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At Wella Company, our mission
is to enable all individuals to
look, feel and be their true
selves. We believe in the power
to build business for good;
striving to have a positive impact
on the Planet, People andthrough our Products. These
tenets are embedded into ouroperating foundation.
As we approach our third
anniversary as a stand-alonecompany, we are proud tohave successfully transformed
Wella Company and our iconic
portfolio of brands. We havecreated a resourceful, resilientbusiness – one of the fastest
growing beauty companies
globally. We are continuing togain share and loyalty acrossthe 127 countries in which we
operate. As we grow, we aredoing it the right way, leveraging
our people, positively uplifting
small businesses across theprofessional beauty sector andenhancing innovation for theplanet. We have an employee
population of more than 6,000,
strong anchored in genderbalance with 59% identifying as
female, and a Board with 58%
female representation. Last year
we launched a broad-based
employee participation program
called WOW (We Own Our Way)that gives everyone a vested
interest in the company’s success.
We are galvanizing our people
to employ an Owner’s Mindset
to scale growth for good.

It is on these principles that fromday one we have advanced
our Environmental and Social
Impact journey. The ambitious
yet pragmatic plan is anchoredin science-based targets
that we have validated andpublicly declared in our ESG
Manifesto. We are proud tobe a participant of the United
Nations Global Compact(UNGC) and to have signed
the Women’s Empowerment
Principles (WEPs) and the UN
Standards of Conduct to tackle
LGBTQIA+ discrimination.
Our carbon targets have beenvalidated by SBTi, and wehave joined the EcoBeauty
Consortium. We believe thatthrough partnerships like these
we are well placed to continue
to advance our efforts to drive
positive impact.
This Environmental & Social
Impact Report 2022 is our firstchapter report. We will continue
to reduce our carbon emissions,contributing to the collective
efforts for the viability of ourplanet. We have built our future
innovation pipeline to mindfully
choose better ingredients, reducepackaging materials and waste
and consider less water usage,
which is our biggest sourceof environmental impact fromproducts sold.

We are committed to being a
corporate citizen of environmental
and social integrity. That means
we intentionally consider what
and where we can positively
impact and state goals that
we believe are actionable andachievable. We hold ourselves
accountable to our global
employees, our customers,
consumers, suppliers and partners.
We engage with more than 91
million beauty lovers aroundthe world, and we encouragethem to join us in embracing ourambition to lead positive change.
As Wella Company continues
to grow and mature, we will
monitor, measure and validate
our environmental and social
impact. We will stand behind ourcommitments and progress withpurpose, ensuring we deliver on
our goals the right way.
We believe we can and will
be a positive force for good
– for our Planet, our People
and through our Products.
The next generation is counting
on all of us.
Regards,
Annie

Wella Company SOCIALENVIRONMENTAL
AND SOCIALAND ENVIRONMENTAL
IMPACT REPORTREPORT
2022 2022

GOOD

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A message fromCEO
our
Letter
CEO

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ABOUT WE LL A COMPANY

5E NVIRONME NTAL AND SOCIAL IMPAC T

6

MATE RIALIT Y A SSESSME NT AND PRIORITIES7G OVE RNANCE AND BUS INESS ETHIC S

8PEOPLE

9

PL ANET

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PRODUC TS

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CLOS ING AND 2023 OUTLOOK41

APPE NDIX

42

Table of Contents

2022 K E Y HIGHLIGHTSENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

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Key Highlights#1
Salon Color Brand in the World1

HIGHLIG143

3

years in the industry

years asstandalone company

USD 2B+59%

ZERO

Net Revenue

employees identifying as female

Waste to Landfill19

6,000+-10%

7 7%

employees

Scope 1 & 2 emissions

recyclable packaging

11

-5.5%

98.85%

brandswater withdrawn per unit
produced in our factories

non-animal derived ingredientsin our factories

1 See Appendix for further details.
19 Where allowed by law (note: Mexico is excluded due to local
regulations that require specific waste to be sent to landfill).

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

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About Wella Company

W

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for salon hair color and #1
professional salon nail brands,
respectively. To build the best
beauty company in the industry,
we adhere to supporting theprofessional beauty industry
because when the industry
thrives, we thrive.

Since 2020, Wella Company has
galvanized the transformationof our business and brands
to become one of the fastest
growing companies in the beauty
sector. Our portfolio of iconic
professional and retail hair, nailand beauty tech brands includes
Wella Professionals, O·P·I, ghd,
Briogeo, Nioxin, SebastianProfessional and Clairol. Today
Wella Professionals and O·P·I
claim the #1 global position

As innovators who seek toinspire consumers and beauty
professionals through ourbrands to look, feel and be theirtrue selves, we advance withthe highest rigor combining
science, technology and artistry
to innovate products across ourbrand portfolio.
Guided by our company values
and led by purpose to deliver
positive impact on people
through our products andtowards our planet and society,we deliver sustainable growth
to all stakeholders. Each day,we impact a diverse communityof more than 91 million beauty
lovers and industry professionals,
social influencers, ambassadors,
followers, employees, customers
and suppliers across the globe.
This is our Wella Family. We arededicated to proudly serving
them and supporting thecommunities in which we operate
across 127 countries globally.
Our ambition to be better by
doing better propels us forward,
empowering everything we
do while also guiding ourenvironmental and social
progress. Continuing our journey
to sustainably improve our
products, reduce our impact
on the environment and fostera culture where all employees
lead as owners together as one
team, we ensure Wella Company
prospers for generations to come.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

OUT
B
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Wella Company is an innovative
global leader in the beauty industry
that combines 140+ years of earned
wisdom and industry experience
with the high-growth momentumof a rising independent company.

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believe that business must
be a catalyst for change, enabling
people, organizations and societies
to collectively prosper.
We aim to unleash the potentialof our people, partners andorganization globally throughenvironmental and social impact,
while ensuring we build on our
ambition the right way throughgovernance. Embedded into
our ethos is Diversity, Equity,
Inclusion and Belonging, whichembraces each person for who
they are, how we operate andhow we support the industry
and communities we serve.
Our environmental and social
impact journey is inherently
connected to our commercial
growth and how we measure ourvalue. And as we make progresson our agenda to care for ourplanet, and leave a positive
impact on society, we will

become a champion for change
whose legacy will be worthyof our iconic history.
Since becoming an independentcompany in 2020, we haveachieved the following
key milestones:• In 2021, during our firstyear, we conducted acomprehensive materiality
assessment to identify with our
stakeholders the environmental
and social challenges Wella
Company should act on.
We assessed our environmental
footprint around carbon andwater to understand ourbaselines and set targets for2030 around People, Planet
and Products pillars.
• In 2022, we defined Wella
Company’s carbon strategy
abiding to the Paris Agreement
and having our 2030 NearTerm Targets validated by SBTi.

We proudly joined the
UN Global Compact andcommitted to respect humanand social rights. We declared
our ambition by publishing ourplan, targets and goals in Wella
Company’s ESG Manifesto.
• In 2023, publishing our firstreport (regarding 2022 impact).
Going forward, we will expand
our efforts to protect natural
resources. We will assess
our biodiversity impact andidentify actions.
And through social impact,
we will identify those causes
where we can use our resources
and people to best benefit thecommunities where we operate,
the people we serve and theplanet we cherish.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

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Environmental and Social Impact

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Our first materiality assessment
gathered input from internaland external stakeholders,
including suppliers, customers
and partners, to understand theirperspectives and expectations
regarding environmental andsocial challenges the worldis facing, and how Wella
Company could best contribute.
Stakeholders were engaged
through interviews and surveys
as well as through social media.
The goal was to align thecompany’s commitments withstakeholder needs and ensure
credibility and authenticity inwhat we built.
With our environmental andsocial priorities identified, we
have built our ESG strategy on
three pillars: People, Planet andProducts, committing to carefor people across our value
chain, to protect the natural
resources of our planet and todevelop sustainable products.
Carbon, water and waste, clean
and green product formulation,
Diversity, Equity, Inclusion andBelonging (DEIB) and businessethics are the core foundationof our strategy.

WE LL A COMPANY
MATE RIAL TOPIC S 2Materiality Assessment and Priorities

We take our Environmental andSocial Impact ambition seriously.
We lead our actions and outreachwith integrity to ensure we dowhat we say.

PEOPLEPILL AR
Diversity, Equity, Inclusion & Belonging
Human & Social Rights
Business Ethics

PL ANE T
PILL AR
Climate Risk
& Carbon Emissions
Water & Waste
Sustainable Salon Operations

PRODUC TSPILL AR
Product Quality & Safety
Clean & Green Formulation and Packaging
Diverse Product Offerings
2 See Appendix for further details.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

Wella Company identified
sustainability as core to ourbusiness value proposition fromthe start. Environmental andSocial Impact are foundational
to how we operate andintegrate into our business,brands and products.

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Governance and Business Ethics

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From the very inception of Wella
Company, we created a formal
corporate governance structure
to steer our Environmental andSocial Impact plans. An ESG
Executive Committee was formed
to include key representative
leaders from Research &Development (R&D), Supply
Chain, Legal, Finance andMarketing, led by Sustainability
and ESG leaders to validate thedefined strategy and steer thepriorities and resources needed.

USG OVE RNANCE

In June 2022, the Wella Company
Board of Directors confirmed its
oversight of ESG matters andWella Company’s Environmental
and Social strategy. We review
the status of our progress
toward achieving the plans
and biannually present to theBoard of Directors.
Looking ahead, we will set
up a Committee at the Board
level whose focus will include
Sustainability to counsel andsupport the detailed strategy
and execution.

BUS INESS ETHIC S
Business Ethics is central to how
we operate Wella Company andto the Environmental and Social
Impact plans. We adhere to
ethical decision-making acrossall operations.
At Wella Company we seek to ‘dothe right thing’, operating withintegrity across everything we
do. We promote ethical behavior
and ensure that everyone in theorganization follows WECare,
our Code of Conduct.
In 2022, we published our
first new Code of Conduct
as an independent company.
WECare is specifically designed
to respond to and manage theethical risks that Wella Company
faces and to provide clarity tocompany stakeholders about
our commitment to doing what
is right. WECare is accessible
in multiple formats and madeunderstandable for all our
employees; as well as being
available in 11 languages.

We now advance this Code of
Conduct model to also include
third-party partners (suppliers,
customers, distributors, etc.).
We aim to establish a mutual
agreement with them ensuringthat ethical decision-making isthe defined working model.
The company’s Whistleblowing
hotline is available in all the
languages across the geographiesin which we operate. We havealso issued Investigation Guidelines
to ensure that all concerns andtheir outcomes are handled
effectively and consistently
across the company.
We continue to invest in our
ethics and compliance program,
continuing to focus on providing
accessible and useful guidance
to all employees regarding the
ethical risks faced at work andhow best to handle them. We
already measure the effectivenessof our program and seek toenhance it where possible.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

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OU R EMPLOYEESDIVERSITY, EQUITY, INCLU SION
AND BELONGINGHUMAN AND SOCIAL RIGHTS

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ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

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People9aim to create apositive environment
where our People:
employees, customers,
partners and suppliers
can conduct businessin an ethical, fair andinclusive way acrossour value chain.
People are our greatest assets
and are the catalysts that drive
our success. Our more than
6,000 employees3 bring theirtalents and best selves to ourdiverse and inclusive workplace
every day. Together, we connect
with a community of more than
91 million beauty lovers andindustry professionals, social
influencers, ambassadors,
followers and customers
across the globe.
We are on a journey to create
a company that is fuelled by thepower of its people. We fostera culture of belonging across all
dimensions of diversity, including
ethnicity, background, religion,
gender, sexual identity, age,disability. By ensuring people
feel authentically heard, valued
and appreciated, we can leverage
the full value of their talents.
Wella Company has the power
to positively impact people,
organizations, and societies tocollectively prosper. We believethat when our industry andits communities thrive, we allcollectively thrive.

OUR GLOBALPRESE NCE

People10>6,000employees

59%
employees globally
identifying as female>100
countries ofprofessional customers

91
million people in our
diverse community‘WE ARE BUILDING AN
ORGANIZATION WHERE EVERYEMPLOYEE IS INVESTED IN
THE COMPANY’S SUCCESS.
WHEN WE WIN, WE ALL
WIN TOGETHER.’
Gretchen Koback Pursel, Chief People Officer

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

3 See Appendix for further details.

PL
OY E E S

are creating a highperforming organization andculture which inspires andempowers people to reach
their full potential and thrive.
High-performance workplaces do nothappen by accident. We know employees
value growth, fulfillment and achievement.
Companies need to reward employees
mentally, physically and financially so thatbusinesses can leverage the full valueof their talents.

OUR APPROACH
Wella Company has a great
ambition to become the best
beauty company in the industry.
We are a fast-moving and highgrowth business with steep
ambition to deliver both a highly
profitable business and also
one that is centered on doing
good for our people, society
and the planet.
Together, we create more value.
Powered by the hair, nails, beauty
tech and salon community;
enabled by science, education
and a passion for partnership,
Wella Company has thrived
through transformation andchange. This could not havebeen achieved without people
at the heart of success.
Our values serve as our North
Star and inform how wework: Collaborative, Creative,
Connected, Courageous andCommitted. In our annual
employee survey ‘WE Listen’,we take the pulse of ouremployees and highlight areasof improvement across three key
indexes: inclusion, engagement
and wellbeing. We are committed
to providing fair wages andgood working conditions toall our employees according
to the law and in line with our
Code of Conduct.

OUR COMMITME NTS

70%
We commit to achieving
an employee engagementscore of 70%

80%
We commit to achieving
an employee sentimentof 80% for ‘everyone canachieve their full potential’

Our management sets clear
goals for employees via midand end-of-year performance
reviews, with goals being basedon how well employees arealigned with, and are deliveringon, the values of Wella Company.
These reviews help employees
realize their best selves, while
keeping communication withinteams open and effective. Thisis reflected in the results ofour ‘WE Listen’ survey: 76% of‘employees feel everyone canachieve their full potential’, and
91% of employees agree that ‘mymanager treats me with respect’.
In 2022, our overall employee
engagement score4 reached 72%
which exceeded our goal of 70%
as stated in our ESG Manifesto.
58% of our employees arecovered by collective bargaining
agreements5, as required in someof the countries in which we
operate. Employee welfare is apriority area at Wella Company.
We provide a global Employee
Assistance Program (EAP),
supplementary life insurance
protection in all countries andsupplementary health insurance
in most countries where we
operate, in addition to theapplicable statutory healthinsurance requirements.
4 See Appendix for further details.
5 See Appendix for further details.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

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People11

72%
employeeengagement score91%
employees agree that‘my manager treatsme with respect’

In 2022, we opened ourdoors and invited employees
to embrace our family ethos
with initiatives such as ‘Kids at
Work days’ to bring all of us
closer together.

OUR VALUE S AND EMPLOYEE E XCELLENCEAt Wella Company,

are…

Collaborative
work together
to create the extraordinary

seek for employees to always…
• Act as one team from global to local
and across functions• Inspire & empower others to succeed• Treat everyone with trust & assume
positive intent

Creative
foster creativity andexcellence to create value forour brands and business

LOOK ING AHE AD
We believe in building an‘Owner’s Mindset’ where
everyone has the accountabilityof leading like an owner witha growth mindset and actions,aligned to our values andconstantly challenge what we canachieve together for the iconic
beauty brands we represent.

• Create brand and customer
experiences that delight• Value expertise and intuition with data
• Promote innovative ideas and excel
in executing them

Courageous• Take full accountability for driving results

are agile, entrepreneurial
and we own our future• Make things happen quickly, turning
decisions into action• Be open minded and adaptableto new thinking and ways to work

Connected
stay connected, ensuring
we are always consumer centric• Connect with professional and consumer
needs and behaviors• Think digital first as we engage
with professionals and consumers• Create active and engaged communities
physically and digitally

Committed• Build inclusive and diverse teams

are responsible
for our impact on others
and the planet• Act with integrity and transparency towards
each other and the consumer• Work to have a positive impact on the planet

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

In 2022

Dependent on job tasks and local
regulations, we continue to offer
employees the flexibility to work
remotely or in a hybrid capacity,
plus a wide-ranging program ofwellbeing, medical care services.
Dependent on location andeligibility, employees are offeredwelfare services such as company
canteens, meal vouchers,
discounts (e.g., travel passes),
onsite parking, grocery shoppingand exclusive deals on our Wella
Company online store. We
launched a series of worldwide
webinars to support employees’
mental wellness and wellbeing.

People12EQ

OUR COMMITME NTSDEIB is our mission, andattracting and retaining adiverse workforce, including,but not limited to, gender,
race, culture and nationality
is at the very heart of how weconnect with our employees,
customers, consumers, suppliersand community.

50%

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OUR APPROACHSI

ON ANDare committed to creating
a diverse, equitable and inclusivecompany where everyone feels
they belong, so that together weenable everyone to be their true
selves and thrive.
Diversity, equity, inclusion and belonging (DEIB)
are important drivers of employee connection.
We added ‘Belonging’ to our DEI strategy in
2022 to better reflect our Wella Family ethos
and build on the 73% employee ‘feeling as
though they belong to Wella Company’ towards
our 80% ambition.
We believe our focus on DEIB opens the door
to new perspectives, ideas and better results.
Businesses that champion DEIB build and retain
teams that excel creatively and collectively.

DEIB AT WELL A COMPANY
Diversity
We ALL bring something unique
EquityWe ALL have what weneed to succeed
Inclusion
We ALL consciously
strive to hear every
voice and achieve
full participation
Belonging
We ALL feel that
we are empowered
to contribute

We commit to achieving
50% female directors
and above by 2025

80%
We commit to achieving 80%
of our employees feeling as
though they belong at Wella
Company by 2025

100%
We commit to training
100% of our employees on
unconscious bias by 2025
We commit to closing the gender
pay gap by 2025
We commit to increasing therepresentation of racially andethnically diverse leaders in
the US and Brazil to moreclosely resemble our consumer
demographic profile6
6 Efforts are made across countries where Wella
Company operates but tracked only where local laws
and regulations allow.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

V E R S I T Y,
I
DPeople13BWe successfully achieved ourambition of 50-50 genderbalance for the Wella Company
board and 46% of women as
Directors and above in following
a select hiring of talented womenleaders in recent years.
Moreover, to assess our status in
the fight towards gender equality,
we have calculated our gender
pay gap7. In 2022, on average,
men’s annual salaries were 2%
higher than women’s. We aim
to eliminate this difference.

SHARING WOMEN’ S PERSPEC TIVE S
ON LE ADERSHIPIn 2022, our Founder’s Forum event hosted morethan 200 business leaders, beauty influencers,
media and up-and-coming female executives
for an inspiring discussion with several of Wella
Company’s powerful female founders The live
event, in Calabasas, California, celebrated theentrepreneurial vision and unique perspectives ofSuzi Weiss-Fischmann, co-founder of OPI; Nancy
Twine, founder of Briogeo; Eva Graham, founderof Nioxin; Annie Young-Scrivner, Wella Company’sCEO. Renowned journalist, Stephanie Mehta,
CEO of Mansueto Ventures (Fast Company andInc. magazines), has served as moderator of
the event. They offered anecdotes and wisdom
on topics close to women’s hearts including
enabling women leaders to succeed, the uniquechallenges facing female entrepreneurs and how
to build a high-performing company culture.

Central to driving our culturechange is our Affinity Groups
Program, which cultivatesdiverse voices and ideas in
the organization that not only
support employees, but also
business growth. Affinity Groups

are open to all our employees
whether they identify with theAffinity Group focus or aresupporters and ambassadors.
They enable a deepened
knowledge of different culturesand experiences and foster new
discoveries for personal andprofessional growth, as well as
contribute to cultural values at
Wella Company.
Since the launch of the programin 2020, six Affinity Groups havebeen established and all of them
are already helping employees
feel recognized, respected andprofessionally empowered.
We are working hard to advancediversity across a broad rangeof dimensions. We recognize theimportance of making sure thatevery voice is listened to at Wella‘WE ARE BUILDING AN
ORGANIZATION WHERE
WE ALL MATTER, WE ALL
ARE INCLUDED, AND WEALL SUCCEED.’

Company. On this topic we haveeffectively leveraged local efforts
to the benefit of our global
progress on DEIB.
Specifically in Brazil, we havecreated a DEIB committee
which is driving our goals andambitions forward. Within thecommittee, five teams focus on
specific areas of diversity (age,gender, ethnicity, disabilities andLGBTQIA+) on which they takeactions to empower equality
across all employees. Each teamhas set KPIs and targets which
are clearly communicated andtracked. Moreover, they createdguidance on how to tailor bestpractices to promote DEIB locally.
The committee is also responsible
for the concept of ‘WEALL’: aninvitation to see Wella Company,
and the world, from anotherperspective. By embracing
new viewpoints ‘WEALL’ makeour company more plural,
dynamic and complete.
Finally, in 2022, we began ourpilot training for an unconscious
bias program in the UK.
The causes of bias, their negative
effects and how to recognize andavoid them were all discussed.

Annie Young-Scrivner, CEO7 See Appendix for further details.

AFFINIT Y GROUPS
Our six groups are just thestart of bringing people closer
together at Wella Company

LGBTQIA+AFFINITY GROUP

Network of Black
Leaders andExecutives (NOBLE)
AFFINITY GROUPASIAN AFFINITYGROUP (AAG)

HISPANIC/LATINX/MEXICAN (HLM)
AFFINITY GROUPWOMEN OFWELLA (WOW)AFFINITY GROUPWOMEN IN STEMAFFINITY GROUPENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

OUR IMPAC T

People14

People15

Case study

OPI proudly supports the Trevor Project, the world’s largest suicide
prevention and crisis intervention organization for LGBTQIA+ young
people. The Project offers crisis services for suicide prevention, advocacy
for LGBTQIA+ youth protection, education and public awareness on the
topic, research in the field for continuous improvement, and an online
networking space, ‘TrevorSpace’ for peer support. The networking space
is an affirming online global community for LGBTQIA+ young people ages
13-24 where you can make friends, ask questions, get advice and find yourpeople. The platform is secure and offers support to the community 24/7
365 days anywhere in the world.
We are about self-expression in all forms. Our support is here to stay:
our continued partnership is one step toward creating a world in which
our community feels safe and welcome in.
The Trevor Project partnership with OPI began in 2022, with the launchof a limited-edition ‘Rock Your Rainbow’ mini-pack of six bold shades
to inspire rainbow-colored nail art and self-expression. OPI communicatedthe new partnership with their ‘Power of Hue’ Summer 2022 collection
media campaign supporting the voices of local activists and organizations
and a donation of USD 25,000 towards The Trevor Project. OPI has
continued the partnership with an additional USD 100,000 donation in
2023. Together we amplify the voices of the LGBTQIA+ community andhelp build a more colorful future spotlighting unique skills, personality andstyle because nail polish isn’t just a color, it’s the punction to hue you are.
Collectively, the Trevor Project has had a significant impact, serving morethan 220,000 youths in the US. When asked how satisfied they were withthe service received, the youth reported an average of 8.5 on a scale from0 - 10, with 10 being Very Satisfied.
Learn more about TrevorSpace by visiting: https: //www.trevorspace.org/
Find out more about OPI’s Corporate Partnership by visiting: https://www.thetrevorproject.org/corporate-partners/
To donate and learn more visit https: //www.thetrevorproject.org/

LOOK ING AHE AD
While our actions to date havefocused on our employees, as
we progress on our DEIB journey,
we aim to broaden our practices
to include our customers andconsumers, suppliers andthe communities where we
operate. This will ensure DEIB
is embedded as an essential
component of our growthstrategy at Wella Company.
With our business partners,
we will continue to promote
more diverse and inclusive
practices which will in turncreate a positive economic
impact on the communities
where they operate.
We will leverage the successof our DEIB Brazil committeeand ‘WEALL’ as well as ourunconscious bias training
by expanding these to otherregions, to enable goodpractices towards the inclusionof all voices.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

Supporting the fight against
LGBTQIA+ youth suicide

PeopleOUR APPROACHOUR IMPAC T

We have adhered to the United
Nations Global Compact (UNGC)– the world’s largest initiative
for building highly sustainablebusinesses – and the Sustainable
Development Goals (SDGs) in theareas of human rights, labor, theenvironment and anti-corruption.
In connection with our Code of
Conduct this is how we aim tooperate as a socially conscious,
purpose-driven company.

Before any new business
partnership, fair wages andworking conditions need to meet
our Code of Conduct expectations.
We prioritize those suppliers which
uphold social and environmental
responsibility.

We work at the highest degreeof integrity around humanrights and business ethics in ourorganization, with our suppliers
and business partners and acrossour value chain.

GHTS

Through fundraising, donations
and financial support, we seek
to have a positive impact within
the local communities where
we operate.

are committed to abiding by thehigh standards we set for ourselves
and our business partners.
Protecting the human and social rights of workers
is non-negotiable. We realize that in global supply
chains and operations it is paramount to ensuretransparency of workers’ rights.

OUR COMMITME NTS
We commit to assessing our
suppliers and customers on
human and social rights andwhen required, to set up a
remediation plan with them.

In 2022, we mapped our supplierswith the Human Rights Global
Index to understand how manyof our suppliers operate in highrisk countries and ensure they
are putting in place all thatis needed to protect humanand social rights.
Moreover, Wella Company
donated unsold inventory tosupport humanitarian relief
efforts, including single mothershelter organizations andchildren’s orphanages.

Donations for
local communities

8,000
products donated to theInternational Red Cross
Geneva (Switzerland) andInternational Red Cross
Annecy (France)

189,291
products donated forhumanitarian assistance

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

SO CIAL
RI

U

N AN
A
M

D

H

16

People17

Case study

Raising over USD 23 million
for breast cancer charities
LOOK ING AHE AD

As a trusted brand that is used by millions
of people across the world, ghd has a uniqueand powerful opportunity to connect andcommunicate with its consumers via its limitededition pink tools and campaigns. The campaigns
feature real-life stories from people who haveexperienced breast cancer and who ghd call ‘ourmuses’, as their stories of positivity, courage anddetermination are focused on promoting a cultureof self-checking for all.
A business that lives its values, ghd has beenat the forefront of supporting the breast cancer
community for 20 years and is committed tocontinuing its meaningful work that helps provide
improvements in breast cancer. By creating anannual Pink Collection of products, ghd has been
donating GBP 10 or USD 10 for every item soldwhich has so far raised around USD 1 million
annually and over USD 23 million in total, whichis then donated to cancer charities globally.

We will define and implement
a comprehensive due diligenceprocess to assess all new andcurrent business partners on
environmental and social risks
impacting people in our supply
chain and in communities
around the world.
We will monitor these risks
using a recognized scoring
platform and conduct audits
when necessary to ensurecompliance with ethical andsustainable standards.
Moving forward on our journey
to become a purpose-driven
company, we will identify thesocial and philanthropic causes
where we can have the greatest
impact. And we will drive for
lasting positive change.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

Tackling breast cancer has been a pillar of the ghd
brand for more than two decades. Close to ourhearts, ghd wants to raise awareness of self-checkfor early diagnosis and to empower people acrossthe world to start regularly checking their breasts
for signs of breast cancer.

CLIMATE

WATER

WASTE

SUSTAINABLE SALONSENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

PL AN

Planet18

TE

‘WE STRIVE EVERYDAY TO PROGRESS ON
OUR SUSTAINABILITYJOURNEY, TO FULFILL OUR
OBLIGATION TO IMPROVE
THE PL ANET FOR TODAYAND FUTURE GENERATIONS.’
German Alonso Boldu, Chief Supply Chain Officer

Climate change is one of thebiggest threats facing our world
today. We care for the planet
and take our responsibility to
act now seriously. Everyone at
Wella Company is committed todriving new solutions that makea meaningful impact.
In our first years as a standalonecompany, we have beenprioritizing actions on carbon,
water, waste and sustainablesalons operations. We believethese material topics are whereWella Company can make themost difference.

OUR GLOBALOPE R ATIONS

3
factories

8
directly controlled
distribution centers

6
Reseach & Development centersin 4 countries

70+
third-party manufacturers

19
third-party distribution centers

18,000+suppliers

38
offices in 25 countries

40
Wella Company studios/salons in 21 countries

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

aim to reduce
our environmental
impact on the Planet,
particularly our carbon
footprint. Our focus
is to reduce GHG
emissions from ourdirect operationsand value chain,
while also supporting
our vendors andcustomers to adopt
sustainable practices.

Planet19

E

In 2021, during our first year
as a stand-alone we started ourjourney toward decarbonization
by assessing the entire carbon
footprint9 of Wella Company.
We have aligned to the Paris
Agreement and Science Based
Targets initiative (SBTi) for
reducing our Scope 1, 2 and 3
GHG emissions10 and havedefined our first roadmap
for meeting these goals.

are committed toreducing our GHG emissions
to help win the fight against
climate change.

Weiterstadt Distribution Center (Germany)

Climate change remains one of the world’s
most complex global crises to solve.
The continued effects of increased global
temperatures have disrupted nature’s
pendulum causing severe droughts andextreme storms. These environmental
effects are growing swiftly and require
collective effort to manage for a sustainable
future. Wella Company is acting to reduce its
climate impact in all our direct operations8and across the value chain.

Scope 1 and 2 emissions
are generated across direct
operations, and energy
reduction11 is a key component
for direct emission depletion.
Scope 3 emissions are generated
across the value chain and wehave already identified our main
hotspots: Purchased Goods andServices, Transportation and Useof Products Sold by our customers
and consumers.
In April 2022, we presented
our decarbonization targets
and roadmap to our Board of
Directors, who confirmed ourplans. We then submitted our2030 Near-Term targets andactions to SBTi.
8 At Wella Company we include our factories, our directly
controlled distribution centers, and our offices.
9 See Appendix for further details.
10 See Appendix for further details.
11 As energy reduction enables direct emissions reduction,
Wella Company decided to report targets only on Scope 1
and 2 emission reduction, which are validated by SBTi.

CLIMATE HA Z ARD A SSE SSMENT
We conducted a climate hazard assessment in
2022 to identify risks across our factories and ourmain distribution centers and across our top 100
strategic third-party manufacturers and suppliers.
This assessment is based on the latest climate
science since, including Intergovernmental Panelon Climate Change (IPPC) and United Nations
Environment Programme (UNEP).
Wella Company Top Four Climate Hazards
Extreme Heat

ExtremePrecipitation

Extreme Wind

Drought

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

CLIMA
T

OUR APPROACH

Planet20

OUR IMPACT-46. 2%

Scope 1 and 2 emissions
represent 4% of our total carbon
footprint. Actions put in placein our direct operations to
reduce Scope 1 and 2 emissions,especially in our energy-intensive
facilities, include improving key
equipment to be more energyefficient, introducing activitycontrolled LED lighting andexpanding smart facility control
systems. To help drive efficiencies
in energy management, ourfactories have been certified
ISO 50001 Energy Management
Systems (or similar certification).

We aim to reduce 46.2%
of absolute Scope 1 and 2
GHG emissions by 2030
from a 2019 base year
(validated by SBTi)-26.3%
We aim to reduce Scope 3
GHG emissions by 26.3% perunit sold by 2030 from a 2019base year (validated by SBTi)

In addition, electric vehicle
charging stations are available
to employees. The Nordic and UK
markets have introduced electricvehicles across their full fleets.
We have also been switchingto energy providers who offer
renewable sources of energy.
For example, our factory in
Rothenkirchen (Germany) andour Weiterstadt (Germany)
distribution center, use 100%
renewable electricity.
Scope 3 emissions represent 96%
of our total carbon footprint.
Purchased Goods and Services,
Transportation and the Useof Products Sold contributethe most to our overall carbon
footprint. We started focusing
on sourcing raw materials andpackaging with a lower carbon
impact. For transportation, we
began maximizing the amountof product per container, forexample by double stacking
pallets and better using thespace available.
During 2022, we have steadily
increased our understanding ofcarbon assessment and worked
on improving the robustnessof our data across all Scope 1,
2, 3 and their categories. Thesemethodological refinements12
make our Carbon Footprint 2022
more solid if compared with the2019 baseline13.
We can report that our absolute
Scope 1 and 2 emissions havedecreased by 10% overall from2019 to 2022 going from 22,296
to 19,913 tCO2eq. However,within the first year sincecommitting to decarbonization,
our Scope 3 emissions wentfrom 431,132 to 442,327 tCO2eq,
increasing by 10.7% per unit
sold when compared to our2019 baseline. This increase inemissions is derived from thefact we have just embarked
on the first steps of identifying
depletion opportunities, andwe are preparing ourselves
to move in the right direction.
Also, we changed our
methodology used for the
carbon footprint calculation,
which impacted the results.

How we are reducing
Scope 1 & 2 emissions

OUR C ARBON FOOTPRINT

Energyefficient equipment
and machinery

The 2022 carbon footprint of Wella Company
is typical of consumer goods companies ofcomparable size. Scope 1 and 2 emissions
represent only 4% of GHG emissions at Wella
Company, while Scope 3 emissions total 96%.

LED lighting

Scope 1, 2 and 3

4%
Scope 1&214

Smart ventilation,
heating andcooling systems

Wella Company
emitted 462,240tCO2eq in 2022

Scope 3

Optimized
office space

Subsidized electricvehicle charging points

96%

Breakdown of Scope 3 hotspots

62%
Purchased Goods
and Services

16.5%
Use
of Products Sold

13.8%
Transportation

7.7%

Others12 See appendix for further details
13 See appendix for further details

14 Market-based.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

OUR COMMITME NTS

Planet21

Planet22

Case study

Reducing impact at our most energy-intensive
facilities (specifically factories and distribution
centers) remains our priority, however, we realize
the importance of fostering a culture of energy
savings awareness and efficiency in our offices.
Darmstadt (Germany) is the home of one of ourmain European offices and also hosts our main
Research and Development center. In thesefacilities, the team deployed Wella Company’s‘Owner’s Mindset’ to develop actionable behavior
changes combined with a suite of smart energysaving ideas to save energy and costs.
Motion-activated LED lighting, intelligent coolingsystems that shut off when windows open andenergy-efficient elevators that wait on alternate
floors, all contributed to reduce electricity
consumption in Darmstadt toward our annual
target of one gigawatt-hour.
In addition, the local Sustainability Club now
offers a ‘Cycle to Work’ challenge, freely available
bikes for lunch breaks or other errands and evenpartnerships with local restaurants for reusabletakeaway lunch containers.

Our sustainability journey isgaining momentum. For factories,
ISO 14001 (Environmental
Management Systems) is thenext step in improving ouroverall efficiency.
Tracking and accurately
measuring our progress will
include a new carbon calculation
tool to formally assess ourcarbon footprint (which will
include Briogeo, acquired in2022). Moreover, we will reassessour 2019 carbon footprint byleveraging our gained knowledge
to ensure a robust carbon
baseline, which will be used infuture reporting. This baseline
reassessment will ensure thecomparability of our carbon
footprints from 2019 to 2030.
After updating our carbon 2030
Near-Term Targets, we willcontinue taking concrete actions
to reduce our GHG emissions
across Scope 1, 2 and 3.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

Smart ideas for energy
savings in Europe

LOOK ING AHE AD

OUR APPROACH

The water purifying system in Rotenkirchen factory (Germany)

have defined targets to
reduce water consumption
across our value chain toensure we respect and value
this essential source of life.
Sustainable water access, conservation,
management and release are among thebiggest environmental challenges facing
businesses and society today. Taking careof the quality of water is also essential tobenefit the environment, health and theprotection of water resources for future
generations. At Wella Company, water
is integral to our product formulations.
Water is central to our manufacturing
processes and it is needed to effectively
use our products (more information in the‘Products Pillar’). At Wella Company, we arefocusing our efforts on water managementin our factories, as they require waterintensive processes.

Because water is critical in our
manufacturing processes, we are
putting our efforts into saving
it. The optimization of water
management in our production
processes, which includes
the cleaning and sanitizingof equipment, and the heating
and cooling of our utilities, isa vital part of reducing Wella
Company’s environmental impact.
To stay up to date on industry
progress and develop our water
impact mitigation strategies
we have been partneringwith Global Water Intelligence(GWI) since 2020.
As one of the eight leading
multinational manufacturers in
GWI’s Corporate Water Leaders(CWL) Beauty and Personal Care
(BPC) group, we meet regularly
to foster solutions and exchange
information, with the ultimate
goal of driving sustainable water
management within the industry.
The group’s current focus isadvancing water circularity
in factory operations.

Uncovering thefactors that may
inhibit water reuse
and recycling
Benchmarking
best practices forwater management

Developing
recommendations
and guidance
Sharing informationon technology
performanceand evaluation
Identifying
opportunities
for innovation

Clarifying andcommunicating
industry needs
Advocating forperception changearound waterreuse and recycling

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

W AT E R

How the Corporate Water
Leaders (CWL) Beauty andPersonal Care (BPC) grouppromotes water circularity
in manufacturing

Planet23

OUR COMMITME NTSOUR IMPAC T-35%

We focus our efforts on water
reduction at our water-intensive
facilities. At the factory in
Rothenkirchen (Germany), we
develop best practices to deploy
to our two other factories in
Mexico and Thailand. We havestarted by mapping water flow
to see where water circularity
principles and actions canbe implemented.

100%
We commit to ensuring that 100%of our factories undergo a waterrisk assessment for the waterbasins in which we operate andseek to implement innovative
circular water solutions

15 Reworded commitments.
See appendix for further details.

We are already optimizing‘washouts’ used for cleaningproduction equipment.
By sequencing the production
to reduce volume of water usage
for cleaning to a minimum,
we have reduced the total
number of washouts in the
manufacturing of all products,
saving water as a result.

These efforts have alreadydecreased the water withdrawn
from our factories per unit
produced by 5.5%16.

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Wella Company will continue
to share virtuous practices with
the GWI consortium. We willcontinue to roll out best practices,to our factories in Rotenkirchen(Germany), Bangkok (Thailand)and Mariscala (Mexico).
Water will be central to our
biodiversity risk assessment
which is planned for the coming
years. We will define and deploy
our water stewardship program,in accordance with the new
Taskforce on Nature-related
Financial Disclosure (TNFD).

16 See appendix for further details.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

We commit to a 35% reduction
in water withdrawn per units
produced in our factories by
2030, reaching 20% by 2025
(from a 2019 base year)15

We are improving ‘wastewater’processes. By renovating thestorages of wastewater to favorwater reuse and treatment,
we are reducing wastewater
whenever possible.

Planet24

OUR IMPAC T

We focus on reducing (orwherever possible eliminating)waste generated during
our business operations,manufacturing and distribution
processes. Our first step:
decreasing product waste17.

We follow local regulations
on waste management in
the countries where we
operate. During 2022 ourimpact reductions focusedon product-related waste.

OUR COMMITME NTS-35%
aim to significantly reduce
the total waste we generate
to lighten the negative impact
we make on the world.
Collectively we generate too much waste and arestruggling to dispose of this in a sustainable way.
Improper waste disposal can lead to pollution,
contamination, greenhouse gas emissions,habitat loss and health problems for humans andwildlife. It is important to assess and mitigate
the environmental risks and impacts associatedwith waste disposal methodologies. Movingfrom a linear to a circular economy that provesto have lower environmental impacts is essential
to protect our planet’s limited natural resources.
At Wella Company, our waste management
efforts are linked to actions taken in our factories
and distribution centers, as they account for thehighest amount of waste generation.

We commit to a 35% reduction
in waste generated per units
produced and shipped in ourfactories and directly controlled
distribution centers by 2030,
reaching 25% by 2025 (froma 2019 base year)18

We have maximized theamount of product formulation
which passes through ourmanufacturing operations andreduced any residual waste
in containers and pipelines
before the cleaning andsanitization processes.
During process control, bothin the production line and via
distribution, we have developed
methods to identify productsthat are not meeting our quality
standards, correct the issue
and avoid the scrapping.

To avoid leakage and potential
waste during transportation,
we check product heat-seals
to ensure they are undamaged.
Finally, we offer unsold products
to our employees to further
reduce scrapping.
In 2022, these initiatives enabled
us to decrease our waste perunit produced by 13.7%21 in
our factories and our waste
per unit shipped by 0.2%22
in distribution centers.

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We continue to improve
manufacturing efficiencies toensure waste is either avoided,
recovered or repurposed.
At the same time, our inventory
controls will be re-examined
to ensure the optimum levelof inventory versus demand to
avoid waste. We will also put ourefforts into identifying further
opportunities to give new life
tounsold products.

We are proud to report that
we have already reached
Zero Waste to Landfill19 at ourfactories and directly controlled
distribution centers and arecommited to maintaining this.

ZERO
Waste to Landfill19
We commit to achieving Zero
Waste to Landfill at all our
factories and directly controlled
distribution centers20

17 Product formulation remaining in machineryand cleaned away as sludge and discarded
finished products.
18 Reworded commitments. See appendix
for further details.
19 Where allowed by law (note: Mexico is
excluded due to local regulations that require
specific waste to be sent to landfill).
20 Reworded commitments. See appendix
for further details.

HOW WE ARE REDUCING WA S TE
Maximizing
product
formulation use

Ensuring productquality control

Seeking
production line
efficiencies

Optimizing
product logistics

21 See Appendix for further details.
22 See Appendix for further details.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

WA S T E

OUR APPROACH

Planet25

S U S TAIN

ABLE SALONS

are committed tosupporting hair and nailsalons in our sustainability
journey to enable
them to be responsible
environmental businesses.
Wella Company supports more than
500,000 hair and nail salons globally,
many of which are small businesses.
We believe we can collectively impact
these salons to be better stewards ofthe planet through our shared actions.

We have a long historyof supporting nail and hairprofessionals, owners andemployees, their customers
and their salon businesses.
We believe these salons are
critical to the success of thecommunities where they
operate. We aspire to supportand educate salon partners
to be better business stewards
toward a more sustainable future.

We help salon professionals
adopt new ways of working
by sharing examples of bestpractices and showing how
positive choices can help reduceenergy and carbon emissions,better manage water usage, limit
waste and promote recycling.

OUR IMPAC TOUR COMMITME NTS

The professional training
delivered by our Wella Company
educators helps salon partners
utilize our products with efficient
usage and disposal to create
a positive impact through our
products. We use online andin-salon training to help salon
partners understand how they
can save natural resources intheir businesses to be morefinancially sound and also better
environmental stewards.

We commit to supporting
professional salons and stylists
to help make their businesses
more sustainable.

We have issued a Sustainable
Salon Digital Playbook that isavailable to salons. It provides
inspiring tips from advice
on energy efficiencies inlighting, heating and washingtowels, to saving water while
using our products.

We also encourage our salons’customers to partner with local
initiatives, specialized in salons’realities to prevent waste fromgoing to landfill by sorting andrecycling cartons, aluminum
tubes, plastic bottles and hair.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

OUR APPROACH

Planet26

Planet27

Case study

Unboxing for a greener last mile

We received detailed survey
responses from over 100 salonsacross Europe and the message
was clear: while our service levels
were strong in terms of on-time,completeness, damage-freeand convenience, we needed to
improve our delivery in terms of
the environmental footprint. We
visited some specific salons to hear
their feedback in greater detail,and to evaluate alternatives tobetter meet their needs for a moreenvironmentally sound delivery.
The research enabled us tounderstand the salon unboxing
experience: improving our ontime, in-full and damage-freeoutcomes while meeting salons’desire to dispose of parcels withminimal environmental impact. Theirrequirements were: right-sized parcel,
made from sustainably sourced
materials, free of plastic void-fill
and with minimal GHG emissions.
Over the last few years, both ourEuropean distribution centers,
directly controlled and thirdparty operated, have successfully
improved around this target
unboxing effort. Wella Company
is switching to sustainably sourced
packing materials, reducing theplastic void-fill, launching additional
parcel sizes while also using
adjustable parcels to better fit the
products. We have also changed
the way orders are processedand parcels are packed so that
we can ship fewer larger parcels,
reducing the carbon emissions
per product shipped. Customer
survey results affirmed we aredoing the right thing: customers
are more positive, recognizing thepositive environmental impact
generated. We continue to makefurther improvements in Europe
and are expanding our last-mile
strategy to the Asia-Pacific andAmericas regions.

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We will update and expand
our Sustainable Salon Playbook
with the latest tips andrecommendations, including bestpractices for using less water
during the coloring process.
We will continue to build
partnerships that further
our efforts to improve upon
local recycling efforts withorganizations in the key markets
where we operate.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

We ship over 1 million parcels to oursalons customers in Europe every
year. The last-mile journey to thesalons has been evolving with therise of e-commerce and increased
awareness of the environmental
footprint. A few years ago, ourlogistics team started conducting‘unboxing’ surveys to gather
feedback from salons to understandtheir satisfaction with our delivery
services and gather suggestions
for improvements in this last mileof our products’ journey.

CLEAN AND GREEN
DIVERSE PRODU CT OF F ERINGSENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

QUALITY AND SAF ETY

UC
D
O

TS

PR

Products

28

Our products are the channel
through which we enablepeople to manifest their beauty.
We develop and produce
all our products with thehighest regard for quality andsafety while addressing theenvironmental impact they make.
The production and use of our
products impact our limited
natural resources, so we arecommitted to addressing ecoethical considerations throughout
the product lifecycle. Each aspectof potential environmental
impact, from sourcing ingredientsand packaging material, to endof life, is addressed with carefulconsideration.

‘WE KEEP AIMING TO DELIVERPATENTED TECHNOLOGY
THAT LIVES UP TO WELL ACOMPANY’S LEGACY.’Peter Coles, Chief Science Officer

Wella Company strives for highperformance, breakthroughinnovation and sustainability. Our
global Research & Development
team employs more than
300 scientists and engineers,
product specialists, designers
and fragrance experts, whotoday hold over 900 active

patents and over 12,000
trademarks both on productand packaging technology. Our
teams actively seek to ensure
a holistic perspective on hairand nails, and to understandconsumers’ unmet needs byclosely collaborating with a
network of over 300 beautysalons across three continents
with whom we co-create. The
collaboration with renowned
professional stylists, hairdressers
and nail artists enables us todesign and receive feedbackon our hair and nail innovation
ideas, products and services.
Our products are assessed in our
Global Test Salons on over 4,000
hair and nail models, to ensure
continuous improvement.
In our first years as a standalonecompany, our Research &Development team focused its
expertise to develop our Clean
and Green Framework, whichenables our products to be highperforming, meeting the global
and local needs of consumers
while being good for both ourcustomers and the planet.

OUR GLOBALRESE ARCH &DE VE LOPME NT

6
Research & Development centersin Europe, Asia and Americas

300+
scientists and engineers

900+
active patents

3
Worldstar Packaging
Organization awards

4
Global Test Salons (GTS)

300+
Partnership with salonsin our global external
hairdresser network

4,000+
hair and nail models

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

make sustainableimprovements
to our Productsthat lessen ourenvironmental impact,from formulation
to packaging.

Products

29

30

Products

Q UA LI

AND S

AFDelivering the highest quality and safety
across our portfolio is embedded in Wella
Company’s DNA.

We uphold the state-of-the-art
product safety standards for
all Wella Company products,
following scientifically accepted
principles and guidelines,
conforming to the expectationsof the strictest jurisdictions. Eachingredient within our products is
carefully reviewed to ensure thatit meets or exceeds the highest
safety standard for consumers,
salon clients and professionals.
To ensure quality, ourmanufacturing facilities inGermany and Mexico are
certified ISO 22716 for Good
Manufacturing Practices for
Cosmetic Products, a standard
providing guidelines on
production, control, storage andshipment of cosmetic products.
In Thailand, our facility meetsan equivalent certification withthe country’s Food and Drug
Administration (TFDA).
We listen to the voice of thecustomer through regular instore customer satisfaction
surveys as well as staying incontact with salon professionals
to hear firsthand productrelated feedback.

OUR COMMITME NTS
We aim to produce the highest
quality products loved byconsumers and professionals
that deliver the best-in-classperformance on which Wella
Company’s legacy is built – andexceed it for a new generationof beauty enthusiasts.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

TY
ensure our products
are developed with thehighest performance andquality standards, withproduct safety and quality
our highest priorities.

OUR APPROACH

ETYOur products are designedwith the highest safety andquality standards, starting fromproduct development.
The safety of our products
is assessed through deep
understanding of each individual
ingredient, considering the
product type and how it is usedby consumers and on salonclients. We perform humanclinical studies ensuring favorable
skin compatibility of our products.

We provide instructions toprofessionals and consumers
on how to safely apply anduse our products as well as
signaling safety precautions
whenever appropriate. Our active
involvement in collaboration with
Academia and Industry partners
aims at advancing safety sciencefor cosmetics, personal careproducts and their ingredients.
We actively monitor andinvestigate any adverse healtheffects and analyze safetycomplaints or concerns fromour consumers. Based on theevaluation of the feedback fromour consumers and professional
clients, we are improving our
products and safety precautions
whenever necessary.
We perform quality controls
through the sourcing process toselect suppliers and third-party
manufacturers, with follow-up
audits based on risk assessments.
For our qualified partners, we
require a certificate of analysis
for each raw material, packaging
material, semi-finished productand finished product.
Finished products are subject
to batch coding for traceability,with samples taken and storedfrom each production line
for investigational use via our
Wella Tracker in the event of
a consumer concern.

COLOR TECHNOLOGIE S
Wella Company is on a mission to develop andproduce the best choice of hair color technologies
for consumers, professionals and the environment.
Our Research & Development team has pioneereda meaningful replacement to traditional dying
molecules (PPD/PTD23). The new dye, named ME+,
greatly reduces the risk of developing a hair dyeallergy24. A 2022 study25 shows that the use of ME+
in professional hair color products also improves
the protection of hair colorist health, many ofwhom have been impacted by dye contact allergy.
Wella Company has broadly commercialized ME+
in its main color lines26.

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Wella Company is committed
to testing and qualifying all
manufacturing processes beyond
the ISO 22716 requirements.
The qualification will consist ofdetailed checks on equipment,
instruments and software toensure they have been installed
correctly, that they operate
as intended and that systems
perform as expected undersimulated real-world conditions.

Wella Company also prioritizes protecting clients’
hair health for long-lasting beautiful color. We havebeen integrating biodegradable Metal Purifier™
technology into our main color lines27 for overa decade. It neutralizes the metal present in hairduring coloration and avoids the developmentof free radicals which can damage hair. The Metal
Purifier™ delivers maximum bond protection andhair health, but also unmatched color predictability
for any type of hair color service across the globe.

23 PPD = p-phenylenediamine, PTD = toluene-2,5-diamine.
24 See Appendix for further details.
25 See Appendix for further details.
26 Specifically, Koleston Perfect, Shinefinity, and Clairol
Nice and Easy.
27 Used in the following coloring lines: Illumina, Koleston
Perfect and Shinefinity. Metal purifier is also used in Care
products: Fusion, ColorMotion+, Invigo Color Brilliance.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

OUR IMPAC T

Products

31

32

Products

AN
E
L
C
A
GR
E
E

N

We adhere to producing beauty
products with green ingredients, nottested on animals and packaged in anenvironmentally friendly way. As we lookat our long-range innovation pipeline
and the criteria by which we develop our
products, we keep this credo in mind: build
a future pipeline of products that are highperforming and clean and green.

We create high performance
products, which respect and carefor the planet and its resources,
across their life cycle.
We have created our Clean
and Green framework, a holistic
approach to sustainable productdesign that integrates sustainability
principles into our innovation
process. This science-based
framework covers two aspects:‘Clean = Good for Me’ and ‘Green= Good for the Planet’. We apply
it to design and manufacture
environmentally responsible,
science-driven innovations,which delight consumers
and salon stylists.
In our Clean = Good for Me
pillar, we seek to be clean
beyond compliance requirements
and ensure transparency ofour products’ ingredients.
For decades, we have been
ensuring that our ingredientsand technologies are selected
and used safely and efficiently.
Understanding that someconsumers and stylists arelooking for products notcontaining certain ingredients,
such as silicones, sulfates orparabens, we are taking an extra
step to source alternatives.

In our Green = Good for thePlanet pillar, we focus on
reducing our impact on natureby implementing the three Rs(Reduce, Reuse and Recycle)of circular innovation andeco-designed products, anddelivering on our responsibility
to nature and society.
To mitigate environmental
impacts, all new productinitiatives at Wella Company
are assessed via our internallydeveloped R&D ‘OneScore’ tool.
This assessment tool assigns
a simple rating to each productbased on our extensive Clean
and Green product criteria
and estimates the carbon
footprint holistically. OneScore
drives our decision-making
and enables us to ensure thateach new product innovation
continually improves, reducing
its environmental footprint.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

ND
innovate and develop
our products with responsible
sourcing of ingredients andmaterials that lessen impact
on the planet, while retaining
the highest-quality standards.

OUR APPROACH

Products

33

PROUD PARTICIPANT INECOBE AUT Y CONSORTIUM

WATER CONSUMPTION S TUDY
Water consumption for the use of our products
is one of the biggest sources of Wella Company
environmental impact. In 2022, a Research &Development team conducted a study in over
25 salons in Germany, UK, USA, Brazil and Japanand in our Wella Global Test Salons to assess
the amount of water consumed while using our
products. The study analyzed average rinsing
time, water consumption and temperature acrossgeographies. The results of the study enabled us
to measure our products’ water footprint, whichis integral to our reduction efforts. To act on it,
we implemented a new efficient formulation
technology utilized in Professional Hair Color
Brand Koleston Perfect which significantly
reduced the color rinsing time for stylists versus
our previous Koleston Perfect. As the Number 1
Salon Color Brand in the World1, this water saving
achievement has been amplified by the brandpopularity with Wella stylists. We have leveraged
the results of this study in education material forstylists to identify opportunities to minimize water
use in the salons.

1 See Appendix for further details.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

Aiming to be a key player in Beauty industry
efforts to develop sustainable products, in 2022
we joined the EcoBeauty Consortium. This
breakthrough initiative of over 70 companies andassociations is advocating for the developmentof a harmonized, science-based ProductEnvironmental Footprint (PEF) and unified
scoring system for cosmetic products. As a
Consortium member, Wella Company participatesin technical working groups and contributes tothe improvement of future beauty products,
scoring methodology.

In 2022

98.85%
We achieved 98.85%
of non-animal derived
ingredients in our factories

OUR IMPAC T

Non-animal-derived ingredients

Wella Company takes pride in thehigh-performing formulations,which have been loved by oursalon professionals and consumers
for decades. As the Number 1
Salon Color Brand in the World1,
we understand the responsibilityof making our formulations
not only top-performing, butalso environmentally friendly
and transparent.

We commit to offering productsthat are completely free ofanimal-derived ingredientsby 2030 in our factories.28

100%
We aim to reach 100% RSPO
certified palm oil by 2025
in our factories28

85%
We are targeting 85%
biodegradable ingredients byvolume by 2030 in our factories28
No testing on animals

Wella Company R&D center in Darmstadt (Germany)

We commit not to test
our products on animals.

We care deeply about ingredienttransparency. Since 2021, we
have published a downloadable‘Ingredient Glossary’ for hairproducts on our company
website, to ensure thateveryone is able to identify ouringredients one by one. Since
its publication, the ‘Glossary’is updated on a regular basis,to keep up with our innovations
and continuous improvements.
We are committed to animal
welfare, and we do not test
our products on animals29.
As an active member of theInternational Collaboration of
Cosmetics Safety (ICCS)30, we
support ICCS in advancing
animal-free safety sciencethrough research, education
and regulatory engagementof the cosmetics industry.
We relentlessly strive to movetoward offering products thatare free of animal-derived

ingredients31, and in 2022, wereached 98.85% by volume ofnon-animal-derived ingredientsin formulas made in our factories.
Palm oil is a key ingredientfor hair products. To source it
in a responsible way, in 2022
we joined the Roundtable on
Sustainable Palm Oil (RSPO)
organization. The RSPO hasdeveloped a set of environmental
and social criteria to advancethe production, procurement
and use of sustainable palm oil
products. Thanks to our transition
from suppliers of palm (kernal)
oil derivatives to those that are
RSPO certified, we have reached65%32 of our overall target toward
100% RSPO Mass Balance
certified palm oil by 2025 in
our factories.
Biodegradability is another key
priority for us as biodegradable
ingredients break down
naturally and do not persist in
the environment as waste. We
are prioritizing biodegradable
ingredients in our formulations.
In 2022, we reached 80%
biodegradable33 ingredientsin our factories by volume.

LOOK ING AHE AD
We will expand our formulationcommitments and Clean andGreen roadmap to cover all
ingredients, including those fromour third-party manufacturers,
and update progress infuture reports.

Products

OUR COMMITME NTS

Our Ingredient Glossary will be
continually updated and kept
freely available on Wella
Company’s website.
Audits of our factories for
RSPO certification will be
conducted in the coming years.

1 See Appendix for further details.
28 Third-party manufacturers excluded.
29 See Appendix for further details.
30 https://www.iccs-cosmetics.org/about
31 See Appendix for further details.
32 Figure not yet audited.
33 See Appendix for further details.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

FORMUL ATION

34

Products

35

Case study

Elements from Wella Professionals

Formulas are clean and green and perform
as expected. Designed with ingredients thatare carefully selected and consciously added,
Elements offers a range of products that are
gentle to hair and scalp, dermatologically tested,
pH compatible and suitable for all hair types. It isan enriched line-up for healthy looking hair andscalp, with three regimen solutions: renewing,calming and purifying.
The formula is up to 99% of natural origin34,
powered by clean science delivering all theuser requires to restore the true energy, calmbalance and fresh purity of their hair. The line
is formulated without silicone and sulfates.
To ensure animal welfare, the line is free ofanimal-derived ingredients or by-products.
Beyond its formulations, Elements upholds its
dedication to more responsible packaging: allrecyclable35 and made with up to 100% postconsumer recycled plastic36.

Renewing
Aloe Vera*

Vitamin E

Olive
Essence otton-basedC
Conditioning
Ingredients*

White Tea
Extract*

Pro-Vitamin B5

Calming

Vegetable Glycerin

Purifying
Kaolin Clay

34 From 91% to 99% natural origin formula, depending on product.
Includes water, natural ingredients, and ingredients made from naturalingredients. See www.wella.com/natural-formula for details.
35 For Calming Serum remove label before recycling.
36 From 50% to 100% post-consumer recycled plastic bottle or tube,
depending on product, excluding jars.
*non-active level

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

Our Clean and Green efforts are manifested
in our Elements line from Wella Professionals.
The gentle and eco-friendly hair care line forhealthy-feeling hair and scalp are designed
for the well-being of clients’ hair and scalp,with sustainability in mind.

Products

36

Case study

Nature Strong by O·P·I

Nature Strong by O·P·I, launched in 2021 to answer
this growing consumer demand. This naturalorigin nail lacquer was specifically developed in
30 nature-inspired shades to be easily applied,
fast drying and offer up to seven days of wear
and shine, without fading. The same performance
consumers know and love, but in a non-GMO
plant-based product that is up to 75% naturalorigin and 84% bio-sourced ingredients, certified
vegan by the Vegan Society and ‘9-Free’37of chemicals of concern.

OPI also addressed the packaging to comply withthe products’ ambition. Nature Strong packaging
features 20% post-consumer recycled (PCR)
materials for the cap and bottle, with in-store
displays made from 100% recycled materials
and natural inks.
OPI Nature Strong became the top-selling Spring
2022 launch of all color cosmetics in the US Food,
Drug, Mass channel38. The success of this launch
has seen the franchise grow to 40 products StockKeeping Units (SKUs), including new Botanical Base
Coat and vegan glitters, made of cellulose fromsustainably farmed eucalyptus trees, proving the
Clean and Green ethos of Wella Company speaks
to the heart of today’s consumers.
.
37 See Appendix for further details.
38 Nielsen Syndicated Database, Spring 2022.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

Today’s nature-conscious consumers and the
younger generations are searching for beauty
products, like nail polish, that align with theirvalues. In a nail polish, they expect an all-in-one
product that is free of harmful chemicals andanimal ingredients, better for the planet, whilestill performing as well as traditional nail polish.

OUR IMPAC T

100%

Wella Company has a legacy
in packaging innovation which
has been recognized within theindustry by multiple Worldstar
Packaging Organization Awards.
Wella Company received its latest
in 2022 for sustainable packaging.

We commit to making 100%of our packaging recyclable,
reusable or refillable by 2030
(reaching 80% by 2025)

50%
We commit to increasing the
proportion of our packaging
made from post-consumer
recycled (PCR) materials by 50%
by 2030 (reaching 30% by 2025)39

100%
In 20227 7%
We achieved 77%
recyclable packaging

We commit to following
sustainable design principles linked
to the circular economy for 100%of new packaging innovation

100%
We commit to being 100%
polyvinyl chloride (PVC) free40
in our packaging by 2030

39 Reworded commitment.
See Appendix for further details.
40 Where technically feasible.

Our focus is eco-design so wecheck the environmental impactof all our packaging41 right fromthe start. To ensure we identify
the most sustainable packaging
options in the design phase, ourteams use an industry leading
science-based impact assessment
tool. In 2022, we recorded over
100 packaging environmental
impact42 assessments.
In 2022, we achieved 77%
of our total packaging being
recyclable43, reusable, orrefillable44. These packaging
characteristics are fundamental
to our contribution to a circular
economy, as they give materials
the chance to have a second life.
To achieve this result, we focus
on using the minimum amountof materials, preferring recyclable
packaging materials and monomaterial packaging, as it is easierto recycle.
Our ambition is to further
leverage recycled packaging
material to make our packaging
even less energy-intensive andreduce emissions generated

during its production. In 2022,
only 5.20% of our portfolio
was made with post-consumer
recycled (PCR)45 material
therefore we aim to strongly
increase it to minimize the useof virgin materials.
We are working to eliminate
polyvinyl chloride (PVC) fromour packaging materials. In
2022, only 0.24% of our portfolio
contained PVC. We will continue
to reduce its use except insituations where a viable
substitute is still not available.

POUCH REFILL
Our ELEMENTS pouch refills are a modelfor how we reimagine our packaging as ecodesigned. Made with 25% recycled plastic
content, our new packaging features 73% lessplastic per mililiter 46. We have createdthe easy-to-use Recharge Station,a tool made from
92% recycled plastic
that can be used byour salon professionals
to facilitate dispensingof product fromthe pouches.

41 42 43 44 45 See Appendix for further details.
46 When compared to existing ELEMENTS
bottles, tubes and pouches.

Products

OUR COMMITME NTS

ghd PACK AGING• All packaging of ghd
appliances is made frompaperboard which is
fully recyclable.
• ghd reassessed theirpackaging portfolio andsaved up to 333,500‘throw-away’ cartonsof packaging.
• By optimizing theirpackaging portfolio ghd
was able to save 163,000
meters of adhesive
tape used in theirtransport packaging.
• ghd has changed to dry
clay as a desiccant for
packing shipments
saving 5,000 kg of silica
gel from being sent
to landfill each year.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

PACK AGING

37

Products

38

Case study

Recycled Aluminum Tubes

In the first phase of our transition, we opted
to replace the virgin aluminum packaging in ourleading Wella Professionals tubes with recycled
aluminum. The savings have been estimatedat 7,000 tCO2eq in our in-house environmental
impact tool, which we aim to double as weroll out the initiative across the full portfolio.
The associated box packaging for the tubes
comprises 85% recycled paper content, with theremaining 15% being sourced from FSC-certified
suppliers. Moreover, the plastic cap of the tubes
is made from 100% recycled plastic.
Recycled aluminum is an investment we see
as a necessity in our sustainability journey.
This innovation was recognized by theWorldstar Packaging Organization witha sustainability award in 2022.

LOOK ING AHE AD
We will continue to build on our
knowledge and implementationof sustainable packaging practices.
Our partnership with our suppliersis therefore critical and we willfurther our efforts to partnerwith suppliers that have asustainability ethos.
We will minimize packaging
material across our portfolio
wherever possible and mitigate
our environmental impact bylimiting production losses,
increasing transportation
efficiencies, investigating lessenergy-intensive packaging
solutions and seeking overall
reductions in packaging
size, weight and virginmaterial content.
In 2023 we will focus on finalizing
our Sustainable Design Principles.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

Moving towards recycled aluminum content
packaging is a choice driven by our willingness
to reduce our carbon footprint and create
circularity. Through an internal assessment andanalysis, we found that virgin aluminum packaging
is associated with high quantities of carbon
emissions. Recycled aluminum content provides
an effective solution, saving 95% of the energy
required to make our tubes while significantly
lowering the overall carbon footprint.

PR

S
G

ODU
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OF

FER
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create products that aresuitable for every hair type,texture, color or style use.
Our mission is to enable all people
to look, feel and be their true selves.
And while each person’s hair is different,
we aim to have a wide variety of products
suited to all hair types and textures
to ensure diversity throughout our
products and services.

Diversity is rooted in our DNA,
reflected in our portfolio acrossthe full spectrum of our brands,
products and services.
Researched and developed byleading experts, our offerings
are formulated for the needsof professionals and consumers
worldwide. Our products aim
to encompass diverse hairneeds and provide the highestperforming products for all.
Because proper usage of our
products is so important toperformance, Wella Company’s
professional education team isa great partner to our salons andartists worldwide. We take great
pride in educating hairdressers
on all types of hair, as well as bestpractices in color, care, stylingand service recommendations.
To ensure that everyone canfeel their true selves when using
Wella Company’s products, we
educate on how to enhance
the characteristics of all hairtypes and textures.

OUR COMMITME NTS
We are committed to offeringhigh-performance products
for a diverse and inclusive rangeof hair types and textures.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

D

R
E
SE
V
I

OUR APPROACH

Products

39

C ARE TECHNOLOGIE S
Our Care products proudly embody our missionof enabling everyone to feel their true selves.
Nioxin’s advanced scalp science targets hairthinning and loss for proven results that consumers
can see and feel. The brand was built on a legacyof clinically proven solutions, focusing on turning
scalp science into true innovation.

OUR IMPAC T

We train over 400,000
professionals through various
programs yearly. Our 700
educators inspire and educate
the next generation of stylists
and consumers on every facetof hair styling and use of Wella
Company products. Training isdone in our own studios or at
Wella Company partner salonsaround the world. Each region
has a specific focus dependingon the needs of the hair types
and consumer preferences.

Across our portfolio, Professional
and Retail, Care and Color,we will continue to develop
innovative products that meetthe needs of all types of haircombined with exceptional
training and ensuring the highest
level of performance is deliveredby all our products.

Nioxin’s latest breakthrough innovation, features
our patented technology, Nutractive Complex™,
a powerful blend of niacinamide, caffeine, lauricacid and Sandalore™, that activates hair follicles
and thickens the hair from the root for visibly
less hair fall in eight weeks47.

BRIOGEO
In 2022, the United States piloted
the ‘Curl Expert Seminar’, a trainingthat gives the opportunity forstylists to gain the confidence
and knowledge to offer a variety
of services to all clients withdifferent hair types.
Globally, we provide an online
consultation program which has
been refreshed and updated
to be more user-friendly andaccessible. This allows our
professionals to quickly accessthe knowledge they need tomake the right choices in termsof coloring, care, and styling,
while always considering theirclients’ unique identities.

In 2022, Wella Company acquired Briogeo,
a rapidly growing and award-winning haircare
brand founded by Nancy Twine.
Briogeo has not only redefined the standardsof clean and natural hair care but has also madeinclusivity a hallmark. Recognized for its uniqueformulations, Briogeo offers a comprehensive
range of products for all hair types and textures.
Briogeo is one of the most celebrated hairbrands, and was awarded an Allure Hall of FameAward in 2022. Under the leadership of Nancy
Twine, and in collaboration with Wella Company
Research & Development, the brand is poisedfor expansion into new distribution channels andgeographies and more diverse product offerings.
47 Double-blind clinical study vs placebo among 120
consumers with hair loss.
Sandalore is a trademark of Givaudan.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

We aim to produce hair products
where our formulations benefit
all hair types and textures. In our
Research & Development centers
we have hair and nail laboratories
where we focus on making
quality products suitable for all.
In our Global Test Salons, wetest our products across different
regions on over 4,000 diverse
models with different hair types.
We complement our tests withthe support of our hairdressers’
network that spans different
geographical regions, to ensure
we address local needs.

LOOK ING AHE AD

Products

40

In the first half of 2023, we havesurpassed our People goals in
employee engagement now
reaching 74%. We have rolled
out the We Own Our Way(WOW) broad-based employee
participation program so every
Wella Company employee now
has a vested interest in building
our company’s future together
with an ‘Owner’s Mindset’
We have proudly reachedgender pay parity across theorganization. We have reached
59% female representation acrossour global employee population,
and we have 58% female
representation at the Boardof Directors level.
On Planet, we had our carbon
2030 Near-Term Targets androadmap validated by SBTi.
We have assessed our suppliers
across the globe as well as
third-party manufacturers
to ensure we are partneringwith companies whose ethics
mirror our own and who holdhigh standards for healthand well-being.

Closing and 2023 Outlook

202 3
O

UT

LO O K

This Environmental & Social
Impact Report 2022 marks thefirst formal assessment of oursustainability and social impact
actions. The possibility of what
we can collectively do to advanceenvironmental and social
progress propels us forward.
The initial impact we have madeacross our People, Planet andProducts pillars is modest yetmaterial for a company of our
tenure. As we reflect on 2022
through the impact alreadyachieved, it is a testament
to our global organization’s
passion for purpose and forbuilding a solid foundation

for growth. We are deliveringon our ambition and doing sowith thoughtful actions as ourbusiness matures. We continue
to accelerate profitable growthwith environment and social
impact as established businessdirectives. And we are alreadygathering steam.

Our Products’ Clean and Green
formulation criteria is built into
every new product development
decision and the transformationof our innovation pipeline hasbright possibilities for more allnatural offerings.
We will establish a plan forsocial impact engagement thatmobilizes our global employees
and the 91 million beauty
enthusiasts we interact withevery day. We know we can bea positive catalyst for good, andthat the power of our people willlead the way.
We invite you to stay withus on this journey of positivechange and to impact yourworld with meaningful belief –and actions. Together we canand will transform our world
for the better.
Regards,
Hilary Crnkovich
Chief Communications& Sustainability Officer
Arielle Semin
Global Head of ESG

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

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41

PEOPLEPLANETPRODU CTSGRI CONTENT INDEXENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

INTRODU CTION

P

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IX

A

Appendix42Appendix

43

Wella Company’s Environmental
and Social Impact Report 2022
(hereinafter the Report or document)is the first Report related toenvironmental and social mattersof the company. It communicatesthe commitments of the company
in favor of sustainable development
and responsible innovation and therelated results achieved.
The information and data in thisinitial publication pertain to thecalendar year 2022 (from January 1st
to December 31st). Any exceptions
are made explicit within the text.
Data reporting is provided on anannual basis.
The present Report is issued by
Rainbow Bitco Ltd who is operating
all the legal entities of Wella Company,
which is the Group’s commercial
name. This include legal entities
listed in the financial statement. The
headquarters of Wella Company arelocated in New York, London andGeneva. Wella Company’s majority
shareholder is KKR Inc.
Data related to Briogeo, which was
acquired in April 2022, is excluded
from this first reporting.

To communicate Wella Company's
sustainability and social performancein a transparent and comparable
manner, the report has been drafted
in reference to a selection of the GRI
Sustainability Reporting Standards,
published by the Global Reporting
Initiative (GRI). The ‘GRI Content Index’
section provides a breakdown of theinformation reported with reference
to the performance indicators definedby the GRI.
For a complete understandingof the document, in the following
sections, definitions of the terms
used by Wella Company, disclaimers,
notes and quantitative tables havebeen included.
On November 7th, 2023, the Boardof Directors of Wella Company
approved the Report.
The publication was on November
29th, 2023 and the document isaccessible on Wella Company's
website www.wellacompany.
com. For any information
about the Report, please email
EnvironmentalSocialImpact@wella.com.
Wella Company is working towards
alignment to the new sustainability
reporting regulation introducedby the European Union withthe adoption of the Corporate
Sustainability Reporting Directive(CSRD). The directive incorporates theconcept of ‘double materiality’, which
we will undertake it in 2024.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

ABOUT THIS RE P ORT:M E THOD OLO GY

Appendix

44

INTRODUC TION

2.	Here’s the definition of eachmaterial topic as of 2021
materiality assessment.

Climate Risk
& Carbon Emissions

Understanding the risk of climate impacts on Wella Company’s direct operations and value chain and implementing approaches
to build resilience, which includes understanding how climate variability impacts year-to-year sales across brands & distribution
channels. This also covers measuring greenhouse gas (GHG) emissions across Wella Company’s operations and material segmentsof its value chain and implementing reduction approaches in procurement, transportation and distribution.

Water

Measuring and managing Wella Company’s water footprint from direct operations and manufacturing in the supply chain.
This includes all water use (e.g., potable and non-potable) and wastewater outputs. In addition, consideration of Wella Company
assets in water stressed regions, and efforts to reduce use.

Packaging

Clean & Green Formulation

Product Quality & Safety

Packaging inputs and final Business to Business or Directo to Consumers packaging for products across Wella Company’s portfolio.
This includes use of virgin and recycled inputs, customer pack requirements, and consumer ease of use.
Assessing Wella Company’s product portfolio to determine opportunities to use the principles of Clean and Green formulation
to reduce the number of hazardous substances and chemicals (e.g., carcinogens, volatile organic compounds (VOCs), etc.) andminimize waste outputs in product formulation, manufacture, use and end-of-life disposal. This includes continuous assessmentand management of hazardous substances and chemicals used across Wella Company’s product portfolio to align with customer,
consumer, stylist and regulatory requirements, leading to product reformulation to remove identified chemicals/substances.

The materiality assessment was
conducted in June 2021. Afterwards,
Wella Company was able to link eachmaterial topic to the business strategy.
Materiality topics have therefore
evolved and some were re-named
accordingly:• 'Clean and Green formulation'
combined with 'Packaging'• 'Water' combined with 'Waste'• We changed 'Labor & Human
Rights' into 'Human & Social Rights'• We added ‘Belonging’ to ‘Diversity,
Equity and Inclusion’’

Maintaining the highest quality assurance, quality control (including durability) and product safety standards for Wella Company’s
product portfolio. This includes at a minimum adhering to regulatory requirements, monitoring sale of counterfeit products andproduct certification and going beyond regulations to adhere to customer requirements.

• 'Diverse & Authentic
Product Offerings / Inclusive
Beauty' became 'Diverse
Product Offerings'.

This also covers providing education and resources for salon workers and consumers to provide best practices on health and safety
while using Wella Company products.

Each material topic is detailed in theappropriate chapter.

Labor & Human Rights

Identification, remediation and elimination of all forms of human and labor rights violations in Wella Company’s direct operations
and supply chain. This includes all forms of forced and compulsory labor, child labor and human trafficking.

Sustainable Salon Operations

Providing services and training to salons to educate them on sustainable practices and operations. This includes guidance
onoperational efficiency, product end of life disposal, last-mile logistics and hazardous chemical management..

Waste

Measuring and managing Wella Company’s waste footprint from direct operations and manufacturing in the supply chain.
This includes all waste streams (e.g., landfill, recycled and efforts to reduce or divert).

Business Ethics

Adhering to the highest standard of business ethics including competitive behavior, prevention of anti-competitive practices,compliance with regulatory authorities and anti-corruption/anti-bribery in Wella Company’s direct operations and supply chain.

Diversity, Equity & Inclusion

A work environment where people differ, including (but not limited to) gender, race, ethnic origin, religion, disability, language,socioeconomic status, age, or sexual orientation, and where there is strategic distribution of resources so that all groups reachcomparable outcomes. There is a culture of belonging where every person's voice counts. This also includes ensuring nondiscrimination across Wella Company and brand operations.

Diverse & Authentic ProductOfferings / Inclusive Beauty

Inclusive product design and advertising that suits a broad customer base, regardless of race-, ethnicity-, age-, or gender-specificphysical attributes

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

1.	Wella Professionals is the
Number 1 Salon Color Brand in
the world based on Wella Master
Brand USD sales on the 2022
Salon Hair Care Study for thehair coloring products category
published by Kline.

Appendix

45

PEOPLEGRI 2-7: EmployeesMEN

WO MENN OTDISCLO SED

TOTAL

ME N

WOME NEMEAN OT
DIS CLOS E D

TOTAL

EMEA

Full time

1,694

2,160

0

3,854

Permanent contract

1,720

2,366

0

4,086

Part time

57

337

0

394

Fixed contract

31

131

0

162

Total

1,751

2,497

0

4,248

TOTAL

1,751

2,497

0

4,248

APAC

APAC

Full time

370

413

0

783

Permanent contract

360

394

0

754

Part time

0

5

0

5

Fixed contract

10

24

0

34

Total

370

418

0

788

TOTAL

370

418

0

788

North America

North America

Full time

459

749

2

1,210

Permanent contract

457

750

2

1,209

Part time

0

3

0

3

Fixed contract

2

2

0

4

Total

459

752

2

1,213

TOTAL

459

752

2

1,213

LATAM
Full time

83

LATAM

110

Part time

193

Permanent contract0

Fixed contract

83

110

193
0

Total

83

110

0

193

Total

83

110

0

193

Grand total

2,663

3,777

2

6,442

Grand total

2,663

3,777

2

6,442

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

3.	See GRI table below
for more details.

Appendix

46

PEOPLE• ‘My company motivates& inspires me to do mybest work’• ‘My work gives me a feelingof personal accomplishment’• ‘I would recommend Wella
Company to people I know
as a great place to work’
5.	Negotiations taking place
between one or more
employers or employers’organizations, on the one
hand, and one or moreworkers’ organizations, on theother, for determining working
conditions and terms of
employment or for regulating
relations between employers
and workers (GRI Standards2018). In Wella Company, we
include work councils, unions,country unions, employee
representatives, regional
unions, white union, company
union club and country unions.
7.	Wella Company calculates
the average salary for all
employees who identify as
female and the average salary
for all employees who identify
as male. By comparing the two
averages, we obtained a 2%of difference in favor of men.
The calculation does not take
into consideration difference
in roles, seniority or yearsof experience.

GRI 405-1: Diversity of governance bodies and employeesMEN

WO MENN OTDISCLO SED

TOTALExecutive Leadership

53.33%

46.67%

0.00%

100.00%

Director & above

54.00%

46.00%

0.00%

100.00%Managers

40.65%

59.35%

0.00%

100.00%Individual Contributors

41.39%

59.56%

0.05%

100.00%Total

41.34%

58.63%

0.03%

100.00%

As for employees, Wella Company includes individuals who are in an employment
relationship with the organization according to national law or practice. Persons
working for organizations other than the reporting organization (i.e. agency
workers, apprentices, contractors, interns, etc...) are excluded from this disclosure.
Figures include ghd employees but exclude Briogeo, acquired in April 2022.
In 2022, Wella Company employed a total of 2,663 men and 3,777 women.
Women compose 59% of Wella Company's workforce. The vast majority (97%)
of employees have a permanent contract. This figure reflects our commitment
to invest in our people, to develop their professional skills and to base theemployer-employee relationship on a long-term commitment that promotes
a stable work environment.

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

4.	Calculated based on annual
employee survey ‘WE Listen’
as an average of the resultsof the following questions:

GRI 305-1: Direct (Scope 1) GHG emissions

CLIMATEGRI 305-2: Energy indirect (Scope 2) GHG emissions
GRI 302-1: Energy consumption within the organization

GRI 305-3: Other indirect (Scope 3) GHG emissions
9.	A corporate carbon footprint is
the total amount of greenhousegas (GHG) emissions produced by
a company’s operations, supply
chains, products and services.
10.	Carbon dioxide (CO2), methane(CH4 ), nitrous oxide (N2O) andhydrofluorocarbons (HFCs) are
examples of greenhouse gases
whose absorption of solar
radiation is responsible for thegreenhouse effect. Taking into
account their differing global
warming potential greenhousegas emissions are usually calculated
and reported in carbon dioxide
equivalents (CO2eq). (Source: ECA)
12.	Apart from updated emission
factors, which particularly
impacted Scope 3 Category
12, main methodologicalrefinements in 2022 Carbon
Footprint compared to 2019are the followings:
Scope 3 Category 1:
 he category includes raw materialsTand packaging purchased bothfrom suppliers and Third Party
Manufacturers (TPMs). For materials
coming from TPMs, Wella Company
estimated the carbon footprint throughan ad hoc analysis done with thesupport of external experts. Results of
the analysis shows that FY2022 TPMs
footprint is strongly higher (around60%) than CY2019. This differenceis explained by the fact that CY2019
footprint relied on a lot of proxies,
as it was our very first assessment.
Our footprint is refined and morerobust in FY2022. In this isolated casedata refers to FY2022 and not CY.

Scope 3 Category 4 and 9:
Following SBTi recommendations,for Carbon Footprint CY2022 Wella
Company reallocated transportationin Category 4 or 9 (Scope 3)
according to who pays for thetransportation. Category 4 Scope 3
involves all transportation paid by
Wella Company. The figure therefore
increased significantly compared to
Carbon Footprint 2019. Category 9
Scope 3 involves transportation paid
for by third-parties only. As we arelacking info on the small amountof transportation paid for by third
parties, in 2022 this category is
substantiated by consumer trips.
13.	We decided to use 2019 data
as a baseline, due to this being
pre-COVID-19 and therefore
being more representative of our‘normal’ activities; and in 2021
we calculated our 2019 baseline
following GHG Protocol as shownin the ESG Manifesto). Carbon
Footprint 2019 was however
adjusted from the ESG Manifesto.
Following SBTi recommendations,emissions derived from the useof heated water were taken out
from Category 11 Scope 3 (Useof Product Sold) as they are
considered by SBTi as indirectemissions. Such refinement
decreased the 2019 figure of
Category 11 Scope 3 from 359,243
tCO2eq to 76,229 tCO2eq. Such
update is reflected into the total
Carbon Footprint 2019: 714,145t
CO2eq (as disclosed into the ESG
Manifesto) to 453,401 CO2eq.

SBT i CY20 19

CY20 22

CY20 22 %F U E L T YP E

TOTAL

Scope 1

11,406

7,185

1.55%

Building energy

120,247.34

Scope 2

10,863

12,7282.75%

Scope 1 & 2

22,26919,913

4.31%

Diesel (Generators)

7,363.46

Liquid Petroleum Gas (kWh)368.29Natural Gas

112,515.58

Scope 3 Cat 1

224,086

274,651

59.42%

Scope 3 Cat 2

2,561

4,065

0.88%

Scope 3 Cat 3

5,934

4,267

0.92%

Car fleet

77,425.38

Scope 3 Cat 4

2,600

41,772

9.04%

Diesel

23,008.46

Scope 3 Cat 5

5,661

3,891

0.84%

Hybrid47,249.79

Scope 3 Cat 6

6,148

1,117

0.24%
Petrol288.76

Unknown

6,711.56

Electric

166.81

Scope 3 Cat 7

7,238

8,970

1.947%

Scope 3 Cat 9

75,031

19,177

4.15%

Scope 3 Cat 1176,22973,04015.80%

Scope 3 Cat 1225,644

11,372

2.46%

Scope 3431,132

442,32795.69%

Total Carbon
Footprint

453,401

462,240

100%

Heating and cooling

1,706.11

Electric energy

147,391.22

of which nonrenewable

112,478.19

of which renewable

34,913.03

To calculate our carbon footprint 2022, we used Ecoinvent 3.9.1 emission factors
and USEEIO Database v.1.1. For Scope 3 Category 6 we used DEFRA Conversion
Factors 2022. The calculations are based on the Greenhouse Gas Protocol
Corporate Accounting and Reporting Standard (GHG Protocol) guidelines.
Wella Company adopted an operational control approach.

Total

For further details on Scope 1 &2, we report energy consumption of Wella
Company's direct operations (factories, DCs, offices and studios).

To convert energy consumption to GJ, DEFRA UK Government GHG
Conversion Factors for Company Reporting 2022 was used.

346,770.05

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

PL ANET

Appendix47

Appendix

48

PL ANET
WA S TE

Water withdrawal: sum of all
water drawn from surface water,
groundwater, seawater or athird party for any use over thecourse of the reporting period(GRI Standards 2018).

GRI 303-3: Water withdrawal

In compliance with local regulations,
Wella Company withdraws municipal
water (third-party water) and waterfrom our own well (groundwater).

WAT ER WI T H DRAWAL BY SO U RCETOTAL (m 3 )Surface water0

Groundwater

163,031

Seawater
Produced water

15.	Compared to the ESG Manifesto,
Wella Company clarified the scopeof the commitment: water
withdrawn in factories.
16.	Decrease of water withdrawn
in our factories per unit producedby –5.5%: Figure calculatedby dividing the liters of water
withdrawn by factories during
CY2022 with the total units
produced by factories in thesame timespan.

Third-party water
Total

0
0
62,115225,146

Disposal: any operation which
is not recovery, even where theoperation has as a secondary
consequence the recovery of energy(GRI Standards 2018)
Wella Company’s waste is 50/50
divided into directed to disposal anddiverted from disposal. Only 17% ofwaste generated by Wella Company’s
factories and distribution centers ishazardous. As mentioned, in Mexico
law requires to send some type ofwaste to landfill, for this reason we
still have a limited amount of waste
overall that is disposed in landfill.
All waste is managed offsite.

GRI 306-3: Waste generated
WAS T ECOMPOS IT ION

WAS T EG E N E RAT E D (t)WAS T EDIV E RT E D
FROMDIS POSAL (t )WAS T E
DIR ECT E D TO
DIS POSAL (t )Cardboard

2,102.56

2,102.56

0.00

Electronic Waste

2.62

2.62

0.00

Metals

85.25

85.25

0.00

Mixed/Unspecified

2,779.64

724.752,054.89

Organic/food waste

13.53

0.00

13.53

Other recycled

512.43201.26311.17

Paper

76.23

76.23

0.00

Plastics

212.64212.640.00

Product disposed*

1,362.23

174.581,187.65

Wood

186.79185.53

1.25

Total

7,333.92

3,765.42

3,568.50

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

WATER

Appendix

49

PL ANET
WA S TE

20.	Compared to the ESG Manifesto,
Wella Company clarified the scopeof the commitment : factories andleased DCs.
21.	Figure calculated by dividing the
kg of waste generated by factories
during CY2022 with the total units
produced by factories in the sametimespan.
22.	Figure calculated by dividing
the kg of waste generated by
distribution centers during CY2022
with the total units shipped by
distribution centers in the sametimespan.

GRI 306-4: Waste diverted from disposal
WAST E COMPO SITIO N

GRI 306-5: Waste directed to disposal
TOTAL (t)WAS T E COMPOS IT ION

Hazardous waste

TOTAL (t )Hazardous waste

Preparation for reuse

0

Incineration (with energy recovery)

937.02

Recycling

187.21

Incineration (without energy recovery)

108.02Other recovery operations (i.e., composting)0

Landfilling

0

Total

187.21Other disposal operations

0

Total

1,045.04

Non-hazardous waste

Non-hazardous waste

Preparation for reuse

261.96

Recycling

2,868.58

Incineration (with energy recovery)

1,532.46

Other recovery operations (i.e., composting)447.68

Incineration (without energy recovery)

917.13Total

3,578.21

Landfilling

72.62

Other disposal operations

0

Total

2,522.21

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

18.	Compared to the ESG Manifesto,
Wella Company clarified the scopeof commitment : for factories
and leased DCs. Wella Company
decided to differentiate intensity
measure depending on the typeof facility where the waste is
generated: waste in factories
on units produced and waste
in distribution centers on units
shipped.

Appendix

50

PRODUC TS
CLE AN & GREEN

24.	Although the risk of developing
new allergies is reduced, there is
still a risk of allergic reaction thatcan be severe. Wella Company
is encouraging stylists andconsumers to perform an Allergy
Alert Test 48 hours before eachcoloration and to strictly follow
safety instructions. If there is anallergic reaction to hair colorants,
they should not color.

29.	At Wella Company, we do not
perform any testing on animalsof our ingredients or products.
Wella Company products soldin China are proven safe before
they enter the market. We cannot
control any additional testing that
Chinese authorities may impose
on our products when applying
for a permit to market.

25.	E. M. Gargano et all, “The2-Methoxymethyl Modification ofp-Phenylenediamine Reduces theSensitization Risk for Hairdressers
to Hair Dyes—An Occupational
Hand Exposure–Based Risk
Assessment”, DERMATITIS,Vol 33 ∙ No 4 ∙ July/August 2022.

The definition of "potentiallybiodegradable" is the following:• Substance measured readily
biodegradable in an OECD
301 test without fulfilling all
test criteria mentioned in
the guideline.
• Substance failed an OECD
301 or OECD 302 test but
indications for biodegradation is
given based on expert review.

31.	Synthetic, plant or mineral derived
ingredients or water and do notuse/contain any animal derivates
or animal by-products and areprocessed solely with or by nonanimal substances.

• Substance was assessed readily
or inherently biodegradability
based on read-across from astructurally close analogue,
based on grouping, based on(Q)SAR calculation, or based ona weight-of-evidence approach.

33.	We consider as biodegradable
an organic substance that iseither ‘readily biodegradable’or ‘inherently biodegradable’,fulfilling all test criteria
according to the international
Organization for Economic Cooperation and Development(OECD) test guideline 301
or 302 or fits into Wella
Company's internal classificationof ‘potentially biodegradable’.

37.	Formulated without the following
ingredients: Formaldehyde,
Formaldehyde Resin, Toluene,
Xylene, Dibutyl phthalate(DBP), Camphor, Parabens,
Ethyl Tosylamidex,Triphenyl
Phosphate North America only,
refer to OPI COM for additional
information.

Biodegradable ingredients

79.9%

Persistent ingredients

10.2%

Data not available*

9.9%* For example, data related
to fragrances, whose formulascommonly not fully disclosed.

39.	Wella Company decided to reword the commitment. Versus
the commitement disclosed in
the ESG Manifesto we decided
to highlight efforts put on
increasing PCR (instead of
reducing virgin materials).
41.	Product to be used for thecontainment, protection, handling,delivery, storage, transport andpresentation of goods, from raw
materials to processed goods,
from the producer to the user or
consumer, including processor,
assembler or other intermediary(ISO 21067: 2007). We therefore
include primary (designed tocome into direct contact with the
product), secondary (designed
to contain one or more primary
packaging’s together with any
protective materials whererequired) and tertiary packaging(designed to contain one or more
packages, or bulk material, for the
purposes of transport, handling
and/or distribution).
42.	Any change to the environment,
whether adverse or beneficial,wholly, or partially resulting froman organization’s environmental
aspects (ISO 14001:2004).

43.	Characteristics of a product,
packaging or associatedcomponent that can bediverted from the waste stream
through available processes
and programmes and can becollected, processed, and returned
to use in the form of raw materials
or products (ISO 21067-2:2015).
44.	Packaging or packaging
component which has been
designed to accomplish orproves its ability to accomplish
a minimum number of trips or
rotations in a system for reuse.
Reuse is the operation by whichpackaging is refilled or used forthe same purpose for which it
was conceived, with or without
the support of auxiliary productspresent on the market enabling
the packaging to be refilled (ISO18603:2013).
45.	Recovered material. Plastics
material that has been separated,diverted, or removed from thesolid-waste stream in order tobe recycled or used to substitutevirgin raw materials (ISO15270:2008). This definition canbe extended to other packaging
material’s e.g., metals glass etc.
(ISO 14021:2016).

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

QUALIT Y AND SAFE T Y

Appendix

51

GRI CONTE NT INDE X

D ESC RI P T I ON

PAGE NU MBERO MISSIO NS/NOTEGRI 1: FOUNDATION 2021

Statement of use

Wella Company has reported with reference to the GRI Standards for the period from01-01-2022 to 31-12-2022.

Organizational details

43

GRI 2-2

Entities included in the organization’ssustainability reporting43

GRI 2-3

Reporting period, frequency andcontact point

43

GRI 2-6

PAG E N UMBE R

OMIS S ION S / N OT E

Energy consumption within
the organization

47

Excl letter f and g

Water withdrawal48

Based on the Water Risk Analysis
that will take place in the years
to come, we will be able todetermine water stress areas
and type of water withdrawn(fresh water or others) fromour factories.

GRI 305-1

Direct (Scope 1) GHG emissions

47

Excl. letter c

GRI 305-2

Energy indirect (Scope 2)
GHG emissions

47

Excl. letter a

GRI 305-3

Other indirect (Scope 3)
GHG emissions

47

Excl. letter c

GRI 306-3

Waste generated48

GRI 306-4

Waste diverted from disposal

49

GRI 306-5

Waste directed to disposal

49

GRI 302-1
GRI 303: WATER 2018

G R I 2- 1

GRI 2-5

DE S CR IPT ION

GRI 302: ENERGY 2016

GRI 2: GENERAL DISCLOSURE

GRI 2-4

GRI STAN DAR D

Restatements of information

47

External assurance
Activities, value chain and otherbusiness relationships

GRI 303-3

Carbon Footprint 2019 was
updated after the publication of
ESG Manifesto

GRI 305: EMISSIONS 2016

Not applicable5

GRI 2-7

Employees

45

GRI 2-28

Membership associations

GRI 2-29

Approach to stakeholder engagement

7

GRI 2-30

Collective bargaining agreements

11

Excl. letter b (ii and iii), c e d
Excl. letter b.ii

GRI 306: WASTE 20186, 23, 33

GRI 3: MATERIAL TOPICS

Excl. letter a.iii

GRI 3-1

Process to determine material topics

7

GRI 405: DIVERSITY AND INCLUSION 2016

GRI 3-2

List of material topics

7

GRI 405-1

Diversity of governance bodies
and employees

GRI 405-2

Ratio of basic salary and remuneration
14
of women to men

14, 46

Only letter a.i, b.i

Excl. letter b

ENVIRONMENTAL AND SOCIAL IMPACT REPORT 2022

G R I STA N DA RD