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Inequality: As people move out of poverty, many are still struggling on very low incomes. But after a year of education, of support and providing them with the means to make the changes, those farmers have really gone along and taken on the initiative.” Since its inception, the Better Cotton Initiative has provided training and education to roughly 110,000 farmers to help them improve the cotton cultivation process and learn sustainable farming methods. Like all businesses, it must balance financial imperatives with its sustainability objectives – it’s just that their business case for sustainability is a strong one and that’s why they’re so dedicated. Only a forensic accountant will be able to work that out. How does IKEA’s sustainability plan align with its ambitious growth strategy? “It’s pretty clear that being able to talk and play in that sustainability field is beneficial to … She explains that s, United Nations Universal Declaration of Human Rights (1948) and the International Labour Organisation Declaration on Fundamental Principles and Rights at Work (1998). I think many businesses transitioning to sustainable business practices should take a leaf or two out of IKEA’s sustainability playbook – just not its tax one. A quick search on Google and it’s clear that this kind of behaviour is not an isolated incident. the IWAY Standard, the IKEA Group Sustainability Strategy for 2020, and the IKEA Group Sustainability Report FY16. By 2030 our ambition is to improve the well-being of millions of people by becoming a truly people-centred company and employer. This can offer new opportunities for job creation, innovation, economic growth and reduced energy costs. Everyone at Ingka Group should be treated fairly and we expect our co-workers to always uphold our company values. IKEA can only, **If you enjoyed, learned from, or felt empowered after reading this piece, we’ve love for you to support us by donating to our, National Sustainability in Business Conference, Ethical Fashion 101: The Top 5 Ethical Issues in the Fashion Industry, I Used 4 Different Carbon Calculators to Work Out My Annual Carbon Footprint. In 2019, IKEA recorded its first reduction in absolute climate footprint of 4.3%, despite a 6.5% increase in sales. “It’s a natural resource that we will run out of one day because it takes a very long time to break down. This is a business that understands future trends and adapts to the ever-changing consumer marketplace – and their sustainability mission will ensure a strong, profitable future. For us, it’s about balancing … Offering low-cost, visually appealing furniture in well-designed highly-coordinated warehouse spaces, it’s little wonder IKEA is the world’s largest furniture retailer and has been for the last decade. Five years later, Kamprad makes the historic decision to include furniture in the range and several years later, published the now-iconic IKEA catalogue. A crisis of rising inequality that is already affecting the lives of many millions of people. Climate change is already threatening lives with heatwaves, wildfires, hurricanes and flooding becoming more common. IKEA Sustainability Report FY18 Making sustainable living more inspiring and affordable. This is why we continuously strive to integrate the Children’s Rights and Business Principles into our daily work. “Our work started with 500 farmers in Pakistan in the beginning and they were really reluctant to change the way they grew cotton and their cultivation techniques. “Plastic is made out of oil and that is currently not a material we’re making use of in its second life form,” explains Dr Ringvall at the conference. How sustainable is IKEA? 'Eco' Perfection Doesn't Exist. IKEA’s five codes of conduct are known as ‘‘The IKEA Way’ within the company and include provisions based on various international conventions and declarations such as the United Nations Universal Declaration of Human Rights (1948) and the International Labour Organisation Declaration on Fundamental Principles and Rights at Work (1998). After an employee removes legs off of a piece of furniture to fit into a car, the concept of the flat pack and self-assembled furniture was born. Still, organic is touted as the most people and planet-friendly form of agriculture there is and if IKEA were really serious about its commitment to sustainability, going certified organic should be the aim (full disclosure: I co-own a certified organic farm). Sustainability can’t be a luxury for the few. In recent years, the company has put sustainability front and centre, releasing its ‘People & Planet Positive‘ roadmap, a document outlining its 2020 sustainability strategy. At IKEA, we want to have a positive impact on people and the planet. Its latest range of kitchen fronts known as KUNGSBACKA is a product that incorporates the circular concept. Related Post: 5 Reasons Why I Love Living Off the Grid. Now we are on track to achieve this in Amsterdam, New York, and Paris too, gave 39 million products a second life by repacking and reselling products in stores, we managed to cut food waste from our operations by 30% by the end of the fiscal year, however we did not manage to reach the goal of 50%. I like that there is a minimalistic nature of the pieces and that many really are well-designed and timeless. Everything we do, as a business and as individuals, can impact children’s lives. It gets worse. Now just so you know I am also extremely honest in my appraisals of businesses. We make sure that we’re a good neighbour, that we support human rights and we act in the best interest of the children that we may be impacting as well. IKEA’s home decor products are, of course, another story. At the recent Edie Live exhibition on achieving a sustainable future, IKEA UK’s sustainability manager, Hege Sæbjørnsen, indicated that building a circular economy into IKEA’s business model will be … Are those customers wrong? This can bring a huge economic benefit to IKEA and customers respectively. About 700-1000 years. It is a part of EWP mission: to be a part of conversations that are substantial and not just gloss over like a badly written advertorial. The furniture may be mass-produced and cheap, but it’s definitely not $10 t-shirt cheap. To learn more about IKEA”s People & Planet Positive sustainability strategy, click here. These include physical impacts of extreme weather on our buildings and the rising cost of using fossil fuels. What is more, this option can bring a positive sustainability … 4 | INTER IKEA SUSTAINABILITY SUMMARY REPORT 14 new IKEA stores worldwide EUR 38.3 billion IKEA retail sales4 28,000 co-workers 41% of Inter IKEA co-workers are women The IKEA business in FY17 2 Inter IKEA … IKEA has achieved zero waste sent to landfill in 2016 – how does the company seek to expand its sustainability efforts? prevention of child labour, purchasing and much more. By promoting sustainable home furnishing and food products, services, life-at-home knowledge and inspiration, we can make healthier and more sustainable living possible for the many people. Fair and inclusive growth leads to motivated co-workers, innovative meeting places, and resilient and empowered communities. The IKEA sustainability strategy The IKEA vision is to create a better everyday life for the many people, and we believe those lives are truly better when they’re lived sustainably. So we need to be mindful of how we use those resources and IKEA is really keen to do something different and use our resources in a second-life way.”, With millions of products in stores around the world, and close to a billion people shopping at IKEA each year, a business decision to incorporate waste and recycled plastic in their products can have a huge impact and accelerate positive change. That’s a big amount of resources that we could be using that we’re currently not for a whole range of reasons.” – Dr Kate Ringvall, IKEA’s Australian Sustainability Manager in her talk at the 2018 National Sustainability in Business Conference. Just How Sustainable Is American ‘Ethical’ Fashion Label Everlane Anyway? Sustainability – caring for people and planet is at the core of our business … © Ingka Holding B.V. 2021.Some images by courtesy of Inter IKEA Systems B.V. IKEA is a Swedish-founded, Dutch-based global retail behemoth. We all need to act now. Here at Eco Warrior Princess, we challenge ethical elitism in all its forms and companies that are providing low-income individuals and families somewhat greener choices isn’t something we’ll turn our nose up at. It’s part of our mission to ensure we put people at the heart of our business. To us, this means creating fair working conditions together with our suppliers, to use our planet’s resources wisely, and to inspire our … The antithesis of a McDonald’s restaurant, an IKEA store (really just a ginormous showroom) is designed to keep you there for as long as possible. The pandemic threatens to make this worse. At the World Economic Forum in Switzerland this month, IKEA’s chief executive Jesper … While the company is by no means perfect (what business is? Leading non-profit ethical consumer advocacy group, Ethical Consumer found IKEA “to have a reasonable approach to difficult issues found within supply chains” and gave the business its best rating for Supply Chain Management. Having a code of conduct doesn’t stop labour, environmental or social issues from arising. Related Post: Q&A with Camille Reed, Founder of the Australian Circular Fashion Conference, One of IKEA’s other sustainability commitments is to be energy-independent, meaning that it wants to generate more renewable energy than it uses. For reasons I can’t put my finger on now, we never did end up working together. In the business case of IKEA, it is likely that organic cotton doesn’t deliver on either. IKEA’s New Green Image Comes with Some Assembly Required Sweden's most recognizable export is trying to change perceptions among consumers, transforming itself from famous maker of … Personally, its high-volume, low-price business model is unsettling, and when one considers the size of the company and the stock it sells, it’s hard to imagine how the business can possibly be sustainable. Annual Summary & Sustainability Report | FY20, Read the IKEA Sustainability strategy here, we use IWAY – the IKEA supplier code of conduct, increased communications on sustainability across our stores, shopping centres and websites to inspire customers and highlight products in ranges that can help save energy and water, reduce waste and live a healthier life at home, inspired 6,000 co-workers and 92,000 customers through the IKEA Better Living app, through insights about their climate footprint of everyday life and how to shrink it, tested solutions to encourage circular consumption such as Furniture as a Service in six markets, buy-back schemes for second-hand IKEA furniture and our spare parts service, phased out all single-use plastic items offered in customer and co-worker restaurants, bistros and cafés within our target, except for disposable cups for hot drinks where a thin plastic coating for safety reasons is still used. “We further extended our code of conduct which is an audit process of our procurement business unit and that goes through our value chain. It’s committing to sustainability because it’s good business to do so. Risks to communities include extreme weather events, rising sea levels, food and resource scarcity and collapsing ecosystems. Known as “Circular IKEA”, the business is testing out the circular model with a new line of kitchen products, replacing raw materials with second-life materials. Head of sustainability at the Scandinavian furniture giant Jonas Carlehed told Reuters earlier this year that: “ We are making a huge readjustment, maybe the biggest IKEA has ever made, … Not only will IKEA Greenwich be our most sustainable store in the country, we are also very excited that the new store will demonstrate … It should be noted that IKEA doesn’t hold any other independent certifications such as Fair-Trade and B-Corp. IKEA is one of those forward-thinking global brands already embracing the circular economy. IKEA has taken big steps to encourage sustainability. “We have about 20,000 solar panels across the Eastern seaboard and we’re looking to include WA and Adelaide in that as well… We want to be producing as much renewable energy as we consume so that we can drive energy efficiency throughout the value chain.”. IKEA Australia’s Sustainability Manager Dr Kate Ringvall’s presentation. Human activities have warmed the planet’s average temperature by more than 1°C, and despite cut in footprint during 2020 we’re still using resources at a rate equivalent more than one Earths per year*. “The name IKEA is formed from the founder’s initials (I.K.) My reply to Sophie the PR consultant was honest and direct (surprise, surprise): I had a look at the info you sent and of course had to do my own research. *Source: Earth Overshoot Day: www.overshootday.org. The opportunities that IKEA takes benefit of through its sustainability outline include: An immense opportunity can be seen in a rising demand for environmentally friendly products (Times, … We’ve been leaning that way since 2009. If you make a purchase using a link we may receive a commission. This includes textile collections, sewing services, and last mile services, supporting fair work for young workers, parents and caregivers, while eliminating child labour entirely from our Ingka Group supply chain, ensuring our IKEA stores and Ingka Centres meeting places are playful and safe spaces for children – for example, by providing Småland crèches at our stores and kid’s centres, and playgrounds and activity areas at our meeting places, offering safe products for children, and marketing these appropriately, contributing to a healthy environment for children to live in – both now and in the future – through our climate initiatives, working together with others to strengthen child-friendly and connected neighbourhoods and cities, reinforcing community and government efforts to respect children’s rights. We have a responsibility to uphold the rights of all people impacted by our business: our co- workers, customers, workers in our supply chain, and the communities around us. Our approach starts with our co-workers. Something that does not gel with my idea of “slow” living. “It also leads to higher costs as cotton is usually grown in developing countries and farmers struggle to make a profit. Its codes of conducts just provide guidelines for minimum expectations required of employees, suppliers, co-workers and subcontractors. We call this ‘democratic design’, it’s that clever combination of form, function, quality and sustainability all at a low price, and it helps all of us, including our co-workers, live a more sustainable life at home.”. Jennifer is also the founder of The Social Copywriter, a digital agency harnessing the power of copywriting and content marketing to help mindful businesses reach more people. It also can have a significant … So many years ago, we decided to help tackle these challenges and made a commitment to improving the cotton industry.”. “When grown conventionally cotton uses large amounts of chemicals and water and this practice often leads to significant health risks to farmers, soil erosion and water scarcity among others,” explains Dr Ringvall. Currently, the business sources wood from 50 different countries, including Vietnam, Sweden, Poland, Russia, Lithuania and Germany. Regardless of whether our suppliers work in construction, security or cleaning, we expect them to comply with our standards – and this includes treating their co-workers fairly. Children’s rights are fundamental – to the world and to IKEA. This means that the cotton is either recycled, or grown with less water, chemical fertiliser and pesticide while increasing profit margins for farmers. Her passion and enthusiasm for her employer was evident: “Having spent many years in government, I finally found a place where my value set is met and IKEA is meeting those every day,” she shares with the audience made up of over a hundred of Australia’s sustainability thought leaders. We divert 70-80 percent of our waste as a company across the country. The 2012 report is the first for the superstore, whose goals begin with a fourfold increase in sales by 2020 but go on to include two pillars of sustainability, engagement of customers, … From here, the rest, as they say, is history. Therefore, IKEA can sell the product made of particleboard with a lower price to attract customers to opt this material as the element of their furniture. It’s easy to imagine these items – picture frames, bath mats, vases – being tossed out in the weekly garbage after breaking. Many of the solutions to the climate crisis already exist, but they urgently need to be deployed on a massive scale. Now a couple of years ago, I received an email from a PR agency working with IKEA Australia on an influencer program, known as IKEA Kollectively. So, we never tolerate child labour or any form of modern slavery, and we support fair and meaningful work for everyone in our supply chain – including vulnerable groups like young or migrant workers. We are committed to implementing the UN Guiding Principles on Business and Human Rights as the basis for our responsibility to respect human rights. We’re really passionate about that.”, “Ideally we would like to move to a place where we’re making products from the waste we create. Well, that could become a thing of the past with a new sustainability initiative from our Swedish furniture overlords. A company can design a sustainable product, but if consumers don’t want it, it’s a waste. We’re taking action to reduce our direct climate impact and strive for zero waste across our own operations. Not long after, the business begins to design and make their own furniture, due in large to risks of supplier boycotts. IKEA sustainability ambitions for 2030 Inspire and enable more than 1 billion people to live a better everyday life within the boundaries of the planet Become circular and climate positive, and regenerate … While shopping at IKEA is no longer a part of my DNA and hasn’t been for more than a decade, I can understand why I did – and why many people around the world still do. It’s more likely that the furniture is fixed if broken, donated or sold on, not dumped in the trash. Dr Ringvall is right. Well, more sustainable every day. Some of the objectives outlined in the report include: With over 400 stores worldwide, roughly 170,000 employees, 915 million customers each year and sales revenue exceeding EUR 34.2 billion (in FY2016 this equated to USD $37.6 billion), we wonder: Good intentions aside, can IKEA ever be sustainable? Ikea turnover history. Like many other multinationals operating in Australia, IKEA pays very little corporate tax when one considers its revenue. A great customer experience to be sure, but it’s intentionally laid out to encourage customers to buy more than what they set out to buy. Dr Ringvall is right. Taking this into consideration, the fact that IKEA is making their products more sustainable and in reach of the everyday consumer should at least be applauded. This is not something IKEA is known for. This is true now more than ever. At the National Sustainability in Business Conference, I had the good fortune to catch IKEA Australia’s Sustainability Manager Dr Kate Ringvall’s presentation. When she's not perfecting a sentence or coaching business clients, you will find her at her certified organic farm reconnecting with nature. But one thought still niggled at me: Can a company that relies on a low-cost, high-volume business model that encourages mass-consumption ever be sustainable? Since it consumes one percent of the world’s wood supply, this is a welcome step in the sustainable direction. Related Post: Ethical Fashion 101: The Top 5 Ethical Issues in the Fashion Industry. If you’re strapped for cash, time poor, prefer a one-stop-shop with a variety of options to choose from, seek value for money, and happy to assemble your own furniture – then IKEA is for you. And, we know it’s possible for businesses to grow while shrinking the climate footprint. To help us maintain our standards throughout our supply chain, we use IWAY – the IKEA supplier code of conduct – which sets out the social and environmental requirements for IKEA Retail suppliers. Of course, Sophie was really understanding of my position and thought that it would be better if we worked together on an ad-hoc basis where they “could tap into sustainable stories and issues that [I’m] passionate about”. It’s easier to replace than fix many of these cheap goods. On the topic of power, it’s a good thing that IKEA’s sustainability goal is to produce as much renewable energy as it uses – stores this size are fossil-fuel hungry and since they have over 400 of them, the combined carbon footprint of all its stores is astronomical and completely unsustainable. IKEA uses more renewable and recycled materials than ever to eliminate waste in our operations and to change how we design products. You might like this one too: Just How Sustainable Is American ‘Ethical’ Fashion Label Everlane Anyway? To make a positive impact on the planet, we have identified three major challenges impacting our business: Climate change: No longer a distant threat, but a visible reality, we believe that the climate change is one of the biggest challenges facing humanity. The company hasn’t achieved this yet, particularly in Australia, but according to Dr Kate Ringvall they’re working towards it. The Principles were launched in 2012 by Save the Children, the UN Global Compact, and UNICEF. She explains that sustainability is at the centre of IKEA’s business strategy and that it informs how the business designs and makes their products: “At IKEA we make products with sustainability at their heart and we sell at a price that puts them well within the reach of the many people, and that’s really one of our goals. The following year, in 2017, IKEA reportedly paid the Australian Taxation Office (ATO) just $289,000 tax – despite selling $1.16 billion of flatpacks! Like most people, our customers want to enjoy a decent quality of life without negatively impacting the environment – but not at the expense of price, quality or convenience. In the previous two years, IKEA didn’t pay any tax! If you like our site, think our work is important and want to pledge your support, you can pledge a donation through Patreon. According to the historical timeline on the IKEA website, the business initially sold consumer products such as pens, wallets and jewellery. ), it’s at least moving in the right direction. One last note. “Sustainability is at the heart of everything we do at IKEA. Guided by our values, we want to create lasting positive change in the communities where we are present. According to The Guardian, in the 2015-16 fiscal year, IKEA recorded $1 billion of revenue and paid a pitiful $11 million tax to the Australian government. Loved this post? Ellen Rupell Shell, author of the book, “Cheap: The High Cost of Discount Culture” writes: “IKEA designs to price, challenging its talented European team to create ever-cheaper objects, and its suppliers—most of them in low-wage countries in Asia and eastern Europe—to squeeze out the lowest possible price.”. Most people don’t just get in and get out of an IKEA store. We keep working for another solution during FY21, enabled customers in 11 markets to use and generate renewable energy with our clean energy services such as solar panel and battery storage systems, we generated renewable energy equivalent to 132% of the energy used in our operations, up from 81% in FY18, two thirds of the electricity used in our buildings in FY20 was from renewable sources, close to 10% of customer delivery transport were made by electric vehicles or other zero emission solutions, we added around 1,000 new electric charging stations for our customers, offering EV charging at 93% of our stores, we recycled 72% of waste generated in FY20, moving towards our goal of 100% recycling of waste from our operations by 2030, we are committed to zero-emission home deliveries in five cities by 2020 and reached this milestone already in Shanghai. Each code of conduct. Now commitment to sustainability aside, IKEA’s minuscule Australian tax bill raises a lot of questions. IKEA originally sells pens, wallets, picture frames, table runners, watches, jewellery and nylon stockings – meeting needs with products at reduced prices… ” it states on IKEA’s website. Jennifer Nini is a writer, activist and the founding editor of Eco Warrior Princess. The health and safety of everyone in contact with our business was a greater risk during the year due to Covid-19. On the one hand I like that IKEA’s items are affordable and that individual items can be replaced if broken etc. The onus is on the supplier and other third parties to ensure standards are being met and requires regular independent, unannounced audit visits to verify compliance. Because the more people we reach, the bigger impact we have in helping the many create a better everyday life. Fast furniture describes the manufacture, not necessarily consumer behaviour. We work hard to ensure co-worker and customer safety and have increased our focus on health and safety with suppliers and home delivery service providers. IKEA has released a 2030 sustainability strategy document which emphasized on using only renewable and recycled materials. We also contribute to safe, affordable and sustainable places to call home in the communities where we are present. We know our customers want IKEA to help make living a more sustainable life affordable, attractive and accessible. Each code of conduct covers specific business needs, from working conditions, prevention of child labour, purchasing and much more. Having a code of conduct doesn’t stop labour, environmental or social issues from arising. Ingka Group has tens of thousands of suppliers. IKEA was founded in 1943 by Swedish entrepreneur Ingvar Kamprad who, at 17-years-old and after receiving money from his father for academic performance, launches the retail business. 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