFS has set up an online e-learning course on employment laws that all employees are invited to take. Cline has set up an assessment procedure for sales jobs, combining role-play with interviews with assessors (HR staff and line personnel). This method enables recruiting to become significantly more objective. Louis Vuitton has also developed partnerships with recruitment agencies to promote diversity.

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SKILLS DEVELOPMENT

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In firms in which know-how is the key to their success, employees skills development is crucial, and the firms take great care to incorporate this. The Group provides a framework that is particularly favourable for career development. Its companies encourage the internal mobility of their employees, as, for example, at Louis Vuitton or Le Bon March, who organised the 3 Celebrating Mobility event in 2011. In addition to the annual Organisations and Talent review, the Groups companies are developing other tools to improve their human resources. Fendi, Cline and Loewe use a 360 process, as does Louis Vuitton. This process makes employees aware of certain areas in which they could improve. It is accompanied by individual and group coaching sessions for both Executive Committee members and vendors. Skills assessments are offered to employees at Fendi, Cline, Kenzo, LVMH Fragrance Brands and Chaumet along with Leadership Development programmes for managers (The Glenmorangie, MHAP, Parfums Christian Dior, Chaumet and Sephora USA).
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EMPLOYEE TRAINING
In addition to standard training such as languages, IT, retail and product courses, Firms are setting up in-house training to make their employees more competitive and to anticipate recruitment needs. At Louis Vuitton, a Development Centre for experienced managers is in the process of being created. Mot Hennessy Asia Pacific has created a Sales School in partnership with local universities to offer a comprehensive management programme for Heads of Sales. Still at Mot Hennessy, but this time in the UK, the company has set up a Management Academy to encourage apprenticeship and continual career development within the company. Loewe has Talents, its vendors academy to train future store managers in Europe. All DFS associate vendors have taken training courses in Sales. In order to anticipate and respond to the chronic lack of labour in Switzerland, Tag Heuer has established a conversion programme, a new recruitment procedure for unskilled operators. This involves open days to enable non-watchmaking employees to learn about these professions. After a days visit and a test, those who wish to continue the recruitment process are then called individually for standard recruitment interviews. Only 2 criteria are taken into account the desire to work and the ability to work as part of a team. Training is then given by 2 watchmaking professors and is staggered over several weeks. Tag Heuer encourages taking training courses that lead to a diploma in watchmaking for people who wish to obtain this.

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SKILLS TRANSMISSION
The firms have made commitments to promote the transmission of skills and knowledge, and have been developing a tutoring system. One of the first measures the Group encourages is promoting sandwich courses. Loewe, Louis Vuitton Guerlain, Parfums Christian Dior and LVMH Fragrance Brands have therefore developed sandwich courses. Guerlain has set up an action plan in its factories to improve the skills of teams who work in packaging, to provide support for mechanisation and to anticipate the risks in operators jobs. Parfums Christian Dior is developing in-house tutoring for new recruits, given by older and more experienced employees recognised for their skills.

CELEBRATING ACHIEVEMENTS
In order to be increasingly competitive, DFS has set up the Prism Reward, a reward programme established in 2010 through which the company pays tribute to operating teams. Over the last year, the programme was extended to include merchandisers, and has been adopted internationally. Other firms have made their own innovations - Louis Vuitton, for example, has launched a Best Sales Challenge programme for store managers.

SHARED VALUES
Managerial conventions and company seminars are organised by companies who wish to define their shared values, teamwork, respecting diversity and so on (Mot Hennessy Diageo France, Cline, Loewe, Fendi and Chaumet). The companies set up in-house projects, such as the project at Bon March where the CEO and the Executive Committee launched the Customer Culture company project (300 voluntary participants in 8 taskforces) which led to over 143 improvement measures being taken to improve customer culture and the quality of management over the next few years. Hennessy instigated the CAPTEN Project in 2008 and it continues to this day. This participative approach has entered into its second phase aiming to develop the firm. It is based on two key themes: sustainable development and CSR, and the Director of Operations Plan. This new stage enables over 150 employees to participate actively in taskforce discussion groups on issues such as ecoresponsibility, conviviality in the workplace, health & safety information and skills transmission.

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RELATIONS WITH THIRD PARTIES AND THE LOCAL ENVIRONMENT

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The Group has made a social and civic commitment to its stakeholders. The firms regularly show their solidarity with those who are most vulnerable and deprived, and support populations that are victim to natural disasters. They carry out actions to encourage and develop local communities.

PARTNERSHIPS WITH TEACHING ESTABLISHMENTS TO HELP UNDERPRIVILEGED STUDENTS

Companies such as Fendi finance scholarships for university students and promising young designers, and fund leather goods manufacturing schools such as Clines Alta Scuola San Colombano" school in Italy. In the UK, Louis Vuitton is working in partnership with the "Young Arts Project". In France, the Group gives financial and human support to Science Pos Priority Education Convention programme.

SOCIAL AND PROFESSIONAL INSERTION

Through its sponsoring actions with Frances Unemployment Office, Hennessy helps jobseekers to find work. Moet & Chandon is contributing to insertion through a professional insertion organisation and a Prevention Club that works to prevent delinquency in deprived areas. The club offers young people the chance to attend educational workshops in their areas of skills. In South America, Louis Vuitton supports "Spectaculu", an NGO that gives young people on low incomes in communities in Rio de Janeiro the opportunity to complete their basic education with artistic, cultural and professional development. Through various actions, Chaumet supports young jobseekers.

LOCAL SOCIAL DEVELOPMENT

Mot Hennessy Asia Pacific and Wenjum provided funding for the "Spring Bud School Building Programme" in the province of Sichuan after the earthquake in 2008. Continuity is provided in the assistance given to schools to improve equipment and give help to poor children and voluntary teachers, etc. Furthermore, through the operation "Hand in Hand for Haiti", set up after the earthquake in January 2010, DFS participated in the rebuilding of a school complex for the most deprived children from the Saint-Marc district. The operation continued in 2011 with the opening of the Jean-Baptiste Pointe du Sable School that now teaches 153 children aged between 3 and 5. Over the next few years, the number of pupils will increase to 720. In 2010, Louis Vuitton made a pledge to work with SOS Villages dEnfants for a period of 5 years. This partnership, which aims to offer children from all over the world a better life, instigates and supports a great number of projects. As part of the partnership, the company has set up a whole series of measures over the last two years (creating or renovating playgrounds, setting up university scholarships, building a learning centre, etc.).

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After the earthquake that shook Japan in March 2011, several firms took action. DFS founded One Japan. An interdisciplinary taskforce was created within the company, composed mainly of Japanese members. Louis Vuitton made a donation to victims and to the not-for-profit organisation Forests are Lovers of the Sea" in Miyagi, a region very badly affected by the earthquake in March 2011. MHAP, Fendi and Loewe also rallied to help Japan. In Belgium, Louis Vuitton set up a 5-year partnership with Amsterdams Rijks Museum, giving lessons to children whose parents were visiting the museum.

PARTNERSHIPS WITH ORGANISATIONS AND NGOs

The Group and its firms set up numerous partnerships with organisations and NGOs, particularly for the benefit of ill people. In Russia, Louis Vuitton made a donation to fund an orphan who needed heart surgery. The firm provides funding for the Vera hospital that gives medical and social help to cancer sufferers through various organisations. Guerlain gives funding to the Cancer League. Moet & Chandon has set up a partnership with Soif de Vivre, an organisation of former alcoholics to help people beat alcohol addiction. MHAP and MHDHK sponsored the road safety and drink-driving campaign organised by the Hong Kongs Road Safety Council. To celebrate the companys 50 anniversary as well as 50 years of philanthropy, DFS gave a percentage of its sales to local charitable works. At The Glenmorangie, a charity committee works with employees to raise funds for the companys Charity of the Year. In Asia Pacific, Louis Vuitton made a donation to build an outdoor activity centre for the children in the village. In the UK, Mot Hennessy organised a partnership with "Centrepoint", a charity organisation based in London and dedicated to young homeless people. The firms support numerous local charities such as SoulTalk, Ponts Bali, Amfar, Charity Bal, Unicef, Charity Vogue China, Royal College of Art - London, Telethon, Smile Train Onlus, Aibi (friends of the children), Luiss, American Cancer Society, The Buddy Program, Coalition for the Homeless, University of Hawaii, Art Department, Houston Grand Opera, Family Services of Greater Houston, Atlanta Ballet, "Frimousses de crateurs" for UNICEF, Audrey Hepburn Foundation, School for Children, Naked Heart and so on.
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PROMOTING ART
In North America, Louis Vuitton has undertaken a series of initiatives and programmes that echo its commitment to art and art education. It has hosted a series of conferences on art including, among others, Ed Ruscha and Vik Muniz, as well as exhibitions of artwork from the best artists in communities where the firm has stores, and works in partnership with the President of the Arts and Humanities Council. All these initiatives will continue in 2012.

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LVMH SOCIAL DEVELOPPEMENT 30/29 2012