1. People & Planet Positive The IKEA Group Sustainability Strategy 2020
© Inter IKEA systems B.V. 2012
People & Planet Positive
The IKEA Group Sustainability Strategy 2020
This presentation can be used both internally and externally. Pls adapt it to your audience.
This presentation focuses on 4 areas:
World around us – introduction to why it is important that IKEA works strategically with sustainability matters.
New strategy – short introduction to the direction
3 change drivers – overview of the content of the 3 change drivers.
Enablers of change

2. IKEA Group Sustainability Strategy
IKEA and the planet
© Inter IKEA systems B.V. 2012
33 million ton of CO2 eq.
150,000 ton cotton
40,000 ton palm oil
14 million m3 wood
39 million m3 water
The figures show annual use for IKEA. Figures on leather (cows) and feathers (ducks) are not presented in the FY12 Sustainability Report (do not use these 2 figures externally).
Around 0.8% of cotton grown in the world ends up in an IKEA product. We used 150,000 tonnes of cotton in FY12.
40 million cubic metres of water. This figure covers the full value chain – where raw material extraction stands for the largest proportion (cotton cultivation).
13.56 million m3 of solid wood and wood-based board materials (not including paper and packaging). This is around 0.7%  of the total wood used commercially around the world.  This corresponds to double the size of the Netherlands.
40,000 tons of palm oil was purchased. We use palm oil in our candles, some food products and for processing rattan which is used in some of our furniture.
33 million tons of CO2 equiv – corresponding to the emissions of Cape Town (26.6 tons CO2 for approx 4 million inhabitants). CO2 figures cover the full value chain, thus also raw material extraction. Only about 2.5 of this figure is for IKEA own operations (scope 1 and 2).
November 2012
IKEA Group Sustainability Strategy

3. IKEA and people 600,000 co-workers at tier 1 suppliers
2 + million people in extended value chain
© Inter IKEA systems B.V. 2012
600,000 co-workers at tier 1 suppliers
Co-workers at tier 2 suppliers
700 million store visitors
139,000 co-workers
139,000 co-workers in IKEA (mainly in IKEA stores)
690 million visitors to IKEA stores worldwide (more than 1 billion visitors to IKEA.com)
400, ,000 people working for tier 1 suppliers (companies directly supplying IKEA with products) in more than 50 countries.
Question mark (fabric shaped as question mark)= Number of people in tier 2 supply chain. Rough estimate- total tier 2: 10,000 Sub-Suppliers (not included TAGC and TANE).
More than 2 million people working in extended supply chain (quick survey of people working in cotton fields and in forests to supply the raw material we need gave this figure).
November 2012
IKEA Group Sustainability Strategy

4. IKEA Group Sustainability Strategy
Our customers
care
© Inter IKEA systems B.V. 2012
Our customers are more receptive to sustainability.
They want IKEA to actively help them.
Same cost, quality and style
IKEA customers seem to rate sustainability as more important that customers of other retailers. More than 70% of our customers think sustainability is important. BUT, we cannot make them work hard, pay more or compromise on quality!
They want to live a more sustainable life at home, but not sure how as they find sustainability confusing and sometimes hard work.
42% of consumers in our PMA think IKEA takes social and environmental responsibility. The target for FY15 in Brand Capital is 70%.
Countries that rate IKEA higher:
China (74%)
Italy (67%)
Poland (49%)
France (48%)
Countries that rate IKEA lower:
UK (32%)
Germany (34%)
US (40%)
Sweden (45%)
These findings come from the biggest piece of research IKEA has ever undertaken on attitudes toward sustainability. Over 8,500 consumers and 1,200 co-workers interviewed – in 8 countries.
November 2012
IKEA Group Sustainability Strategy

5. To create a better everyday
Growing IKEA Together
© Inter IKEA systems B.V. 2012
To create a better everyday
life for the
many people
November 2012
IKEA Group Sustainability Strategy

6. IKEA Group Sustainability Strategy
People & Planet Positive
© Inter IKEA systems B.V. 2012
We must have positive impacts: promoting renewable energy, healthy and safe chemicals, responsible stewardship of forests and farmlands, and a more fair society.
This is what we mean by people and planet positive.
November 2012
IKEA Group Sustainability Strategy

7. IKEA Group Sustainability Strategy
People & Planet
Positive
© Inter IKEA systems B.V. 2012 1
Inspire and enable millions of customers to live a more sustainable life at home 2
Strive for resource and energy independence 3
You can show the film that provides an overview of the 3 change drivers here:
For each of the change drivers, we will explore:
Why should IKEA care?
What is IKEA already doing about it?
What is IKEA planning to do more of?
Take the lead in creating a better life for people and communities
November 2012
IKEA Group Sustainability Strategy

8. IKEA Group Sustainability Strategy
© Inter IKEA systems B.V. 2012
A more sustainable life at home
The market for solar electric power is set to be worth $130 billion per year for the next decade, close to the value of the global furniture industry.
The global recycling industry is growing rapidly with even greater revenues of $160 billion per year.
November 2012
IKEA Group Sustainability Strategy

9. IKEA Group Sustainability Strategy
Fourfold increase in sales
© Inter IKEA systems B.V. 2012
Build on the existing range and develop new and exciting products and solutions!
We aim to achieve more than a fourfold increase in sales from products and solutions inspiring and enabling customers to live a more sustainable life at home.
We focus on products and solutions that enable our customers to save energy and water and reduce waste at home.
Take the lead in developing and promoting products and solutions that inspire and enable customers to live a more sustainable life at home, and achieve more than a fourfold increase in sales from these solutions by the end of FY20.
Enable customers to take climate positive actions in their homes by offering a compelling range of solutions for home energy management, consumption and generation.
Offer innovative solutions and knowledge that stimulate customers to save, reuse and recycle water and minimise household chemical use at home.
Motivate customers to turn waste into resources by offering low price, functional and easy to use solutions for sorting and minimising waste at home.
Take a lead, together with our customers and others in society, in re-thinking the nature of future homes and communities to ensure they are built as true examples of attractive, affordable and sustainable living.
November 2012
IKEA Group Sustainability Strategy

10. IKEA Group Sustainability Strategy
© Inter IKEA systems B.V. 2012
Resource and energy independance
Becoming energy and resource independent, which includes producing as much renewable energy as is consumed in IKEA Group stores and buildings, building on the €1.5 billion allocated to wind and solar projects. It also includes improving the energy efficiency in IKEA Group operations by at least 20% and encouraging suppliers to do the same. Continuously developing the IKEA range, making products more sustainable by ensuring all main home furnishing materials, including packaging, are renewable, recyclable or recycled.
November 2012
IKEA Group Sustainability Strategy

11. 4,5 million m3 purchased wood comes from preferred sources.
All wood comply with our strict requirements on wood sourcing.
550,000 solar panels installed & 157wind turbines installed and under installation
Some of IKEA’s acheivements:
€590 million allocated to invest in renewable energy, focusing on solar and wind, over the coming three years. More than 340,000 solar panels have been installed on IKEA stores and buildings across the world and we own/operate around 126 wind turbines.
100% of our wood is sourced in compliance with our forestry requirements, and if it is not, we move quickly to address it. IKEA is also one of the biggest users of Forest Stewardship Council (FSC) certified wood, which is still in relatively limited supply. Over the past year we used around 2.2 million cubic meters of FSC wood, representing 16% of our total wood.
The share of more sustainable cotton used in IKEA products is currently one quarter of our total cotton use. Working with partners such as WWF has helped around 100,000 cotton farmers to halve their water consumption and chemical pesticide use, and cut the use of chemical fertilisers by one third. More sustainable cotton also contributes to significant cost reductions and better earnings for the farmers. Results so far:
Reduction of pesticides 50%
Reduction of use of water resources 50%
Reduction of use of chemical fertilisers 30%
78% more cost effective
Two third of all cotton used is more sustainable.

12. Turning waste into resources

13. Goals at IKEA
We will take a lead in turning waste into resources. We will develop key resource chains securing recycled materials, ensure key parts of our range are easily recycled, and take a stand for closed loop society. By the end of FY15 all main home furnishing materials, including packaging, will be either made from renewable, recyclable or recycled materials. 
Strive for zero waste to landfill wherever possible, with a minimum of 90% of the waste from our stores and other IKEA operations sorted for recycling by the end of FY15. 
By the end of 2020 to reduce the waste from our stores with 10% (kg/m3) compared to 2013
To have material recycled 80 % of the waste from our operations by 2020
Enable customers to have clear and simple options for the reuse and recycling of appropriate categories of IKEA products, e.g. mattresses, sofas, appliances and light bulbs.
Target key raw materials with dedicated “resource chain” projects to establish new flows of recycled materials.
By the end of FY17, 50% of the non-renewable materials used in our home furnishing products will be recycled materials.
By FY20, 30% of the wood used by the industry group will be recycled. 

14. Circular economy at IKEA
Circular economy at IKEA
© Inter IKEA systems B.V. 2013
Key Strategic Questions:
How does IKEA group secure materials for the future
How do we enable our customers to reuse, recycle products at end of life

15. How does it look like in society
Recycling system characteristics
Bottom up system business that has developed in response to raw material scarcity and high demand rather than by policy intervention
Highly commercial system with profitability being the main driver and monetary transactions taking place at every step in the value chain
Widely policy driven system with well developed infrastructure, recycling targets and standards (e.g. quality and labeling)
Industrial and technologically advanced recycling for high value materials, such as metals and pre consumer plastics
Bottom up system build on voluntary engagement of the consumers and ‘green’ lifestyle rather than monetary incentives
Recycling rates for common materials*
Material
Country EU
China
Paper(a)
60%
40-50%
Cardboard
70%
80%
Steel
75%
Aluminum
90%
Plastics(b)
15-20%
22%
Glass(c)
50-60%
20-30%
Wood(d)
67%
70-80%
Textiles(e)
25%
<1% (<1%)
Excluding ”recycling abroad”, b. Post-consumer plastics, c. Glass containers, d. Including energy recovery, e. Post consumer, material rec. (collection)
* Accenture analysis and multiple (>10) cross checked third party written sources (e.g. EU commission, BIR, World Bank, Ouvertes project)

16. Material prioritization
Example of MATERIAL MATRIX
Transformational potential
Wood (67)
Plastic (15-22%)
Textile (25%)
Apply best practice
Cardboard (70-80%)
Steel (60-75%)
Aluminum (90%)
Ceramics
Glass (20-60%)
Paper (40-60%)
HIGH POTENTIAL
LOW POTENTIAL
LOW RECYCLE RATE
IN SOCIETY
HIGH RECYCLE RATE
IN SOCIETY

17. How to approach Circular economy1
Post-consumer
- Reuse, repair - Reverse logistics - Collection network
- Incentive platform 4
Sourcing of recycled materials - Resource bank/pool
- Recycled material supplier
- Alternative material supplier 3
Processing infrastructure
Sorting technology/process
Quality requirements - Upcycling technology/process - Recycling technology/process 6
Design for recyclability - Recyclable material - Easy for recycling 2
Post-industrial logistic - External commercial source - Join stream with industries
- Consumer goods producer
- Service industry (hotel, airport)
Pre-Consumer waste
How to approach Circular economy
© Inter IKEA systems B.V. 2013 5
Supply chain - IKEA suppliers
- Recycled material at supplier

18. A sustainability opportunity must economically sustainable
Economic opportunity
Virgin
Material
Cost
Collection Cost
(Including material dumping fee)
Sorting and pre-treatment Cost
Processing and recycling production cost
Additional production costs due to use recycled material
Recycled
Material
Cost

19. CE100 Circular Economy 100 Members ADBA AeroFarms Antea Group
AQUAFIL S.p.A. BT
Chervon Group
Closed Loop
Desso
Ecovative
Environcom
FLOOW2
Hennes & Mauritz AB
iFixit
IKEA
Innoverne
Kingfisher
M&S
Micromidas Inc.
Midal Cables
National Grid
National Physical Laboratory
Nespresso
Philips
Ragn-Sells
Recoup
Region of Wallonia
Renault
Ricoh
Royal BAM Group
Royal DSM
SAB Miller
Scottish Government
Selfrag
SGW Global
Tarkett
TerraCycle
The Agency of Design
The Coca-Cola Company
Turntoo
Unilever
Veolia Environment
Vestas Technology UK Ltd
Wallonia
Wm Morrison Supermarkets PLC
WRAP
Zerobin

20. IKEA Group Sustainability Strategy
© Inter IKEA systems B.V. 2012
A better life for people and communities
Taking the lead in creating a better life for the people and communities, which includes supporting the development of good places to work throughout the IKEA Group supply chain - encouraging suppliers to not only focus on compliance but also shared values. It also includes going beyond the immediate reach of the supply chain and helping to support human rights.
November 2012
IKEA Group Sustainability Strategy

21. IWAY at all suppliers 170,000 audited improvements!
100 million children
The IKEA Foundation donated €65 million in 2011, helping children in more than 30 countries.
Encourage suppliers to move from a compliance-driven approach to one based on shared values and a commitment to sustainable business. Work together with our suppliers to ensure their operations are the best places to work in each sector and local market, offering working conditions that ensure they attract, motivate, develop and keep the talent they need.
Since our code of conduct for suppliers, IWAY, was introduced in 2000 we have seen more than 170,000 audited improvements in environment and working conditions in supplier factories around the world. In the past year, more than 1,000 audits, over 700 of which were unannounced, were carried out in supplier factories.
Go beyond the immediate reach of our supply chain and contribute to transforming entire sectors, such as cotton, and create positive change in society or addressing wide spread challenges such as the impact of migrant work on families and children.
We invested €1.9 million in FY12 in sustainable cotton farming projects, reaching more than 100,000 farmers.
With support from the IKEA Foundation, UNICEF has improved children’s health, hygiene and education in India:
3.6 million children are receiving quality education in more than 18,000 schools across six states
4.9 million mothers have started breastfeeding their new-born babies within one hour of birth
32 million homes now have toilets
8,000 community groups came together to collectively protect children’s rights
1.1 million schools now have toilets, hand-washing facilities and safe drinking water
BUSINESS PLAN FOCUS WEEKS FY14-16

22. Home is the most important place in the world
© Inter IKEA Systems B.V. 2012
Home is the most important place in the world
14-Apr-17
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