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Sustainability Report 2010 2 IKEA at a Glance FY10

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Sustainability Report 2010 2 IKEA at a Glance FY10 Sustainability Report 10 CONTENT INTRODUCTION COMMUNITIES IKEA AT A GLANCE 3 THE IKEA FOUNDATION 53 HIGHLIGHTS FY10 4 OTHER COMMUNITY PROJECTS 56 LETTER FROM THE CEO 5 LETTER FROM THE CHIEF SUSTAINABILITY OFFICER 6 ENVIRONMENT MILESTONES 7 FORESTRY 59 SUSTAINABILITY DIRECTION 8 COTTON 64 GOVERNANCE 14 WATER 67 STAKEHOLDERS 16 WASTE 70 CLIMATE 72 CUSTOMERS ENERGY USE IN IKEA BUILDINGS 75 MORE SUSTAINABLE PRODUCTS 19 ENERGY USE AT SUPPLIERS 78 SAFE & HEALTHY PRODUCTS 24 TRANSPORT OF PRODUCTS 79 CUSTOMER ENGAGEMENT 27 TRANSPORT OF PEOPLE 81 SUSTAINABLE LIFE AT HOME 83 CO-WORKERS CLIMATE PERSPECTIVE ON FOOD PRODUCTS 84 WHEN WE GROW, IKEA GROWS 31 CLOSING THE LOOPS 85 SUPPLIERS METRICS & REFERENCES CODE OF CONDUCT 36 KPIS 87 IWAY 38 CROSS-REFERENCE TABLE 89 CHILD LABOUR 38 LIST OF KEY ORGANISATIONS 90 HOME FURNISHING SUPPLIERS 39 TRANSPORT SERVICE PROVIDERS 46 FOOD SUPPLIERS 48 CATALOGUE SUPPLIERS 50 About this report This report describes the sustainability work carried In the final chapter, we have gathered the metrics out on a global level by the IKEA Group during financial presented throughout this report. This report is our year 2010, from 01 September 2009 to 31 August communication on progress (CoP) as a signatory to the TELL US 2010 (FY10). UN Global Compact, and a cross reference list shows WHAT YOU how we implement the ten principles of the UN Global THINK How to read this report Compact in our operations. The structure of this report reflects the environmental and social responsibility approach to our stakeholders, Would you like to know more? and how we work to address the environmental You can find more information and download impacts of our operations. documents on our website. Please visit “About IKEA/ Each chapter provides a description of developments People and the Environment” at www.IKEA.com during FY10 and our systematic work in many areas. We encourage you to send your feedback We use key performance indicators (KPIs) to show and/or questions about this report to us results against our targets. at [email protected] IKEA Sustainability Report 2010 2 IKEA at a glance FY10 IKEA GROUP STORES WORLDWIDE In 2010, the IKEA Group opened 12 new stores, in 7 countries. On 31st August 2010, the IKEA Group had a total of 280 stores in 26 countries. CO-WORKERS IN 2010 127,000 CO-WORKERS CO-WORKERS PER FUNCTION PER REGION 12 Purchasing, distribution, Asia & Australia: 8,000 192 wholesale, range & other: 14,500 North America: 15,500 48 Retail: 96,500 Europe: 103,500 12 Swedwood: 15,500 Swedspan: 500 3 THE IKEA GROUP ANNUAL SALES FIGURES, BILLION EURO The IKEA Group had operations in 41 Sales of goods, excl. rental income countries –29 Trading Service Offices 23.1 in 25 countries and 27 Distribution Centres 21.2 21.4 and 11 Customer Distribution 19.8 Centres in 16 countries. 17.3 14.8 INDUSTRIAL GROUPS Swedwood, an industrial supplier within the IKEA Group, had 15,500 co-workers and 41 7.6 production units in 9 countries. Swedspan, an industrial supplier within the IKEA Group, had 500 co-workers and 5 production units in 5 countries. SUPPLIERS IN 2010 1999 2005 2006 2007 2008 2009 2010 IKEA had 1,074 suppliers in 55 countries. PRODUCTS IN THE RANGE TOTAL SALES FY10: The IKEA range consisted of 23.1 BILLON EURO approximately 9,500 products. PURCHASING Sales increased 7.7% FY10 PER REGION, % compared to FY09. IKEA GROUP STORE VISITORS IN FY10 The IKEA Group stores had North America: 4% IKEA FOOD SERVICES Asia: 34% 626 million visitors. TURNOVER FY10 Europe: 62% Turnover for IKEA Food was ESTIMATED VISITS TO IKEA WEBSITES 1.1 billion EURO. DURING 2010 IKEA websites had 712 million visits. SALES PER REGION, % PRINTED CATALOGUES, LANGUAGES & EDITIONS Asia & Australia: 6% The IKEA catalogue was printed in more North America: 15% than 197 million copies in 29 languages Europe: 79% and 61 editions. IKEA Sustainability Report 2010 3 Highlights FY10 IKEA SUSTAINABILITY DIRECTION LEADS THE WAY FORWARD Our new direction outlines our priorities for 2015. These CONTINUED IKEA INVESTMENTS IN priorities shall influence our entire value chain, from product design and development to the very end of a product’s life. RENEWABLE Read more under Sustainability Direction ENERGY The implementation of the FY09 decision to install solar panels on roughly 150 stores and distribution centres is progressing well. In FY10 the number of buildings with solar panel systems nearly doubled, from nine to 17, and we expect the number to increase to around 40 buildings by the end of FY11. Read more under Climate INTRODUCING THE IKEA SUSTAINABILITY PRODUCT SCORE CARD This new internal tool for more sustainable product development and purchasing will help classify the IKEA home furnishing range. It will steer us to select the best possible alternatives within 11 criteria that have an impact on the product’s sustainability profile. Read more under More sustainable products IKEA FOUNDATION INCREASES FUNDING TO HEALTH PROGRAMME The IKEA Foundation has decided to invest an additional 7.5 million euro in UNICEF’s water and sanitation programme in India. This support will help expand the scope of this programme in 15 states. SUBSTANTIAL INCREASE OF Read more under Communities CERTIFIED WOOD IN IKEA PRODUCTS In addition to IWAY forestry requirements, the share of certified solid wood increased substantially in FY10, to 23.6 percent from 16.2 percent the year before. IKEA has actively supported certification efforts in some of our DOUBLED SHARE OF key wood sourcing areas, notably Russia. Read more under Forestry MORE SUSTAINABLE COTTON IN IKEA TEXTILES More than 80,000 farmers in India and Pakistan are now using more sustainable farming practices, and the share of more sustainable cotton in the IKEA range more than doubled compared to last year to 13.4 percent of our total cotton use. Read more under Cotton IKEA Sustainability Report 2010 4 LETTER FROM THE CEO “We have unique opportunities” Welcome to the IKEA Sustainability Report 2010! I’m delighted to welcome our new Chief Sustainability Officer I’m proud to share with you some of the things that IKEA has Steve Howard on-board. His competence and passion, not accomplished so far together with our customers, co-workers, least when it comes to climate-related issues, will help sup- suppliers and partners such as WWF, UNICEF and Save the port the innovation and drive we need to make IKEA a truly Children. Working together, taking many small steps in the sustainable company and help our customers to live a more same direction, means that we can make huge contributions sustainable life at home. towards a more sustainable future. On behalf of all of IKEA, I thank you for taking the time The IKEA vision is to create a better everyday life for the to read this report and share our progress. many people, and we believe that home is the most important place in the world. We offer affordable home furnishing prod- ucts and solutions, while also taking responsibility for people and the environment. We want our customers to be able to freely choose from our range, knowing that they do not have to choose between sustainability, style, function or price. IKEA has begun a long journey with sustainability as one of four cornerstones in our overall direction “Growing IKEA – together”. This, combined with a long history and culture built on enthusiasm and a constant strive for renewal, makes us well equipped to tackle some of the global challenges we are Mikael Ohlsson all facing. I‘m convinced that we will find new, unique opportu- President and CEO, IKEA Group nities to build a better tomorrow. IKEA Sustainability Report 2010 5 LETTER FROM THE CHIEF SUSTAINABILITY OFFICER “IKEA can play a vital role” The release of this report also marks the start of my journey at have no negative impact on the planet, but preferably have IKEA. I’m excited to join many dedicated colleagues in a com- positive impact and generate zero waste and zero carbon. pany that puts its social and environmental values at the heart This doesn’t mean that the world can’t still be exciting. of its business. Future generations must be allowed to enjoy the same or bet- My aim is to incorporate sustainability into every part of the ter quality of life as we have today, but in a way that takes IKEA experience – from raw materials and how products are care of both people and our planet. IKEA plays an important made to inspiring us to live a more sustainable life at home. role in meeting the many people’s aspirations through innova- IKEA has laid a great foundation over the last decade or so, tive, exciting products that will increasingly offer a more sus- and that shows in this report. Persistent, hard work within for- tainable way of life, giving people better choices without com- estry and cotton cultivation is paying off; the IKEA Foundation promises to the way they want to live, work and play. helps us improve the lives of many millions of children in need; This is the challenge we must embrace if we are to provide and the goal to use 100 percent renewable energy in all IKEA a great quality of life for present and future generations. I units is an industry-leading commitment. believe IKEA can do this. We can and will play a vital role in I know that IKEA possesses both the desire and the ability a more sustainable future. to take on the challenge of transformational change. Much of the world is in an era of unprecedented growth with populations in the world’s cities swelling by more than one million people every week.
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