SUSTAINABILITY PROJECT

Topic- Sustainability strategy for IKEA

Submitted to: Professor Sushil Kumar Dixit

Submitted by:
Simran Bhutani 006/2021
Nikita Agrawal 034/2021
Mayank Singh 037/2021
Veer Hanu Gupta 039/2021
Abhiram P 040/2021

PGDM General
Section A
INTRODUCTION

The organization that we have selected for the report is IKEA, a multinational
company that specializes in home furnishing, kitchen products, furniture, and
appliances. The company was founded in 1943, and since then has gone through
many changes in terms of its business concept, corporate structure, and
organizational culture. The company has described “sustainable growth” as one
of its core business aims, as well as stating that sustainable solutions is one of
the areas in which the company invests most of its profit. IKEA is committed to
protecting raw materials, reducing energy consumption, and minimizing waste.

STRATEGY- THINK AHEAD

IKEA is seen more as an externally focused organization, with the focus on
expanding into various markets around the globe. That is prevalent form the
official sustainability strategy of IKEA which states the importance of building
decent working conditions in markets that IKEA is expanding to. It was also
shown that IKEA Sustainability strategy clearly emphasizes co-creation as one
of ways of organizing its work to address sustainability challenges.
There are five key Strategies that IKEA is taking to have a positive impact on
sustainability.
1. Health & Sustainable Living
The ambition of IKEA for 2030 is to inspire and enable more than 1 billion
people to live a better everyday life within the boundaries of the planet. They
are working on energy, air and water parameters.
 Developing even better bulbs
IKEA introduced SOLHETTA LED lights, which, on average, cost less and use
35% less energy than earlier IKEA LED bulbs.
 Bringing our solar panel offer to more homes
The IKEA home solar offer (including installation) was available in 11 markets
as of the end of FY21. Overall, IKEA helped clients with a reduction of energy
costs of more than 11.7 million euros.
 Testing new energy services
To develop a scalable solution that other IKEA markets can use, the testing of
new energy services may continue to expand the greener energy offer.
 2. Becoming Climate Positive
By 2030, IKEA is committed to becoming climate positive by reducing more
greenhouse gas (GHG) emissions than the IKEA value chain emits, while
growing the IKEA business. This is how IKEA contribute to limiting the global
temperature increase to 1.5°C by the end of the century.

3. Transforming into a Circular Business

IKEA ambition is to be a circular business by 2030. IKEA aim to use only
renewable or recycled materials and to provide new solutions for our customers
to prolong the life of products and materials. IKEA used circular design
thinking throughout the year to enhance the strength, longevity, and round
capability of various IKEA seating products.

4. Regenerating resources, protecting ecosystem & improving biodiversity

IKEA ambition for 2030 is to regenerate resources while growing the IKEA
business.
 IKEA developed regenerative project benchmarks during FY21 based on
CO2 reduction per funded EUR. They looked at the financial feasibility,
resilience, and contribution to factors like food security, livelihoods, and
biodiversity of this innovative land use system.
 During FY21, IKEA set a goal that by 2030 at least 80% of our particle
board will be made of recycled wood. Today, particle board represents
approximately 53% of the IKEA total wood consumption.

5. Fair & Equal

By 2030, IKEA ambition is to create a positive social impact for everyone
across the IKEA value chain. Following are the key activities to achieve this:
- Co-worker health, safety, and wellbeing- IKEA has assisted coworkers in
confronting and negotiating the associated financial, practical, and mental
health repercussions during FY21 and ever since the COVID-19 pandemic
started.
- Responsible wage practices- This framework and methodology take a holistic
approach to the subject of wages by placing equal focus on equality at work,
pay principles, competence, enabling dialogue, and a living wage.
 Past Present Future
Industry Self-assembling As the IKEA Provide smarter,
goods are a concept democratic design more inclusive,
that IKEA dimensions, all better-priced
introduced, helping IKEA goods and products and
reduce the overall solutions are created services so that
burden on the with quality, shape, people may live
customer. function, safer, healthier, and
affordability, and more sustainable
sustainability in lives.
mind.

IKEA has been

proactive in phasing Utilizing discarded
out potentially toxic IKEA items as raw
substances from its materials to create
goods, frequently better, more
before regulation has inclusive, and more
been put in place. cost-effective smart
goods and solutions
that help people live
safer, healthier, and
more sustainably
Region Initially IKEA IKEA is now Further tap into the
operated in expanding into mass markets of
developed developing developing
economies only. economies such ad economies which is
Asia and China now becoming more
aware of their
carbon impact.
Educate and offer
them smart
sustainable products.
Interest Group IKEA has always IWAY 6, which has Work to ensure and
prioritized a larger emphasis on support safe and
disadvantaged enabling their healthy employment,
people by working suppliers to grow labour rights, and
with social and exceed even social protection, as
entrepreneurs and higher standards, well as to secure
social companies to beyond compliance, steady and
improve incomes was introduced by predictable
and generate jobs. IKEA in 2021 as employment for
part of a everyone involved in
comprehensive the IKEA value
system overhaul. chain.
The foundation of
their efforts to
ensure adherence to
human rights and In order to ensure
 favourable working equity, diversity, and
conditions at their inclusion, emphasise
suppliers is IWAY, a human-centric
their supplier code approach to our
of conduct. digital touchpoints
and data-driven
operations.

Ensure that all

advertising and
communications are
inclusive and
actively promote
diversity while
avoiding
discrimination.
Company IKEA has IKEA, home IKEA's Biggest
concentrated on furnishings retailer Franchisor Plans to
providing a variety that was the world’s Invest More Than $3
of attractive and largest seller of Billion in
practical appliances, furniture in the early Omnichannel Store
accessories, and 21st century, Push. Ingka Group,
home furnishings operating more than which operates 392
that are accessible to 392 stores around IKEA stores across
the general public. the world. 32 markets, will
IKEA specializes in invest more than €3
low-priced goods, billion ($3.16
sold whenever billion) into opening
possible in compact new locations and
“flat-pack” form for revamping existing
in-home assembly stores by the end of
by the customer. 2023.