Responsible sourcing through IWAY

In the context of IKEA, you hear the term IWAY a lot! Can you tell us just what IWAY is all about?

Of course! Simply put, IWAY is the IKEA supplier code of conduct. It’s the way of working that we, at IKEA, use to ensure that the operations of all our suppliers are done in the right way, with clear requirements and expectations for suppliers on environmental, social, and working conditions.

The collaborative approach of IWAY involves working closely with suppliers to continuously improve practices and ensure the IKEA value chain’s sustainability and responsible sourcing of materials and products.

Thanks Joana. Can you tell us how it is implemented?

IWAY is implemented at the operational level of every IKEA supplier throughout the world! It creates the foundation for the relationship and collaboration between IKEA and each supplier. To make this a reality, every IKEA supplier commits to living up to IWAY by signing the business contract that includes IWAY.

Can you give us an overview of what is currently being implemented through IWAY?

Absolutely. Through IWAY, we focus on environmental and social topics that we believe are most important to make happen at our supplier operations. These include protecting children’s rights, health and safety at work, social insurance for all workers, good working conditions, business ethics, prevention of environmental pollution, the welfare of animals, energy and resource management and optimisation, among others. There is always more to be done! 

Is IWAY applicable to all suppliers working with IKEA?  

Yes. IWAY is for each and every supplier that works with any company within the Inter IKEA Group.

Wow, that's far-reaching. How do you ensure that fair labour policies are practised throughout the IKEA value chain?

Good question! It starts with what we define as fair labour practices. This includes limited working hours, the right to have breaks (rest periods), wage payments on time, social insurance, among many others. We ask suppliers to work with continuous implementation, and IKEA teams have regular dialogues with the suppliers. To ensure that fair labour practices are in place, approved auditors regularly check on conditions at suppliers.

Why do you need a supplier code of conduct for that?

We operate across many countries and regions, each with its own legal system and requirements. To ensure consistency in practices in our value chain, we need to have a supplier code of conduct. IWAY helps us align with our partners globally, promoting shared commitments to social and environmental standards.

We also ensure that suppliers comply with both local labour laws and international labour standards by performing regular part-time and full-time IWAY audits at our suppliers.

How do you verify and monitor responsible sourcing practices and compliance?

The work of maintaining IWAY practices and compliance starts with full implementation by suppliers and an active dialogue between suppliers and the local IKEA teams. We conduct regular, often unannounced IWAY audits, using both IKEA and independent third-party auditors, to ensure compliance. These audits not only secure that the required conditions are in place but also provide an opportunity for further development of the requirements in future.

What steps have been taken to ensure transparency throughout the supply chain?

Many! Since 2000, we've worked to improve visibility and transparency in our value chains. In close collaboration with suppliers, we map and update sub-suppliers to trace materials and services to their source. This helps us identify and proactively address social and environmental issues, ensuring better conditions throughout our chains in partnership with IWAY.

How do you work with suppliers to improve their sustainability and social conditions?

With every supplier to IKEA, we start work at the base to ensure the supplier complies with the IWAY Must and IWAY Basic requirements. This is the foundation of IWAY. This part is non-negotiable, and every supplier needs to follow the requirements to be able to work with IKEA.

Once the foundation is in place, we work actively with suppliers to find and implement improvements in social and environmental conditions in their operations. This can be anything from ensuring limited working hours to waste management.

What happens when you find gaps in the implementation of IWAY? 

We take this very seriously. When IWAY implementation gaps are found through audits or regular dialogue, we ask the supplier to identify root causes and corrective actions. These actions must close the gaps within 90 days of detection and prevent recurrence. This ensures accountability and continuous improvement in collaboration with our suppliers.

There are business implications (including the termination of business contracts) in cases of repeated deviations.

If you have time for one more question, we'd love to know what you're most proud of today?

Of course! When it comes to IWAY, what I am most proud of is knowing that, for 25 years, we have been making a real difference on the ground at our suppliers and in our value chains, by contributing to improving the social and working conditions for workers, the environmental conditions, and the welfare of the animals in the IKEA value chains. And the work continues every day.

I am also proud that IWAY is often mentioned as one of the best practices worldwide for securing and advancing social and environmental conditions in value chains. We want to continue inspiring other companies and working together across our value chain to make a difference every day.

Thank you so much for your time, Joana! It's been great to learn more about IWAY!

The pleasure was all mine! Onwards and upwards!