INTRODUCTION A LONG-TERM PERSPECTIVE CHANEL’s performance is always measured not by shareholder equity, but by brand equity. Everything we do is aimed at protecting and enhancing the long-term value of the brand, independently of short-term financial results and/or market constraints. Looking at long-term brand equity is how we measure our success and how we make decisions. “PERF ORMANCE IS NOT Being a creation-driven brand, committed JUST ABOUT SHORT-TERM luxury leader, and a human-driven company FINANCIAL RESULTS, is made possible through our long-term perspective. BUT ABOUT LONG-TERM CREATION OF VALUE.” This long-term perspective gives us the ability to help drive positive change. It gives us the — PHILIPPE BLONDIAUX possibility, and the responsibility, to use GLOBAL CHIEF FINANCIAL the power of our creativity, our people, and OFFICER, CHANEL our influence, to think, plan, and act with society’s and the planet’s long-term interests in mind, as well as our own. This long-term vision for our performance is Operating in this way means we can work the most important element of our business with suppliers over generations to ensure the model, and is based on our complete financial resources they provide are well managed and independence. Being a wholly privately benefit the community in its entirety. It means owned company with a strong cash flow, an we can protect rare skills that may otherwise extremely sound balance sheet structure, and die out. It means we can invest in future very little debt affords us total independence energy sources that not only serve us, but in financing all of our strategic investments. also, others who need them. These and many more examples in this report show what our Operating without short-term financial specific approach can enable us to achieve. constraints gives us the freedom and the luxury to make the right decisions for our brand.