Published 27 February 2020 • Inter IKEA newsroom

IKEA Sustainability Report FY19 shows a decrease in climate footprint

FY 2019* marked an important break in the trend as the climate footprint of the IKEA value chain decreased while maintaining business growth. The IKEA Sustainability Report FY19 outlines progress from across the IKEA value chain and franchise system as part of our People & Planet Positive strategy.

The Sustainability Report FY19 describes how the IKEA business tackles global challenges such as climate change, unsustainable consumption and inequalities.

“We are on an exciting journey to inspire and enable more people to live healthier and more sustainable lives, while at the same time, create a positive impact for people, society and the planet. FY19 marks an important milestone as this is the first year where we continued to grow – but our climate footprint decreased. With 6.5% growth in sales, we managed to decrease our climate footprint by 4.3% in absolute terms. This is good news, especially since we know that we need to do so much more to reach our commitments for 2030,” says Lena Pripp-Kovac, Chief Sustainability Officer, Inter IKEA Group.

Highlights from the financial year 2019 include:

- FY19 is the first year in which the climate footprint has decreased while maintaining business growth. Retail sales grew by 6.5% compared to FY18 and at the same time the climate footprint of the value chain decreased by 4.3% in absolute terms, down to the FY16 baseline level. This was driven by a large increase of renewable energy in the production of IKEA products plus significant increases in energy efficiency of the lighting and appliances range. - 91% (84% FY18) of the wood used for IKEA products is now from more sustainable sources – defined as FSC® (Forest Stewardship Council®) or recycled wood - 80% of the IKEA home furnishing range is assessed against the IKEA circular design principles - Testing new ways of product ownership and refurbishing in four countries - Using more recycled materials – 59% of polyester used in textile products is recycled, on the way to goal 100% by end of 2020 - Collections such as MUSSELBLOMMA, where materials have been sourced to clean plastic waste from oceans and FÖRÄNDRING, which contribute to reducing air pollution - Making renewable energy affordable for more people through IKEA Home Solar in seven retail markets¹ - Testing sustainable biofuel for container vessels transporting IKEA products – a collaboration with many partners - More plant-based food - a version of the iconic IKEA meatball, made from plant-based alternative protein - to be launched in August 2020 - Our supplier code of conduct, IWAY, has been updated to make sure suppliers meet, or even go beyond, IKEA requirements - Launch of first programmes for social entrepreneurs not directly linked to the IKEA business, for example accelerator programme together with Ashoka - By January 2020, all single-use plastic home furnishing products will be taken out of the range

After end of FY19, the decision was made to invest 200 million euros to further speed up the transformation to become climate positive.

“IKEA is committed to making a positive difference. To further speed up action we have decided to make a 100M EUR investment in renewable energy at our direct suppliers plus another 100M EUR for actions to remove CO2 from the atmosphere through better forest management. Most important of all is to take action together. This is the only way forward to achieve the big changes we want to see and that need to happen,” says Torbjörn Lööf, CEO, Inter IKEA Group.

You can find more examples of our progress in the IKEA Sustainability Report FY19. The report shows progress from across the entire IKEA value chain, including Inter IKEA Group, franchisees and suppliers. The IKEA People & Planet Positive Sustainability Strategy outlines the ambitions and commitments, creating a common agenda leading together towards 2030. Each part of the IKEA business sets goal, targets and road maps to deliver on the strategy and to allow for locally tailored and relevant activities.

\*The financial year 2019 (FY19) is the period from 1 September 2018 to 31 August 2019.

¹Markets operated by the franchisee Ingka Group_