IKEA’s Sustainable Initiatives Are Paying Off for the Retailer and the World

February 18, 2014 by  
Filed under Wind Energy Tips

In October 2012, IKEA, the largest furniture retailer in the world, announced its “People and Planet Positive” initiative in an effort to make sustainability a household word.

In its just-released Sustainability Report for 2013, the Swedish company indicated it is well on its way to generating 70 percent of its energy from renewables by 2017 and becoming a 100 percent renewable energy company by 2020. That means IKEA will produce as much renewable energy as it will consume. Reaching this ambitious goal takes an investment of more than $2 billion in clean energy through 2015, with a big commitment to such alternative energy sources as solar and wind. 

Sustainability may be a big idea, but it also takes a commitment to small things, like LED lightbulbs. In IKEA’s first ever sustainability marketing campaign in the UK, a fanciful television ad depicting a lit-up enchanted forest claims, “By 2016 we will only sell energy efficient LED lightbulbs. Sometimes small things can make a big difference.” Peter Wright, IKEA’s UK/Ireland marketing manager, says the ad speaks to IKEA’s “thrifty and resourceful” Swedish roots. “This is a sustainability campaign but also a brand campaign. We need to explain what we stand for and celebrate that.”

The ad campaign will include TV, radio, digital, and social media activations. Tips will be included on how consumers can apply sustainability to their own lives. The campaign is actually the first flight of a broader effort under the banner, “The Wonderful Everyday,” and subsequent ads will address little things that can make a big difference in people’s lives.

IKEA’s sustainability accomplishments are already impressive. According to its Sustainability Report, the company installed 550,000 solar panels in 2013 and committed to own 137 wind turbines. It sold 22.4 million LED products, including 12.3 million LED lightbulbs. Its share of cotton from more sustainable sources went from 34 percent (Fiscal Year 2012) to 72 percent (Fiscal Year 2013), and in Canada, all of the company’s stores source 100 percent recycled content paper products.

Sustainability is more than a buzzword to IKEA. Steve Howard, Chief Sustainability Officer of IKEA Group, told Forbes, “Sustainability will be a decisive factor in terms of which businesses will be here in 20 or 30 years time. It is the future of business. …And we use sustainability to drive innovation, steer our investments and develop new business opportunities.” What’s more, Howard says, there is a measurable payback: “Since 2010 we have saved 40 million Euros in our stores and distribution centers alone through energy efficiency and our best performing stores turn a 50,000 Euro cost for waste management into 40,000 Euros net revenue.”

IKEA is on to something, and other large corporations are following suit. According to the State of Sustainability Initiatives Review 2014, mainstream markets are now very accepting of Fairtrade, Organic, Rainforest Alliance, and other such voluntary sustainability standards. Sustainable sourcing commitments from large companies are driving major market growth for sustainable commodities, says the Review.

That could be a reason retailers like Target and Walmart are pushing their suppliers to be sustainability-conscious. Walmart, in fact, says that its sustainability index for suppliers is setting the pace in the industry. Late last year, Target began to collect supplier information so it could eventually implement its own “sustainable product standard.”

But for brands like IKEA, sustainable advances aren’t just reserved for the retail environment. In partnership with the UNHCR, the company provides renewable energy resources and its own patented flat-pack shelters for refugee camps around the world. 

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